10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

 (Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the quarterly period ended March 31, 2020

or 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from             to            .

Commission File Number 1-13455

TETRA Technologies, Inc.

(Exact name of registrant as specified in its charter)

Delaware	74-2148293
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
24955 Interstate 45 North
The Woodlands,
Texas	77380
(Address of Principal Executive Offices)	(Zip Code)

(281) 367-1983

(Registrant’s Telephone Number, Including Area Code)

_______________________________________________________________________

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	TTI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No ☒

 As of May 5, 2020, there were 125,898,683 shares outstanding of the Company’s Common Stock, $0.01 par value per share.

TETRA Technologies, Inc. and Subsidiaries
Table of Contents
	Page
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations	1
Consolidated Statements of Comprehensive Income (Loss)	2
Consolidated Balance Sheets	3
Consolidated Statements of Equity	5
Consolidated Statements of Cash Flows	6
Notes to Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3. Quantitative and Qualitative Disclosures about Market Risk	35
Item 4. Controls and Procedures	35
PART II—OTHER INFORMATION
Item 1. Legal Proceedings	35
Item 1A. Risk Factors	36
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3. Defaults Upon Senior Securities	37
Item 4. Mine Safety Disclosures	37
Item 5. Other Information	37
Item 6. Exhibits	38
SIGNATURES	39

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Operations

(In Thousands, Except Per Share Amounts)

(Unaudited)

	Three Months Ended March 31,
	2020			2019
Revenues:
Product sales	$	85,033		$	91,781
Services	137,909			151,947
Total revenues	222,942			243,728
Cost of revenues:
Cost of product sales	58,967			74,588
Cost of services	89,727			102,156
Depreciation, amortization, and accretion	29,460			30,628
Impairments and other charges	5,371			146
Total cost of revenues	183,525			207,518
Gross profit	39,417			36,210
General and administrative expense	30,537			34,277
Interest expense, net	17,856			18,379
Warrants fair value adjustment (income) expense	(338		)	407
CCLP Series A Preferred Units fair value adjustment (income) expense	—			1,163
Other (income) expense, net	439			(951		)
Loss before taxes and discontinued operations	(9,077		)	(17,065		)
Provision for income taxes	1,154			1,609
Loss before discontinued operations	(10,231		)	(18,674		)
Discontinued operations:
Loss from discontinued operations, net of taxes	(145		)	(426		)
Net loss	(10,376		)	(19,100		)
Less: loss attributable to noncontrolling interest	8,825			8,262
Net loss attributable to TETRA stockholders	$	(1,551	)	$	(10,838	)
Basic net loss per common share:
Loss before discontinued operations attributable to TETRA stockholders	$	(0.01	)	$	(0.09	)
Loss from discontinued operations attributable to TETRA stockholders	$	0.00		$	0.00
Net loss attributable to TETRA stockholders	$	(0.01	)	$	(0.09	)
Average shares outstanding	125,587			125,681
Diluted net loss per common share:
Loss before discontinued operations attributable to TETRA stockholders	$	(0.01	)	$	(0.09	)
Loss from discontinued operations attributable to TETRA stockholders	$	0.00		$	0.00
Net loss attributable to TETRA stockholders	$	(0.01	)	$	(0.09	)
Average diluted shares outstanding	125,587			125,681

See Notes to Consolidated Financial Statements

1

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

(In Thousands)

(Unaudited)

	Three Months Ended March 31,
	2020			2019
Net loss	$	(10,376	)	$	(19,100	)
Foreign currency translation adjustment, net of taxes of $0 in 2020 and 2019	(6,467		)	(406		)
Comprehensive loss	(16,843		)	(19,506		)
Less: Comprehensive loss attributable to noncontrolling interest	9,054			8,086
Comprehensive loss attributable to TETRA stockholders	$	(7,789	)	$	(11,420	)

See Notes to Consolidated Financial Statements

2

TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands)

	March 31, 2020			December 31, 2019
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	29,473		$	17,704
Restricted cash	53			64
Trade accounts receivable, net of allowances of $6,308 in 2020 and $5,262 in 2019	169,231			176,291
Inventories	142,116			136,510
Prepaid expenses and other current assets	23,107			20,785
Total current assets	363,980			351,354
Property, plant, and equipment:
Land and building	57,357			60,586
Machinery and equipment	1,347,642			1,335,157
Automobiles and trucks	30,052			31,681
Chemical plants	58,327			57,692
Construction in progress	24,760			34,393
Total property, plant, and equipment	1,518,138			1,519,509
Less accumulated depreciation	(777,891		)	(760,872		)
Net property, plant, and equipment	740,247			758,637
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization of $89,450 in 2020 and $88,422 in 2019	72,104			74,199
Deferred tax assets, net	24			24
Operating lease right-of-use assets	75,344			68,131
Other assets	18,065			19,577
Total other assets	165,537			161,931
Total assets	$	1,269,764		$	1,271,922

See Notes to Consolidated Financial Statements

3

TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands, Except Share Amounts)

	March 31, 2020			December 31, 2019
	(Unaudited)
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable	$	88,204		$	88,917
Unearned income	28,422			9,831
Accrued liabilities and other	76,559			87,877
Liabilities of discontinued operations	2,011			2,098
Total current liabilities	195,196			188,723
Long-term debt, net	845,842			842,871
Deferred income taxes	2,762			2,988
Asset retirement obligations	12,878			12,762
Warrants liability	112			449
Operating lease liabilities	59,845			53,919
Other liabilities	6,198			7,384
Total long-term liabilities	927,637			920,373
Commitments and contingencies
Equity:
TETRA stockholders' equity:
Common stock, par value $0.01 per share; 250,000,000 shares authorized at March 31, 2020 and December 31, 2019; 128,693,692 shares issued at March 31, 2020 and 128,304,354 shares issued at December 31, 2019	1,287			1,283
Additional paid-in capital	468,088			466,959
Treasury stock, at cost; 2,896,627 shares held at March 31, 2020, and 2,823,191 shares held at December 31, 2019	(19,253		)	(19,164		)
Accumulated other comprehensive income (loss)	(58,421		)	(52,183		)
Retained deficit	(364,073		)	(362,522		)
Total TETRA stockholders' equity	27,628			34,373
Noncontrolling interests	119,303			128,453
Total equity	146,931			162,826
Total liabilities and equity	$	1,269,764		$	1,271,922

See Notes to Consolidated Financial Statements

4

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Equity

(In Thousands)

	Common Stock Par Value		Additional Paid-In Capital			Treasury Stock			Accumulated Other  Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest			Total Equity
									Currency Translation
Balance at December 31, 2019	$	1,283	$	466,959		$	(19,164	)	$	(52,183	)	$	(362,522	)	$	128,453		$	162,826
Net loss for first quarter 2020	—		—			—			—			(1,551		)	(8,825		)	(10,376		)
Translation adjustment, net of taxes of $0	—		—			—			(6,238		)	—			(229		)	(6,467		)
Comprehensive loss	—		—			—			—			—			—			(16,843		)
Distributions to public unitholders	—		—			—			—			—			(309		)	(309		)
Equity award activity	4		—			—			—			—			—			4
Treasury stock activity, net	—		—			(89		)	—			—			—			(89		)
Equity compensation expense	—		1,145			—			—			—			228			1,373
Other	—		(16		)	—			—			—			(15		)	(31		)
Balance at March 31, 2020	$	1,287	$	468,088		$	(19,253	)	$	(58,421	)	$	(364,073	)	$	119,303		$	146,931

	Common Stock Par Value			Additional Paid-In Capital			Treasury Stock			Accumulated Other  Comprehensive Income (Loss)			Retained Earnings			Noncontrolling Interest			Total Equity
										Currency Translation
Balance at December 31, 2018	$	1,285		$	460,680		$	(18,950	)	$	(51,663	)	$	(217,952	)	$	139,349		$	312,749
Net loss for first quarter 2019	—			—			—			—			(10,838		)	(8,262		)	(19,100		)
Translation adjustment, net of taxes of $0	—			—			—			(582		)	—			176			(406		)
Comprehensive loss	—			—			—			—			—			—			(19,506		)
Distributions to public unitholders	—			—			—			—			—			(307		)	(307		)
Equity award activity	(1		)	—			—			—			—			—			(1		)
Treasury stock activity, net	—			—			(155		)	—			—			—			(155		)
Equity compensation expense	—			1,628			—			—			—			311			1,939
Conversions of CCLP Series A Preferred	—			—			—			—			—			2,539			2,539
Cumulative effect adjustment	—			—			—			—			2,843			—			2,843
Other	—			(67		)	—			—			—			76			9
Balance at March 31, 2019	$	1,284		$	462,241		$	(19,105	)	$	(52,245	)	$	(225,947	)	$	133,882		$	300,110

See Notes to Consolidated Financial Statements

5

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited) 

	Three Months Ended March 31,
	2020			2019
Operating activities:
Net loss	$	(10,376	)	$	(19,100	)
Reconciliation of net loss to cash provided by operating activities:
Depreciation, amortization, and accretion	29,460			30,627
Impairment and other charges	5,371			146
Benefit for deferred income taxes	55			229
Equity-based compensation expense	784			2,165
Provision for doubtful accounts	1,380			627
Amortization and expense of financing costs	569			1,292
CCLP Series A Preferred Unit distributions and adjustments	—			2,159
Warrants fair value adjustment	(337		)	407
Contingent consideration liability fair value adjustment	—			(400		)
Gain on sale of assets	(833		)	(201		)
Changes in operating assets and liabilities:
Accounts receivable	3,601			2,353
Inventories	(12,414		)	(15,809		)
Prepaid expenses and other current assets	(2,442		)	(3,222		)
Trade accounts payable and accrued expenses	8,742			6,638
Other	(1,384		)	(499		)
Net cash provided by operating activities	22,176			7,412
Investing activities:
Purchases of property, plant, and equipment, net	(12,390		)	(32,409		)
Proceeds on sale of property, plant, and equipment	1,425			364
Other investing activities	350			319
Net cash used in investing activities	(10,615		)	(31,726		)
Financing activities:
Proceeds from long-term debt	56,512			66,000
Principal payments on long-term debt	(54,511		)	(35,451		)
CCLP distributions	(309		)	(307		)
Redemptions of CCLP Series A Preferred	—			(8,346		)
Tax remittances on equity based compensation	(319		)	(429		)
Debt issuance costs and other financing activities	(235		)	(155		)
Net cash provided by financing activities	1,138			21,312
Effect of exchange rate changes on cash	(940		)	(167		)
Increase (decrease) in cash and cash equivalents	11,759			(3,169		)
Cash and cash equivalents and restricted cash at beginning of period	17,768			40,102
Cash and cash equivalents and restricted cash at end of period	$	29,527		$	36,933
Supplemental cash flow information:
Interest paid	$	15,421		$	15,544
Income taxes paid	1,479			1,644

See Notes to Consolidated Financial Statements

6

TETRA Technologies, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 – ORGANIZATION, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization 

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We were incorporated in Delaware in 1981. We are composed of three divisions – Completion Fluids & Products, Water & Flowback Services, and Compression. Unless the context requires otherwise, when we refer to “we,” “us,” and “our,” we are describing TETRA Technologies, Inc. and its consolidated subsidiaries on a consolidated basis.

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended March 31, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary ("CCLP") as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA's capital structure and CCLP's capital structure are separate, and do not include cross default provisions, cross collateralization provisions, or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission ("SEC") and do not include all information and footnotes required by U.S. generally accepted accounting principles ("U.S. GAAP") for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Significant Accounting Policies

Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2019 included in our Annual Report on Form 10-K. There have been no significant changes in our accounting policies or the application thereof during the first quarter of 2020.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications

Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year's overall presentation.

7

Impairments and Other Charges

Impairments of long-lived assets, including identified intangible assets, are determined periodically when indicators of impairment are present. If such indicators are present, the determination of the amount of impairment is based on our judgment as to the future undiscounted operating cash flows to be generated from the relevant assets throughout their remaining estimated useful lives. If these undiscounted cash flows are less than the carrying amount of the related assets, an impairment is recognized for the excess of the carrying value over fair value. Fair value of intangible assets is generally determined using the discounted present value of future cash flows using discount rates commensurate with the risks inherent with the specific assets. Assets held for disposal are recorded at the lower of carrying value or estimated fair value less estimated selling costs. See Note 3 - "Impairments and Other Charges" for additional discussion of recorded impairments.

Revenue Recognition

Performance Obligations. Revenue is generally recognized when we transfer control of our products or services to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products or providing services to our customers. We receive cash equal to the invoice price for most sales of product and services and payment terms typically range from 30 to 60 days from the date we invoice our customer. Since the period between when we deliver products or services and when the customer pays for such products or services is not expected to exceed one year, we have elected not to calculate or disclose a financing component for our customer contracts.

Depending on the terms of the arrangement, we may also defer the recognition of revenue for a portion of the consideration received because we have to satisfy a future performance obligation. For example, consideration received from customers during the fabrication of new compressor packages is typically deferred until control of the compressor package is transferred to our customer.

For any arrangements with multiple performance obligations, we use management's estimated selling price to determine the stand-alone selling price for separate performance obligations. For revenue associated with mobilization of service equipment as part of a service contract arrangement, such revenue, if significant, is deferred and amortized over the estimated service period.

Product Sales. Product sales revenues are generally recognized when we ship products from our facility to our customer. The product sales for our Completion Fluids & Products Division consist primarily of clear brine fluids ("CBFs"), additives, and associated manufactured products. Product sales for our Water & Flowback Services Division are typically attributed to specific performance obligations within certain production testing service arrangements. Parts and equipment sales comprise the product sales for the Compression Division.

Services. Service revenues represent revenue recognized over time, as our customer arrangements typically provide agreed upon day-rates (monthly service rates for compression services) and we recognize service revenue based upon the number of days services have been performed. Service revenue recognized over time is associated with a majority of our Water & Flowback Services Division arrangements, compression service and aftermarket service contracts within our Compression Division, and a small portion of Completion Fluids & Products Division revenue that is associated with completion fluid service arrangements. With the exception of the initial terms of the compression services contracts for medium- and high-horsepower compressor packages of our Compression Division, our customer contracts are generally for terms of one year or less. The majority of the service arrangements in the Water & Flowback Services Division are for a period of 90 days or less.

Sales taxes, value added taxes, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We have elected to recognize the cost for freight and shipping costs as part of cost of product sales when control over our products (i.e. delivery) has transferred to the customer.

Use of Estimates. In recognizing revenue for variable consideration arrangements, the amount of variable consideration recognized is limited so that it is probable that significant amounts of revenues will not be reversed in future periods when the uncertainty is resolved. For products returned by the customer, we estimate the expected returns based on an analysis of historical experience. For volume discounts earned by the customer, we estimate the discount (if any) based on our estimate of the total expected volume of products sold or services to be provided to the customer during the discount period. In certain contracts for the sale of CBFs, we may agree to issue credits

8

for the repurchase of reclaimable used fluids from certain customers at an agreed price that is based on the condition of the fluids.

Contract Assets and Liabilities. We consider contract assets to be trade accounts receivable when we have an unconditional right to consideration and only the passage of time is required before payment is due. In certain instances, particularly those requiring customer specific documentation prior to invoicing, our invoicing of the customer is delayed until certain documentation requirements are met. In those cases, we recognize a contract asset rather than a billed trade accounts receivable until we are able to invoice the customer. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

We classify contract liabilities as unearned income in our consolidated balance sheets. Such deferred revenue typically results from advance payments received on orders for new compressor equipment prior to the time such equipment is completed and transferred to the customer in accordance with the customer contract. New equipment sales orders generally take less than twelve months to build and deliver.

Bill-and-Hold Arrangements. We design and fabricate compressor packages based on our customer’s specifications. In some cases, the customer will request us to hold the equipment, upon completion of the unit, until the job site is ready to receive the equipment. When this occurs, we along with the customer sign a bill-and-hold agreement, which outlines that the customer has title to the equipment, the equipment is ready for delivery, we cannot use the equipment or direct it to another customer, and we have a present right to payment. When those criteria have been met and the agreement is executed, we recognize the revenue on the equipment because control of the equipment has passed to our customer and our performance obligations are complete. Entering into these arrangements is something we have done as a courtesy for certain customers for many years. The equipment subject to the bill-and-hold agreements has generally been invoiced and paid for through progressive billings such that at the time the bill-and-hold agreement is executed, the majority of the contractual cash obligation of the customer has been received by us.

Operating Costs

Cost of product sales includes direct and indirect costs of manufacturing and producing our products, including raw materials, fuel, utilities, labor, overhead, repairs and maintenance, materials, services, transportation, warehousing, equipment rentals, insurance, and certain taxes. Cost of services includes operating expenses we incur in delivering our services, including labor, equipment rental, fuel, repair and maintenance, transportation, overhead, insurance, and certain taxes. We include in product sales revenues the reimbursements we receive from customers for shipping and handling costs. Shipping and handling costs are included in cost of product sales. Amounts we incur for “out-of-pocket” expenses in the delivery of our services are recorded as cost of services. Reimbursements for “out-of-pocket” expenses we incur in the delivery of our services are recorded as service revenues. Depreciation, amortization, and accretion includes depreciation expense for all of our facilities, equipment and vehicles, amortization expense on our intangible assets, and accretion expense related to our decommissioning and other asset retirement obligations.

We include in general and administrative expense all costs not identifiable to our specific product or service operations, including divisional and general corporate overhead, professional services, corporate office costs, sales and marketing expenses, insurance, and certain taxes. 

Foreign Currency Translation

We have designated the euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $1.9 million during the three months ended March 31, 2020, and $(1.2) million during the three months ended March 31, 2019, respectively.

9

Fair Value Measurements

We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain liabilities, including the liabilities for the warrants to purchase 11.2 million shares of our common stock (the "Warrants") and our foreign currency derivative contracts. Refer to Note 9 - "Fair Value Measurements" for further discussion.

Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, such as in the allocation of purchase consideration for acquisition transactions to the assets and liabilities acquired, including intangible assets and goodwill (a Level 3 fair value measurement), the initial recording of our asset retirement obligations, and for the impairment of long-lived assets, including goodwill (a Level 3 fair value measurement).

