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Management Discussion

• We operate in five business segments. The segments are contained within two businesses — services and products provided primarily to the oil and gas industry, and to a lesser extent, the offshore renewables and mobility solutions industries (“Energy Services and Products”) and services and products provided to non-energy industries (“Aerospace and Defense Technologies”). Our Unallocated Expenses are those not associated with a specific business segment.
• We generate a material amount of our consolidated revenue from contracts for services in the U.S. Gulf of Mexico in our OPG segment, which is usually more active in the second and third quarters, as compared to the rest of the year. The European operations of our IMDS segment are also seasonally more active in the second and third quarters. Revenue in our Subsea Robotics segment is subject to seasonal variations in demand, with our first quarter generally being the low quarter of the year. The level of our Subsea Robotics seasonality depends on the number of Remotely Operated Vehicles (“ROVs”) we have engaged in vessel-based subsea infrastructure inspection, maintenance, repair and installation, which is more seasonal than drilling support. Revenue in each of our Manufactured Products and ADTech segments generally has not been seasonal.
• We had operating income of $23 million, $14 million and $37 million in the three-month periods ended June 30, 2021 and March 31, 2021, and the six-month period ended June 30, 2021, respectively. We had operating losses of $5.2 million and $386 million in the three- and six-month periods ended June 30, 2020, respectively. Included in our operating income and loss for the three months ended June 30, 2021, June 30, 2020 and March 31, 2021 were certain charges of $1.4 million, $5.7 million and $1.3 million, respectively. Included in our operating income and loss for the six months ended June 30, 2021 and 2020, were certain charges of $2.7 million and $391 million, respectively. These charges were primarily due to market conditions requiring impairment of certain of our assets along with other costs we recognized as we adapted our geographic footprint and staffing levels to the conditions of the markets we serve and are summarized as follows: