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Dispositions
 9 Months Ended
Sep. 30, 2022
Discontinued Operations and Disposal Groups [Abstract]  
Dispositions Dispositions
Harsco Rail Segment
In November 2021, the Company announced its intention to sell its Rail business and the sales process is ongoing. The former Harsco Rail Segment was historically a separate reportable segment with primary operations in the United States, Europe and Asia Pacific.

The former Harsco Rail Segment's balance sheet positions as of September 30, 2022 and December 31, 2021 are presented as Assets held-for-sale and Liabilities of assets held-for-sale in the Condensed Consolidated Balance Sheets and are summarized as follows:
(in thousands)September 30
2022		December 31
2021
Trade accounts receivable, net$44,677 $33,689 
Other receivables4,304 4,740 
Inventories97,552 103,560 
Current portion of contract assets87,199 94,597 
Other current assets27,961 25,442 
Property, plant and equipment, net40,012 39,524 
Right-of-use assets, net1,903 3,108 
Goodwill13,026 13,026 
Intangible assets, net2,786 3,081 
Deferred income tax assets4,993 6,064 
Other assets1,144 6,432 
Total Rail assets included in Assets held-for-sale$325,557 $333,263 
Accounts payable$35,794 $46,076 
Accrued compensation3,420 2,171 
Current portion of operating lease liabilities990 1,619 
Current portion of advances on contracts50,536 62,401 
Other current liabilities66,492 49,732 
Operating lease liabilities997 1,775 
Deferred tax liabilities5,571 5,736 
Other liabilities868 981 
Total Rail liabilities included in Liabilities of assets held-for-sale$164,668 $170,491 
The results of the former Harsco Rail Segment are presented as discontinued operations and, as such, have been excluded from both continuing operations and segment results for the three and nine months ended September 30, 2022, and 2021. Certain key selected financial information included in Income (loss) from discontinued operations, net of tax, for the former Harsco Rail Segment is as follows:
Three Months EndedNine Months Ended
September 30September 30
(In thousands)2022202120222021
Amounts directly attributable to the former Harsco Rail Segment:
Service revenues$8,629 $7,800 $22,827 $24,990 
Product revenues (a)
60,386 66,115 169,778 231,661 
Cost of services sold6,559 4,193 15,823 12,373 
Cost of products sold49,789 54,830 176,210 189,288 
Income (loss) from discontinued businesses3,964 2,829 (26,768)17,674 
Additional amounts allocated to the former Harsco Rail Segment:
  Selling, general and administrative expenses (b)
$376 $— $3,887 $— 
(a) The decrease in product revenues for the nine months ended September 30, 2022 as compared to the nine months ended September 30, 2021 is due in part to liquidated damages and penalties on certain long-term contracts, as discussed below.
(b) The Company has allocated directly attributable transaction costs to discontinued operations.

The Company has retained corporate overhead expenses previously allocated to the former Harsco Rail Segment of $1.0 million and $3.1 million for each of the three and nine months ended September 30, 2022, and 2021, respectively, as part of Selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.

The Company's former Harsco Rail Segment is currently manufacturing highly-engineered equipment under large long-term fixed-price contracts with SBB, Network Rail, and Deutsche Bahn. As previously disclosed, in the fourth quarter of 2021 the Company recognized an estimated forward loss provision of $33.4 million related to these contracts. In 2022, the Company encountered continued supply chain related delays and additional costs in building the machines.

For the Network Rail contracts, the Company encountered supply chain delays in the build of the initial machine, and there were further changes to the production schedule based on the manufacturing experience gained from assembling the first unit during the first quarter of 2022 which had a cascading effect on the delivery schedule of remaining machines. During the nine months ended September 30, 2022, the Company recorded additional forward loss provisions of $24.5 million, principally for additional estimated contractual liquidated damages which were recorded as a reduction to revenue in the first quarter of 2022. The Company continues to negotiate with Network Rail regarding a reduction to these liquidated damages, which could result in additional favorable or unfavorable adjustments in future periods.

For the Deutsche Bahn contract, on March 8, 2022 a European-based supplier of critical components to the project, indicated it would be significantly late on the delivery of these components to the project, which has the impact of delaying the overall delivery schedule for the project. As a result, the Company recorded an additional $7.4 million estimated forward loss provision during the first quarter of 2022 due principally to the estimated contractual penalties that would be triggered by this delay and thus recorded as a reduction of revenue. Additionally, this supplier filed for bankruptcy during the second quarter of 2022, although it continues to operate. Should this supplier cease operations, the Company may incur further losses if there are additional costs to change suppliers or an inability to recover the value of prepayments made to the supplier, as well as additional penalties and damages under the contract with Deutsche Bahn in the event of further production delays.

For the second SBB contract, the Company recorded an additional $3.5 million forward estimated loss provision during the first quarter of 2022 due to additional supply chain delays and cost overruns.

The estimated forward loss provisions represent the Company's best estimate based on currently available information. It is possible that the Company's overall estimate of liquidated damages, penalties and costs to complete these contracts may change, which would result in an additional estimated forward loss provision at such time.

The first contract with SBB is complete, and the second contract is 83% complete as of September 30, 2022. The contracts with Network Rail and Deutsche Bahn are 50% and 29% complete, respectively, as of September 30, 2022.
The following is selected financial information included on the Condensed Consolidated Statements of Cash Flows attributable to the former Harsco Rail Segment:
Nine Months Ended September 30
(In thousands)20222021
Non-cash operating items
Depreciation and amortization$— $3,905 
Cash flows from investing activities
Purchases of property, plant and equipment1,494 1,329