Business Segment, Geographic and Major Customer Information

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Business Segment, Geographic and Major Customer Information

Business Segment, Geographic and Major Customer Information

Segment Information

Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the chief operating decision-maker in deciding how to allocate resources and assess performance. The operations of the Company are categorized into the following reportable segments: CT and DA.

Chemistry Technologies. The CT segment includes green specialty chemistries, logistics and technology services, which enable its customers to pursue improved efficiencies in the drilling and completion of their wells. The Company designs, develops, manufactures, packages, distributes, delivers and markets reservoir-centric fluid systems, including specialty and conventional chemistries, for use in oil and gas well drilling, cementing, completion, remediation and stimulation activities designed to maximize recovery in both new and mature fields. Customers of the CT segment include major integrated oil and gas companies, oilfield services companies, independent oil and gas companies, national and state-owned oil companies, and international supply chain management companies.

In 2020, the Company leveraged historical expertise, existing infrastructure, personnel, supply chain, research and resident consumer market experience to address the emerging demand for sanitizers, surface cleaners and disinfectants for industrial, commercial and consumer use. Rather than operating under relaxed pandemic-related guidelines, the Company sought to produce Food and Drug Administration and Environmental Protection Agency compliant products by completing all necessary upgrades to its already ISO 9001:2015 certified facility in Marlow, Oklahoma. Today the Company has a portfolio of specialty chemical products to address the long-term challenges created by the current COVID-19 pandemic and in preparation for future outbreaks.

Data Analytics. The DA segment, created in the second quarter of 2020 in conjunction with the acquisition of JP3 on May 18, 2020, includes the design, development, production, sale and support of equipment and services that create and provide valuable information about the composition of energy customers’ hydrocarbon fluids. The customers of the DA segment span across the entire oil and gas market, from production upstream to midstream facilities to refineries and distribution networks. To date, the DA segment has focused solely on North American markets. The DA segment provides real-time hydrocarbon composition data that helps its customers generate additional profit by enhancing blending, optimizing transmix, increasing efficiencies of towers, enabling automation of fluid handling, and reducing losses due to give-away (i.e., that portion of a product of higher value than what is specified) using real-time process information.

The Company evaluates performance based upon a variety of criteria. The primary financial measure is segment operating income. Various functions, including certain sales and marketing activities and general and administrative activities, are provided centrally by the corporate office. Costs associated with corporate office functions, other corporate income and expense items, and income taxes are not allocated to the reportable segment.

Summarized financial information of the reportable segments is as follows (in thousands):

For the three months ended March 31,	Chemistry Technologies		Data Analytics (1)		Corporate and Other		Total
2021
Net revenue from external customers	$	10,302	$	1,468	$	—	$	11,770
Loss from operations, including impairment	(3,589)		(292)		(4,362)		(8,243)
Depreciation and amortization	292		15		—		307
Additions to long-lived assets	19		—		—		19
2020
Net revenue from external customers	$	19,416	$	—	$	—	$	19,416
Loss from operations, including impairment	(70,269)		—		184		(70,085)
Depreciation and amortization	1,809		—		382		2,191
Additions to long-lived assets	42		—		—		42

(1) The Company formed the Data Analytics segment in the second quarter of 2020 upon acquiring JP3.

Assets of the Company by reportable segments are as follows (in thousands):

	March 31, 2021		December 31, 2020
Chemistry Technologies	$	33,804	$	43,346
Data Analytics	14,025		13,201
Corporate and Other	30,888		29,663
Total assets	$	78,717	$	86,210

Geographic Information

Revenue by country is based on the location where services are provided and products are used. No individual countries other than the U.S. and the United Arab Emirates (“UAE”) accounted for more than 10% of revenue. Revenue by geographic location is as follows (in thousands):

	Three months ended March 31,
	2021		2020
U.S.	$	9,661	$	15,775
UAE	1,103		1,461
Other countries	1,006		2,180
Total revenue	$	11,770	$	19,416

Long-lived assets held in countries other than the U.S. are not considered material to the consolidated financial statements.

Major Customers

Revenue from major customers, as a percentage of consolidated revenue, is as follows (in thousands):

For the Three Months Ended March 31,	Chemistry Technologies		% of Total Revenue		Data Analytics	% of Total Revenue
2021
Customer A	$	3,029	25.7	%	*	*
Customer B	2,849		24.2	%	*	*

2020
Customer A	$	7,754	39.9	%	* (1)	* (1)
Customer B	3,480		17.9	%	* (1)	* (1)

* This customer did not account for more than 10% of revenue during this period.

*(1) Not applicable, as the Company did not form the Data Analytics segment until May 2020 upon acquiring JP3.