New Accounting Pronouncements

Standards adopted in 2020

In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2018-15, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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NOTE 2 – REVENUE FROM CONTRACTS WITH CUSTOMERS

As of March 31, 2020, we had $56.7 million of remaining contractual performance obligations for compression services. As a practical expedient, this amount does not reflect revenue for compression service contracts whose original expected duration is less than twelve months and does not consider the effects of the time value of money. Expected revenue to be recognized in the future as of March 31, 2020 for completion of performance obligations of compression service contracts are as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	38,720	$	15,941	$	2,026	$	54	$	—	$	56,741

For sales of CBFs where we have agreed to issue credits for the repurchase of reclaimable used fluids at an agreed price based on the condition of the fluid upon return, we adjust the revenue recognized in the period of shipment by an estimated amount, based on historical experience, of the credit expected to be issued. As of March 31, 2020, the amount of remaining credits expected to be issued for the repurchase of reclaimable used fluids was $5.6 million recorded in inventory (right of return asset) and either accounts payable or as a reduction to accounts receivable. There were no material differences between amounts recognized during the three month period ended March 31, 2020, compared to estimates made in a prior period from these variable consideration arrangements.

Our contract asset balances, primarily associated with customer documentation requirements, were $33.3 million and $34.9 million as of March 31, 2020 and December 31, 2019, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

Collections primarily associated with progressive billings to customers for the construction of compression equipment is included in unearned income in the consolidated balance sheets. The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678		$	25,333
Additional unearned income	23,869			49,363
Revenue recognized	(5,767		)	(24,858		)
Unearned income, end of period	$	27,780		$	49,838

During the three month period ended March 31, 2020, we recognized product sales revenue of $2.9 million from unearned income that was deferred as of December 31, 2019. During the three months ended March 31, 2019, we recognized product sales revenue of $11.0 million from unearned income that was deferred as of December 31, 2018.

As of March 31, 2020, contract costs were immaterial.

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We disaggregate revenue from contracts with customers into Product Sales and Services within each segment, as noted in our three reportable segments in Note 11. In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	$	37,958	$	31,606
International	37,279		29,975
	75,237		61,581
Water & Flowback Services
U.S.	54,384		73,199
International	3,083		5,479
	57,467		78,678
Compression
U.S.	80,599		93,517
International	9,639		9,952
	90,238		103,469
Total Revenue
U.S.	172,941		198,322
International	50,001		45,406
	$	222,942	$	243,728

NOTE 3 – IMPAIRMENTS AND OTHER CHARGES

Impairments of Long-Lived Assets

During the first quarter of 2020, the COVID-19 pandemic and decline in oil prices had a significant impact on our customers and industry. We started to see our customers revise their capital budgets downwards and adjust their operations accordingly, which led to a decline in orders for new compression equipment to be fabricated and sold to third parties, among other impacts. We concluded these events were indicators of impairment for all asset groups within our Compression Division and certain asset groups within our Completion Fluids & Products Division. As a result, we performed recoverability analyses on the relevant asset groups within these divisions. Based upon these recoverability analyses, we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory in our Compression Division exceeded their respective fair values. Therefore, we recorded impairments of approximately $5.4 million during the first quarter of 2020 related to these assets. Fair value was estimated based on a market approach. No other recoverability analysis performed indicated an impairment as of March 31, 2020. Given the dynamic nature of the events beginning in the first quarter of 2020, we are not able to reasonably estimate how long our operations will be adversely impacted and the full extent these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments.

NOTE 4 – INVENTORIES

Components of inventories as of March 31, 2020 and December 31, 2019 are as follows: 

	March 31, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	67,824	$	70,135
Raw materials	3,886		4,125
Parts and supplies	38,859		47,793
Work in progress	31,547		14,457
Total inventories	$	142,116	$	136,510

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Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling. Work in progress inventory consists primarily of new compressor packages located at our Compression Division manufacturing facility in Midland, Texas.

NOTE 5 – LEASES

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commence upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. We anticipate taking delivery of the remaining six compressor packages when the compression units are completed, which is expected to occur during the second quarter of 2020. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the consummation of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Operating lease expense	$	5,148	$	5,044
Short-term lease expense	9,430		11,161
Total lease expense	$	14,578	$	16,205

Supplemental cash flow information:

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	5,949	$	4,657
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,844	$	3,257

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Supplemental balance sheet information:

	March 31, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	75,344	$	68,131
Accrued liabilities and other	$	16,782	$	15,850
Operating lease liabilities	59,845		53,919
Total operating lease liabilities	$	76,627	$	69,769

Additional operating lease information:

	March 31, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.37 Years		6.43 Years
Weighted average discount rate:
Operating leases	9.43	%	9.46	%

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at March 31, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	19,961
2021		22,092
2022		18,422
2023		14,776
2024		12,372
Thereafter		30,268
Total lease payments		117,891
Less imputed interest		(41,264		)
Total lease liabilities		$	76,627

At March 31, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $6.1 million. For the three months ended March 31, 2020, we recognized sublease income of $0.3 million.

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NOTE 6 – LONG-TERM DEBT AND OTHER BORROWINGS

We believe our capital structure, excluding CCLP, ("TETRA") and CCLP's capital structure should be considered separately, as there are no cross default provisions, cross collateralization provisions, or cross guarantees between CCLP's debt and TETRA's debt.

Consolidated long-term debt as of March 31, 2020 and December 31, 2019, consists of the following:

		March 31, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $1.3 million as of March 31, 2020 and $1.0 million as of December 31, 2019)	September 2023	$	2,246	$	—
Term credit agreement (presented net of the unamortized discount of $6.2 million as of March 31, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $9.2 million as of March 31, 2020 and $9.5 million as of December 31, 2019)	September 2025	205,167		204,633
TETRA total debt		207,413		204,633
Less current portion		—		—
TETRA total long-term debt		$	207,413	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0.8 million as of March 31, 2020 and $0.9 million of December 31, 2019)	June 2023	2,184		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $1.5 million as of March 31, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $2.6 million as of March 31, 2020 and $2.8 million as of December 31, 2019)	August 2022	291,863		291,444
CCLP 7.50% Senior Secured Notes (presented net of unamortized deferred financing costs of $5.6 million as of March 31, 2020 and $5.8 million as of December 31, 2019)	April 2025	344,382		344,172
CCLP total debt		638,429		638,238
Less current portion		—		—
CCLP total long-term debt		$	638,429	$	638,238
Consolidated total long-term debt		$	845,842	$	842,871

As of March 31, 2020, TETRA had a $3.5 million outstanding balance and $7.9 million in letters of credit against its asset-based credit agreement ("ABL Credit Agreement"). As of March 31, 2020, subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement that may limit borrowings, TETRA had an availability of $40.8 million under this agreement. There was a $3.0 million balance outstanding and $3.0 million in letters of credit against the CCLP asset-based credit agreement ("CCLP Credit Agreement") as of March 31, 2020. As of March 31, 2020, and subject to compliance with the covenants, borrowing base, and other provisions of the CCLP Credit Agreement that may limit borrowings, CCLP had availability of $20.4 million.

TETRA and CCLP credit and senior note agreements contain certain affirmative and negative covenants, including covenants that restrict the ability to pay dividends or other restricted payments. TETRA and CCLP are both in compliance with all covenants of their respective credit and senior note agreements as of March 31, 2020.

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NOTE 7 – DISCONTINUED OPERATIONS

On March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division. As a result, we have accounted for our Offshore Division, consisting of our Offshore Services and Maritech segments, as discontinued operations. See Note 8 - "Commitments and Contingencies" for further discussion. A summary of financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands)

	Three Months Ended March 31, 2020								Three Months Ended March 31, 2019
	Offshore Services			Maritech		Total			Offshore Services			Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—		$	—	$	—		$	—		$	—	$	—
Cost of revenues	(60		)	—		(60		)	22			—		22
Depreciation, amortization, and accretion	—			—		—			—			—		—
General and administrative expense	205			—		205			404			—		404
Other (income) expense, net	—			—		—			—			—		—
Pretax loss from discontinued operations	(145		)	—		(145		)	(426		)	—		(426		)
Pretax loss on disposal of discontinued operations						—								—
Total pretax loss from discontinued operations						(145		)						(426		)
Income tax benefit						—								—
Total loss from discontinued operations						$	(145	)						$	(426	)

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)

	March 31, 2020						December 31, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Carrying amounts of major classes of assets included as part of discontinued operations
Trade receivables	$	—	$	—	$	—	$	—	$	—	$	—
Other current assets	—		—		—		—		—		—
Assets of discontinued operations	$	—	$	—	$	—	$	—	$	—	$	—
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,303	$	—	$	1,303	$	1,233	$	—	$	1,233
Accrued liabilities	480		228		708		745		120		865
Liabilities of discontinued operations	$	1,783	$	228	$	2,011	$	1,978	$	120	$	2,098

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

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Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC ("Orinoco") that provided for the purchase by Orinoco of Maritech's remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

Pursuant to a Bonding Agreement entered into as part of these transactions (the "Bonding Agreement"), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were

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payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million during the quarter ended September 30, 2019. The Epic Promissory Note became due on December 31, 2019 but neither Epic nor the Clarkes made the required payment. Upon the default by Epic and the Clarkes, we filed a lawsuit against the Clarkes on January 15, 2020 in Montgomery County, Texas for breach of the Clarke Promissory Note Guaranty Agreement, seeking the amounts due under the Epic Promissory Note and related interest, as well as attorneys’ fees and expenses. The Clarkes each filed an answer and counterclaims for fraud and negligent misrepresentation and seek monetary damages in excess of $1 million, punitive damages, and attorneys’ fees. We will vigorously prosecute our claim and defend against the claims by the Clarkes.

NOTE 9 – FAIR VALUE MEASUREMENTS

Financial Instruments

Warrants

The Warrants are valued using a Black Scholes option valuation model that includes implied volatility of the trading price (a Level 3 fair value measurement).

Derivative Contracts

We and CCLP each enter into short term foreign currency forward derivative contracts with third parties as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. As of March 31, 2020, we and CCLP had the following foreign currency derivative contracts outstanding relating to portions of our foreign operations:

Derivative Contracts	US Dollar Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	$	8,167	1.08	4/21/2020
Forward purchase Euro	10,497		1.10	4/21/2020
Forward purchase pounds sterling	9,400		1.17	4/21/2020
Forward sale pounds sterling	500		1.18	4/21/2020
Forward sale pounds sterling	1,875		1.17	4/21/2020
Forward sale Norwegian krone	1,000		11.76	4/21/2020
Forward purchase Norwegian krone	4,300		11.36	4/21/2020
Forward sale Mexican peso	4,974		24.40	4/21/2020

Derivative Contracts	British Pound Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	£	3,445	0.92	4/21/2020

Derivative Contracts	Swedish Krona Notional Amount			Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro		210	kr	10.90	4/6/2020
Forward purchase Euro		66,690	kr	10.91	4/6/2020
Forward purchase Euro		2,400	kr	11.24	4/21/2020

Under this program, we and CCLP may enter into similar derivative contracts from time to time. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative contracts during a period will be included in the determination of earnings for that period.

The fair values of foreign currency derivative contracts are based on quoted market values (a Level 2 fair value measurement). The fair values of our and CCLP's foreign currency derivative contracts as of March 31, 2020

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and December 31, 2019, are as follows:

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at March 31, 2020			Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	1,160		$	86
Forward sale contracts	Current liabilities	(433		)	(53		)
Forward purchase contracts	Current liabilities	(181		)	(3		)
Net asset (liability)		$	546		$	30

None of our foreign currency derivative contracts contain credit risk related contingent features that would require us to post assets or collateral for contracts that are classified as liabilities. During the three months ended March 31, 2020 and March 31, 2019, we recognized $(1.0) million and $0.6 million of net (gains) losses, respectively, reflected in other (income) expense, net, associated with our foreign currency derivative program.

During the first quarter of 2020, we recorded impairments of approximately $5.4 million, reflecting the decreased fair value for certain assets. The fair values used in these impairment calculations were estimated based on a market approach, which is based on significant unobservable inputs (Level 3) in accordance with the fair value hierarchy.

Recurring and nonrecurring fair value measurements by valuation hierarchy as of March 31, 2020 and December 31, 2019, are as follows:

				Fair Value Measurements Using
	Total as of			Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Description	March 31, 2020			(Level 1)		(Level 2)			(Level 3)
	(In Thousands)
Midland manufacturing facility and related assets	$	19,646		$	—	$	—		$	19,646
Warrants liability	(112		)	—		—			(112		)
Asset for foreign currency derivative contracts	1,160			—		1,160			—
Liability for foreign currency derivative contracts	(614		)	—		(614		)	—
Net asset	$	20,080

				Fair Value Measurements Using
	Total as of			Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Description	December 31, 2019			(Level 1)		(Level 2)			(Level 3)
	(In Thousands)
Warrants liability	$	(449	)	$	—	$	—		$	(449	)
Asset for foreign currency derivative contracts	86			—		86			—
Liability for foreign currency derivative contracts	(56		)	—		(56		)	—
Net liability	$	(419	)

The fair values of cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, short-term borrowings and long-term debt pursuant to TETRA's ABL Credit Agreement and Term Credit Agreement, and the CCLP Credit Agreement approximate their carrying amounts. The fair values of the publicly traded CCLP 7.25% Senior Notes at March 31, 2020 and December 31, 2019, were approximately $148.0 million and $266.0 million, respectively. Those fair values compare to the face amount of $295.9 million both at March 31, 2020 and December 31, 2019. The fair values of the CCLP 7.50% Senior Secured Notes at March 31, 2020 and December 31, 2019 were approximately $239.8 million and $344.8 million, respectively. These fair values compare

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to aggregate principal amount of such notes at both March 31, 2020 and December 31, 2019, of $350.0 million. We based the fair values of the CCLP 7.25% Senior Notes and the CCLP 7.50% Senior Secured Notes as of March 31, 2020 on recent trades for these notes.

NOTE 10 – NET INCOME (LOSS) PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

		Three Months Ended March 31,
		2020	2019
	(In Thousands)
Number of weighted average common shares outstanding		125,587	125,681
Assumed exercise of equity awards and warrants		—	—
Average diluted shares outstanding		125,587	125,681

For the three month periods ended March 31, 2020 and March 31, 2019, the average diluted shares outstanding excludes the impact of all outstanding equity awards and warrants, as the inclusion of these shares would have been anti-dilutive due to the net losses recorded during the periods. In addition, for the three month period ended March 31, 2019, the calculation of diluted earnings per common share excludes the impact of the CSI Compressco LP Series A Convertible Preferred Units (the "CCLP Preferred Units"), as the inclusion of the impact from conversion of the CCLP Preferred Units into CCLP common units would have been anti-dilutive.

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NOTE 11 – INDUSTRY SEGMENTS

We manage our operations through three Divisions: Completion Fluids & Products, Water & Flowback Services, and Compression.

 Summarized financial information concerning the business segments is as follows:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	70,190		$	57,328
Water & Flowback Services Division	25			364
Compression Division	14,818			34,089
Consolidated	$	85,033		$	91,781
Services
Completion Fluids & Products Division	$	5,047		$	4,253
Water & Flowback Services Division	57,442			78,314
Compression Division	75,420			69,380
Consolidated	$	137,909		$	151,947
Total revenues
Completion Fluids & Products Division	$	75,237		$	61,581
Water & Flowback Services Division	57,467			78,678
Compression Division	90,238			103,469
Interdivision eliminations	—			—
Consolidated	$	222,942		$	243,728
Income (loss) before taxes
Completion Fluids & Products Division	$	19,396		$	6,186
Water & Flowback Services Division	(2,244		)	2,231
Compression Division	(12,790		)	(7,801		)
Interdivision eliminations	5			6
Corporate Overhead(1)	(13,444		)	(17,687		)
Consolidated	$	(9,077	)	$	(17,065	)

(1) Amounts reflected include the following general corporate expenses:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
General and administrative expense	$	8,081		$	12,089
Depreciation and amortization	197			168
Interest expense	5,455			5,342
Warrants fair value adjustment (income) expense	(338		)	407
Other general corporate (income) expense, net	49			(319		)
Total	$	13,444		$	17,687

NOTE 12 – SUBSEQUENT EVENTS

In April 2020, we announced our plan to shutdown our Midland manufacturing facility as a result of a decline in orders for new equipment from third parties and the expectation that no incremental equipment will be fabricated for our fleet in the second half of 2020. As a result of the decision to close this facility and solely utilize third party fabricators in the future for our own service fleet, we are pursuing the sale of the Midland facility in an effort to further improve our balance sheet, and have entered into an agreement with a third party purchaser, which

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is subject to numerous conditions. While we will continue to operate the facility until the completion and sale of our remaining backlog, we no longer intend to fabricate new compressor packages for sales to third parties. We have and will continue to evaluate the sale of other non-core assets, including our low-horsepower compression fleet. We can provide no assurance that we will consummate a sale of the Midland manufacturing facility, our low-horsepower compression fleet, or any other non-core asset.

In April 2020, we began the process of discontinuing chemical production operations at our El Dorado, Arkansas production facility, which primarily produced calcium chloride from underground brine reserves. The current COVID-19 pandemic and oil oversupply events have led to unprecedented market conditions and this facility’s relatively high fixed costs have led us to rationalize our manufacturing base. We will continue to manufacture and deliver all products through early June 2020, at which time we will begin a sequenced shutdown of the manufacturing facility. We will continue to ship product until the inventory is gone, at which time production operations at the plant will be shutdown. Going forward, we will continue to meet our customer demand for liquid calcium chloride products through our network of other manufacturing plants and terminals.

On April 17, 2020, CCLP announced the commencement of an offer (the "Exchange Offer") to certain eligible noteholders ("Eligible Holders") to exchange any and all of their outstanding 7.25% Senior Notes due 2022 (the “Unsecured Notes”) for newly issued 7.50% Senior Secured First Lien Notes due 2025 and 7.25% Senior Secured Second Lien Notes due 2027. In conjunction with the offer, consents are being solicited from Eligible Holders to eliminate substantially all restrictive covenants and certain of the default provisions in the indenture governing the Unsecured Notes.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and accompanying notes included in this Quarterly Report. In addition, the following discussion and analysis also should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 16, 2020 ("2019 Annual Report"). This discussion includes forward-looking statements that involve certain risks and uncertainties.

