Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 02, 2021 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-38066 | |
Entity Registrant Name | SELECT ENERGY SERVICES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-4561945 | |
Entity Address, Address Line One | 1233 W. Loop South, Suite 1400 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77027 | |
City Area Code | 713 | |
Local Phone Number | 235-9500 | |
Title of 12(b) Security | Class A common stock, par value $0.01 per share | |
Trading Symbol | WTTR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001693256 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 91,760,703 | |
Class B Common Stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 16,221,101 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 143,722 | $ 169,039 |
Accounts receivable trade, net of allowance for credit losses of $7,514 and $9,157, respectively | 148,690 | 129,392 |
Accounts receivable, related parties | 205 | 69 |
Inventories | 38,546 | 33,384 |
Prepaid expenses and other current assets | 24,852 | 19,621 |
Total current assets | 356,015 | 351,505 |
Property and equipment | 858,592 | 878,902 |
Accumulated depreciation | (541,021) | (528,537) |
Total property and equipment, net | 317,571 | 350,365 |
Right-of-use assets, net | 47,509 | 52,331 |
Other intangible assets, net | 110,846 | 116,079 |
Other long-term assets, net | 7,922 | 5,079 |
Total assets | 839,863 | 875,359 |
Current liabilities | ||
Accounts payable | 26,368 | 12,995 |
Accrued accounts payable | 26,677 | 21,359 |
Accounts payable and accrued expenses, related parties | 1,418 | 519 |
Accrued salaries and benefits | 12,234 | 16,279 |
Accrued insurance | 10,836 | 9,788 |
Sales tax payable | 1,224 | 1,415 |
Accrued expenses and other current liabilities | 9,638 | 12,077 |
Current operating lease liabilities | 13,521 | 14,019 |
Current portion of finance lease obligations | 267 | 307 |
Total current liabilities | 102,183 | 88,758 |
Long-term operating lease liabilities | 55,208 | 60,984 |
Other long-term liabilities | 21,926 | 19,735 |
Total liabilities | 179,317 | 169,477 |
Commitments and contingencies (Note 8) | ||
Preferred stock, $0.01 par value; 50,000,000 shares authorized; no shares issued and outstanding as of June 30, 2021 and December 31, 2020 | ||
Additional paid-in capital | 912,872 | 909,278 |
Accumulated deficit | (356,921) | (317,247) |
Total stockholders' equity | 556,995 | 593,061 |
Noncontrolling interests | 103,551 | 112,821 |
Total equity | 660,546 | 705,882 |
Total liabilities and equity | 839,863 | 875,359 |
Class A Common Stock | ||
Current liabilities | ||
Common stock | 882 | 868 |
Class B Common Stock | ||
Current liabilities | ||
Common stock | $ 162 | $ 162 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Allowance for doubtful accounts | $ 7,514 | $ 9,157 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Class A Common Stock | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 350,000,000 | 350,000,000 |
Common Stock, Shares, Issued | 88,160,703 | 86,812,647 |
Common Stock, Shares, Outstanding | 88,160,703 | 86,812,647 |
Class A-2 Common Stock | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 40,000,000 | 40,000,000 |
Common Stock, Shares, Issued | 0 | 0 |
Common Stock, Shares, Outstanding | 0 | 0 |
Class B Common Stock | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 150,000,000 | 150,000,000 |
Common Stock, Shares, Issued | 16,221,101 | 16,221,101 |
Common Stock, Shares, Outstanding | 16,221,101 | 16,221,101 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenue | ||||
Total revenue | $ 161,117 | $ 92,239 | $ 304,859 | $ 370,524 |
Costs of revenue | ||||
Depreciation and amortization | 21,018 | 25,508 | 42,668 | 51,690 |
Total costs of revenue | 162,754 | 115,958 | 310,893 | 378,947 |
Gross loss | (1,637) | (23,719) | (6,034) | (8,423) |
Operating expenses | ||||
Selling, general and administrative | 15,890 | 17,658 | 35,784 | 42,947 |
Depreciation and amortization | 624 | 834 | 1,273 | 1,519 |
Impairment of goodwill and trademark | 276,016 | |||
Impairment and abandonment of property and equipment | 4,726 | 7,910 | ||
Lease abandonment costs | 222 | 868 | 326 | 1,821 |
Total operating expenses | 16,736 | 24,086 | 37,383 | 330,213 |
Loss from operations | (18,373) | (47,805) | (43,417) | (338,636) |
Other (expense) income | ||||
Losses on sales of property and equipment and divestitures, net | (1,657) | (2,183) | (2,236) | (2,618) |
Interest expense, net | (400) | (513) | (835) | (844) |
Foreign currency gain (loss), net | 4 | 27 | 7 | (19) |
Other (expense) income, net | 895 | (2,700) | (734) | (2,441) |
