Note 14 - Segment and Geographic Information

12 Months Ended

Dec. 31, 2019

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

14.    SEGMENT AND GEOGRAPHIC INFORMATION

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 leadership that reports to the chief operating decision manager (“CODM”). The operating results and financial information reported by each segment 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 and divestiture expenses and restructuring charges, if applicable.

In 2019, the Company began reporting Corporate expenses separately rather than allocating those costs to the operating segments. The reported information for 2018 and 2017 has been revised to conform to the current period presentation.

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

	Years Ended December 31,
	2019			2018			2017
Revenues:
Infrastructure Solutions	$	590,797		$	604,121		$	612,154
Corrosion Protection		295,090			393,740			456,139
Energy Services		328,048			335,707			290,726
Total revenues	$	1,213,935		$	1,333,568		$	1,359,019
Gross profit:
Infrastructure Solutions	$	144,074		$	132,411		$	140,823
Corrosion Protection		60,927			92,968			108,240
Energy Services		41,234			41,547			35,749
Total gross profit	$	246,235		$	266,926		$	284,812
Operating income (loss):
Infrastructure Solutions (1)	$	42,079		$	37,509		$	(47,316	)
Corrosion Protection (2)		(5,635	)		16,283			32,222
Energy Services (3)		9,740			9,638			7,736
Corporate (4)		(35,211	)		(33,783	)		(36,162	)
Total operating income (loss)		10,973			29,647			(43,520	)
Other income (expense):
Interest expense		(14,002	)		(17,327	)		(16,001	)
Interest income		1,038			516			145
Other (5)		(10,893	)		(9,881	)		(2,201	)
Total other expense		(23,857	)		(26,692	)		(18,057	)
Income (loss) before taxes on income	$	(12,884	)	$	2,955		$	(61,577	)
Total assets:
Infrastructure Solutions	$	508,226		$	500,977		$	531,746
Corrosion Protection		278,694			279,106			329,848
Energy Services		161,165			163,109			152,416
Corporate		31,336			41,432			22,775
Assets held for sale		16,092			7,793			70,314
Total assets	$	995,513		$	992,417		$	1,107,099
Capital expenditures:
Infrastructure Solutions	$	10,679		$	12,730		$	16,680
Corrosion Protection		11,437			9,754			8,603
Energy Services		3,437			3,053			2,713
Corporate		3,219			4,977			2,834
Total capital expenditures	$	28,772		$	30,514		$	30,830
Depreciation and amortization:
Infrastructure Solutions	$	13,773		$	16,758		$	18,731
Corrosion Protection		12,487			11,874			15,598
Energy Services		7,490			7,111			6,726
Corporate		2,413			2,112			3,364
Total depreciation and amortization	$	36,163		$	37,855		$	44,419

(1)	Operating income for 2019 includes: (i) $7.5 million of restructuring charges (see Note 4); (ii) $1.0 million of costs primarily related to the planned divestiture of certain international operations; and (iii) $17.6 million of impairment charges to assets held for sale (see Note 6). Operating income for 2018 includes: (i) $16.1 million of restructuring charges (see Note 4); and (ii) $0.4 million of cost incurred related to the disposition of Denmark. Operating loss for 2017 includes: (i) $17.5 million of restructuring charges (see Note 4); (ii) $45.4 million of goodwill impairment charges (see Note 2); (iii) $41.0 million of definite-lived intangible asset impairment charges (see Note 2); and (iv) $0.1 million of costs incurred related to the acquisition of Environmental Techniques.
(2)	Operating loss for 2019 includes: (i) $7.7 million of restructuring charges (see Note 4); (ii) $0.1 million of divestiture costs; and (iii) $2.9 million of impairment charges to assets held for sale (see Note 6). Operating income for 2018 includes: (i) $7.6 million of restructuring charges (see Note 4); and (ii) $2.5 million of costs incurred related to the divestiture of Bayou. Operating income for 2017 includes $4.9 million of restructuring charges (see Note 4) and (ii) $1.6 million of costs incurred related to the planned divestiture of Bayou.
(3)	Operating income for 2019 includes $1.7 million of restructuring charges (see Note 4). Operating income for 2018 includes $0.3 million of restructuring charges (see Note 4).
(4)	Operating loss for 2019 includes: (i) $5.2 million of restructuring charges (see Note 4); (ii) $2.2 million of costs primarily related to the planned divestiture of certain international operations; and (iii) $2.9 million of impairment charges to assets held for sale (see Note 6). Operating loss for 2018 includes $1.6 million of restructuring charges (see Note 4) and $4.1 million of divestiture costs. Operating loss for 2017 includes $1.6 million of restructuring charges (see Note 4) and $1.2 million of divestiture costs.
(5)	Other expense for 2019 includes $10.2 million of restructuring charges (see Note 4). Other expense for 2018 includes charges of $7.0 million related to the loss on the sale of Bayou (see Note 1) and $4.0 million of restructuring charges (see Note 4).

The following table summarizes revenues, gross profit, operating income (loss) and long-lived assets by geographic region (in thousands):

	Years Ended December 31,
	2019			2018			2017
Revenues: (1)
United States	$	914,676		$	966,291		$	1,028,313
Canada		123,033			133,612			139,734
Europe		64,278			66,794			71,839
Other foreign		111,948			166,871			119,133
Total revenues	$	1,213,935		$	1,333,568		$	1,359,019
Gross profit: (1)
United States	$	175,705		$	178,024		$	226,026
Canada		22,183			22,823			31,173
Europe		14,849			8,379			11,997
Other foreign		33,498			57,700			15,616
Total gross profit	$	246,235		$	266,926		$	284,812
Operating income (loss): (1)
United States	$	6,212		$	174		$	(33,583	)
Canada		7,460			9,482			12,220
Europe		(11,363	)		(10,599	)		(3,771	)
Other foreign		8,664			30,590			(18,386	)
Total operating income (loss)	$	10,973		$	29,647		$	(43,520	)
Long-lived assets: (1)(2)
United States	$	80,910		$	105,978		$	93,472
Canada		7,462			7,725			8,816
Europe		2,499			8,295			13,435
Other foreign		10,220			6,662			9,586
Total long-lived assets	$	101,091		$	128,660		$	125,309

(1)	Attributed to the country of origin.
(2)	Long-lived assets do not include goodwill, intangible assets, operating lease assets or deferred tax assets.