Business Overview  

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, comprehensive water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We operate through three reporting segments organized into three Divisions - Completion Fluids & Products, Water & Flowback Services, and Compression.

Demand for products and services of our Completion Fluids & Products Division has remained strong despite the continued volatility in pricing for oil and uncertainty in many of the markets where we operate, which affects the plans of many of our oil and gas operations customers. During the first quarter of 2020, we experienced increased CBF product sales revenues in the U.S. Gulf of Mexico, including product sales associated with a TETRA CS Neptune completion fluid sale and increased international CBF product sales and domestic manufactured products sales. However, the significant decline in oil prices may adversely affect the demand for our products and services in the near future.

Recent macroeconomic uncertainty resulting from declining oil prices and the COVID-19 pandemic has particularly affected domestic onshore demand for our Water & Flowback Services Division services. We experienced decreased water management services activity during the first quarter of 2020 and without a meaningful recovery, we expect our water management services operations to continue to be negatively impacted in the near future.

Our Compression Division is significantly dependent upon the demand for, and production of, oil and the associated natural gas from unconventional oil and natural gas production in the domestic and international markets in which we operate. During the first part of our quarter, we continued to see increased demand in our products and services, with the exception of a declining backlog for new unit sales. However, during the latter part of the quarter, as the macroeconomic uncertainty resulting from declining oil prices and the COVID-19 pandemic continued, we started to see our customers revise their capital budgets downwards and adjust their operations accordingly. In response to both market uncertainty and the lower levels of spending by our customers, we lowered our projected growth capital expenditures originally intended to increase the horsepower of our fleet. In addition, given the decline

22

in orders for new equipment to be fabricated and sold to third parties and the expectation that no incremental equipment will be fabricated for our fleet in the second half of 2020, we announced our intentions to close our Midland manufacturing facility, retain equipment design and engineering personnel, and outsource the fabrication of new equipment for our fleet. We no longer intend to design or fabricate new compressor packages for sales to third parties. Due to excess compression equipment in the industry, we have started to and expect to continue to see lower utilization of our compression fleet, client requests to put units on stand-by, and pricing pressures as customers try to reduce their costs.

The COVID-19 pandemic and decline in oil prices had a significant impact on our customers and industry. We concluded these events were indicators of impairment for all asset groups within our Compression Division and certain asset groups in our Completion Fluids & Products Division. As a result, we performed recoverability analyses on the relevant asset groups within these divisions. Based upon these recoverability analyses, we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory in our Compression Division exceeded their respective fair values. Therefore, we recorded impairments of approximately $5.4 million during the first quarter of 2020 related to these assets. Given the dynamic nature of the events beginning in the first quarter of 2020, we are not able to reasonably estimate how long our operations will be adversely impacted and the full extent these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments.

We are continuing to monitor the 2020 spending plans of our customers and are aggressively managing our working capital and capital expenditure needs in order to maximize our liquidity in the current oil and gas industry environment. Capital expenditure levels continue to be monitored carefully for each of our businesses to ensure that capital investments are only made for the most attractive return on investment. As obtaining additional financing is challenging in the current debt and equity markets, growth capital expenditures are expected to be primarily funded by available cash and cash expected to be provided by operating activities. We intend to manage our flexible cost structure to proactively respond to changing market conditions and execute on actions necessary to manage through these conditions, some of which could result in impairments or restructuring charges in future periods.

Cost reductions we have recently implemented or are in the process of implementing include reductions in 2020 capital expenditures, workforce reductions, salary reductions, the suspension of 401(k) matching contributions for our employees, targeted reduction in SG&A expenses, and negotiated reductions in expenditures with many of our suppliers. Absent a meaningful recovery in natural gas and oil prices and a material improvement in the status of the COVID-19 pandemic, we expect our operations to continue to be negatively impacted, particularly in our onshore producing regions of the United States. We are not able to predict how long market disruptions resulting from the COVID-19 pandemic will continue, or what impact it will ultimately have on our business. Despite that, we will continue to maintain our commitment to safety and service quality for our customers.

How we Evaluate Operations

We use U.S. GAAP financial measures such as revenues, gross profit, income (loss) before taxes, and net cash provided by operating activities, as well as certain non-GAAP financial measures, including Adjusted EBITDA, as performance measures for our business.

Adjusted EBITDA. We view Adjusted EBITDA as one of our primary management tools, and we track it on a monthly basis, both in dollars and as a percentage of revenues (typically compared to the prior month, prior year period, and to budget). We define Adjusted EBITDA as earnings before interest, taxes, depreciation, amortization, impairments and certain other non-cash charges and non-recurring adjustments.

Adjusted EBITDA is used as a supplemental financial measure by our management to:

• evaluate the financial performance of our assets without regard to financing methods, capital structure, or historical cost basis; and

• determine our ability to incur and service debt and fund capital expenditures.

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 The following table reconciles net income (loss) to Adjusted EBITDA for the periods indicated:

	Three Months Ended
	March 31, 2020
	Net Income (Loss), as reported			Tax Provision		Income (Loss) Before Tax, as Reported			Impairments & Special Charges			Adjusted Income (Loss) Before Tax			Interest Expense, Net			Depreciation & Amortization			Equity Comp. Expense		Adjusted EBITDA
	(In Thousands)
Completion Fluids & Products Division						$	19,396		$	450		$	19,846		$	(154	)	$	1,934		$	—	$	21,626
Water & Flowback Services Division						(2,244		)	1,607			(637		)	(9		)	7,425			—		6,779
Compression Division						(12,790		)	5,971			(6,819		)	12,564			19,908			324		25,977
Eliminations and other						5			—			5			—			(4		)	—		1
Subtotal						4,367			8,028			12,395			12,401			29,263			324		54,383
Corporate and other						(13,444		)	73			(13,371		)	5,455			197			1,145		(6,574		)
TETRA excluding Discontinued Operations	$	(10,231	)	$	1,154	$	(9,077	)	$	8,101		$	(976	)	$	17,856		$	29,460		$	1,469	$	47,809
	Three Months Ended
	March 31, 2019
	Net Income (Loss), as reported			Tax Provision		Income (Loss) Before Tax, as Reported			Impairments & Special Charges			Adjusted Income (Loss) Before Tax			Interest Expense, Net			Depreciation & Amortization			Equity Comp. Expense		Adjusted EBITDA
	(In Thousands)
Completion Fluids & Products Division						$	6,186		$	683		$	6,869		$	(179	)	$	3,665		$	—	$	10,355
Water & Flowback Services Division						2,231			(400		)	1,831			4			8,267			—		10,102
Compression Division						(7,801		)	1,610			(6,191		)	13,213			18,532			365		25,919
Eliminations and other						6			—			6			(1		)	(4		)	—		1
Subtotal						622			1,893			2,515			13,037			30,460			365		46,377
Corporate and other						(17,687		)	331			(17,356		)	5,342			168			1,800		(10,046		)
TETRA excluding Discontinued Operations	$	(18,674	)	$	1,609	$	(17,065	)	$	2,224		$	(14,841	)	$	18,379		$	30,628		$	2,165	$	36,331

Adjusted EBITDA is a financial measure that is not in accordance with U.S. GAAP and should not be considered an alternative to net income, operating income, cash flows from operating activities, or any other measure of financial performance presented in accordance with U.S. GAAP. This measure may not be comparable to similarly titled financial metrics of other entities, as other entities may not calculate Adjusted EBITDA in the same manner as we do. Management compensates for the limitations of Adjusted EBITDA as analytical tools by reviewing the comparable U.S. GAAP measures, understanding the differences between the measures, and incorporating this knowledge into management’s decision-making processes.

Critical Accounting Policies and Estimates

There have been no material changes or developments in the evaluation of the accounting estimates and

the underlying assumptions or methodologies pertaining to our Critical Accounting Policies and Estimates disclosed

in our 2019 Annual Report. In preparing our consolidated financial statements, we make assumptions, estimates, and judgments that affect the amounts reported. These judgments and estimates may change as new events occur, as new information is acquired, and as changes in our operating environments are encountered. Actual results are likely to differ from our current estimates, and those differences may be material.    

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Results of Operations

Three Months Ended March 31, 2020 compared with three months ended March 31, 2019.

Consolidated Comparisons

	Three Months Ended March 31,						Period to Period Change
	2020			2019			2020 vs 2019			% Change
	(In Thousands, Except Percentages)
Revenues	$	222,942		$	243,728		$	(20,786	)	(8.5	)%
Gross profit	39,417			36,210			3,207			8.9	%
Gross profit as a percentage of revenue	17.7		%	14.9		%
General and administrative expense	30,537			34,277			(3,740		)	(10.9	)%
General and administrative expense as a percentage of revenue	13.7		%	14.1		%
Interest expense, net	17,856			18,379			(523		)	(2.8	)%
Warrants fair value adjustment (income) expense	(338		)	407			(745		)	(183.0	)%
CCLP Series A Preferred Units fair value adjustment (income) expense	—			1,163			(1,163		)	(100.0	)%
Other (income) expense, net	439			(951		)	1,390			(146.2	)%
Loss before taxes and discontinued operations	(9,077		)	(17,065		)	7,988			46.8	%
Loss before taxes and discontinued operations as a percentage of revenue	(4.1		)%	(7.0		)%
Provision for income taxes	1,154			1,609			(455		)	(28.3	)%
Loss before discontinued operations	(10,231		)	(18,674		)	8,443			(45.2	)%
Discontinued operations:
Loss from discontinued operations, net of taxes	(145		)	(426		)	281			(66.0	)%
Net loss	(10,376		)	(19,100		)	8,724			(45.7	)%
Loss attributable to noncontrolling interest	8,825			8,262			563			6.8	%
Net loss attributable to TETRA stockholders	$	(1,551	)	$	(10,838	)	$	9,287		(85.7	)%

Consolidated revenues for the current year period decreased compared to the prior year period primarily due to decreased revenues in our Water & Flowback Services and Compression Divisions, which decreased by $21.2 million and $13.2 million, respectively. The decrease in revenues for the Water & Flowback Services Division was primarily due to decreased water management services activity. The decreased revenues of the Compression Division were primarily due to decreased deliveries of new compressor packages. These decreases were partially offset by an increase in revenues in our Completion Fluids & Products Division of $13.7 million primarily due to increased CBF product sales revenues in the U.S. Gulf of Mexico, including product sales associated with a TETRA CS Neptune completion fluid sale, and increased international CBF product sales and domestic manufactured products sales. See Divisional Comparisons section below for additional discussion.

Consolidated gross profit increased during the current year period compared to the prior year period primarily due to the increased profitability of our Completion Fluids & Products Division. The increased gross profit from the Completion Fluids & Products Division was offset by the decreased gross profit of our Water & Flowback Services Division. Despite the improvement in activity levels of our Completion Fluids & Products Division, onshore activity levels remained flat and the impact of pricing pressures continues to challenge profitability in certain markets. Operating expenses reflect the decrease in consolidated revenues, as well as aggressive management of operating costs and headcount.

Consolidated general and administrative expenses decreased during the current year period compared to the prior year period primarily due to decreased salary related expenses of $4.8 million and decreased general expenses of $0.2 million. These decreases were offset by increased bad debt expense of $1.0 million and increased professional services fees of $0.4 million. Decreased general and administrative expenses were driven primarily by our Water & Flowback Services Division and Corporate Divisions. General and administrative expense as a percentage of revenues decreased compared to the prior year period.

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Consolidated interest expense, net, decreased in the current year period primarily due to a decrease in Compression Division interest expense associated with the expense of CCLP Series A Preferred units that was incurred in the prior year period. Interest expense during the current year period and the prior year period includes $1.1 million and $1.0 million, respectively, of finance cost amortization.

The Warrants are accounted for as a derivative liability in accordance with ASC 815 and therefore they are classified as a long-term liability on our consolidated balance sheet at their fair value. Increases (or decreases) in the fair value of the Warrants are generally associated with increases (or decreases) in the trading price of our common stock, resulting in adjustments to earnings for the associated valuation losses (gains), and resulting in future volatility of our earnings during the period the Warrants are outstanding.

The CCLP Preferred Units were eligible to be settled using a variable number of CCLP common units, and therefore the fair value of the CCLP Preferred Units was classified as a long-term liability on our consolidated balance sheets in accordance with ASC 480. Because the CCLP Preferred Units were convertible into CCLP common units at the option of the holder, the fair value of the CCLP Preferred Units generally increased or decreased with the trading price of the CCLP common units, and this increase (decrease) in CCLP Preferred Unit fair value was charged (credited) to earnings, as appropriate. The last remaining outstanding CCLP Preferred Units were redeemed for cash on August 8, 2019.

Consolidated other (income) expense, net, was $0.4 million of expense during the current year period compared to $1.0 million of income during the prior year period. The increase in expense is primarily due to $1.5 million of increased foreign currency losses due to the devaluation of the Mexican peso and increased deferred compensation expense of $0.4 million. The increases in expense were offset by $0.6 million of gains associated with the sale of assets.

Our consolidated provision for income taxes for the current year period is primarily attributable to taxes in certain foreign jurisdictions and Texas gross margin taxes. Our consolidated effective tax rate for the three month period ended March 31, 2020 of negative 12.7% was primarily the result of losses generated in entities for which no related tax benefit has been recorded. The losses generated by these entities do not result in tax benefits due to offsetting valuation allowances being recorded against the related net deferred tax assets. We establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Included in our deferred tax assets are net operating loss carryforwards and tax credits that are available to offset future income tax liabilities in the U.S. as well as in certain foreign jurisdictions.

Divisional Comparisons

Completion Fluids & Products Division

	Three Months Ended March 31,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	75,237		$	61,581		$	13,656	22.2	%
Gross profit	25,964			10,664			15,300		143.5	%
Gross profit as a percentage of revenue	34.5		%	17.3		%
General and administrative expense	5,934			4,728			1,206		25.5	%
General and administrative expense as a percentage of revenue	7.9		%	7.7		%
Interest (income) expense, net	(154		)	(179		)	25		(14.0	)%
Other (income) expense, net	788			(71		)	859
Income before taxes	$	19,396		$	6,186		$	13,210	213.5	%
Income before taxes as a percentage of revenue	25.8		%	10.0		%

The increase in Completion Fluids & Products Division revenues during the current year period compared to the prior year period was primarily due to $12.9 million of increased product sales revenue which was partly due to increased CBF product sales revenues in the U.S. Gulf of Mexico, including product sales associated with a TETRA CS Neptune completion fluid sale. Increased revenues were also the result of improved markets for CBF product sales in international locations, including South America and domestic manufactured products sales. Additionally,

26

service revenues increased $0.8 million, primarily due to increased filtration and engineering work in the U.S. Gulf of Mexico associated with fluid sales.

Completion Fluids & Products Division gross profit during the current year period increased compared to the prior year period primarily due to the profitability associated with the increased manufactured products and international CBF sales revenues. Completion Fluids & Products Division profitability in future periods will be affected by the mix of its products and services, including the timing of TETRA CS Neptune completion fluid projects.

The Completion Fluids & Products Division reported an increase in pretax earnings during the current year period compared to the prior year period due to the increase in gross profit discussed above. Completion Fluids & Products Division administrative cost levels increased compared to the prior year period primarily due to increased salary and employee-related expenses of $1.2 million. Other expense, net increased as compared to prior year period primarily due to $0.8 million of foreign currency losses.

Water & Flowback Services Division

	Three Months Ended March 31,						Period to Period Change
	2020			2019			2020 vs 2019			% Change
	(In Thousands, Except Percentages)
Revenues	$	57,467		$	78,678		$	(21,211	)	(27.0	)%
Gross profit	3,267			8,851			(5,584		)	(63.1	)%
Gross profit as a percentage of revenue	5.7		%	11.2		%
General and administrative expense	6,334			6,796			(462		)	(6.8	)%
General and administrative expense as a percentage of revenue	11.0		%	8.6		%
Interest (income) expense, net	(9		)	4			(13		)	(40.0	)%
Other (income) expense, net	(814		)	(180		)	(634		)	(137.3	)%
Income (loss) before taxes	$	(2,244	)	$	2,231		$	(4,475	)	200.6	%
Income (loss) before taxes as a percentage of revenue	(3.9		)%	2.8		%

Water & Flowback Services Division service and product revenues decreased $21.2 million during the current year period compared to the prior year period due to decreased water management services activity associated with economic uncertainty and decreased international equipment sales activity.

The Water & Flowback Services Division reflected decreased gross profit during the current year period compared to the prior year period partly due to decreased gross profit consistent with decreased revenues and partly due to decreased gross profit as a result of certain high-margin projects performed during the prior year.

The Water & Flowback Services Division reported a pretax loss compared to a pretax income in the prior year period, primarily due to the decrease in gross profit described above. General and administrative expenses decreased primarily due decreased wage and benefit related expenses of $1.0 million and decreased general expenses of $0.4 million offset by increased bad debt expense of $0.7 million and increased professional fees of $0.2 million. The Water & Flowback Services Division reported increased other income, net, primarily due to increased gains associated with the disposal of assets of $0.7 million and foreign currency gains of $0.3 million, offset by decreased income of $0.4 million associated with the remeasurement of contingent purchase price consideration in the prior year.

