Business Segment, Geographic and Major Customer Information

9 Months Ended

Sep. 30, 2012

Business Segment, Geographic and Major Customer Information [Abstract]

Business Segment, Geographic and Major Customer Information

Note 13 — 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 chief operating decision-makers to determine allocation of resources and assess performance. The operations of the Company can be categorized into three reportable segments: Chemicals and Logistics (“Chemicals”), Drilling Products (“Drilling”) and Artificial Lift.

• Chemicals is comprised of two business divisions: Specialty Chemicals and Logistics. Specialty Chemicals designs, develops, manufactures, packages and markets specialty chemicals used in oil and gas well cementing, stimulation, acidizing, drilling and production. Logistics manages automated material handling, loading facilities and blending capabilities for oilfield services companies.

• Drilling rents, inspects, manufactures and markets down-hole drilling equipment for energy, mining, water well and industrial drilling sectors.

• Artificial Lift assembles and markets artificial lift equipment, notably the Company’s Petrovalve product line of rod pump components, electric submersible pumps, gas separators, valves and services that support natural gas and oil production activities.

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, as well as estimated income tax provisions (benefits), are not allocated to reportable segments.

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

	Chemicals		Drilling		Artificial Lift		Corporate			Total
As of and for the Three Months Ended September 30,
2012
Net revenue from external customers	$	44,189	$	30,424	$	4,015	$	—		$	78,628
Gross margin		20,774		11,252		1,817		—			33,843
Income (loss) from operations		16,530		5,329		1,384		(8,650	)		14,593
Depreciation and amortization		460		2,277		54		177			2,968
Total assets		53,076		122,533		10,563		31,963			218,135
Capital expenditures		733		2,384		5		2,643			5,765
2011
Net revenue from external customers	$	43,639	$	26,963	$	4,456	$	—		$	75,058
Gross margin		17,393		11,091		2,233		—			30,717
Income (loss) from operations		13,795		5,585		1,811		(5,086	)		16,105
Depreciation and amortization		409		2,056		50		53			2,568
Total assets		56,880		111,804		10,162		32,182			211,028
Capital expenditures		928		945		38		403			2,314

	Chemicals		Drilling		Artificial Lift		Corporate			Total
As of and for the Nine Months Ended September 30,
2012
Net revenue from external customers	$	137,827	$	89,214	$	9,085	$	—		$	236,126
Gross margin		61,856		34,764		3,699		—			100,319
Income (loss) from operations		50,005		17,320		2,284		(22,679	)		46,930
Depreciation and amortization		1,321		6,738		148		261			8,468
Total assets		53,076		122,533		10,563		31,963			218,135
Capital expenditures		2,896		7,724		73		4,550			15,243
2011
Net revenue from external customers	$	99,707	$	74,068	$	10,106	$	—		$	183,881
Gross margin		39,705		30,844		3,557		—			74,106
Income (loss) from operations		30,586		16,187		2,205		(15,683	)		33,295
Depreciation and amortization		1,189		5,979		155		209			7,532
Total assets		56,880		111,804		10,162		32,182			211,028
Capital expenditures		1,090		3,900		48		933			5,971

Geographic Information

Revenue by country is based upon the location where services are provided and products are sold. No individual country other than the United States (“U.S.”) accounted for more than 10% of revenue.

Revenue by geographic location is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
U.S.	$	68,512	$	63,906	$	206,394	$	159,756
Other countries		10,116		11,152		29,731		24,125
Total	$	78,628	$	75,058	$	236,125	$	183,881

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:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Customer A		16.6	%		14.6	%		15.2	%		13.7	%
Customer B		9.5	%		12.8	%		10.4	%		11.7	%
Customer C		12.1	%		5.8	%		9.8	%		4.5	%

Over 97% of Customer A’s revenue for the three and nine month periods ended September 30, 2012 and 2011, was attributable to sales within the Chemicals segment.