Segment Data

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment Data

Segment Data

Summarized operating results for our reportable segments are shown in the following table (net of inter-segment transfers):

	Second Quarter				First Half
(In thousands)	2020		2019		2020		2019
Revenues
Fluids systems	$	74,662	$	172,544	$	207,467	$	333,197
Mats and integrated services	27,284		43,868		59,029		94,688
Total revenues	$	101,946	$	216,412	$	266,496	$	427,885
Operating income (loss)
Fluids systems	$	(25,059)	$	12,184	$	(27,327)	$	16,058
Mats and integrated services	1,005		9,276		4,067		22,814
Corporate office	(6,485)		(10,546)		(13,165)		(22,279)
Total operating income (loss)	$	(30,539)	$	10,914	$	(36,425)	$	16,593

        The following table presents further disaggregated revenues for the Fluids Systems segment:

	Second Quarter				First Half
(In thousands)	2020		2019		2020		2019
United States	$	42,670	$	117,154	$	116,330	$	220,213
Canada	3,066		4,988		16,326		18,254
Total North America	45,736		122,142		132,656		238,467
EMEA	26,036		44,455		68,173		82,220
Other	2,890		5,947		6,638		12,510
Total International	28,926		50,402		74,811		94,730
Total Fluids Systems revenues	$	74,662	$	172,544	$	207,467	$	333,197

The following table presents further disaggregated revenues for the Mats and Integrated Services segment:

	Second Quarter				First Half
(In thousands)	2020		2019		2020		2019
Service revenues	$	12,930	$	19,909	$	27,031	$	41,059
Rental revenues	9,170		17,675		22,672		39,255
Product sales revenues	5,184		6,284		9,326		14,374
Total Mats and Integrated Services revenues	$	27,284	$	43,868	$	59,029	$	94,688

During March 2020, oil prices collapsed due to geopolitical events along with the worldwide effects of the COVID-19 pandemic, which led to a rapid decline in customer activity in the oil and natural gas exploration and production (“E&P”) industry. As of June 30, 2020, the U.S. active rig count was 265, reflecting a 66% decline from the first quarter 2020 average level. In response to the deteriorating U.S. land oil and natural gas market, we initiated certain headcount reductions and other cost reduction programs late in the first quarter of 2020, and continued these actions in the second quarter of 2020.

As part of the cost reduction programs, we have reduced our global employee base by approximately 550 (25%) in the first half of 2020. As a result of these workforce reductions, our operating results for the second quarter of 2020 include $2.8 million of total severance costs ($2.6 million in Fluids Systems and $0.2 million in our Corporate office), with $2.0 million in cost of revenues and $0.8 million in selling, general and administrative expenses. Our operating results for the first half of 2020 include $3.5 million of total severance costs ($3.1 million in Fluids Systems and $0.4 million in our Corporate office), with $2.4 million in cost of revenues and $1.1 million in selling, general and administrative expenses. These costs have been substantially paid as of June 30, 2020.

We recognized $11.9 million of total charges for inventory write-downs, severance costs, and facility exit costs in the second quarter of 2020, with $11.7 million in the Fluids Systems segment and $0.2 million in the Corporate office. We recognized $13.3 million of total charges for inventory write-downs, severance costs, and facility exit costs in the first half of 2020, with $12.9 million in the Fluids Systems segment and $0.4 million in the Corporate office. See below for details of charges in the Fluids Systems segment.

	Second Quarter				First Half
(In thousands)	2020		2019		2020		2019
Inventory write-downs	$	8,269	$	—	$	8,996	$	—
Severance costs	2,593		333		3,099		868
Facility exit costs	800		—		800		—
Total Fluids Systems impairments and other charges	$	11,662	$	333	$	12,895	$	868

We also made the decision in late 2019 to wind down our Brazil operations. At June 30, 2020, we had $11.8 million of accumulated translation losses related to our subsidiary in Brazil. As such, we will reclassify these losses and recognize a charge to income at such time when we have substantially liquidated our subsidiary in Brazil.

As of June 30, 2020, our consolidated balance sheet includes $42.1 million of goodwill, all of which relates to the Mats and Integrated Services segment. Goodwill and other indefinite-lived intangible assets are tested for impairment annually as of November 1, or more frequently, if indicators of impairment exists. In March 2020, primarily as a result of the collapse in oil prices and the expected declines in the U.S. land E&P markets, along with a significant decline in the quoted market prices of our common stock, we considered these developments to be a potential indicator of impairment that required us to complete an interim goodwill impairment evaluation. As such, in March 2020, we estimated the fair value of our Mats and Integrated Services reporting unit based on our current forecasts and expectations for market conditions and determined that even though the estimated fair value had decreased, the fair value remained substantially in excess of its net carrying value, and therefore, no impairment was required. During the second quarter of 2020, we determined that there were no further indicators of events or changes in circumstances that would more likely than not reduce the fair value below its carrying amount.

As of June 30, 2020, our consolidated balance sheet also includes $297.2 million of property, plant and equipment, net, and $26.4 million of finite-lived intangible assets, net, which combined includes $167.0 million in the Fluids Systems segment and $145.8 million in the Mats and Integrated Services segment. We review property, plant and equipment, finite-lived intangible assets and certain other assets for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We assess recoverability based on expected undiscounted future net cash flows. Due to the changes in market conditions, we have reviewed these assets for impairment during the first half of 2020 and determined that the estimated undiscounted cash flows exceeded the carrying value, and therefore, no impairment was required.