Loss before income tax benefit | (19,531) | (53,174) | (47,215) | (344,558) |
Income tax benefit | (84) | 130 | 179 | 294 |
Net loss | (19,615) | (53,044) | (47,036) | (344,264) |
Less: net loss attributable to noncontrolling interests | 3,048 | 8,746 | 7,362 | 54,104 |
Net loss attributable to Select Energy Services, Inc. | (16,567) | (44,298) | (39,674) | (290,160) |
Water Services | ||||
Revenue | ||||
Total revenue | 76,651 | 55,807 | 140,874 | 205,318 |
Costs of revenue | ||||
Costs of revenue | 70,745 | 54,014 | 133,069 | 183,128 |
Water Infrastructure | ||||
Revenue | ||||
Total revenue | 33,326 | 15,300 | 71,129 | 73,062 |
Costs of revenue | ||||
Costs of revenue | 26,237 | 13,871 | 52,636 | 61,684 |
Oilfield Chemicals | ||||
Revenue | ||||
Total revenue | 51,140 | 21,132 | 92,856 | 92,144 |
Costs of revenue | ||||
Costs of revenue | 44,754 | 22,562 | 82,520 | 82,438 |
Other. | ||||
Costs of revenue | ||||
Costs of revenue | 3 | 7 | ||
Class A Common Stock | ||||
Other (expense) income | ||||
Net loss attributable to Select Energy Services, Inc. | $ (16,567) | $ (44,298) | $ (39,674) | $ (290,160) |
Net loss per share attributable to common stockholders (Note 14): | ||||
Basic | $ (0.19) | $ (0.52) | $ (0.47) | $ (3.39) |
Diluted | $ (0.19) | $ (0.52) | $ (0.47) | $ (3.39) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net loss | $ (19,615) | $ (53,044) | $ (47,036) | $ (344,264) |
Other comprehensive income | ||||
Comprehensive loss | (19,615) | (53,044) | (47,036) | (344,264) |
Less: comprehensive loss attributable to noncontrolling interests | 3,048 | 8,746 | 7,362 | 54,104 |
Comprehensive loss attributable to Select Energy Services, Inc. | $ (16,567) | $ (44,298) | $ (39,674) | $ (290,160) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Class A Common StockCommon Stock | Class B Common StockCommon Stock | Total Stockholders' Equity | Additional Paid-In Capital | Accumulated (Deficit) Retained Earnings | Noncontrolling Interests. | Total |
Beginning balance at Dec. 31, 2019 | $ 879 | $ 162 | $ 937,177 | $ 914,699 | $ 21,437 | $ 175,635 | $ 1,112,812 |
Beginning balance (in shares) at Dec. 31, 2019 | 87,893,525 | 16,221,101 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
ESPP shares issued | 48 | 48 | (4) | 44 | |||
ESPP shares issued (in shares) | 7,640 | ||||||
Equity-based compensation | 1,530 | 1,530 | 286 | 1,816 | |||
Issuance of restricted shares | $ 15 | 2,422 | 2,407 | (2,422) | |||
Issuance of restricted shares (in shares) | 1,477,488 | ||||||
Exercise of restricted stock units | 1 | 1 | (1) | ||||
Exercise of restricted stock units (in shares) | 625 | ||||||
Repurchase of common stock | $ (22) | (12,043) | (12,021) | 1,405 | (10,638) | ||
Repurchase of common stock ( in shares) | (2,155,901) | ||||||
Restricted shares forfeited | $ (3) | (511) | (508) | 511 | |||
Restricted shares forfeited (in shares) | (340,328) | ||||||
Noncontrolling interest in subsidiary | (133) | (133) | |||||
NCI income tax adjustment | 8 | 8 | (8) | ||||
Net loss | (290,160) | (290,160) | (54,104) | (344,264) | |||
Ending balance at Jun. 30, 2020 | $ 869 | $ 162 | 638,472 | 906,164 | (268,723) | 121,165 | 759,637 |
Ending balance (in shares) at Jun. 30, 2020 | 86,883,049 | 16,221,101 | |||||
Beginning balance at Mar. 31, 2020 | $ 880 | $ 162 | 686,429 | 909,812 | (224,425) | 129,128 | 815,557 |
Beginning balance (in shares) at Mar. 31, 2020 | 87,991,839 | 16,221,101 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
ESPP shares issued | 18 | 18 | (1) | 17 | |||
ESPP shares issued (in shares) | 3,197 | ||||||
Equity-based compensation | 1,047 | 1,047 | 195 | 1,242 | |||
Issuance of restricted shares | $ 2 | 251 | 249 | (251) | |||
Issuance of restricted shares (in shares) | 205,782 | ||||||
Repurchase of common stock | $ (12) | (4,804) | (4,792) | 802 | (4,002) | ||
Repurchase of common stock ( in shares) | (1,176,510) | ||||||
Restricted shares forfeited | $ (1) | (171) | (170) | 171 | |||
Restricted shares forfeited (in shares) | (141,259) | ||||||
Noncontrolling interest in subsidiary | (133) | (133) | |||||
Net loss | (44,298) | (44,298) | (8,746) | (53,044) | |||
Ending balance at Jun. 30, 2020 | $ 869 | $ 162 | 638,472 | 906,164 | (268,723) | 121,165 | 759,637 |
Ending balance (in shares) at Jun. 30, 2020 | 86,883,049 | 16,221,101 | |||||
Beginning balance at Dec. 31, 2020 | $ 868 | $ 162 | 593,061 | 909,278 | (317,247) | 112,821 | 705,882 |
Beginning balance (in shares) at Dec. 31, 2020 | 86,812,647 | 16,221,101 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
ESPP shares issued | 30 | 30 | (1) | 29 | |||
