Business Segment, Geographic and Major Customer Information

6 Months Ended

Jun. 30, 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 and performance throughout the life cycle of their wells, helping customers improve their ESG and operational goals. The Company designs, develops, manufactures, packages, distributes, delivers and markets optimized 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, as well as to reduce health and environmental risk by utilization of greener chemicals. 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 disinfectants, surface cleaners, degreasers and solvents for industrial, commercial and consumer use. The Company produces Food and Drug Administration and Environmental Protection Agency compliant products its ISO 9001:2015 certified facility in Marlow, Oklahoma. Today the Company has a portfolio of specialty chemical products to address the long-term challenges in the janitorial and sanitization (JanSan), food service and adjacent markets.

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 on the composition and properties of energy customers’ hydrocarbon fluids. The real-time information on hydrocarbon composition and properties helps customers generate additional profits by enhancing their operations including crude/condensates stabilization, blending, optimization of transmix, increasing efficiencies of gas processing plants, ensuring product quality while enabling automation of fluid handling and reducing losses through give-aways (i.e., that portion of a product of higher value than what is specified). The customers of the DA segment span across the entire oil and gas market, from upstream production to midstream facilities to refineries and distribution networks.

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 June 30,	Chemistry Technologies		Data Analytics (1)		Corporate and Other		Total
2021
Net revenue from external customers	$	7,688	$	1,477	$	—	$	9,165
Loss from operations, including impairment	(3,819)		(773)		(2,869)		(7,461)
Depreciation and amortization	233		20		—		253
Additions to long-lived assets	13		—		—		13
2020
Net revenue from external customers	$	7,962	$	918	$	—	$	8,880
Loss from operations, including impairment	(3,596)		(1,151)		(5,484)		(10,231)
Depreciation and amortization	246		131		91		468
Additions to long-lived assets	—		—		—		—

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

For the six months ended June 30,	Chemistry Technologies		Data Analytics (1)		Corporate and Other		Total
2021
Net revenue from external customers	$	17,990	$	2,945	$	—	$	20,935
Loss from operations, including impairment	(7,407)		(1,067)		(7,230)		$	(15,704)
Depreciation and amortization	524		35		1		$	560
Additions to long-lived assets	31		—		—		$	31
2020
Net revenue from external customers	$	27,378	$	918	$	—	$	28,296
Loss from operations, including impairment	(66,257)		(1,151)		(12,908)		(80,316)
Depreciation and amortization	2,056		131		472		2,659
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):

	June 30, 2021		December 31, 2020
Chemistry Technologies	$	41,950	$	43,346
Data Analytics	5,154		13,201
Corporate and Other	24,314		29,663
Total assets	$	71,418	$	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 June 30,				Six months ended June 30,
	2021		2020		2021		2020
U.S.	$	6,869	$	6,936	$	16,530	$	22,711
UAE	1,319		847		2,422		2,308
Other countries	977		1,097		1,983		3,277
Total revenue	$	9,165	$	8,880	$	20,935	$	28,296

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 June 30,	Chemistry Technologies		% of Total Revenue		Data Analytics	% of Total Revenue
2021
Customer C	$	1,038	11.3	%	*	*
Customer D	1,810		19.8	%	*	*

2020
Customer A	$	2,004	22.6	%	* (1)	* (1)
Customer B	1,246		14.0	%	* (1)	* (1)

For the six months ended June 30,	Chemistry Technologies		% of Total Revenue		Data Analytics	% of Total Revenue
2021
Customer C	$	4,067	19.4	%	*	*
Customer D	4,660		22.3	%	*	*

2020
Customer C	$	8,324	29.4	%	* (1)	* (1)
Customer A	3,536		12.5	%	* (1)	* (1)
Customer D	3,485		12.3	%	* (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.