Segment and Geographic Location Information

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment and Geographic Location Information

18. SEGMENT AND GEOGRAPHIC LOCATION INFORMATION

The Company has three operating and reportable segments: Assessment, Permitting and Response, Measurement and Analysis, and Remediation and Reuse. These segments are monitored separately by management for performance against budget and prior year and are consistent with internal financial reporting. The Company’s operating segments are organized based upon primary services provided, the nature of the production process, their type of customers, methods used to distribute the products, and the nature of the regulatory environment.

Segment Adjusted EBITDA is the primary measure of operating performance for all three operating segments. Segment Adjusted EBITDA is the calculated Company’s Earnings before Interest, Tax, Depreciation and Amortization (“EBITDA”), adjusted to exclude certain transactions such as stock-based compensation, acquisition costs, and fair value changes in financial instruments, amongst others. Beginning in the first quarter of 2023, the calculation of Segment adjusted EBITDA no longer adjusts for start-up losses and investment in new services as the Chief Operating Decision Maker (“CODM”) no longer reviews the Segment Adjusted EBITDA measure without these costs. The CODM does not review segment assets as a measure of segment performance.

During the first quarter of 2023, the Company determined to sell one of its specialty service lines within the lab testing business (the "Discontinuing Specialty Lab"), whose performance has been sporadic and whose service offering is non-core to the Company’s business. The Company expects the sale process to be completed by December 31, 2023. The discontinuation of this specialty service line, which is part of the Company's Measurement and Analysis segment, did not represent a strategic shift that had (or will have) a major effect on the Company’s operations and financial results, therefore it did not meet the requirements to be classified as discontinued operations.

Corporate and Other includes costs associated with general corporate overhead (including executive, legal, finance, safety, human resources, marketing, and IT related costs) that are not directly related to supporting operations. Overhead costs that are directly related to supporting operations (such as insurance, software, licenses, shared services, and payroll processing costs) are allocated to the operating segments on a basis that reasonably approximates an estimate of the use of these services.

Segment revenues and Adjusted EBITDA consisted of the following:

	Three Months Ended September 30,
	2023						2022
				Segment						Segment
	Segment			Adjusted			Segment			Adjusted
	Revenues			EBITDA			Revenues			EBITDA(4)
Assessment, Permitting and Response	$	57,009		$	14,878		$	46,414		$	9,820
Measurement and Analysis		50,468	(1)		10,352			43,754	(1)		8,483		(3)
Remediation and Reuse		60,460			7,446			40,144			7,010
Total Operating Segments		167,937			32,676			130,312			25,313
Corporate and Other		—			(9,373	)		—			(6,940	)
Total	$	167,937		$	23,303		$	130,312		$	18,373
	Nine Months Ended September 30,
	2023						2022
				Segment						Segment
	Segment			Adjusted			Segment			Adjusted
	Revenues			EBITDA			Revenues			EBITDA(4)
Assessment, Permitting and Response	$	170,634		$	42,977		$	142,051		$	30,252
Measurement and Analysis		143,050	(2)		27,528			125,739	(2)		21,852		(3)
Remediation and Reuse		144,782			18,767			137,112			22,059
Total Operating Segments		458,466			89,272			404,902			74,163
Corporate and Other		—			(28,175	)		—			(22,826	)
Total	$	458,466		$	61,097		$	404,902		$	51,337

_____________________________________

(1) Includes revenue of $2.0 million and $3.9 million from the Discontinuing Specialty Lab, for the three months ended September 30, 2023 and September 30, 2022, respectively.

(2) Includes revenue of $5.9 million and $12.9 million from the Discontinuing Specialty Lab, for the nine months ended September 30, 2023 and September 30, 2022, respectively.
(3) Includes Adjusted EBITDA loss of $(0.5) million and $(0.1) million from the Discontinuing Specialty Lab for the three and nine months ended September 30, 2022, respectively.

(4) Includes the add back of start-up losses and investment in new services of $1.3 million and $2.9 million for the three and nine months ended September 30, 2022, respectively.

Presented below is a reconciliation of the Company’s segment measure to net loss:

	For the Three Months Ended September 30,								For the Nine Months Ended September 30,
	2023				2022				2023				2022
Total	$	23,303			$	18,373			$	61,097			$	51,337
Interest expense, net		(2,089	)			(1,400	)			(5,507	)			(4,010	)
Income tax (expense) benefit		(1,324	)			208				(2,842	)			(1,892	)
Depreciation and amortization		(11,863	)			(11,504	)			(33,816	)			(35,928	)
Stock-based compensation		(11,484	)			(11,018	)			(35,609	)			(32,375	)
Start-up losses and investment in new services		—				(1,278	)			—				(2,949	)
Acquisition costs		(1,499	)			(368	)			(4,970	)			(1,354	)
Fair value changes in financial instruments		(806	)			1,808				(1,814	)			4,664
Fair value changes in business acquisition    contingencies		(459	)			(59	)			(414	)			3,472
Expenses related to financing transactions		(3	)			—				(7	)			(7	)
Discontinuing Specialty Lab		(1,302	)	(1)		—				(5,321	)	(1)		—
Other gains (losses) and (expenses)		1				(482	)	(2)		(215	)			(1,965	)	(2)
Net loss	$	(7,525	)		$	(5,720	)		$	(29,418	)		$	(21,007	)

__________________________

(1) Amounts consist of operating losses before depreciation related to the Discontinuing Specialty Lab.

(2) Amounts include costs associated with the closing of a lab.

The following table presents revenues by geographic location:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2023		2022		2023		2022
United States	$	133,451	$	124,677	$	405,395	$	389,954
Canada		31,206		3,361		44,488		8,486
Other international		3,280		2,274		8,583		6,462
Total Revenue	$	167,937	$	130,312	$	458,466	$	404,902