ESPP shares issued (in shares) | 4,881 | ||||||
Equity-based compensation | 3,333 | 3,333 | 613 | 3,946 | |||
Shares issued to consultant | 5 | 5 | 5 | ||||
Shares issued to consultant (in shares) | 738 | ||||||
Issuance of restricted shares | $ 19 | 1,900 | 1,881 | (1,900) | |||
Issuance of restricted shares (in shares) | 1,843,808 | ||||||
Repurchase of common stock | $ (2) | (1,225) | (1,223) | 19 | (1,206) | ||
Repurchase of common stock ( in shares) | (199,976) | ||||||
Restricted shares forfeited | $ (3) | (318) | (315) | 318 | |||
Restricted shares forfeited (in shares) | (301,395) | ||||||
Noncontrolling interest in subsidiary | (140) | (140) | (934) | (1,074) | |||
NCI income tax adjustment | 23 | 23 | (23) | ||||
Net loss | (39,674) | (39,674) | (7,362) | (47,036) | |||
Ending balance at Jun. 30, 2021 | $ 882 | $ 162 | 556,995 | 912,872 | (356,921) | 103,551 | 660,546 |
Ending balance (in shares) at Jun. 30, 2021 | 88,160,703 | 16,221,101 | |||||
Beginning balance at Mar. 31, 2021 | $ 879 | $ 162 | 571,375 | 910,688 | (340,354) | 106,574 | 677,949 |
Beginning balance (in shares) at Mar. 31, 2021 | 87,856,767 | 16,221,101 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
ESPP shares issued | 16 | 16 | (1) | 15 | |||
ESPP shares issued (in shares) | 2,736 | ||||||
Equity-based compensation | 2,131 | 2,131 | 393 | 2,524 | |||
Shares issued to consultant | 5 | 5 | 5 | ||||
Shares issued to consultant (in shares) | 738 | ||||||
Issuance of restricted shares | $ 4 | 356 | 352 | (356) | |||
Issuance of restricted shares (in shares) | 356,360 | ||||||
Repurchase of common stock | $ (1) | (336) | (335) | 4 | (332) | ||
Repurchase of common stock ( in shares) | (55,898) | ||||||
NCI income tax adjustment | 15 | 15 | (15) | ||||
Net loss | (16,567) | (16,567) | (3,048) | (19,615) | |||
Ending balance at Jun. 30, 2021 | $ 882 | $ 162 | $ 556,995 | $ 912,872 | $ (356,921) | $ 103,551 | $ 660,546 |
Ending balance (in shares) at Jun. 30, 2021 | 88,160,703 | 16,221,101 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash flows from operating activities | ||
Net loss | $ (47,036) | $ (344,264) |
Adjustments to reconcile net loss to net cash provided by operating activities | ||
Depreciation and amortization | 43,941 | 53,209 |
Net loss on disposal of property and equipment and divestitures | 2,236 | 2,207 |
Bad debt (recovery) expense | (381) | 4,810 |
Amortization of debt issuance costs | 344 | 344 |
Inventory write-downs | 82 | 566 |
Equity-based compensation | 3,946 | 1,816 |
Impairment of goodwill and trademark | 276,016 | |
Impairment and abandonment of property and equipment | 7,910 | |
Loss on divestitures | 411 | |
Unrealized loss on short-term investment | 1,169 | |
Other operating items, net | (139) | 404 |
Changes in operating assets and liabilities | ||
Accounts receivable | (19,054) | 160,204 |
Prepaid expenses and other assets | (11,044) | 3,276 |
Accounts payable and accrued liabilities | 14,497 | (64,176) |
Net cash (used in) provided by operating activities | (11,439) | 102,733 |
Cash flows from investing activities | ||
Proceeds received from divestitures | 197 | |
Purchase of property and equipment | (13,451) | (16,461) |
Investment in note receivable | (1,101) | |
Purchase of equity method investments | (2,200) | |
Distribution from cost method investment | 120 | |
Proceeds received from sales of property and equipment | 5,141 | 11,015 |
Net cash used in investing activities | (11,491) | (5,249) |
Cash flows from financing activities | ||
Payments of finance lease obligations | (156) | (121) |
Proceeds from share issuance | 29 | 44 |
(Distributions to) contributions from noncontrolling interests | (1,074) | 383 |
Repurchase of common stock | (1,206) | (10,638) |
Net cash used in financing activities | (2,407) | (10,332) |
Effect of exchange rate changes on cash | 20 | (13) |
Net (decrease) increase in cash and cash equivalents | (25,317) | 87,139 |
Cash and cash equivalents, beginning of period | 169,039 | 79,268 |
Cash and cash equivalents, end of period | 143,722 | 166,407 |
Supplemental cash flow disclosure: | ||
Cash paid for interest | 741 | 760 |
Cash refunds received for income taxes, net | (962) | 544 |
Supplemental disclosure of noncash investing activities: | ||
Capital expenditures included in accounts payable and accrued liabilities | $ 6,038 | 2,422 |
Noncash proceeds received from sale of interest in a formerly consolidated joint venture | $ 367 |
BUSINESS AND BASIS OF PRESENTAT
BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2021 | |
BUSINESS AND BASIS OF PRESENTATION | |
BUSINESS AND BASIS OF PRESENTATION | NOTE 1—BUSINESS AND BASIS OF PRESENTATION Description of the business : Select Energy Services, Inc. (“we,” “Select Inc.” or “the Company”) was incorporated as a Delaware corporation on November 21, 2016. The Company is a holding company whose sole material asset consists of common units (“SES Holdings LLC Units”) in SES Holdings, LLC (“SES Holdings”). We are a leading provider of comprehensive water-management and chemical solutions to the oil and gas industry in the U.S. We also develop, manufacture and deliver a full suite of chemical solutions for use in oil and gas well completion and production operations. As a leader in the water solutions industry, we place the utmost importance on safe, environmentally responsible management of oilfield water throughout the lifecycle of a well. Additionally, we believe that responsibly managing water resources through our operations to help conserve and protect the environment in the communities in which we operate is paramount to our continued success. Class A and Class B Common Stock: Exchange rights: Basis of presentation : The accompanying unaudited interim consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). These unaudited interim consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all disclosures required for financial statements prepared in conformity with GAAP. This Quarterly Report relates to the three and six months ended June 30, 2021 (the “Current Quarter” and the “Current Period”, respectively) and the three and six months ended June 30, 2020 (the “Prior Quarter” and the “Prior Period”, respectively). The Company’s Annual Report on Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”) filed with the SEC on February 24, 2021, includes certain definitions and a summary of significant accounting policies and should be read in conjunction with this Quarterly Report. All material adjustments (consisting solely of normal recurring adjustments) which, in the opinion of management, are necessary for a fair statement of the results for the interim periods have been reflected. The results for the Current Quarter and Current Period may not be indicative of the results to be expected for the full year, in part due to the COVID-19 pandemic and continued progress in the distribution and uptake of remedies such as vaccines. The unaudited interim consolidated financial statements include the accounts of the Company and all of its majority-owned or controlled subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. For investments in subsidiaries that are not wholly owned, but where the Company exercises control, the equity held by the minority owners and their portion of net income or loss are reflected as noncontrolling interests. Investments in entities in which the Company exercises significant influence over operating and financial policies are accounted for using the equity method, and investments in entities for which the Company does not have significant control or influence are accounted for using the cost method or other appropriate basis as applicable. As of June 30, 2021, the Company had two equity method investees and one cost-method investee. The Company also had one investment in notes receivable accounted for using the amortized cost basis and one investment in publicly traded securities accounted for using the fair value option. The Company’s investments are reviewed for impairment whenever events or circumstances indicate that the carrying value may not be recoverable. When circumstances indicate that the fair value of its investment is less than its carrying value and the reduction in value is other than temporary, the reduction in value is recognized in earnings. Our investments in unconsolidated entities are summarized below and are reported under our Water Services segment: Year (in thousands) Type of Investment attained Accounting method Balance Sheet Location June 30, 2021 December 31, 2020 20% minority interest 2011 Cost-method Other long-term assets, net $ 180 $ 300 Notes receivable 2020 Amortized cost basis Other long-term assets, net 4,276 3,037 33% minority interest 2021 Equity-method Other long-term assets, net 2,000 — 45% minority interest 2021 Equity-method Other long-term assets, net 200 — Publicly traded securities 2020 Fair value option Prepaid expenses and other current assets 2,208 3,377 Segment reporting : The Company has three reportable segments. Reportable segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. The Company’s current reportable segments are Water Services, Water Infrastructure, and Oilfield Chemicals. The Water Services segment consists of the Company’s services businesses, including water transfer, flowback and well testing, fluids hauling, water containment and water network automation, primarily serving E&P companies. Additionally, this segment includes the operations of our accommodations and rentals business as well as the Company’s industrial solutions business. The Water Infrastructure segment consists of the Company’s infrastructure assets, including operations associated with our water sourcing and pipeline infrastructure, our water recycling solutions and infrastructure, and our produced water gathering systems and saltwater disposal wells, primarily serving E&P companies. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2—SIGNIFICANT ACCOUNTING POLICIES Significant accounting policies : The Company’s significant accounting policies are disclosed in Note 2 of the consolidated financial statements for the year ended December 31, 2020, included in the 2020 Form 10-K. Use of estimates : The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, the Company evaluates its estimates, including those related to the recoverability of long-lived assets and intangibles, useful lives used in depreciation and amortization, uncollectible accounts receivable, inventory reserve, income taxes, self-insurance liabilities, share-based compensation, contingent liabilities and the incremental borrowing rate for leases. The Company bases its estimates on historical and other pertinent information that are believed to be reasonable under the circumstances. The accounting estimates used in the preparation of the consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Allowance for credit losses: The change in the allowance for credit losses is as follows: Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 9,157 Increase to allowance based on a percentage of revenue 607 Adjustment based on aged receivable analysis (1,000) Charge-offs (1,252) Recoveries 2 Balance at June 30, 2021 $ 7,514 The Company also has a $4.3 million note receivable resulting from an initial investment in the fourth quarter of 2020 and additional investment in the Current Quarter, with no allowance for credit losses as of June 30, 2021. See “Note 11— Related-Party Transactions” for additional information. Asset retirement obligations: Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 999 Accretion expense, included in depreciation and amortization expense 1 Disposals (188) Payments (213) Balance at June 30, 2021 $ 599 We review the adequacy of our ARO liabilities whenever indicators suggest that the estimated cash flows underlying the liabilities have changed. The Company’s ARO liabilities are included in accrued expenses and other current liabilities and other long-term liabilities in the accompanying consolidated balance sheets. Lessor Income: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Category Classification Lessor income Costs of revenue $ 60 $ 96 $ 126 $ 212 Sublease income Lease abandonment costs and Costs of revenue 231 335 474 736 The Company also generates short-term equipment rental revenue. See “Note 3—Revenue” for a discussion of revenue recognition for the accommodations and rentals business. Defined Contribution Plan: Payroll Tax Deferral: Severance: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Severance Costs of revenue - Water services $ — $ 1,453 $ — $ 2,929 Costs of revenue - Water infrastructure — 206 — 452 Costs of revenue - Oilfield chemicals — 514 — 626 Selling, general and administrative — 1,493 3,225 3,161 Total severance expense $ — $ 3,666 $ 3,225 $ 7,168 |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2021 | |
REVENUE | |
REVENUE | NOTE 3—REVENUE The Company follows ASU 2014-09, Revenue from Contracts with Customers (Topic 606) Leases, The following factors are applicable to all three of the Company’s segments for the Current Period and Prior Period, respectively: ● The vast majority of customer agreements are short-term, lasting less than one year. ● Contracts are seldom combined together as virtually all of our customer agreements constitute separate performance obligations. Each job is typically distinct, thereby not interdependent or interrelated with other customer agreements. ● Most contracts allow either party to terminate at any time without substantive penalties. If the customer terminates the contract, the Company is unconditionally entitled to the payments for the services rendered and products delivered to date. ● Contract terminations before the end of the agreement are rare. ● Sales returns are rare and no sales return assets have been