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Compression Division

	Three Months Ended March 31,						Period to Period Change
	2020			2019			2020 vs 2019			% Change
	(In Thousands, Except Percentages)
Revenues	$	90,238		$	103,469		$	(13,231	)	(12.8	)%
Gross profit	10,380			16,859			(6,479		)	(38.4	)%
Gross profit as a percentage of revenue	11.5		%	16.3		%
General and administrative expense	10,189			10,664			(475		)	(4.5	)%
General and administrative expense as a percentage of revenue	11.3		%	10.3		%
Interest expense, net	12,564			13,213			(649		)	(4.9	)%
CCLP Series A Preferred fair value adjustment (income) expense	—			1,163			(1,163		)	100.0	%
Other (income) expense, net	417			(380		)	797			(209.7	)%
Loss before taxes	$	(12,790	)	$	(7,801	)	$	(4,989	)	(64.0	)%
Loss before taxes as a percentage of revenue	(14.2		)%	(7.5		)%

Compression Division revenues decreased during the current year period compared to the prior year period primarily due to a $19.3 million decrease in product sales revenues due to a decrease in deliveries of new compressors compared to the prior year. Overall, new unit sale booking levels declined in the first quarter of 2020 as customers substantially cut spending on infrastructure projects. The decrease in product sales was offset by a $6.0 million increase in service revenues from compression and aftermarket services operations. The increase in service revenues was primarily due to increases in our high-horsepower fleet during 2019 and resulting increased horsepower in service during the current year period compared to the prior year period and pricing secured in 2019 that was realized during the first quarter of 2020.

Compression Division gross profit decreased during the current year period compared to the prior year due to decreased revenues discussed above and the impairment of $5.4 million associated with our Midland manufacturing facility and related assets.

The Compression Division recorded increased pretax loss in the current year period compared to the prior year period due to the decreased gross profit discussed above. Interest expense decreased compared to the prior year period due to decreased interest associated with the CCLP Series A Preferred units that was incurred in the prior year period. General and administrative expense levels decreased compared to the prior year period, due to decreased salary and employee-related expenses, including the impact of decreased headcount, incentives and equity compensation of $0.7 million and decreased general expenses of $0.3 million. These decreases were offset by increased professional services of $0.3 million and increased bad debt expense of $0.2 million. Other (income) expense, net changed from income of $0.4 million income in the prior year period to $0.4 million expense in the current year period. The change from income to expense is primarily due to $1.2 million on increased foreign currency losses due to the devaluation of the peso offset by decreased expense of $0.5 million associated with the redemption premium incurred during the prior year period in connection with the redemption of Preferred Units for cash. The last remaining outstanding CCLP Preferred Units were redeemed for cash on August 8, 2019.

Corporate Overhead

	Three Months Ended March 31,						Period to Period Change
	2020			2019			2020 vs 2019			% Change
	(In Thousands, Except Percentages)
Depreciation and amortization	$	197		$	(168	)	$	365		217.3	%
General and administrative expense	8,081			12,089			(4,008		)	(33.2	)%
Interest expense, net	5,455			5,342			113			2.1	%
Warrants fair value adjustment (income) expense	(338		)	407			(745		)	(183.0	)%
Other (income) expense, net	49			(319		)	368			(115.4	)%
Loss before taxes	$	(13,444	)	$	(17,687	)	$	4,243		24.0	%

Corporate Overhead pretax loss decreased during the current year period compared to the prior year period primarily due to decreased general and administrative expenses. Corporate general and administrative expense

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decreased primarily due to decreased salary related expense of $4.4 million. This decrease was offset by $0.3 million of decreased general expenses and $0.1 million of decreased professional fees. The fair value of the outstanding Warrants liability resulted in a $0.3 million credit to earnings in the current year period compared to an $0.4 million charge to earnings during the prior year period. In addition, the other (income) expense, net change was primarily associated with adjustments to deferred compensation plans.

Liquidity and Capital Resources

We believe that our and CCLP's separate capital structures allow us to meet our respective financial obligations, despite current uncertain operating conditions and financial markets. As of March 31, 2020, we and CCLP are in compliance with all covenants of our respective debt agreements. Information about the terms and covenants of our debt agreements can be found in our 2019 Annual Report.

Because of the level of consolidated debt, we believe it is important to consider our capital structure and that of CCLP separately, as there are no cross default provisions, cross collateralization provisions, or cross guarantees between CCLP's debt and TETRA's debt. Our consolidated debt outstanding has a carrying value of approximately $845.8 million as of March 31, 2020. However, approximately $638.4 million of this consolidated debt balance is owed by CCLP and is serviced from the cash balances and cash flows of CCLP, and $346.6 million of which is secured by certain of CCLP's assets. Through our common unit ownership interest in CCLP, which was approximately 34% as of March 31, 2020, and ownership of an approximate 1.4% general partner interest, we receive our share of the distributable cash flows of CCLP through its quarterly cash distributions. Approximately $7.4 million of the $29.5 million of the cash balance reflected on our consolidated balance sheet is owned by CCLP and is not accessible by us. The following table provides condensed consolidating balance sheet information reflecting TETRA's net assets and CCLP's net assets that service and secure TETRA's and CCLP's respective capital structures.

	March 31, 2020
Condensed Consolidating Balance Sheet	TETRA		CCLP		Eliminations			Consolidated
	(In Thousands)
Cash, excluding restricted cash	$	22,057	$	7,416	$	—		$	29,473
Affiliate receivables	14,964		—		(14,964		)	—
Other current assets	194,292		140,215		—			334,507
Property, plant and equipment, net	112,095		628,152		—			740,247
Long-term affiliate receivables	11,618		—		(11,618		)	—
Other assets, including investment in CCLP	22,474		58,519		84,544			165,537
Total assets	$	377,500	$	834,302	$	57,962		$	1,269,764
Affiliate payables	$	—	$	14,964	$	(14,964	)	$	—
Other current liabilities	80,576		114,620		—			195,196
Long-term debt, net	207,413		638,429		—			845,842
Warrants liability	112		—		—			112
Long-term affiliate payable	—		11,618		(11,618		)	—
Other non-current liabilities	61,771		19,912		—			81,683
Total equity	27,628		34,759		84,544			146,931
Total liabilities and equity	$	377,500	$	834,302	$	57,962		$	1,269,764

As of March 31, 2020, subject to compliance with the covenants, borrowing base requirements, and other provisions of the agreement that may limit borrowings, we had $40.8 million of availability under the ABL Credit Agreement. The amounts we may borrow under the ABL Credit Agreement are derived from our accounts receivable and certain inventory. Decreases in the amount of our accounts receivable and the value of our inventory would result in reduced borrowing availability under the Credit Agreement. As of March 31, 2020, and subject to compliance with the covenants, borrowing base requirements, and other provisions of the agreement that may limit borrowings under the CCLP Credit Agreement, CCLP had availability of $20.4 million. See CCLP Financing Activities below for further discussion.

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Our consolidated sources (uses) of cash during the three months ended March 31, 2020 and 2019 are as follows:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Operating activities	$	22,176		$	7,412
Investing activities	(10,615		)	(31,726		)
Financing activities	1,138			21,312

Operating Activities

Consolidated cash flows provided by operating activities increased by $14.8 million. CCLP generated $13.4 million of our consolidated cash flows provided by operating activities during the three months ended March 31, 2020 compared to $31.6 million during the corresponding prior year period. Operating cash flows increased primarily due to improved operating profitability of the Completion Fluids and Products Division. We continue to monitor customer credit risk in the current environment and focus on serving larger capitalized oil and gas operators and national oil companies.

Investing Activities

Total cash capital expenditures during the first three months of 2020 were $12.4 million, which is net of $1.9 million cost of compressors sold. Our Completion Fluids & Products Division spent $0.9 million on capital expenditures, the majority of which related to plant and facility additions. Our Water & Flowback Services Division spent $4.7 million on capital expenditures, primarily to add to and maintain its water management equipment fleet. Our Compression Division spent $6.7 million, primarily for growth capital expenditure projects and to maintain its compression fleet.

Historically, a significant majority of our planned capital expenditures has been related to identified opportunities to grow and expand our existing businesses. However, such expenditures have recently been, and may continue to be, postponed or canceled as we are reviewing all capital expenditure plans carefully in an effort to conserve cash. We currently have no long-term capital expenditure commitments. The deferral of capital projects could affect our ability to expand our operations in the future. Excluding our Compression Division, we expect to spend approximately $10.0 million to $15.0 million during 2020 on capital expenditures, primarily to expand and maintain our Water & Flowback Services Division equipment fleet.

Our Compression Division has adjusted its expected capital spend downward to approximately $28.0 million to $35.0 million during 2020 primarily to maintain its compression fleet.

If the forecasted demand for our products and services increases or decreases, the amount of planned expenditures on growth and expansion may be adjusted.

Financing Activities 

During the first three months of 2020, the total amount of consolidated cash provided by financing activities was $1.1 million, primarily due to borrowings under our ABL Credit Agreement. We and CCLP may supplement our existing cash balances and cash flow from operating activities with short-term borrowings, long-term borrowings, issuances of equity and debt securities, and other sources of capital. We and CCLP are aggressively managing our working capital and capital expenditure needs in order to maximize our liquidity in the current environment.

TETRA Long-Term Debt

Asset-Based Credit Agreement. The ABL Credit Agreement provides for a senior secured revolving credit facility of up to $100 million, subject to a borrowing base to be determined by reference to the value of inventory and accounts receivable, and includes a sublimit of $20.0 million for letters of credit and a swingline loan sublimit of $10.0 million. The amounts we may borrow under the ABL Credit Agreement are derived from our accounts receivable and certain inventory. Decreases in the amount of our accounts receivable and the value of our inventory would result in reduced borrowing availability under the ABL Credit Agreement. The ABL Credit Agreement is

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scheduled to mature on September 10, 2023. As of May 5, 2020, we have $1.0 million outstanding under our ABL Credit Agreement and $6.4 million letters of credit, resulting in $45.9 million of availability.

Term Credit Agreement.    The Term Credit Agreement is scheduled to mature on September 10, 2025. As of May 5, 2020, $220.5 million in aggregate principal amount of our Term Credit Agreement is outstanding.

CCLP Financing Activities

CCLP Preferred Units. In January 2019 CCLP began redeeming its Series A Preferred Units for cash, resulting in 783,046 Preferred Units being redeemed during the three months ended March 31, 2019 for an aggregate of $8.3 million, which includes approximately $0.4 million of redemption premiums that were paid. The last redemption of the remaining Preferred Units, along with a final cash payment made in lieu of paid-in-kind units, occurred on August 8, 2019.

CCLP Bank Credit Facility. All the obligations of CCLP and two of its wholly owned subsidiaries (collectively the "CCLP Borrowers") under the CCLP Credit Agreement are guaranteed by certain of their existing and future domestic subsidiaries. The CCLP Credit Agreement, as amended, includes a maximum credit commitment of $50.0 million which is available for loans, letters of credit (with a sublimit of $25.0 million), and swingline loans (with a sublimit of $5.0 million), subject to a borrowing base to be determined by reference to the value of accounts receivable and certain inventory of the CCLP Borrowers. Such maximum credit commitment may be increased by $25.0 million in accordance with the terms and conditions of the CCLP Credit Agreement. As of March 31, 2020, and subject to compliance with the covenants, borrowing base, and other provisions of the agreements that may limit borrowings under the CCLP Credit Agreement, CCLP had availability of $20.4 million.

The CCLP Borrowers may borrow funds under the CCLP Credit Agreement to pay fees and expenses related to the CCLP Credit Agreement and for the CCLP Borrower's ongoing working capital needs and for general partnership purposes. The revolving loans under the CCLP Credit Agreement may be voluntarily prepaid, in whole or in part, without premium or penalty, subject to breakage or similar costs. The maturity date of the CCLP Credit Agreement is June 29, 2023. As of March 31, 2020, CCLP had a $3.0 million outstanding balance and had $3.0 million in letters of credit against the CCLP Credit Agreement. As of May 5, 2020, CCLP has $6.7 million balance outstanding under the CCLP Credit Agreement and $2.7 million in letters of credit, resulting in $16.1 million of availability. The amounts the CCLP Borrowers may borrow under the CCLP Credit Agreement are derived from CCLP’s accounts receivable and certain inventory. Decreases in the amount of CCLP’s accounts receivable and the value of its inventory would result in reduced borrowing availability under the CCLP Credit Agreement. The CCLP Borrowers are in discussions with the lenders under the CCLP Credit Agreement regarding a potential amendment that would permit the CCLP Borrowers to incur second-priority liens on collateral pledged under the CLLP Senior Secured Notes. This amendment will be entered into if the exchange offer discussed below is completed. We anticipate the terms of the amendment to the CCLP Credit Agreement may include, among other items, the inclusion of a $5.0 million reserve which would result in reduced borrowing availability. We can provide no assurance the amendment will be entered into or what its final terms might be.

CCLP Senior Secured Notes. As of May 5, 2020, $350.0 million in aggregate principal amount was outstanding. The CCLP Senior Secured Notes accrue interest at a rate of 7.50% per annum and are scheduled to mature on April 1, 2025.

CCLP Senior Notes. As of May 5, 2020, $295.9 million in aggregate principal amount was outstanding. The CCLP Senior Notes accrue interest at a rate of 7.25% per annum and are scheduled to mature on August 15, 2022.

On April 17, 2020, CCLP announced the commencement of an offer (the "Exchange Offer") to certain eligible noteholders ("Eligible Holders") to exchange any and all of their outstanding CCLP Senior Notes due 2022 (the “Unsecured Notes”) for newly issued CCLP 7.50% Senior Secured First Lien Notes due 2025 and CCLP 7.25% Senior Secured Second Lien Notes due 2027. In conjunction with the offer, consents are being solicited from Eligible Holders to eliminate substantially all restrictive covenants and certain of the default provisions in the indenture governing the Unsecured Notes. On May 1, 2020, CCLP extended the early tender time for the Exchange Offer from 5:00 p.m., New York City time, on April 30, 2020 to 11:59 p.m., New York City time, on May 14, 2020 (which is the expiration time of the Exchange Offer), unless extended or earlier terminated by CCLP. Eligible Holders that validly tender and do not validly withdraw their Unsecured Notes in the exchange offer prior to the Expiration Time will receive $700 in principal amount of new CCLP 7.50% Senior Secured First Lien Notes or, as applicable and subject to proration, $750 principal amount of CCLP 7.25% Senior Secured Second Lien Notes for

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each $1,000 principal amount of Unsecured Notes tendered. CCLP can terminate, withdraw, amend or extend the Exchange Offer at any time, subject to applicable law. There can be no assurance that the Exchange Offer will be completed.

Other Sources and Uses

In addition to the aforementioned credit facilities and senior notes, we and CCLP fund our respective short-term liquidity requirements from cash generated by our respective operations and from short-term vendor financing. Should additional capital be required, the ability to raise such capital through the issuance of additional debt or equity securities may currently be limited. Instability or volatility in the capital markets at the times we need to access capital may affect the cost of capital and the ability to raise capital for an indeterminable length of time. If it is necessary to issue additional equity to fund our capital needs, additional dilution of our common stockholders will occur. We periodically evaluate engaging in strategic transactions and may consider divesting non-core assets where our evaluation suggests such transaction is in the best interest of our business.

On April 11, 2019, we filed a universal shelf Registration Statement on Form S-3 with the SEC. On May 1, 2019, the Registration Statement on Form S-3 was declared effective by the SEC. Pursuant to this registration statement, we have the ability to sell debt or equity securities in one or more public offerings up to an aggregate public offering price of $464.1 million, inclusive of $64.1 million of our common stock issuable upon conversion of our currently outstanding warrants. This shelf registration statement currently provides us additional flexibility with regard to potential financings that we may undertake when market conditions permit or our financial condition may require.

The Second Amended and Restated Partnership Agreement of CCLP requires that within 45 days after the end of each quarter, CCLP distribute all of its available cash, as defined in the Second Amended and Restated Partnership Agreement, to its common unitholders of record on the applicable record date. During the three months ended March 31, 2020, CCLP distributed $0.5 million in cash, including $0.3 million to its public unitholders. The amount of quarterly distributions is determined based on a variety of factors, including estimates of CCLP's cash needs to fund its future operating, investing, and debt service requirements. There can be no assurance that quarterly distributions from CCLP will increase from this amount per unit going forward.

Off Balance Sheet Arrangements

As of March 31, 2020, we had no “off balance sheet arrangements” that may have a current or future material effect on our consolidated financial condition or results of operations. 

Commitments and Contingencies

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC ("Orinoco") that provided for the purchase by Orinoco of Maritech's remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

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Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

Pursuant to a Bonding Agreement entered into as part of these transactions (the "Bonding Agreement"), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million during the quarter ended September 30, 2019. The Epic Promissory Note became due on December 31, 2019 but neither Epic nor the Clarkes made the required payment. Upon the default by Epic and the Clarkes, we filed a lawsuit against the Clarkes on January 15, 2020 in Montgomery County, Texas for breach of the Clarke Promissory Note Guaranty Agreement, seeking the amounts due under the Epic Promissory Note and related interest, as well as attorneys’ fees and expenses. The Clarkes each filed an answer and counterclaims for

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fraud and negligent misrepresentation and seek monetary damages in excess of $1 million, punitive damages, and attorneys’ fees. We will vigorously prosecute our claim and defend against the claims by the Clarkes.

Contractual Obligations

Our contractual obligations and commitments principally include obligations associated with our outstanding

indebtedness and obligations under operating leases. The table below summarizes our consolidated contractual cash obligations as of March 31, 2020:

	Payments Due
	Total		2020		2021		2022		2023		2024		Thereafter
	(In Thousands)
Long-term debt - TETRA	$	221,500	$	—	$	—	$	—	$	1,000	$	—	$	220,500
Long-term debt - CCLP	649,430		—		—		295,930		3,500		—		350,000
Interest on debt - TETRA	95,794		13,106		17,474		17,474		17,435		17,317		12,988
Interest on debt - CCLP	185,387		35,779		47,705		40,593		26,310		26,250		8,750
Purchase obligations	92,569		7,144		9,525		9,525		9,525		9,525		47,325
Asset retirement obligations(1)	12,878		—		—		—		—		—		12,878
Operating leases	117,891		19,961		22,092		18,422		14,776		12,372		30,268
Total contractual cash obligations(2)	$	1,375,449	$	75,990	$	96,796	$	381,944	$	72,546	$	65,464	$	682,709

⁽¹⁾  We have estimated the timing of these payments for asset retirement obligation liabilities based upon our plans. The amounts shown represent the discounted obligation as of March 31, 2020.

