DISCONTINUED OPERATIONS

In the first quarter of 2018, in a continuing effort to streamline our business and align our business strategy for further integration of services and products, the Company committed to divest the business of our full range of permanent downhole monitoring systems and related services, which had been part of our Production Enhancement segment. We anticipate the sale of this business line will occur by the end of the first quarter of 2019.

The associated results of operations are separately reported as Discontinued Operations for all periods presented on the Consolidated Statements of Operations. Balance sheet items for this discontinued business, including an allocation of goodwill from the Production Enhancement segment, have been reclassified to Other current assets and Other current liabilities in the Consolidated Balance Sheet. Cash flows from this discontinued business are shown in the table below. As such, the results from continuing operations for the Company and segment highlights for Production Enhancement, exclude these discontinued operations.

Selected data for this discontinued business consisted of the following (in thousands):



	Three Months Ended
	September 30, 2018			September 30, 2017
Service revenue	$	167		$	265
Sales revenue	2,058			3,095
Total revenue	2,225			3,360

Cost of services, exclusive of depreciation expense shown below	87			91
Cost of product sales, exclusive of depreciation expense shown below	1,944			2,438
Depreciation and Amortization	14			98
Other Expense	(1		)	(74		)
Operating Income	181			807
Income tax expense (benefit)	(27		)	121
Income (loss) from discontinued operations, net of income taxes	$	208		$	686

	Nine Months Ended
	September 30, 2018			September 30, 2017
Service revenue	$	1,069		$	898
Sales revenue	3,768			9,351
Total revenue	4,837			10,249

Cost of services, exclusive of depreciation expense shown below	961			482
Cost of product sales, exclusive of depreciation expense shown below	4,124			7,082
Depreciation and Amortization	115			334
Other Expense (income)	22			(148		)
Operating Income (loss)	(385		)	2,499
Income tax expense	81			368
Income (loss) from discontinued operations, net of income taxes	$	(466	)	$	2,131

	September 30, 2018			December 31, 2017
Current assets	$	3,262		$	2,549
Non-current assets	1,847			1,048
Total assets	$	5,109		$	3,597

Current liabilities	$	740		$	221
Non-current liabilities	77			75
Total liabilities	$	817		$	296

Net cash provided by (used in) operating activities of discontinued operations for the three and nine months ended September 30, 2018 was $(0.8) million and $(0.5) million, respectively.