| Segment Information |
Note 16—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-makers in deciding how to allocate resources and assess performance.
The Company is comprised of three reportable segments; Chemicals, Drilling, and Artificial Lift:
| Ÿ |
|
The Chemicals segment consists of two business divisions: 1) Specialty Chemicals and 2) Logistics. Specialty Chemicals designs, develops, manufactures, packages and sells chemicals used by oilfield service companies in oil and gas well drilling, cementing, stimulation and production activities. The Logistics division manages automated handling, loading facilities, and blending capabilities of bulk materials for oilfield service companies. |
| Ÿ |
|
The Drilling segment rents, inspects, manufactures and markets down-hole drilling equipment used in energy, mining, water well and industrial drilling activities. |
| Ÿ |
|
The Artificial Lift segment manufactures and markets artificial lift equipment, including the Petrovalve line of beam pump components, electric submersible pumps and gas separators, valves and services that support coal bed methane production activities. |
The Company evaluates performance based on several criteria. The primary financial measure is business segment income before taxes. Various functions, including certain sales and marketing activities and corporate general and administrative activities, are provided centrally by the corporate office. Costs associated with corporate office functions, identified other income and expense items as well as estimated income tax provisions (benefits), are not allocated to reportable segments. Intersegment sales are accounted for at fair value as if sales were to third parties. Intersegment revenue is not considered material to the consolidated financial statements.
Summarized financial information regarding reportable segments is shown in the following table (in thousands):
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As of and for the
Year ended December 31, |
|
Chemicals and
Logistics |
|
|
Drilling
Products |
|
|
Artificial Lift |
|
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Corporate and
Other |
|
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Total |
|
|
2011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue from external |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
customers |
|
$ |
140,836 |
|
|
$ |
102,470 |
|
|
$ |
15,479 |
|
|
$ |
- |
|
|
$ |
258,785 |
|
|
Gross margin |
|
|
56,115 |
|
|
|
43,607 |
|
|
|
6,098 |
|
|
|
- |
|
|
|
105,820 |
|
|
Income (loss) from operations |
|
|
43,549 |
|
|
|
23,035 |
|
|
|
4,296 |
|
|
|
(21,992 |
) |
|
|
48,888 |
|
|
Depreciation and amortization |
|
|
1,594 |
|
|
|
8,061 |
|
|
|
196 |
|
|
|
254 |
|
|
|
10,105 |
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Total assets |
|
|
54,958 |
|
|
|
113,130 |
|
|
|
10,815 |
|
|
|
53,109 |
|
|
|
232,012 |
|
|
Capital expenditures |
|
|
2,231 |
|
|
|
6,025 |
|
|
|
182 |
|
|
|
1,546 |
|
|
|
9,984 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue from external |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
customers |
|
$ |
66,121 |
|
|
$ |
65,782 |
|
|
$ |
15,079 |
|
|
$ |
- |
|
|
$ |
146,982 |
|
|
Gross margin |
|
|
29,249 |
|
|
|
18,991 |
|
|
|
4,730 |
|
|
|
- |
|
|
|
52,970 |
|
|
Income (loss) from operations |
|
|
19,833 |
|
|
|
(9,738 |
) |
|
|
3,070 |
|
|
|
(19,432 |
) |
|
|
(6,267 |
) |
|
Depreciation and amortization |
|
|
1,671 |
|
|
|
11,445 |
|
|
|
219 |
|
|
|
433 |
|
|
|
13,768 |
|
|
Total assets |
|
|
44,102 |
|
|
|
102,949 |
|
|
|
9,062 |
|
|
|
28,694 |
|
|
|
184,807 |
|
|
Capital expenditures |
|
|
1,227 |
|
|
|
4,679 |
|
|
|
32 |
|
|
|
122 |
|
|
|
6,060 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue from external |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
customers |
|
$ |
49,296 |
|
|
$ |
50,774 |
|
|
$ |
12,480 |
|
|
$ |
- |
|
|
$ |
112,550 |
|
|
Gross margin |
|
|
21,667 |
|
|
|
4,781 |
|
|
|
2,936 |
|
|
|
- |
|
|
|
29,384 |
|
|
Income (loss) from operations |
|
|
12,964 |
|
|
|
(32,084 |
) |
|
|
1,161 |
|
|
|
(15,144 |
) |
|
|
(33,103 |
) |
|
Depreciation and amortization |
|
|
1,844 |
|
|
|
11,826 |
|
|
|
292 |
|
|
|
224 |
|
|
|
14,186 |
|
|
Total assets |
|
|
33,053 |
|
|
|
119,960 |
|
|
|
7,084 |
|
|
|
18,804 |
|
|
|
178,901 |
|
|
Capital expenditures |
|
|
291 |
|
|
|
6,189 |
|
|
|
42 |
|
|
|
33 |
|
|
|
6,555 |
|
One customer and its affiliates accounted for 13%, 11% and 17% of consolidated revenue for the years ended December 31, 2011, 2010 and 2009, respectively. Over 97% of this revenue related to sales by the Chemicals segment. Long-lived assets held in countries other than the US are not considered material to the consolidated financial statements.
Revenue by country is determined based upon the location of services provided and products sold. Revenue by geographic location is as follows (in thousands):
| |
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| |
|
Year ended December 31, |
|
| |
|
2011 |
|
|
2010 |
|
|
2009 |
|
|
United States |
|
$ |
222,304 |
|
|
$ |
127,285 |
|
|
$ |
97,737 |
|
|
Other countries |
|
|
36,481 |
|
|
|
19,697 |
|
|
|
14,813 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
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|
Total |
|
$ |
258,785 |
|
|
$ |
146,982 |
|
|
$ |
112,550 |
|
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