⁽²⁾  Amounts exclude other long-term liabilities reflected in our Consolidated Balance Sheet that do not have known payment streams. These excluded amounts include approximately $0.4 million of liabilities under FASB Codification Topic 740, “Accounting for Uncertainty in Income Taxes,” as we are unable to reasonably estimate the ultimate amount or timing of settlements.

For additional information about our contractual obligations as of December 31, 2019, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2019 Annual Report on Form 10-K.

Cautionary Statement for Purposes of Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements in this Quarterly Report are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates", "assumes", “believes,” "budgets", “could,” “estimates,” "expects", "forecasts", "goal", "intends", "may", "might", "plans", "predicts", "projects", "schedules", "seeks", "should", "targets", "will", and "would".

Such forward-looking statements reflect our current views with respect to future events and financial performance and are based on assumptions that we believe to be reasonable, but such forward-looking statements are subject to numerous risks, and uncertainties, including, but not limited to:

• economic and operating conditions that are outside of our control, including the trading price of our common stock;

• the current significant surplus in the supply of oil and the ability of the OPEC and other oil producing nations to agree on and comply with supply limitations; the duration and magnitude of the unprecedented disruption in the oil and gas industry currently, which is negatively impacting our business;

• the availability of adequate sources of capital to us;

• expected customer drilling activity and capital spending for 2020 and 2021 and projections concerning our business activities

• the levels of competition we encounter;

• the planned closures of our El Dorado plant and CCLP’s Midland facility;

• the availability of raw materials and labor at reasonable prices;

• risks related to acquisitions and our growth strategy;

34

• restrictions under our debt agreements and the consequences of any failure to comply with debt covenants;

• the effect and results of litigation, regulatory matters, settlements, audits, assessments, and contingencies;

• risks related to our foreign operations;

• information technology risks including the risk of cyberattack;

• the severity and duration of the COVID-19 pandemic and related economic repercussions and the resulting negative impact on the demand for oil and gas;

• operational challenges relating to the COVID-19 pandemic and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees, remote work arrangements, performance of contracts, and supply chain disruptions;

• other global or national health concerns, and

• other risks and uncertainties under “Item 1A. Risk Factors” in our 2019 Annual Report, and as included in our other filings with the SEC, which are available free of charge on the SEC website at www.sec.gov.

The risks and uncertainties referred to above are generally beyond our ability to control and we cannot predict all the risks and uncertainties that could cause our actual results to differ from those indicated by the forward-looking statements. If any of these risks or uncertainties materialize, or if any of the underlying assumptions prove incorrect, actual results may vary from those indicated by the forward-looking statements, and such variances may be material.

All subsequent written and oral forward-looking statements made by or attributable to us or to persons acting on our behalf are expressly qualified in their entirety by reference to these risks and uncertainties. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement, and we undertake no obligation to update or revise any forward-looking statements we may make, except as may be required by law.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not Applicable.

Item 4. Controls and Procedures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2020, the end of the period covered by this quarterly report.

There were no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

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Item 1A. Risk Factors.

The statements in this section describe the known material risks to our business and should be considered carefully. We have described in the 2019 Annual Report significant risk factors and periodically update those risks for material developments. Provided below is an update to our risk factors as previously disclosed in the 2019 Annual Report.

The COVID-19 pandemic and oversupply of oil from OPEC+ has materially reduced demand for our products and services, and has had, and may continue to have, a significant adverse impact on our financial condition and results of operations.

The COVID-19 pandemic and subsequent mitigation efforts and disagreements between OPEC+ regarding limits of production of oil have added significant volatility and uncertainty in the oil and gas industry. At the outset of the pandemic, OPEC and the other oil producing nations were unable to reach an agreement on production levels for crude oil, which led both Russia and Saudi Arabia to substantially increase production. This, combined with an unprecedented decline in oil demand due to the COVID-19 pandemic, resulted in global oil markets being oversupplied. On April 12th, OPEC and the other oil producing nations reached an agreement to limit production through the end of June, although there still appears to be a large demand/supply imbalance. Despite the OPEC+ agreement to cut production, downward pressure on oil and natural gas prices remains and could continue for the foreseeable future. The collapse in the demand for oil caused by this unprecedented global health and economic crisis has had, and is reasonably likely to continue to have, a negative impact on the demand for our products and services. The decline in demand for our products and services has had, and is likely to continue to have, a negative impact on our financial condition and results of operations.

While the full impact of the COVID-19 pandemic is not yet known, we are closely monitoring the effects of the pandemic on our customers, our suppliers, our operations, and our employees. These effects have included, and may continue to include, declining revenue, disruptions to our operations, including customers canceling orders and returning our equipment early, customer shutdowns of oil and gas production activities, employee impacts from illness, school closures and other community response measures, and temporary closures of our facilities or the facilities of our customers and suppliers.

The extent to which our financial and operating results are negatively impacted by the COVID-19 pandemic and oversupplied oil markets will depend on various factors beyond our control, such as the duration and severity of the pandemic, additional measures taken by governments and our customers and suppliers in response to the pandemic, and the speed and effectiveness of mitigation efforts taken to combat the virus. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

If we cannot meet the continued listing requirements of the New York Stock Exchange (the “NYSE”), the NYSE may delist our common stock.

On March 26, 2020, we were notified by the New York Stock Exchange (the “NYSE”) that the average closing price of the TETRA’s common stock over the prior 30 consecutive trading day period was below $1.00 per share, which is the minimum average closing price per share required to maintain listing on the NYSE under Section 802.01C of the NYSE Listed Company Manual (“Section 802.01C”). We have a period of six months following receipt of the NYSE’s notice to regain compliance with the NYSE’s minimum share price requirement, during which time our shares continue to be listed and traded on the NYSE, subject to our compliance with other continued listing standards.

On April 20, 2020, the NYSE announced a rule change providing relief to listed companies that, due to market conditions resulting from the impact of the COVID-19 pandemic, have fallen out of compliance with certain of the NYSE’s continued listing standards. The NYSE has tolled the compliance period from April 20, 2020 through June 30, 2020, which has the effect of extending the available cure period. The cure period will recommence on July 1, 2020. If we fail to regain compliance with Section 802.01C by December 5, 2020, which is the end of our extended cure period, our shares will be subject to the NYSE’s suspension and delisting procedures. If necessary to regain compliance with NYSE listing standards, we may, subject to approval of our board of directors and stockholders, implement a reverse stock split. A delisting of our shares from the NYSE could negatively impact us by, among other things, reducing the liquidity and market price of our shares, reducing the number of investors willing to hold or acquire our shares, limiting our ability to issue securities or obtain financing in the future, and limiting our ability to

36

use a registration statement to offer and sell freely tradable securities, thereby restricting our ability to access the public capital markets.

In addition, the NYSE has other continued listing criteria that we are at risk of violating. For example, continued declines in the market price of our shares could result in a delisting under the NYSE’s “abnormally low selling price” criteria, which the NYSE typically views to be a trading price of less than $0.16 per share, or its minimum average market capitalization requirement of $15.0 million. The NYSE has suspended through June 30, 2020 its rule that would immediately begin delisting procedures against companies with an average global market capitalization of under $15 million over a 30-trading day period. There are no assurances that suspension will be extended. On May 5, 2020, the trading price of our common stock closed at $0.55 per share and our market capitalization was $69.2 million.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a) None.

(b) None.

(c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers.

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1)	Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Publicly Announced Plans or Programs(1)
January 1 – January 31, 2020	—		$	—	—	$	14,327,000
February 1 – February 29, 2020	73,436	(2)	1.22		—	14,327,000
March 1 – March 31, 2020	—		—		—	14,327,000
Total	73,436				—	$	14,327,000

(1) In January 2004, our Board of Directors authorized the repurchase of up to $20 million of our common stock. Purchases will be made from time to time in open market transactions at prevailing market prices. The repurchase program may continue until the authorized limit is reached, at which time the Board of Directors may review the option of increasing the authorized limit.

(2) Shares we received in connection with the exercise of certain employee stock options or the vesting of certain shares of employee restricted stock. These shares were not acquired pursuant to the stock repurchase program.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

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Item 6. Exhibits.

Exhibits:

31.1*	Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.SCH+	XBRL Taxonomy Extension Schema Document.
101.CAL+	XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB+	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE+	XBRL Taxonomy Extension Presentation Linkbase Document.
101.DEF+	XBRL Taxonomy Extension Definition Linkbase Document.

* Filed with this report.

** Furnished with this report.

+ Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Operations for the three month periods ended March 31, 2020 and 2019; (ii) Consolidated Statements of Comprehensive Income for the three month periods ended March 31, 2020 and 2019; (iii) Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019; (iv) Consolidated Statements of Cash Flows for the three month periods ended March 31, 2020 and 2019; and (v) Notes to Consolidated Financial Statements for the three months ended March 31, 2020.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		TETRA Technologies, Inc.
Date:	May 7, 2020	By:	/s/Brady M. Murphy
			Brady M. Murphy
			President
			Chief Executive Officer
Date:	May 7, 2020	By:	/s/Elijio V. Serrano
			Elijio V. Serrano
			Senior Vice President
			Chief Financial Officer
Date:	May 7, 2020	By:	/s/Richard D. O'Brien
			Richard D. O'Brien
			Vice President – Finance and Global Controller
			Principal Accounting Officer

39

EX-31.1

Exhibit 31.1

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Brady M. Murphy, certify that:

1. I have reviewed this report on Form 10-Q for the fiscalquarter ended March 31, 2020, of TETRA Technologies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presentedin this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	May 7, 2020	/s/Brady M. Murphy
		Brady M. Murphy
		President and
		Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Elijio V. Serrano, certify that:

1. I have reviewed this report on Form 10-Q for the fiscalquarter ended March 31, 2020, of TETRA Technologies, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presentedin this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	May 7, 2020	/s/Elijio V. Serrano
		Elijio V. Serrano
		SeniorVice President and
		Chief Financial Officer and Principal Accounting Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Brady M. Murphy, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects,the financial condition and results of operations of the Company.

Dated:	May 7, 2020	/s/Brady M. Murphy
		Brady M. Murphy
		President and
		Chief Executive Officer
		TETRA Technologies, Inc.

A signed original of this written statementrequired by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Elijio V. Serrano, Senior Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all materialrespects, the financial condition and results of operations of the Company.

Dated:	May 7, 2020	/s/Elijio V. Serrano
		Elijio V. Serrano
		Senior Vice President and
		Chief Financial Officer
		TETRA Technologies, Inc.

A signed original ofthis written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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Long-Term Debt and Other Borrowings Long-Term Debt and Other Borrowings (Table)

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Long-Term Debt Table

		March 31, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $1.3 million as of March 31, 2020 and $1.0 million as of December 31, 2019)	September 2023	$	2,246	$	—
Term credit agreement (presented net of the unamortized discount of $6.2 million as of March 31, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $9.2 million as of March 31, 2020 and $9.5 million as of December 31, 2019)	September 2025	205,167		204,633
TETRA total debt		207,413		204,633
Less current portion		—		—
TETRA total long-term debt		$	207,413	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0.8 million as of March 31, 2020 and $0.9 million of December 31, 2019)	June 2023	2,184		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $1.5 million as of March 31, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $2.6 million as of March 31, 2020 and $2.8 million as of December 31, 2019)	August 2022	291,863		291,444
CCLP 7.50% Senior Secured Notes (presented net of unamortized deferred financing costs of $5.6 million as of March 31, 2020 and $5.8 million as of December 31, 2019)	April 2025	344,382		344,172
CCLP total debt		638,429		638,238
Less current portion		—		—
CCLP total long-term debt		$	638,429	$	638,238
Consolidated total long-term debt		$	845,842	$	842,871

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Basis of Presentation and Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Principles of consolidation policy

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended March 31, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary ("CCLP") as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA's capital structure and CCLP's capital structure are separate, and do not include cross default provisions, cross collateralization provisions, or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission ("SEC") and do not include all information and footnotes required by U.S. generally accepted accounting principles ("U.S. GAAP") for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Use of estimates policy

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications [Text Block]

Reclassifications

Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year's overall presentation.

Lessee, Leases [Policy Text Block]

Foreign currency translation policy

Foreign Currency Translation

We have designated the euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $1.9 million during the three months ended March 31, 2020, and $(1.2) million during the three months ended March 31, 2019, respectively.

New Accounting Pronouncements policy

New Accounting Pronouncements

Standards adopted in 2020

In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2018-15, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues	$ 222,942	$ 243,728
Cost of Goods and Services Sold [Abstract]
Depreciation, amortization, and accretion	29,460	30,628
Impairment of Long-Lived Assets Held-for-use	5,371	146
Total cost of revenues	183,525	207,518
Gross profit	39,417	36,210
General and administrative expense	30,537	34,277
Interest expense, net	17,856	18,379
Fair Value Adjustment Of Warrants, Income Statement	(338)	407
Preferred, Fair Value Adjustment	0	1,163
Other (income) expense, net	439	(951)
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(9,077)	(17,065)
Provision (benefit) for income taxes	1,154	1,609
Income (loss) before taxes	(10,231)	(18,674)
Income (Loss) from Discontinued Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(145)	(426)
Net income (loss)	(10,376)	(19,100)
(Income) loss attributable to noncontrolling interest	8,825	8,262
Net income (loss) attributable to TETRA stockholders	$ (1,551)	$ (10,838)
Basic net income per common share:
Income (Loss) from Continuing Operations, Per Basic and Diluted Share	$ (0.01)	$ (0.09)
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Basic Share	0.00	0.00
Net income (loss) attributable to TETRA stockholders	$ (0.01)	$ (0.09)
Weighted Average Number of Shares Outstanding, Basic	125,587	125,681
Diluted net income per common share:
Income (Loss) from Continuing Operations, Per Diluted Share	$ (0.01)	$ (0.09)
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Diluted Share	0.00	0.00
Net income (loss) attributable to TETRA stockholders	$ (0.01)	$ (0.09)
Weighted Average Number of Shares Outstanding, Diluted	125,587	125,681
Product [Member]
Revenues	$ 85,033	$ 91,781
Cost of Goods and Services Sold [Abstract]
Cost of product sales	58,967	74,588
Service [Member]
Revenues	137,909	151,947
Cost of Goods and Services Sold [Abstract]
Cost of product sales	$ 89,727	$ 102,156

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Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Trade accounts receivable, allowances for doubtful accounts	$ 6,308	$ 5,262
Other assets:
Patents, trademarks, and other intangible assets, accumulated amortization	$ 89,450	$ 88,422
Equity:
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	128,693,692	128,304,354
Treasury stock, shares held	2,896,627	2,823,191

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Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Operating Leases
2019	$ 19,961
2020	22,092
2021	18,422
2022	14,776
2023	12,372
Thereafter	30,268
Total lease payments	117,891
Less imputed interest	(41,264)
Total operating lease liabilities	$ 76,627	$ 69,769

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Fair Value Measurements CCLP Preferred Units (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Fair Value Disclosures [Abstract]
Preferred, Fair Value Adjustment	$ 0	$ (1,163)

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Subsequent Events (Details)	Apr. 17, 2020	Mar. 31, 2020	Dec. 31, 2019
Compressco Partners Senior Notes [Member] | CSI Compressco [Member]
Subsequent Event [Line Items]
Senior Note interest rate		7.25%	7.25%
Compressco Partners Senior Notes [Member] | CSI Compressco [Member] | Subsequent Event
Subsequent Event [Line Items]
Senior Note interest rate	7.25%
Senior Secured First Lien Notes Due 2025 | Subsequent Event
Subsequent Event [Line Items]
Senior Note interest rate	7.50%
Senior Secured Second Lien Notes Due 2027 | Subsequent Event
Subsequent Event [Line Items]
Senior Note interest rate	7.25%

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Commitments and Contingencies Commitment and Contingencies (Details) - USD ($) $ in Millions	Mar. 31, 2020	Aug. 31, 2019	Mar. 01, 2018
Long-term Purchase Commitment [Line Items]
Discontinued operation, amounts of material contingent liabilities remaining, performance bonds	$ 47.0
Offshore Division | Discontinued Operations, Disposed of by Sale
Long-term Purchase Commitment [Line Items]
Disposal Group, Including Discontinued Operation, Consideration, Additional Receivable			$ 7.5
Disposal group, including discontinued operation, consideration, promissory note receivable, interest rate			1.52%
Disposal Group, Including Discontinued Operation, Reserve, Other Receivables		$ 1.5

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Revenue from Contracts with Customers Revenue Performance Obligation (Details) $ in Thousands	Mar. 31, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 56,741
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 38,720
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 15,941
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 2,026
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 54
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 0
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year

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Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Inventory, Finished Goods, Gross	$ 67,824	$ 70,135
Inventory, Raw Materials, Gross	3,886	4,125
Other Inventory, Supplies, Gross	38,859	47,793
Inventory, Work in Process, Gross	31,547	14,457
Inventories	$ 142,116	$ 136,510

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Net Income (Loss) per Share (Notes)

3 Months Ended

Mar. 31, 2020

Earnings Per Share [Abstract]

Net Income (Loss) per Share

NET INCOME (LOSS) PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

		Three Months Ended March 31,
		2020	2019
	(In Thousands)
Number of weighted average common shares outstanding		125,587	125,681
Assumed exercise of equity awards and warrants		—	—
Average diluted shares outstanding		125,587	125,681

For the three month periods ended March 31, 2020 and March 31, 2019, the average diluted shares outstanding excludes the impact of all outstanding equity awards and warrants, as the inclusion of these shares would have been anti-dilutive due to the net losses recorded during the periods. In addition, for the three month period ended March 31, 2019, the calculation of diluted earnings per common share excludes the impact of the CSI Compressco LP Series A Convertible Preferred Units (the "CCLP Preferred Units"), as the inclusion of the impact from conversion of the CCLP Preferred Units into CCLP common units would have been anti-dilutive.

