Supplemental Consolidated Financial Statement Information

12 Months Ended

Dec. 31, 2023

Supplemental Consolidated Financial Statement Information

Supplemental Consolidated Financial Statement Information

5.           Supplemental Consolidated Financial Statement Information

Other Current Assets and Other Current Liabilities

Prepaid expenses and other current assets consist of the following at December 31, 2023 and 2022 (in thousands):

	December 31,
	2023		2022 (as adjusted)
Contract assets	$	4,318	$	5,433
Prepaid expenses		3,197		2,271
Other assets		1,139		1,247
Other current assets	$	8,654	$	8,951

Other current liabilities consisted of the following at December 31, 2023 and 2022 (in thousands):

	December 31,
	2023		2022 (as adjusted)
Accrued self-insurance reserves	$	338	$	435
Other accrued expenses and current liabilities		371		845
Other current liabilities	$	709	$	1,280

Related Party Transactions

For the year ending December 31, 2023, the Company incurred related party expenses totaling approximately $120,000 related to hauling charges paid to various commonly controlled companies of Wilks Brothers, LLC, the holder of approximately 80% of the Company’s outstanding stock. For the year ended December 31, 2023, the Company recorded approximately $10,000 of related party revenue from a commonly controlled company of Wilks Brothers, LLC. The Company did not have any related party transactions during the year ended December 31, 2022. As of December 31, 2023, the Company had approximately $11,000 of outstanding related party accounts payable and no outstanding related party accounts receivable.

For the years ended December 31, 2023, and December 31, 2022, Breckenridge incurred related party expenses totaling approximately $110,000 and $567,000, respectively. For the year ended December 31, 2023, these charges by various commonly controlled companies of Wilks Brothers, LLC consisted of trucking charges of $60,000, management charges of $44,000, and payroll administration charges of $6,000.  For the year ended December 31, 2022, these charges by various commonly controlled companies of Wilks Brothers, LLC consisted of trucking charges of $92,000, management charges of $432,000, and payroll administration charges of $43,000.

Deferred Costs

Deferred costs were $5.4 million and $1 million at January 1, 2023 and 2022, respectively. The Company’s prepaid expenses and other current assets at December 31, 2023 and 2022 included deferred costs incurred to fulfill contracts with customers of $4.3 million and $5.4 million, respectively.

Deferred costs at December 31, 2023 compared to January 1, 2023 decreased primarily as a result of the completion of several projects for clients with significant deferred fulfillment costs at the beginning of the year. Deferred costs at December 31, 2022 compared to January 1, 2022 increased primarily as a result of new projects for clients with significant deferred fulfillment costs at December 31, 2022.

The amount of total deferred costs amortized for the years ended December 31, 2023 and 2022 was $38.3 million and $6.8 million, respectively. There were no material impairment losses incurred during these periods.

Deferred Revenue

Deferred revenue was $7.4 million and $1.3 million at January 1, 2023 and 2022, respectively. The Company’s deferred revenue at December 31, 2023 and 2022 was $11.8 million and $7.4 million, respectively.

Deferred revenue at December 31, 2023 and 2022 compared to January 1, 2023 and 2022, increased primarily as a result of various new projects for clients with large third party reimbursables where data has not yet been recorded.

Revenue recognized for the year ended December 31, 2023 that was included in the contract liability balance at the beginning of 2023 was $7.3 million. Revenue recognized for the year ended December 31, 2022 that was included in the contract liability balance at the beginning of 2022 was $1.1 million. Deferred revenue not recognized during 2023 relates to projects that have not yet started or were cancelled.