SEGMENT REPORTING

Segment reporting is prepared on the same basis that the Company's chief executive officer, who is the Company's chief operating decision maker, manages its business, makes operating decisions and assesses performance. During the fourth quarter of 2016, the Company changed the manner in which it manages its business, makes operating decisions and assesses its performance. These changes included combining the Safety-Kleen Environmental Services business and Kleen Performance Products business into a single operating segment called "Safety-Kleen," moving the Production Services business, previously included in the Company's Oil and Gas Field Services operating segment, into the Company's Industrial Services operating segment, and reassigning certain departments among the Company's operating segments in line with management reporting changes. In addition, for purposes of segment disclosure, the Company combined the Oil and Gas Field Services and Lodging Services operating segments under the heading "Oil, Gas and Lodging Services," as those individual operating segments do not meet the quantitative thresholds for separate disclosure.

The Company believes this new organizational structure aligns the businesses for growth and efficiency. The amounts presented for all periods herein have been recast to reflect the impact of such changes. The Company's operations are now managed in six operating segments: Technical Services, Industrial Services, Field Services, Safety-Kleen, Oil and Gas Field Services and Lodging Services. For purposes of segment disclosure the Industrial Services and Field Services operating segments have been aggregated into a single reportable segment based upon their similar economic and other characteristics, and the Oil and Gas Field Services and Lodging Services operating segments have been combined as they do not meet the quantitative thresholds for separate presentation.

Third-party revenue is revenue billed to outside customers by a particular segment. Direct revenue is revenue allocated to the segment providing the product or service. Intersegment revenues represent the sharing of third-party revenues among the segments based on products and services provided by each segment as if the products and services were sold directly to the third-party. The intersegment revenues are shown net. The negative intersegment revenues are due to more transfers out of customer revenues to other segments than transfers in of customer revenues from other segments. The operations not managed through the Company’s operating segments described above are recorded as “Corporate Items.” Corporate Items revenues consist of two different operations for which the revenues are insignificant. Corporate Items cost of revenues represents certain central services that are not allocated to the Company's operating segments for internal reporting purposes. Corporate Items selling, general and administrative expenses include typical corporate items such as legal, accounting and other items of a general corporate nature that are not allocated to the Company’s operating segments.

The following table reconciles third-party revenues to direct revenues for the years ended December 31, 2016, 2015 and 2014 (in thousands):



	For the Year Ended December 31, 2016
	Technical Services		Industrial and Field Services			Safety-Kleen			Oil, Gas and Lodging Services		Corporate Items			Totals
Third-party revenues	$	906,495	$	618,245		$	1,110,727		$	116,692	$	3,067		$	2,755,226
Intersegment revenues, net	147,866		(35,724		)	(115,013		)	2,871		—			—
Corporate Items, net	2,374		(306		)	369			320		(2,757		)	—
Direct revenues	$	1,056,735	$	582,215		$	996,083		$	119,883	$	310		$	2,755,226



	For the Year Ended December 31, 2015
	Technical Services		Industrial and Field Services			Safety-Kleen			Oil, Gas and Lodging Services		Corporate Items			Totals
Third-party revenues	$	991,410	$	1,023,638		$	1,060,926		$	198,705	$	458		$	3,275,137
Intersegment revenues, net	144,084		(32,903		)	(119,232		)	8,051		—			—
Corporate Items, net	3,586		(782		)	(5		)	383		(3,182		)	—
Direct revenues	$	1,139,080	$	989,953		$	941,689		$	207,139	$	(2,724	)	$	3,275,137

(18) SEGMENT REPORTING (Continued)



	For the Year Ended December 31, 2014
	Technical Services		Industrial and Field Services			Safety-Kleen			Oil, Gas and Lodging Services		Corporate Items			Totals
Third-party revenues	$	1,043,267	$	795,249		$	1,200,907		$	361,937	$	276		$	3,401,636
Intersegment revenues, net	156,543		(46,424		)	(121,382		)	11,263		—			—
Corporate Items, net	5,573		271			(63		)	75		(5,856		)	—
Direct revenues	$	1,205,383	$	749,096		$	1,079,462		$	373,275	$	(5,580	)	$	3,401,636

The primary financial measure by which the Company evaluates the performance of its segments is Adjusted EBITDA which consists of net (loss) income plus accretion of environmental liabilities, depreciation and amortization, net interest expense, provision for income taxes, other gains or non-cash charges (including gain on sale of business and goodwill impairment charges) not deemed representative of fundamental segment results and excludes other (income) expense, net. Transactions between the segments are accounted for at the Company’s best estimate based on similar transactions with outside customers.