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Leases

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Leases

LEASES

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commence upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. We anticipate taking delivery of the remaining six compressor packages when the compression units are completed, which is expected to occur during the second quarter of 2020. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the consummation of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Operating lease expense	$	5,148	$	5,044
Short-term lease expense	9,430		11,161
Total lease expense	$	14,578	$	16,205

Supplemental cash flow information:

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	5,949	$	4,657
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,844	$	3,257

Supplemental balance sheet information:

	March 31, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	75,344	$	68,131
Accrued liabilities and other	$	16,782	$	15,850
Operating lease liabilities	59,845		53,919
Total operating lease liabilities	$	76,627	$	69,769

Additional operating lease information:

	March 31, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.37 Years		6.43 Years
Weighted average discount rate:
Operating leases	9.43	%	9.46	%

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at March 31, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	19,961
2021		22,092
2022		18,422
2023		14,776
2024		12,372
Thereafter		30,268
Total lease payments		117,891
Less imputed interest		(41,264		)
Total lease liabilities		$	76,627

At March 31, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $6.1 million. For the three months ended March 31, 2020, we recognized sublease income of $0.3 million.

Leases

LEASES

We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commence upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. We anticipate taking delivery of the remaining six compressor packages when the compression units are completed, which is expected to occur during the second quarter of 2020. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the consummation of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Operating lease expense	$	5,148	$	5,044
Short-term lease expense	9,430		11,161
Total lease expense	$	14,578	$	16,205

Supplemental cash flow information:

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	5,949	$	4,657
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,844	$	3,257

Supplemental balance sheet information:

	March 31, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	75,344	$	68,131
Accrued liabilities and other	$	16,782	$	15,850
Operating lease liabilities	59,845		53,919
Total operating lease liabilities	$	76,627	$	69,769

Additional operating lease information:

	March 31, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.37 Years		6.43 Years
Weighted average discount rate:
Operating leases	9.43	%	9.46	%

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at March 31, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	19,961
2021		22,092
2022		18,422
2023		14,776
2024		12,372
Thereafter		30,268
Total lease payments		117,891
Less imputed interest		(41,264		)
Total lease liabilities		$	76,627

At March 31, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $6.1 million. For the three months ended March 31, 2020, we recognized sublease income of $0.3 million.

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Basis of Presentation and Significant Accounting Policies Basis of Presentation and Significant Accounting Policies (Notes)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization 

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We were incorporated in Delaware in 1981. We are composed of three divisions – Completion Fluids & Products, Water & Flowback Services, and Compression. Unless the context requires otherwise, when we refer to “we,” “us,” and “our,” we are describing TETRA Technologies, Inc. and its consolidated subsidiaries on a consolidated basis.

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended March 31, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary ("CCLP") as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA's capital structure and CCLP's capital structure are separate, and do not include cross default provisions, cross collateralization provisions, or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission ("SEC") and do not include all information and footnotes required by U.S. generally accepted accounting principles ("U.S. GAAP") for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Significant Accounting Policies

Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2019 included in our Annual Report on Form 10-K. There have been no significant changes in our accounting policies or the application thereof during the first quarter of 2020.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications

Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year's overall presentation.

Impairments and Other Charges

Impairments of long-lived assets, including identified intangible assets, are determined periodically when indicators of impairment are present. If such indicators are present, the determination of the amount of impairment is based on our judgment as to the future undiscounted operating cash flows to be generated from the relevant assets throughout their remaining estimated useful lives. If these undiscounted cash flows are less than the carrying amount of the related assets, an impairment is recognized for the excess of the carrying value over fair value. Fair value of intangible assets is generally determined using the discounted present value of future cash flows using discount rates commensurate with the risks inherent with the specific assets. Assets held for disposal are recorded at the lower of carrying value or estimated fair value less estimated selling costs. See Note 3 - "Impairments and Other Charges" for additional discussion of recorded impairments.

Revenue Recognition

Performance Obligations. Revenue is generally recognized when we transfer control of our products or services to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products or providing services to our customers. We receive cash equal to the invoice price for most sales of product and services and payment terms typically range from 30 to 60 days from the date we invoice our customer. Since the period between when we deliver products or services and when the customer pays for such products or services is not expected to exceed one year, we have elected not to calculate or disclose a financing component for our customer contracts.

Depending on the terms of the arrangement, we may also defer the recognition of revenue for a portion of the consideration received because we have to satisfy a future performance obligation. For example, consideration received from customers during the fabrication of new compressor packages is typically deferred until control of the compressor package is transferred to our customer.

For any arrangements with multiple performance obligations, we use management's estimated selling price to determine the stand-alone selling price for separate performance obligations. For revenue associated with mobilization of service equipment as part of a service contract arrangement, such revenue, if significant, is deferred and amortized over the estimated service period.

Product Sales. Product sales revenues are generally recognized when we ship products from our facility to our customer. The product sales for our Completion Fluids & Products Division consist primarily of clear brine fluids ("CBFs"), additives, and associated manufactured products. Product sales for our Water & Flowback Services Division are typically attributed to specific performance obligations within certain production testing service arrangements. Parts and equipment sales comprise the product sales for the Compression Division.

Services. Service revenues represent revenue recognized over time, as our customer arrangements typically provide agreed upon day-rates (monthly service rates for compression services) and we recognize service revenue based upon the number of days services have been performed. Service revenue recognized over time is associated with a majority of our Water & Flowback Services Division arrangements, compression service and aftermarket service contracts within our Compression Division, and a small portion of Completion Fluids & Products Division revenue that is associated with completion fluid service arrangements. With the exception of the initial terms of the compression services contracts for medium- and high-horsepower compressor packages of our Compression Division, our customer contracts are generally for terms of one year or less. The majority of the service arrangements in the Water & Flowback Services Division are for a period of 90 days or less.

Sales taxes, value added taxes, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We have elected to recognize the cost for freight and shipping costs as part of cost of product sales when control over our products (i.e. delivery) has transferred to the customer.

Use of Estimates. In recognizing revenue for variable consideration arrangements, the amount of variable consideration recognized is limited so that it is probable that significant amounts of revenues will not be reversed in future periods when the uncertainty is resolved. For products returned by the customer, we estimate the expected returns based on an analysis of historical experience. For volume discounts earned by the customer, we estimate the discount (if any) based on our estimate of the total expected volume of products sold or services to be provided to the customer during the discount period. In certain contracts for the sale of CBFs, we may agree to issue credits

for the repurchase of reclaimable used fluids from certain customers at an agreed price that is based on the condition of the fluids.

Contract Assets and Liabilities. We consider contract assets to be trade accounts receivable when we have an unconditional right to consideration and only the passage of time is required before payment is due. In certain instances, particularly those requiring customer specific documentation prior to invoicing, our invoicing of the customer is delayed until certain documentation requirements are met. In those cases, we recognize a contract asset rather than a billed trade accounts receivable until we are able to invoice the customer. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

We classify contract liabilities as unearned income in our consolidated balance sheets. Such deferred revenue typically results from advance payments received on orders for new compressor equipment prior to the time such equipment is completed and transferred to the customer in accordance with the customer contract. New equipment sales orders generally take less than twelve months to build and deliver.

Bill-and-Hold Arrangements. We design and fabricate compressor packages based on our customer’s specifications. In some cases, the customer will request us to hold the equipment, upon completion of the unit, until the job site is ready to receive the equipment. When this occurs, we along with the customer sign a bill-and-hold agreement, which outlines that the customer has title to the equipment, the equipment is ready for delivery, we cannot use the equipment or direct it to another customer, and we have a present right to payment. When those criteria have been met and the agreement is executed, we recognize the revenue on the equipment because control of the equipment has passed to our customer and our performance obligations are complete. Entering into these arrangements is something we have done as a courtesy for certain customers for many years. The equipment subject to the bill-and-hold agreements has generally been invoiced and paid for through progressive billings such that at the time the bill-and-hold agreement is executed, the majority of the contractual cash obligation of the customer has been received by us.

Operating Costs

Cost of product sales includes direct and indirect costs of manufacturing and producing our products, including raw materials, fuel, utilities, labor, overhead, repairs and maintenance, materials, services, transportation, warehousing, equipment rentals, insurance, and certain taxes. Cost of services includes operating expenses we incur in delivering our services, including labor, equipment rental, fuel, repair and maintenance, transportation, overhead, insurance, and certain taxes. We include in product sales revenues the reimbursements we receive from customers for shipping and handling costs. Shipping and handling costs are included in cost of product sales. Amounts we incur for “out-of-pocket” expenses in the delivery of our services are recorded as cost of services. Reimbursements for “out-of-pocket” expenses we incur in the delivery of our services are recorded as service revenues. Depreciation, amortization, and accretion includes depreciation expense for all of our facilities, equipment and vehicles, amortization expense on our intangible assets, and accretion expense related to our decommissioning and other asset retirement obligations.

We include in general and administrative expense all costs not identifiable to our specific product or service operations, including divisional and general corporate overhead, professional services, corporate office costs, sales and marketing expenses, insurance, and certain taxes. 

Foreign Currency Translation

We have designated the euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $1.9 million during the three months ended March 31, 2020, and $(1.2) million during the three months ended March 31, 2019, respectively.

Fair Value Measurements

We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain liabilities, including the liabilities for the warrants to purchase 11.2 million shares of our common stock (the "Warrants") and our foreign currency derivative contracts. Refer to Note 9 - "Fair Value Measurements" for further discussion.

Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, such as in the allocation of purchase consideration for acquisition transactions to the assets and liabilities acquired, including intangible assets and goodwill (a Level 3 fair value measurement), the initial recording of our asset retirement obligations, and for the impairment of long-lived assets, including goodwill (a Level 3 fair value measurement).

New Accounting Pronouncements

Standards adopted in 2020

In August 2018, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2018-15, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract." ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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Industry Segments - Revenue, Income from Operations, and Assets by Reporting Segment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Industry Segments Details [Line Items]
Revenues	$ 222,942	$ 243,728
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(9,077)	(17,065)
Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	75,237	61,581
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	19,396	6,186
Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	57,467	78,678
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(2,244)	2,231
Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	90,238	103,469
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(12,790)	(7,801)
Interdivision Eliminations [Member]
Industry Segments Details [Line Items]
Revenues	0	0
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	5	6
Corporate Overhead [Member]
Industry Segments Details [Line Items]
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(13,444)	(17,687)
Product [Member]
Industry Segments Details [Line Items]
Revenues	85,033	91,781
Product [Member] | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	70,190	57,328
Product [Member] | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	25	364
Product [Member] | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	14,818	34,089
Service [Member]
Industry Segments Details [Line Items]
Revenues	137,909	151,947
Service [Member] | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	5,047	4,253
Service [Member] | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	57,442	78,314
Service [Member] | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	$ 75,420	$ 69,380

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Revenue from Contracts with Customers Services (Details) $ in Millions	Mar. 31, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining credits expected to be issued	$ 5.6

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Impairments and Other Charges (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($)
Asset Impairment Charges [Abstract]
Impairment charges	$ 5.4

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Long-Term Debt and Other Borrowings

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Long-Term Debt and Other Borrowings

LONG-TERM DEBT AND OTHER BORROWINGS

We believe our capital structure, excluding CCLP, ("TETRA") and CCLP's capital structure should be considered separately, as there are no cross default provisions, cross collateralization provisions, or cross guarantees between CCLP's debt and TETRA's debt.

Consolidated long-term debt as of March 31, 2020 and December 31, 2019, consists of the following:

		March 31, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $1.3 million as of March 31, 2020 and $1.0 million as of December 31, 2019)	September 2023	$	2,246	$	—
Term credit agreement (presented net of the unamortized discount of $6.2 million as of March 31, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $9.2 million as of March 31, 2020 and $9.5 million as of December 31, 2019)	September 2025	205,167		204,633
TETRA total debt		207,413		204,633
Less current portion		—		—
TETRA total long-term debt		$	207,413	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0.8 million as of March 31, 2020 and $0.9 million of December 31, 2019)	June 2023	2,184		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $1.5 million as of March 31, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $2.6 million as of March 31, 2020 and $2.8 million as of December 31, 2019)	August 2022	291,863		291,444
CCLP 7.50% Senior Secured Notes (presented net of unamortized deferred financing costs of $5.6 million as of March 31, 2020 and $5.8 million as of December 31, 2019)	April 2025	344,382		344,172
CCLP total debt		638,429		638,238
Less current portion		—		—
CCLP total long-term debt		$	638,429	$	638,238
Consolidated total long-term debt		$	845,842	$	842,871

As of March 31, 2020, TETRA had a $3.5 million outstanding balance and $7.9 million in letters of credit against its asset-based credit agreement ("ABL Credit Agreement"). As of March 31, 2020, subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement that may limit borrowings, TETRA had an availability of $40.8 million under this agreement. There was a $3.0 million balance outstanding and $3.0 million in letters of credit against the CCLP asset-based credit agreement ("CCLP Credit Agreement") as of March 31, 2020. As of March 31, 2020, and subject to compliance with the covenants, borrowing base, and other provisions of the CCLP Credit Agreement that may limit borrowings, CCLP had availability of $20.4 million.

TETRA and CCLP credit and senior note agreements contain certain affirmative and negative covenants, including covenants that restrict the ability to pay dividends or other restricted payments. TETRA and CCLP are both in compliance with all covenants of their respective credit and senior note agreements as of March 31, 2020.

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Revenue from Contracts with Customers (Notes)

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

REVENUE FROM CONTRACTS WITH CUSTOMERS

As of March 31, 2020, we had $56.7 million of remaining contractual performance obligations for compression services. As a practical expedient, this amount does not reflect revenue for compression service contracts whose original expected duration is less than twelve months and does not consider the effects of the time value of money. Expected revenue to be recognized in the future as of March 31, 2020 for completion of performance obligations of compression service contracts are as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	38,720	$	15,941	$	2,026	$	54	$	—	$	56,741

For sales of CBFs where we have agreed to issue credits for the repurchase of reclaimable used fluids at an agreed price based on the condition of the fluid upon return, we adjust the revenue recognized in the period of shipment by an estimated amount, based on historical experience, of the credit expected to be issued. As of March 31, 2020, the amount of remaining credits expected to be issued for the repurchase of reclaimable used fluids was $5.6 million recorded in inventory (right of return asset) and either accounts payable or as a reduction to accounts receivable. There were no material differences between amounts recognized during the three month period ended March 31, 2020, compared to estimates made in a prior period from these variable consideration arrangements.

Our contract asset balances, primarily associated with customer documentation requirements, were $33.3 million and $34.9 million as of March 31, 2020 and December 31, 2019, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

Collections primarily associated with progressive billings to customers for the construction of compression equipment is included in unearned income in the consolidated balance sheets. The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678		$	25,333
Additional unearned income	23,869			49,363
Revenue recognized	(5,767		)	(24,858		)
Unearned income, end of period	$	27,780		$	49,838

During the three month period ended March 31, 2020, we recognized product sales revenue of $2.9 million from unearned income that was deferred as of December 31, 2019. During the three months ended March 31, 2019, we recognized product sales revenue of $11.0 million from unearned income that was deferred as of December 31, 2018.

As of March 31, 2020, contract costs were immaterial.

We disaggregate revenue from contracts with customers into Product Sales and Services within each segment, as noted in our three reportable segments in Note 11. In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	$	37,958	$	31,606
International	37,279		29,975
	75,237		61,581
Water & Flowback Services
U.S.	54,384		73,199
International	3,083		5,479
	57,467		78,678
Compression
U.S.	80,599		93,517
International	9,639		9,952
	90,238		103,469
Total Revenue
U.S.	172,941		198,322
International	50,001		45,406
	$	222,942	$	243,728

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC ("Orinoco") that provided for the purchase by Orinoco of Maritech's remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

Pursuant to a Bonding Agreement entered into as part of these transactions (the "Bonding Agreement"), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were

payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million during the quarter ended September 30, 2019. The Epic Promissory Note became due on December 31, 2019 but neither Epic nor the Clarkes made the required payment. Upon the default by Epic and the Clarkes, we filed a lawsuit against the Clarkes on January 15, 2020 in Montgomery County, Texas for breach of the Clarke Promissory Note Guaranty Agreement, seeking the amounts due under the Epic Promissory Note and related interest, as well as attorneys’ fees and expenses. The Clarkes each filed an answer and counterclaims for fraud and negligent misrepresentation and seek monetary damages in excess of $1 million, punitive damages, and attorneys’ fees. We will vigorously prosecute our claim and defend against the claims by the Clarkes.

