Discontinued Operations

6 Months Ended

Jun. 30, 2022

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

DISCONTINUED OPERATIONS

On January 29, 2021, we entered into the Purchase and Sale Agreement with Spartan Energy Partners, LP (“Spartan”) pursuant to which we sold the general partner of CSI Compressco, including the incentive distribution rights (“IDRs”) in CSI Compressco LP, (“CSI Compressco”), and approximately 23.1% of the outstanding limited partner interests in CSI Compressco, in exchange for the combination of $13.9 million in cash and $3.1 million in contingent consideration in the form of cash and/or CSI Compressco common units if CSI Compressco achieves certain financial targets on or before December 31, 2022. Throughout this Quarterly Report, we refer to this transaction as the “GP Sale.” Following the closing of the transaction, we retained an interest in CSI Compressco representing approximately 3.7% of the outstanding common units as of June 30, 2022. As a result of these transactions, we no longer consolidate CSI Compressco as of January 29, 2021. We recognized a primarily non-cash accounting gain of $120.6 million during the three-month period ended March 31, 2021 related to the GP Sale. The gain is included in income (loss) from discontinued operations, net of taxes in our consolidated statement of operations. We provided back-office support to CSI Compressco under a Transition Services Agreement that ended during the three-month period ended March 31, 2022. During the three months ended June 30, 2022, we sold equipment to CSI Compressco for approximately $0.3 million. Our interest in CSI Compressco and the general partner represented substantially all of our Compression Division.

In addition, on March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division, consisting of our Offshore Services and Maritech segments. Our former Compression and Offshore Divisions are reported as discontinued operations for all periods presented. Our consolidated balance sheets and consolidated statements of operations report discontinued operations separate from continuing operations. Our consolidated statements of comprehensive income, statements of equity and statements of cash flows combine continuing and discontinued operations. Our prior-year consolidated statement of operations, statement of comprehensive income, statement of equity and statement of cash flows include CSI Compressco activity for January 1 through January 29 in 2021. Our consolidated statements of cash flows for the six-month period ended June 30, 2021 included $3.0 million, of capital expenditures related to our former Compression division. 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, unaudited)

	Three Months Ended June 30, 2022
	Offshore Services		Maritech		Total
Major classes of line items constituting loss from discontinued operations
Cost of revenues	$	54	$	—	$	54
General and administrative expense	8		—		$	8
Other expense, net	—		(28)		(28)
Pretax income (loss) from discontinued operations	(62)		28		(34)
Loss from discontinued operations attributable to TETRA stockholders					$	(34)

	Three Months Ended June 30, 2021
	Compression	Offshore Services	Total
Major classes of line items constituting loss from discontinued operations
General and administrative expense	—	5	5
Other (income) expense, net	121	—	121
Pretax loss from discontinued operations	(121)	(5)	(126)
Loss from discontinued operations attributable to TETRA stockholders			$	(126)

	Six Months Ended June 30, 2022
	Offshore Services	Maritech	Total
Major classes of line items constituting income from discontinued operations
Cost of revenues	55	—	55
General and administrative expense	22	—	22
Other expense, net	—	(28)	(28)
Pretax income (loss) from discontinued operations	(77)	28	(49)
Loss from discontinued operations attributable to TETRA stockholders			$	(49)

	Six Months Ended June 30, 2021
	Compression		Offshore Services		Total
Major classes of line items constituting loss from discontinued operations
Revenue	$	18,968	$	—	$	18,968
Cost of revenues	11,474		28		11,502
General and administrative expense	2,795		—		2,795
Interest expense, net	4,336		—		4,336
Other expense, net	15		—		15
Pretax income (loss) from discontinued operations	348		(28)		320
Pretax gain on disposal of discontinued operations					120,574
Total pretax income from discontinued operations					120,894
Income tax provision					30
Total income from discontinued operations					120,864
Income from discontinued operations attributable to noncontrolling interest					(333)
Income from discontinued operations attributable to TETRA stockholders					$	120,531

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

(in thousands)

	June 30, 2022
	Offshore Services		Maritech		Total
	(unaudited)
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,272	$	—	$	1,272
Accrued liabilities and other	—		95		95
Total liabilities associated with discontinued operations	$	1,272	$	95	$	1,367

	December 31, 2021
	Offshore Services		Maritech		Total
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,157	$	—	$	1,157
Accrued liabilities and other	—		228		228
Total liabilities associated with discontinued operations	$	1,157	$	228	$	1,385