The following table presents Adjusted EBITDA information used by management by reported segment (in thousands):



	For the Year Ended December 31,
	2016			2015			2014
Adjusted EBITDA:
Technical Services	$	271,176		$	291,737		$	328,130
Industrial and Field Services	51,191			161,447			98,266
Safety-Kleen	219,546			172,262			165,547
Oil, Gas and Lodging Services	(3,292		)	11,704			90,877
Corporate Items	(138,267		)	(132,983		)	(160,901		)
Total	400,354			504,167			521,919
Reconciliation to Consolidated Statements of Operations:
Accretion of environmental liabilities	10,177			10,402			10,612
Depreciation and amortization	287,002			274,194			276,083
Goodwill impairment charges	34,013			31,992			123,414
Income from operations	69,162			187,579			111,810
Other (income) expense, net	(6,195		)	1,380			(4,380		)
Gain on sale of business	(16,884		)	—			—
Interest expense, net of interest income	83,525			76,553			77,668
Income from operations before provision for income taxes	$	8,716		$	109,646		$	38,522

Revenue, property, plant and equipment and intangible assets outside of the United States

For the year ended December 31, 2016, the Company generated $2,213.4 million or 80.3% of revenues in the United States and Puerto Rico, $538.0 million or 19.5% of revenues in Canada, and less than 1.0% of revenues in other international locations. For the year ended December 31, 2015, the Company generated $2,576.2 million or 78.7% of revenues in the United States and Puerto Rico, $695.0 million or 21.2% of revenues in Canada, and less than 1.0% of revenues in other international locations. For the year ended December 31, 2014, the Company generated $2,414.6 million or 71.0% of revenues in the United States and Puerto Rico, $982.1 million or 28.9% of revenues in Canada, and less than 1.0% of revenues in other international locations.

As of December 31, 2016, the Company had property, plant and equipment, net of depreciation and amortization of $1,611.8 million, and permits and other intangible assets of $498.7 million. Of these totals, $400.3 million or 24.8% of property, plant and equipment and $63.1 million or 12.7% of permits and other intangible assets were in Canada, with the balance being in the United States and Puerto Rico (except for insignificant assets in other foreign countries). As of December 31, 2015, the Company had property, plant and equipment, net of depreciation and amortization of $1,532.5 million, and permits and other intangible assets of $506.8 million. Of these totals, $449.3 million or 29.3% of property, plant and equipment and $71.7 million or 14.2% of permits and other intangible assets were in Canada, with the balance being in the United States and Puerto Rico (except for insignificant assets in other foreign countries).

(18) SEGMENT REPORTING (Continued)

The following table presents assets by reported segment and in the aggregate (in thousands):



	December 31, 2016		December 31, 2015
Property, plant and equipment, net
Technical Services	$	521,134	$	483,425
Industrial and Field Services	245,143		283,509
Safety-Kleen	584,647		458,394
Oil, Gas and Lodging Services	182,038		215,645
Corporate Items	78,865		91,494
Total property, plant and equipment, net	$	1,611,827	$	1,532,467

Goodwill and Permits and other intangibles, net
Technical Services
Goodwill	$	61,116	$	49,267
Permits and other intangibles, net	78,625		73,601
Total Technical Services	139,741		122,868

Industrial and Field Services
Goodwill	107,968		105,286
Permits and other intangibles, net	17,817		17,198
Total Industrial and Field Services	125,785		122,484

Safety-Kleen
Goodwill	296,070		266,344
Permits and other intangibles, net	391,390		396,661
Total Safety-Kleen	687,460		663,005

Oil, Gas and Lodging Services
Goodwill	—		32,208
Permits and other intangibles, net	10,889		19,358
Total Oil, Gas and Lodging Services	10,889		51,566

Total	$	963,875	$	959,923

The following table presents the total assets by reported segment (in thousands):



	December 31, 2016		December 31, 2015		December 31, 2014
Technical Services	$	862,957	$	800,060	$	756,169
Industrial and Field Services	446,826		461,180		513,962
Safety-Kleen	1,474,755		1,297,971		1,269,993
Oil, Gas and Lodging Services	253,242		333,245		471,695
Corporate Items	644,140		538,972		677,604
Total	$	3,681,920	$	3,431,428	$	3,689,423

The following table presents the total assets by geographical area (in thousands):



	December 31, 2016		December 31, 2015		December 31, 2014
United States	$	2,960,337	$	2,575,746	$	2,557,639
Canada	721,583		851,949		1,128,458
Other foreign	—		3,733		3,326
Total	$	3,681,920	$	3,431,428	$	3,689,423