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (10,376)	$ (19,100)
Foreign currency translation adjustment, net of taxes of $0 in 2019 and 2018	(6,467)	(406)
Comprehensive income	(16,843)	(19,506)
Comprehensive (income) loss attributable to noncontrolling interest	9,054	8,086
Comprehensive income (loss) attributable to TETRA stockholders	$ (7,789)	$ (11,420)

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating activities:
Net income (loss)	$ (10,376)	$ (19,100)
Reconciliation of net income (loss) to cash provided by (used in) operating activities:
Depreciation, amortization, and accretion	29,460	30,627
Impairment of Long-Lived Assets Held-for-use	5,371	146
Provision (benefit) for deferred income taxes	55	229
Equity-based compensation expense	784	2,165
Provision for doubtful accounts	1,380	627
Amortization of deferred financing costs	569	1,292
Liabilities, Fair Value Adjustment	0	2,159
Fair Value Adjustment of Warrants	(337)	407
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability	0	(400)
Gain on sale of assets	(833)	(201)
Changes in operating assets and liabilities, net of assets acquired:
Accounts receivable	3,601	2,353
Inventories	(12,414)	(15,809)
Prepaid expenses and other current assets	(2,442)	(3,222)
Trade accounts payable and accrued expenses	8,742	6,638
Other	(1,384)	(499)
Net cash provided by (used in) operating activities	22,176	7,412
Investing activities:
Payments to Acquire Property, Plant, and Equipment	12,390	32,409
Proceeds on sale of property, plant, and equipment	1,425	364
Other investing activities	350	319
Net cash provided by (used in) investing activities	(10,615)	(31,726)
Financing activities:
Proceeds from long-term debt	56,512	66,000
Principal payments on long-term debt	(54,511)	(35,451)
CCLP distributions	(309)	(307)
Redemptions of CCLP Series A Preferred	0	(8,346)
Tax remittances on equity based compensation	(319)	(429)
Debt issuance costs and other financing activities	(235)	(155)
Net cash provided by (used in) financing activities	1,138	21,312
Effect of exchange rate changes on cash	(940)	(167)
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect	11,759	(3,169)
Cash, cash equivalents, and restricted cash	29,527	36,933
Supplemental cash flow information:
Interest paid	15,421	15,544
Income taxes paid	$ 1,479	$ 1,644

XML

Fair Value Measurements Market Risks and Derivative Hedge Contracts (Tables)

3 Months Ended

Mar. 31, 2020

Derivative [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions Table

Derivative Contracts	US Dollar Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	$	8,167	1.08	4/21/2020
Forward purchase Euro	10,497		1.10	4/21/2020
Forward purchase pounds sterling	9,400		1.17	4/21/2020
Forward sale pounds sterling	500		1.18	4/21/2020
Forward sale pounds sterling	1,875		1.17	4/21/2020
Forward sale Norwegian krone	1,000		11.76	4/21/2020
Forward purchase Norwegian krone	4,300		11.36	4/21/2020
Forward sale Mexican peso	4,974		24.40	4/21/2020

Derivative Contracts	British Pound Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	£	3,445	0.92	4/21/2020

Derivative Contracts	Swedish Krona Notional Amount			Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro		210	kr	10.90	4/6/2020
Forward purchase Euro		66,690	kr	10.91	4/6/2020
Forward purchase Euro		2,400	kr	11.24	4/21/2020

Derivatives Designated as Hedging Instruments Table

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at March 31, 2020			Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	1,160		$	86
Forward sale contracts	Current liabilities	(433		)	(53		)
Forward purchase contracts	Current liabilities	(181		)	(3		)
Net asset (liability)		$	546		$	30

XML

Revenue from Contracts with Customers (Tables)

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block]

as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	38,720	$	15,941	$	2,026	$	54	$	—	$	56,741

Summary of Changes in Contract Liabilities

The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678		$	25,333
Additional unearned income	23,869			49,363
Revenue recognized	(5,767		)	(24,858		)
Unearned income, end of period	$	27,780		$	49,838

Disaggregation of Revenue [Table Text Block]

In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	$	37,958	$	31,606
International	37,279		29,975
	75,237		61,581
Water & Flowback Services
U.S.	54,384		73,199
International	3,083		5,479
	57,467		78,678
Compression
U.S.	80,599		93,517
International	9,639		9,952
	90,238		103,469
Total Revenue
U.S.	172,941		198,322
International	50,001		45,406
	$	222,942	$	243,728

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Leases - Additional Information (Details)	Mar. 31, 2020	Dec. 31, 2019
Weighted average remaining lease term:
Operating leases	6 years 4 months 13 days	6 years 5 months 4 days
Weighted average discount rate:
Operating leases	9.43%	9.46%

XML

Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Aug. 31, 2019	Mar. 01, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	$ 0	$ 0
Disposal Group, Including Discontinued Operation, Cost of Revenue	(60)	22
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	0
Disposal Group, Including Discontinued Operation, General and Administrative Expense	205	404
Disposal Group, Including Discontinued Operation, Other Income		0
Disposal Group, Including Discontinued Operation, Other Expense	0
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	(145)	(426)
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax	0	0
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax	(145)	(426)
Discontinued Operation, Tax Effect of Discontinued Operation	0	0
Income (Loss) from Discontinued Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(145)	(426)
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		$ 0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	1,303		1,233
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	708		865
Disposal Group, Including Discontinued Operation, Liabilities, Current	2,011		2,098
Maritech [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	0	0
Disposal Group, Including Discontinued Operation, Cost of Revenue	0	0
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	0
Disposal Group, Including Discontinued Operation, General and Administrative Expense	0	0
Disposal Group, Including Discontinued Operation, Other Expense	0	0
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	0	0
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	0		0
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	228		120
Disposal Group, Including Discontinued Operation, Liabilities, Current	228		120
Offshore Services [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	0	0
Disposal Group, Including Discontinued Operation, Cost of Revenue	(60)	22
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	0
Disposal Group, Including Discontinued Operation, General and Administrative Expense	205	404
Disposal Group, Including Discontinued Operation, Other Income		0
Disposal Group, Including Discontinued Operation, Other Expense	0
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	(145)	$ (426)
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	1,303		1,233
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	480		745
Disposal Group, Including Discontinued Operation, Liabilities, Current	$ 1,783		$ 1,978
Discontinued Operations, Disposed of by Sale | Offshore Division
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group, Including Discontinued Operation, Reserve, Other Receivables				$ 1,500
Disposal Group, Including Discontinued Operation, Consideration, Additional Receivable					$ 7,500

XML

Industry Segments Additional Details (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)
Industry Segments Details [Line Items]
Number of Reportable Segments	3
Revenues	$ 222,942	$ 243,728
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(9,077)	(17,065)
General and administrative expense	30,537	34,277
Depreciation, amortization, and accretion	29,460	30,628
Interest expense, net	17,856	18,379
Fair Value Adjustment of Warrants	(337)	407
Other Nonoperating Income (Expense)	(439)	951
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(10,231)	(18,674)
Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	75,237	61,581
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	19,396	6,186
Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	57,467	78,678
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(2,244)	2,231
Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	90,238	103,469
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(12,790)	(7,801)
Interdivision Eliminations [Member]
Industry Segments Details [Line Items]
Revenues	0	0
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	5	6
Corporate Overhead [Member]
Industry Segments Details [Line Items]
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(13,444)	(17,687)
General and administrative expense	8,081	12,089
Depreciation, amortization, and accretion	197	168
Interest expense, net	5,455	5,342
Fair Value Adjustment of Warrants	(338)	407
Other Nonoperating Income (Expense)	(49)	319
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(13,444)	(17,687)
Product [Member]
Industry Segments Details [Line Items]
Revenues	85,033	91,781
Product [Member] | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	70,190	57,328
Product [Member] | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	25	364
Product [Member] | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	14,818	34,089
Service [Member]
Industry Segments Details [Line Items]
Revenues	137,909	151,947
Service [Member] | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	5,047	4,253
Service [Member] | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	57,442	78,314
Service [Member] | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	$ 75,420	$ 69,380

XML

Market Risks and Derivative Hedge Contracts (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)
Derivatives, Fair Value [Line Items]
Forward purchase contracts	$ 546		$ 30
Net gains associated with foreign currency derivatives	(1,000)	$ 600
Impairment charges	$ 5,400
Compressco Partners Senior Notes [Member]
Derivatives, Fair Value [Line Items]
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate	7.25%
Fair value of Senior Notes	$ 148,000		266,000
Carrying value of Senior Notes	$ 295,900		295,900
Compressco Partners Senior Notes 7.50% [Member]
Derivatives, Fair Value [Line Items]
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate	7.50%
Fair value of Senior Notes	$ 239,800		344,800
Fair Value, Recurring [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	20,080		(419)
Foreign Currency Contract, Asset, Fair Value Disclosure	1,160		86
Foreign Currency Contracts, Liability, Fair Value Disclosure	614		56
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	0		0
Foreign Currency Contracts, Liability, Fair Value Disclosure	0		0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	1,160		86
Foreign Currency Contracts, Liability, Fair Value Disclosure	614		56
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	0		0
Foreign Currency Contracts, Liability, Fair Value Disclosure	0		0
Current Assets [Member]
Derivatives, Fair Value [Line Items]
Forward sale contracts	(1,160)		(86)
Current Liabilities [Member]
Derivatives, Fair Value [Line Items]
Forward sale contracts	(433)		(53)
Forward purchase contracts	(181)		(3)
Mandatorily Redeemable Preferred Stock [Member] | Fair Value, Recurring [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	19,646
Mandatorily Redeemable Preferred Stock [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0
Mandatorily Redeemable Preferred Stock [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0
Mandatorily Redeemable Preferred Stock [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	19,646
Warrant [Member] | Fair Value, Recurring [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	(112)		(449)
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0		0
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0		0
Warrant [Member] | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	(112)		$ (449)
Forward Purchase Contract, Euro, Swedish Krona Notional Amount [3] [Member]
Derivative [Line Items]
Derivative notional amount	$ 2,400
Traded exchange rate	11.24
Value date	Apr. 21, 2020
Forward Purchase Contract, Euro [Member]
Derivative [Line Items]
Derivative notional amount	$ 8,167
Traded exchange rate	1.08
Value date	Apr. 21, 2020
Forward Purchase Contract, Euros, Two [Member]
Derivative [Line Items]
Derivative notional amount	$ 10,497
Traded exchange rate	1.10
Value date	Apr. 21, 2020
Forward Purchase Contract, Pounds Sterling [Member]
Derivative [Line Items]
Derivative notional amount	$ 9,400
Traded exchange rate	1.17
Value date	Apr. 21, 2020
Forward Sale Contract, Pounds Sterling [Member]
Derivative [Line Items]
Derivative notional amount	$ 500
Traded exchange rate	1.18
Value date	Apr. 21, 2020
Forward Sale Contract, Pounds Sterling [Two] [Member]
Derivative [Line Items]
Derivative notional amount	$ 1,875
Traded exchange rate	1.17
Value date	Apr. 21, 2020
Forward Sale Contract, Norwegian krone [Domain]
Derivative [Line Items]
Derivative notional amount	$ 1,000
Traded exchange rate	11.76
Value date	Apr. 21, 2020
Forward Sale Contract, Norwegian Krone [Member]
Derivative [Line Items]
Derivative notional amount	$ 4,300
Traded exchange rate	11.36
Value date	Apr. 21, 2020
Forward Sale Contract, Mexican Pesos (2) [Member]
Derivative [Line Items]
Derivative notional amount	$ 4,974
Traded exchange rate	24.40
Value date	Apr. 21, 2020
Forward Purchase Contract, Euro, British Pound Notional Amount [Member]
Derivative [Line Items]
Derivative notional amount	$ 3,445
Traded exchange rate	0.92
Value date	Apr. 21, 2020
Forward Purchase Contract, Euro [Member]
Derivative [Line Items]
Derivative notional amount	$ 210
Traded exchange rate	10.90
Value date	Apr. 06, 2020
Forward Purchase Contract, Euro, Swedish Krona Notional Amount [2] [Member]
Derivative [Line Items]
Derivative notional amount	$ 66,690
Traded exchange rate	10.91
Value date	Apr. 06, 2020

XML

Market Risks and Derivative Hedge Contracts

3 Months Ended

Mar. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Hedge Contracts

FAIR VALUE MEASUREMENTS

Financial Instruments

Warrants

The Warrants are valued using a Black Scholes option valuation model that includes implied volatility of the trading price (a Level 3 fair value measurement).

Derivative Contracts

We and CCLP each enter into short term foreign currency forward derivative contracts with third parties as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. As of March 31, 2020, we and CCLP had the following foreign currency derivative contracts outstanding relating to portions of our foreign operations:

Derivative Contracts	US Dollar Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	$	8,167	1.08	4/21/2020
Forward purchase Euro	10,497		1.10	4/21/2020
Forward purchase pounds sterling	9,400		1.17	4/21/2020
Forward sale pounds sterling	500		1.18	4/21/2020
Forward sale pounds sterling	1,875		1.17	4/21/2020
Forward sale Norwegian krone	1,000		11.76	4/21/2020
Forward purchase Norwegian krone	4,300		11.36	4/21/2020
Forward sale Mexican peso	4,974		24.40	4/21/2020

Derivative Contracts	British Pound Notional Amount		Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro	£	3,445	0.92	4/21/2020

Derivative Contracts	Swedish Krona Notional Amount			Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward purchase Euro		210	kr	10.90	4/6/2020
Forward purchase Euro		66,690	kr	10.91	4/6/2020
Forward purchase Euro		2,400	kr	11.24	4/21/2020

Under this program, we and CCLP may enter into similar derivative contracts from time to time. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative contracts during a period will be included in the determination of earnings for that period.

The fair values of foreign currency derivative contracts are based on quoted market values (a Level 2 fair value measurement). The fair values of our and CCLP's foreign currency derivative contracts as of March 31, 2020

and December 31, 2019, are as follows:

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at March 31, 2020			Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	1,160		$	86
Forward sale contracts	Current liabilities	(433		)	(53		)
Forward purchase contracts	Current liabilities	(181		)	(3		)
Net asset (liability)		$	546		$	30

None of our foreign currency derivative contracts contain credit risk related contingent features that would require us to post assets or collateral for contracts that are classified as liabilities. During the three months ended March 31, 2020 and March 31, 2019, we recognized $(1.0) million and $0.6 million of net (gains) losses, respectively, reflected in other (income) expense, net, associated with our foreign currency derivative program.

During the first quarter of 2020, we recorded impairments of approximately $5.4 million, reflecting the decreased fair value for certain assets. The fair values used in these impairment calculations were estimated based on a market approach, which is based on significant unobservable inputs (Level 3) in accordance with the fair value hierarchy.

Recurring and nonrecurring fair value measurements by valuation hierarchy as of March 31, 2020 and December 31, 2019, are as follows:

				Fair Value Measurements Using
	Total as of			Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Description	March 31, 2020			(Level 1)		(Level 2)			(Level 3)
	(In Thousands)
Midland manufacturing facility and related assets	$	19,646		$	—	$	—		$	19,646
Warrants liability	(112		)	—		—			(112		)
Asset for foreign currency derivative contracts	1,160			—		1,160			—
Liability for foreign currency derivative contracts	(614		)	—		(614		)	—
Net asset	$	20,080

				Fair Value Measurements Using
	Total as of			Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs			Significant Unobservable Inputs
Description	December 31, 2019			(Level 1)		(Level 2)			(Level 3)
	(In Thousands)
Warrants liability	$	(449	)	$	—	$	—		$	(449	)
Asset for foreign currency derivative contracts	86			—		86			—
Liability for foreign currency derivative contracts	(56		)	—		(56		)	—
Net liability	$	(419	)

The fair values of cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, short-term borrowings and long-term debt pursuant to TETRA's ABL Credit Agreement and Term Credit Agreement, and the CCLP Credit Agreement approximate their carrying amounts. The fair values of the publicly traded CCLP 7.25% Senior Notes at March 31, 2020 and December 31, 2019, were approximately $148.0 million and $266.0 million, respectively. Those fair values compare to the face amount of $295.9 million both at March 31, 2020 and December 31, 2019. The fair values of the CCLP 7.50% Senior Secured Notes at March 31, 2020 and December 31, 2019 were approximately $239.8 million and $344.8 million, respectively. These fair values compare

to aggregate principal amount of such notes at both March 31, 2020 and December 31, 2019, of $350.0 million. We based the fair values of the CCLP 7.25% Senior Notes and the CCLP 7.50% Senior Secured Notes as of March 31, 2020 on recent trades for these notes.

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Inventories

3 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

Inventories

INVENTORIES

Components of inventories as of March 31, 2020 and December 31, 2019 are as follows: 

	March 31, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	67,824	$	70,135
Raw materials	3,886		4,125
Parts and supplies	38,859		47,793
Work in progress	31,547		14,457
Total inventories	$	142,116	$	136,510

Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling. Work in progress inventory consists primarily of new compressor packages located at our Compression Division manufacturing facility in Midland, Texas.

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Basis of Presentation and Significant Accounting Policies Basis of Presentation and Significant Accounting Policies - Additional Information (Details) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($) shares	Mar. 31, 2019 USD ($)
Accounting Policies [Abstract]
Number of Operating Segments	3
Foreign Currency Transaction Gain (Loss), Realized | $	$ 1.9	$ (1.2)
Class of Warrant or Right, Outstanding | shares	11.2

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Revenue from Contracts with Customers Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Disaggregation of Revenue [Line Items]
Revenues	$ 222,942	$ 243,728
Remaining credits expected to be issued	5,600
UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	172,941	198,322
Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	50,001	45,406
Completion Fluids & Products Division [Member]
Disaggregation of Revenue [Line Items]
Revenues	75,237	61,581
Completion Fluids & Products Division [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	37,958	31,606
Completion Fluids & Products Division [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	37,279	29,975
Water & Flowback Services [Member]
Disaggregation of Revenue [Line Items]
Revenues	57,467	78,678
Water & Flowback Services [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	54,384	73,199
Water & Flowback Services [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	3,083	5,479
Compression Division [Member]
Disaggregation of Revenue [Line Items]
Revenues	90,238	103,469
Compression Division [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	80,599	93,517
Compression Division [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	9,639	9,952
Interdivision Eliminations [Member]
Disaggregation of Revenue [Line Items]
Revenues	$ 0	$ 0

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Leases - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($)
Lessee, Lease, Description [Line Items]
Operating lease, initial lease term	15 years
Lessee, operating lease, liability, payments, net of sublease income, due	$ 6.1
Sublease income	$ 0.3
Minimum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease term	16 years

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Label	Element	Value
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	$ 40,102,000
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	$ 17,768,000

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Industry Segments (Tables)

3 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Segment Reporting Table

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	70,190		$	57,328
Water & Flowback Services Division	25			364
Compression Division	14,818			34,089
Consolidated	$	85,033		$	91,781
Services
Completion Fluids & Products Division	$	5,047		$	4,253
Water & Flowback Services Division	57,442			78,314
Compression Division	75,420			69,380
Consolidated	$	137,909		$	151,947
Total revenues
Completion Fluids & Products Division	$	75,237		$	61,581
Water & Flowback Services Division	57,467			78,678
Compression Division	90,238			103,469
Interdivision eliminations	—			—
Consolidated	$	222,942		$	243,728
Income (loss) before taxes
Completion Fluids & Products Division	$	19,396		$	6,186
Water & Flowback Services Division	(2,244		)	2,231
Compression Division	(12,790		)	(7,801		)
Interdivision eliminations	5			6
Corporate Overhead(1)	(13,444		)	(17,687		)
Consolidated	$	(9,077	)	$	(17,065	)

(1) Amounts reflected include the following general corporate expenses:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
General and administrative expense	$	8,081		$	12,089
Depreciation and amortization	197			168
Interest expense	5,455			5,342
Warrants fair value adjustment (income) expense	(338		)	407
Other general corporate (income) expense, net	49			(319		)
Total	$	13,444		$	17,687