recognized on the balance sheet. ● There are minimal volume discounts. ● There are no service-type warranties. ● There is no long-term customer financing. In the Water Services and Water Infrastructure segments, performance obligations arise in connection with services provided to customers in accordance with contractual terms, in an amount the Company expects to collect. Services are generally sold based upon customer orders or contracts with customers that include fixed or determinable prices. Revenues are generated by services rendered and measured based on output generated, which is usually simultaneously received and consumed by customers at their job sites. As a multi-job site organization, contract terms, including pricing for the Company’s services, are negotiated on a job site level on a per-job basis. Most jobs are completed in a short period of time, usually between one day and one month. Revenue is recognized as performance obligations are completed on a daily, hourly or per unit basis with unconditional rights to consideration for services rendered reflected as accounts receivable trade, net of allowance for credit losses. In cases where a prepayment is received before the Company satisfies its performance obligations, a contract liability is recorded in accrued expenses and other current liabilities. Final billings generally occur once all of the proper approvals are obtained. Mobilization and demobilization are factored into the pricing for services. Billings and costs related to mobilization and demobilization are not material for customer agreements that start in one period and end in another. As of June 30, 2021, the Company had six contracts in place for these segments lasting over one year. The Company has recorded an $8.2 million contract liability associated with one of the six long-term contracts as of June 30, 2021, recognized in other long-term liabilities in the accompanying balance sheets. The Company expects this contract liability to be converted to revenue under the terms of the contract as it is earned. Accommodations and rentals revenue is included in the Water Services segment and the Company accounts for accommodations and rentals agreements as an operating lease. The Company recognizes revenue from renting equipment on a straight-line basis. Accommodations and rental contract periods are generally daily, weekly or monthly. The average lease term is less than three months and as of June 30, 2021, there were no material rental agreements in effect lasting more than one year. During the Current Quarter, Prior Quarter, Current Period and Prior Period, approximately $6.7 million, $4.6 million $12.9 million and $19.8 million of accommodations and rentals revenue was accounted for under ASC 842 lease guidance, with the remainder accounted for under ASC 606 revenue guidance. In the Oilfield Chemicals segment, the typical performance obligation is to provide a specific quantity of chemicals to customers in accordance with the customer agreement in an amount the Company expects to collect. Products and services are generally sold based upon customer orders or contracts with customers that include fixed or determinable prices. Revenue is recognized as the customer takes title to chemical products in accordance with the agreement. Products may be provided to customers in packaging or delivered to the customers’ containers through a hose. In some cases, the customer takes title to the chemicals upon consumption from storage containers on their property, where the chemicals are considered inventory until customer usage. In cases where the Company delivers products and recognizes revenue before collecting payment, the Company usually has an unconditional right to payment reflected in accounts receivable trade, net of allowance for credit losses. Customer returns are rare and immaterial and there were no material in-process customer agreements for this segment as of June 30, 2021, lasting greater than one year. The following table sets forth certain financial information with respect to the Company’s disaggregation of revenues by geographic location: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Geographic Region Permian Basin $ 83,355 $ 36,638 $ 154,559 $ 174,636 Eagle Ford 24,569 10,672 45,354 46,336 Haynesville/E. Texas 18,303 14,708 35,568 33,723 Marcellus/Utica 13,251 13,251 24,918 33,090 Rockies 9,196 6,927 19,218 25,796 MidCon 9,527 7,825 18,003 32,698 Bakken 3,864 2,542 10,767 25,102 Eliminations and other regions (948) (324) (3,528) (857) Total $ 161,117 $ 92,239 $ 304,859 $ 370,524 In the Water Services segment, the top