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Cover Page - shares	3 Months Ended
	Mar. 31, 2020	May 06, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2020
Document Transition Report	false
Entity File Number	1-13455
Entity Registrant Name	TETRA Technologies, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	74-2148293
Entity Address, Address Line One	24955 Interstate 45 North
Entity Address, City or Town	The Woodlands,
Entity Address, Postal Zip Code	77380
Entity Address, State or Province	TX
City Area Code	281
Local Phone Number	367-1983
Title of 12(b) Security	Common Stock
Trading Symbol	TTI
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Common Stock Shares Outstanding		125,898,683
Entity Central Index Key	0000844965
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

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Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 29,473	$ 17,704
Restricted cash	53	64
Trade accounts receivable, net of allowances	169,231	176,291
Inventories	142,116	136,510
Disposal Group, Including Discontinued Operation, Assets, Current	0	0
Prepaid expenses and other current assets	23,107	20,785
Total current assets	363,980	351,354
Property, plant, and equipment:
Land and building	57,357	60,586
Machinery and equipment	1,347,642	1,335,157
Automobiles and trucks	30,052	31,681
Chemical plants	58,327	57,692
Construction in progress	24,760	34,393
Total property, plant, and equipment	1,518,138	1,519,509
Less accumulated depreciation	(777,891)	(760,872)
Net property, plant, and equipment	740,247	758,637
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization	72,104	74,199
Deferred tax assets, net	24	24
Operating lease right-of-use assets	75,344	68,131
Other assets	18,065	19,577
Total other assets	165,537	161,931
Total assets	1,269,764	1,271,922
Current liabilities:
Trade accounts payable	88,204	88,917
Unearned income	28,422	9,831
Accrued liabilities	76,559	87,877
Disposal Group, Including Discontinued Operation, Liabilities, Current	2,011	2,098
Total current liabilities	195,196	188,723
Long-term debt, net	845,842	842,871
Deferred income taxes	2,762	2,988
Decommissioning and other asset retirement obligations, net	12,878	12,762
Warranty Liability	112	449
Operating lease liabilities	59,845	53,919
Other liabilities	6,198	7,384
Total long-term liabilities	927,637	920,373
Equity:
Common stock, par value $0.01 per share	1,287	1,283
Additional paid-in capital	468,088	466,959
Treasury stock, at cost	(19,253)	(19,164)
Accumulated other comprehensive income (loss)	(58,421)	(52,183)
Retained earnings	(364,073)	(362,522)
Total TETRA stockholders' equity	27,628	34,373
Noncontrolling interests	119,303	128,453
Total equity	146,931	162,826
Total liabilities and equity	$ 1,269,764	$ 1,271,922

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Leases (Tables)

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Lease, Cost

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Operating lease expense	$	5,148	$	5,044
Short-term lease expense	9,430		11,161
Total lease expense	$	14,578	$	16,205

Supplemental cash flow information:

	Three Months Ended March 31,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	5,949	$	4,657
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	11,844	$	3,257

Assets and Liabilities, Lessee

upplemental balance sheet information:

	March 31, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	75,344	$	68,131
Accrued liabilities and other	$	16,782	$	15,850
Operating lease liabilities	59,845		53,919
Total operating lease liabilities	$	76,627	$	69,769

Additional operating lease information:

	March 31, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.37 Years		6.43 Years
Weighted average discount rate:
Operating leases	9.43	%	9.46	%

Lessee, Operating Lease, Liability, Maturity

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at March 31, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	19,961
2021		22,092
2022		18,422
2023		14,776
2024		12,372
Thereafter		30,268
Total lease payments		117,891
Less imputed interest		(41,264		)
Total lease liabilities		$	76,627

Finance Lease, Liability, Maturity

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at March 31, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	19,961
2021		22,092
2022		18,422
2023		14,776
2024		12,372
Thereafter		30,268
Total lease payments		117,891
Less imputed interest		(41,264		)
Total lease liabilities		$	76,627

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Subsequent Events (Notes)

3 Months Ended

Mar. 31, 2020

Subsequent Events [Abstract]

Subsequent Events

SUBSEQUENT EVENTS

In April 2020, we announced our plan to shutdown our Midland manufacturing facility as a result of a decline in orders for new equipment from third parties and the expectation that no incremental equipment will be fabricated for our fleet in the second half of 2020. As a result of the decision to close this facility and solely utilize third party fabricators in the future for our own service fleet, we are pursuing the sale of the Midland facility in an effort to further improve our balance sheet, and have entered into an agreement with a third party purchaser, which

is subject to numerous conditions. While we will continue to operate the facility until the completion and sale of our remaining backlog, we no longer intend to fabricate new compressor packages for sales to third parties. We have and will continue to evaluate the sale of other non-core assets, including our low-horsepower compression fleet. We can provide no assurance that we will consummate a sale of the Midland manufacturing facility, our low-horsepower compression fleet, or any other non-core asset.

In April 2020, we began the process of discontinuing chemical production operations at our El Dorado, Arkansas production facility, which primarily produced calcium chloride from underground brine reserves. The current COVID-19 pandemic and oil oversupply events have led to unprecedented market conditions and this facility’s relatively high fixed costs have led us to rationalize our manufacturing base. We will continue to manufacture and deliver all products through early June 2020, at which time we will begin a sequenced shutdown of the manufacturing facility. We will continue to ship product until the inventory is gone, at which time production operations at the plant will be shutdown. Going forward, we will continue to meet our customer demand for liquid calcium chloride products through our network of other manufacturing plants and terminals.

On April 17, 2020, CCLP announced the commencement of an offer (the "Exchange Offer") to certain eligible noteholders ("Eligible Holders") to exchange any and all of their outstanding 7.25% Senior Notes due 2022 (the “Unsecured Notes”) for newly issued 7.50% Senior Secured First Lien Notes due 2025 and 7.25% Senior Secured Second Lien Notes due 2027. In conjunction with the offer, consents are being solicited from Eligible Holders to eliminate substantially all restrictive covenants and certain of the default provisions in the indenture governing the Unsecured Notes.

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Consolidated Statement of Equity Consolidated Statement of Equity (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Stockholders' Equity [Abstract]
Translation adjustment, tax	$ 0	$ 0

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Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$ 5,949	$ 4,657
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$ 11,844	$ 3,257

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Long-Term Debt and Other Borrowings Schedule of Long Term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Long-term Debt, Excluding Current Maturities	$ 845,842	$ 842,871
New Credit Agreement [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Fair Value of Amount Outstanding	3,000
Long-term Debt	2,184	2,622
Compressco Partners Senior Notes [Member]
Debt Instrument [Line Items]
Long-term Debt	291,863	291,444
Compressco Partners Senior Notes 7.50% [Member]
Debt Instrument [Line Items]
Long-term Debt	344,382	344,172
Parent Company [Member]
Debt Instrument [Line Items]
Long-term Debt	207,413	204,633
Long-term Debt, Current Maturities	0	0
Long-term Debt, Excluding Current Maturities	207,413	204,633
Parent Company [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Fair Value of Amount Outstanding	3,500
CSI Compressco [Member]
Debt Instrument [Line Items]
Long-term Debt	638,429	638,238
Revolving Credit Facility [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term Debt	2,246	0
Term Loan [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term Debt	$ 205,167	$ 204,633

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Net Income (Loss) per Share (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Earnings Per Share [Abstract]
Weighted Average Number of Shares Outstanding, Basic	125,587	125,681
Weighted Average Number Diluted Shares Outstanding Adjustment	0	0
Weighted Average Number of Shares Outstanding, Diluted	125,587	125,681

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Inventories (Tables)

3 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

Components of inventories as of March 31, 2020 and December 31, 2019 are as follows: 

	March 31, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	67,824	$	70,135
Raw materials	3,886		4,125
Parts and supplies	38,859		47,793
Work in progress	31,547		14,457
Total inventories	$	142,116	$	136,510

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Industry Segments

3 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Industry Segments

INDUSTRY SEGMENTS

We manage our operations through three Divisions: Completion Fluids & Products, Water & Flowback Services, and Compression.

 Summarized financial information concerning the business segments is as follows:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	70,190		$	57,328
Water & Flowback Services Division	25			364
Compression Division	14,818			34,089
Consolidated	$	85,033		$	91,781
Services
Completion Fluids & Products Division	$	5,047		$	4,253
Water & Flowback Services Division	57,442			78,314
Compression Division	75,420			69,380
Consolidated	$	137,909		$	151,947
Total revenues
Completion Fluids & Products Division	$	75,237		$	61,581
Water & Flowback Services Division	57,467			78,678
Compression Division	90,238			103,469
Interdivision eliminations	—			—
Consolidated	$	222,942		$	243,728
Income (loss) before taxes
Completion Fluids & Products Division	$	19,396		$	6,186
Water & Flowback Services Division	(2,244		)	2,231
Compression Division	(12,790		)	(7,801		)
Interdivision eliminations	5			6
Corporate Overhead(1)	(13,444		)	(17,687		)
Consolidated	$	(9,077	)	$	(17,065	)

(1) Amounts reflected include the following general corporate expenses:

	Three Months Ended March 31,
	2020			2019
	(In Thousands)
General and administrative expense	$	8,081		$	12,089
Depreciation and amortization	197			168
Interest expense	5,455			5,342
Warrants fair value adjustment (income) expense	(338		)	407
Other general corporate (income) expense, net	49			(319		)
Total	$	13,444		$	17,687

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Consolidated Statement of Equity Statement - USD ($) $ in Thousands	Total	Common Stock Value [Member]	Additional Paid-in Capital [Member]	Treasury Stock [Member]	Accumulated Foreign Currency Adjustment Attributable to Parent [Member]	Retained Earnings [Member]	Noncontrolling Interest [Member]
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 312,749	$ 1,285	$ 460,680	$ (18,950)	$ (51,663)	$ (217,952)	$ 139,349
Net Income (Loss) Attributable to Parent	(10,838)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(19,100)						(8,262)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	(406)				(582)		176
Other Comprehensive Income (Loss), Net of Tax	(19,506)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(307)						307
Noncontrolling Interest, Increase from Subsidiary Equity Issuance		(1)
Proceeds from Issuance of Common Stock	(1)
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures	(155)			(155)
APIC, Share-based Payment Arrangement, Increase for Cost Recognition	1,939		1,628				311
Conversion of CCLP Preferred Stock, Amount Converted	2,539						2,539
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests	9		67				76
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	300,110	1,284	462,241	(19,105)	(52,245)	(225,947)	133,882
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	162,826	1,283	466,959	(19,164)	(52,183)	(362,522)	128,453
Net Income (Loss) Attributable to Parent	(1,551)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(10,376)						(8,825)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	(6,467)				(6,238)		(229)
Other Comprehensive Income (Loss), Net of Tax	(16,843)
Noncontrolling Interest, Decrease from Distributions to Noncontrolling Interest Holders	(309)						309
Noncontrolling Interest, Increase from Subsidiary Equity Issuance		4
Proceeds from Issuance of Common Stock	(4)		0
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures	(89)			(89)
APIC, Share-based Payment Arrangement, Increase for Cost Recognition	1,373		1,145				228
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests	(31)		16				(15)
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest	$ 146,931	$ 1,287	$ 468,088	$ (19,253)	$ (58,421)	$ (364,073)	$ 119,303

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Net Income (Loss) per Share (Tables)

3 Months Ended

Mar. 31, 2020

Earnings Per Share [Abstract]

Schedule of Weighted Average Number of Shares [Table Text Block]

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

		Three Months Ended March 31,
		2020	2019
	(In Thousands)
Number of weighted average common shares outstanding		125,587	125,681
Assumed exercise of equity awards and warrants		—	—
Average diluted shares outstanding		125,587	125,681

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Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Comprehensive Income [Abstract]
Foreign Currency Translation Adjustment, Tax	$ 0	$ 0

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Fair Value Measurements Warrants (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Fair Value Disclosures [Abstract]
Fair Value Adjustment Of Warrants, Income Statement	$ (338)	$ 407

XML

Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Operating leases:
Operating lease right-of-use assets	$ 75,344	$ 68,131
Accrued liabilities and other	16,782	15,850
Operating lease liabilities	59,845	53,919
Total operating lease liabilities	$ 76,627	$ 69,769

XML

Long-Term Debt and Other Borrowings (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Bank line of credit, net availability	$ 20,400
Parent Company [Member]
Debt Instrument [Line Items]
Long-term debt	207,413	$ 204,633
Compressco Partners Senior Notes [Member]
Debt Instrument [Line Items]
Long-term debt	291,863	291,444
Compressco Partners Senior Notes 7.50% [Member]
Debt Instrument [Line Items]
Long-term debt	344,382	344,172
Line of Credit [Member] | Parent Company [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Fair Value of Amount Outstanding	3,500
Bank line of credit, letters of credit and guarantees	7,900
Bank line of credit, net availability	40,800
New Credit Agreement [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Fair Value of Amount Outstanding	3,000
Bank line of credit, letters of credit and guarantees	3,000
Long-term debt	2,184	2,622
Unamortized deferred finance costs	800	900
CSI Compressco [Member] | Compressco Partners Senior Notes [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs	2,600	2,800
Unamortized discount	$ 1,500	$ 1,700
Senior Note interest rate	7.25%	7.25%
CSI Compressco [Member] | Compressco Partners Senior Notes 7.50% [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs	$ 5,600	$ 5,800
Senior Note interest rate	7.50%
Revolving Credit Facility [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term debt	$ 2,246	0
Unamortized deferred finance costs	1,300	1,000
Term Loan [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term debt	205,167	204,633
Unamortized deferred finance costs	9,200	9,500
Unamortized discount	$ 6,200	$ 6,400

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Industry Segments - Corporate Expenses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Segment Reporting Information [Line Items]
General and administrative expense	$ 30,537	$ 34,277
Depreciation, amortization, and accretion	29,460	30,628
Interest expense, net	17,856	18,379
Fair Value Adjustment of Warrants	(337)	407
Other (income) expense, net	439	(951)
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	10,231	18,674
Corporate Overhead [Member]
Segment Reporting Information [Line Items]
General and administrative expense	8,081	12,089
Depreciation, amortization, and accretion	197	168
Interest expense, net	5,455	5,342
Fair Value Adjustment of Warrants	(338)	407
Other (income) expense, net	49	(319)
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	$ 13,444	$ 17,687

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Fair Value Measurements Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Business Acquisition, Contingent Consideration [Line Items]
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability	$ 0	$ (400,000)
Compressco Partners Senior Notes 7.50% [Member]
Business Acquisition, Contingent Consideration [Line Items]
Original principal amount			$ 350,000,000.0

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Discontinued Operations (Notes)

3 Months Ended

Mar. 31, 2020

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

DISCONTINUED OPERATIONS

On March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division. As a result, we have accounted for our Offshore Division, consisting of our Offshore Services and Maritech segments, as discontinued operations. See Note 8 - "Commitments and Contingencies" for further discussion. A summary of financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands)

	Three Months Ended March 31, 2020								Three Months Ended March 31, 2019
	Offshore Services			Maritech		Total			Offshore Services			Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—		$	—	$	—		$	—		$	—	$	—
Cost of revenues	(60		)	—		(60		)	22			—		22
Depreciation, amortization, and accretion	—			—		—			—			—		—
General and administrative expense	205			—		205			404			—		404
Other (income) expense, net	—			—		—			—			—		—
Pretax loss from discontinued operations	(145		)	—		(145		)	(426		)	—		(426		)
Pretax loss on disposal of discontinued operations						—								—
Total pretax loss from discontinued operations						(145		)						(426		)
Income tax benefit						—								—
Total loss from discontinued operations						$	(145	)						$	(426	)

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)

	March 31, 2020						December 31, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Carrying amounts of major classes of assets included as part of discontinued operations
Trade receivables	$	—	$	—	$	—	$	—	$	—	$	—
Other current assets	—		—		—		—		—		—
Assets of discontinued operations	$	—	$	—	$	—	$	—	$	—	$	—
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,303	$	—	$	1,303	$	1,233	$	—	$	1,233
Accrued liabilities	480		228		708		745		120		865
Liabilities of discontinued operations	$	1,783	$	228	$	2,011	$	1,978	$	120	$	2,098

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Impairments and Other Charges (Notes)

3 Months Ended

Mar. 31, 2020

Asset Impairment Charges [Abstract]

Impairments and Other Charges

IMPAIRMENTS AND OTHER CHARGES

Impairments of Long-Lived Assets

During the first quarter of 2020, the COVID-19 pandemic and decline in oil prices had a significant impact on our customers and industry. We started to see our customers revise their capital budgets downwards and adjust their operations accordingly, which led to a decline in orders for new compression equipment to be fabricated and sold to third parties, among other impacts. We concluded these events were indicators of impairment for all asset groups within our Compression Division and certain asset groups within our Completion Fluids & Products Division. As a result, we performed recoverability analyses on the relevant asset groups within these divisions. Based upon these recoverability analyses, we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory in our Compression Division exceeded their respective fair values. Therefore, we recorded impairments of approximately $5.4 million during the first quarter of 2020 related to these assets. Fair value was estimated based on a market approach. No other recoverability analysis performed indicated an impairment as of March 31, 2020. Given the dynamic nature of the events beginning in the first quarter of 2020, we are not able to reasonably estimate how long our operations will be adversely impacted and the full extent these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments.

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Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Leases [Abstract]
Operating lease expense	$ 5,148	$ 5,044
Short-term lease expense	9,430	11,161
Total lease expense	$ 14,578	$ 16,205

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Basis of Presentation and Significant Accounting Policies New Accounting Pronouncements (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Operating lease right-of-use assets	$ 75,344	$ 68,131
Accrued liabilities and other	16,782	15,850
Operating lease liabilities	$ 59,845	$ 53,919

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Revenue from Contracts with Customers Contract Assets and Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Contract with customer, asset balances	$ 33,300		$ 34,900
Unearned income	2,900	$ 11,000
Deferred Revenue	27,780	49,838	$ 9,678	$ 25,333
Deferred Revenue, Additions	23,869	49,363
Contract with Customer, Liability, Revenue Recognized	$ (5,767)	$ (24,858)