three revenue-producing regions are the Permian Basin, Eagle Ford and Marcellus/Utica, which collectively comprised 78%, 69%, 77% and 73% of segment revenue for the Current Quarter, Prior Quarter, Current Period and Prior Period, respectively. In the Water Infrastructure segment, the top three revenue-producing regions are the Permian Basin, Eagle Ford and Bakken, which collectively comprised 97%, 96%, 97% and 97% of segment revenue for the Current Quarter, Prior Quarter, Current Period and Prior Period, respectively. In the Oilfield Chemicals segment, the top three revenue-producing regions are the Permian Basin, Haynesville/E. Texas and MidCon, which collectively comprised 84%, 89%, 86% and |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2021 | |
INVENTORIES | |
INVENTORIES | NOTE 4—INVENTORIES Inventories, which are comprised of blended chemicals and raw materials available for resale and parts and consumables used in operations, are valued at the lower of cost and net realizable value, with cost determined under the weighted-average method. The significant components of inventory are as follows: June 30, 2021 December 31, 2020 (in thousands) Raw materials $ 21,601 $ 16,701 Finished goods 16,945 16,683 Total $ 38,546 $ 33,384 During the Current Quarter, Prior Quarter, Current Period and Prior Period, the Company recorded charges to the reserve for excess and obsolete inventory for a nominal amount, $0.5 million, $0.1 million and $0.6 million, respectively, which were recognized within costs of revenue on the accompanying consolidated statements of operations. The Company’s inventory reserve was $4.1 million as of June 30, 2021 and December 31, 2020. The reserve for excess and obsolete inventories is determined based on the Company’s historical usage of inventory on hand, as well as future expectations and the amount necessary to reduce the cost of the inventory to its estimated net realizable value. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2021 | |
PROPERTY AND EQUIPMENT.. | |
PROPERTY AND EQUIPMENT | NOTE 5—PROPERTY AND EQUIPMENT Property and equipment are stated at cost less accumulated depreciation. Depreciation (and amortization of finance lease assets) is calculated on a straight-line basis over the estimated useful life of each asset. Property and equipment consists of the following as of June 30, 2021 and December 31, 2020: June 30, 2021 December 31, 2020 (in thousands) Machinery and equipment $ 585,728 $ 596,441 Buildings and leasehold improvements 96,793 93,236 Pipelines 72,803 72,458 Disposal wells 44,392 48,097 Vehicles and equipment 29,477 30,975 Land 10,624 13,497 Computer equipment and software 6,222 7,127 Office furniture and equipment 857 892 Machinery and equipment - finance lease 544 537 Vehicles and equipment - finance lease 422 475 Computer equipment and software - finance lease 412 356 Construction in progress 10,318 14,811 858,592 878,902 Less accumulated depreciation (1) (541,021) (528,537) Total property and equipment, net $ 317,571 $ 350,365 (1) Includes $1.1 million of accumulated depreciation related to finance leases as of both June 30, 2021 and December 31, 2020. Total depreciation and amortization expense related to property and equipment and finance leases presented in the table above, as well as amortization of intangible assets presented in Note 6 is as follows: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Category Depreciation expense from property and equipment $ 19,017 $ 23,286 $ 38,604 $ 47,271 Amortization expense from finance leases 21 39 103 116 Amortization expense from intangible assets 2,616 2,986 5,233 5,979 Accretion expense from asset retirement obligations (12) 31 1 (157) Total depreciation and amortization $ 21,642 $ 26,342 $ 43,941 $ 53,209 Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. During the Prior Quarter and Prior Period, the Company determined that certain equipment was obsolete, and recorded the following impairment charges: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Impairment and abandonment of property and equipment Water Services $ — $ 1,396 $ — $ 3,894 Water Infrastructure — 3,330 — 4,016 Total impairment and abandonment of property and equipment $ — $ 4,726 $ — $ 7,910 |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS. | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 6—GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill is evaluated for impairment on at least an annual basis, or more frequently if indicators of impairment exist. The annual impairment tests are based on Level 3 inputs (see “Note 10—Fair Value Measurement”). During the first quarter of 2020, the Company had triggering events related to the significant adverse change to the demand for the Company’s services in connection with a significant decline in the price of oil and the related global economic impacts resulting from the OPEC+ disputes as well as the COVID-19 pandemic. This included uncertainty regarding oil prices and the length of the recovery following the significant market disruption in the oil and gas industry. Given the volatile market environment as of March 31, 2020, the Company utilized third-party valuation advisors to assist with these evaluations. These evaluations included significant judgment, including management’s short-term and long-term forecast of operating performance, discount rates based on our weighted-average cost of capital, revenue growth rates, profitability margins, capital expenditures, the timing of future cash flows based on an eventual recovery of the oil and gas industry, and in the case of long-lived assets, the remaining useful life and service potential of the asset. The Company performed quantitative tests for reporting units in both the Water Services and Water Infrastructure segments using the income and market approaches, resulting in a full impairment to goodwill in both segments totaling $266.9 million. The components of other intangible assets, net as of June 30, 2021 and December 31, 2020 are as follows: As of June 30, 2021 As of December 31, 2020 Gross Accumulated Net Gross Accumulated Net Value Amortization Value Value Impairment Amortization Value (in thousands) (in thousands) Definite-lived Customer relationships $ 116,554 $ (33,836) $ 82,718 $ 116,554 $ — $ (29,302) $ 87,252 Patents 9,741 (3,653) 6,088 9,741 — (3,166) 6,575 Other 7,234 (6,585) 649 7,234 — (6,373) 861 Total definite-lived 133,529 (44,074) 89,455 133,529 — (38,841) 94,688 Indefinite-lived Water rights 7,031 — 7,031 7,031 — — 7,031 Trademarks 14,360 — 14,360 23,442 (9,082) — 14,360 Total indefinite-lived 21,391 — 21,391 30,473 (9,082) — 21,391 Total other intangible assets, net $ 154,920 $ (44,074) $ 110,846 $ 164,002 $ (9,082) $ (38,841) $ 116,079 Due to the triggering events discussed above, the Company also tested indefinite-lived intangible assets for impairment during the first quarter of 2020. These evaluations included significant judgment, including discount rates based on our weighted-average cost of capital and the royalty rate. This resulted in $9.1 million of impairment to trademarks using the relief from royalty method, which was recorded in the Oilfield Chemicals segment. Further, the Company tested all other long-lived assets for impairment, including definite-lived intangible assets, using an undiscounted test for recoverability at the asset group level which resulted in no additional impairments. The weighted-average amortization period for customer relationships, patents, and other definite-lived assets was 9.2 years, 6.3 years, and 2.4 five Amount (in thousands) Remainder of 2021 $ 5,233 Year ending December 31, 2022 10,252 Year ending December 31, 2023 10,180 Year ending December 31, 2024 10,111 Year ending December 31, 2025 9,948 Thereafter 43,731 Total $ 89,455 |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2021 | |
DEBT | |
DEBT | NOTE 7—DEBT Credit facility and revolving line of credit On November 1, 2017, SES Holdings and Select Energy Services, LLC (“Select LLC”) entered into a $300.0 million senior secured revolving credit facility (the “Credit Agreement”), by and among SES Holdings, as parent, Select LLC, as borrower and certain of SES Holdings’ subsidiaries, as guarantors, each of the lenders party thereto and Wells Fargo Bank, N.A., as administrative agent, issuing lender and swingline lender (the “Administrative Agent”). The Credit Agreement also has a sublimit of $40.0 million for letters of credit and a sublimit of $30.0 million for swingline loans. The maturity date of the Credit Agreement is the earlier of (a) November 1, 2022, and (b) the earlier termination in whole of the Commitments pursuant to Section 2.1(b) of Article VII of the Credit Agreement. The Credit Agreement permits extensions of credit up to the lesser of $300.0 million and a borrowing base that is determined by calculating the amount equal to the sum of (i) 85% of the Eligible Billed Receivables (as defined in the Credit Agreement), plus (ii) 75% of Eligible Unbilled Receivables (as defined in the Credit Agreement), provided that this amount will not equal more than 35% of the borrowing base, plus (iii) the lesser of (A) the product of 70% multiplied by the value of Eligible Inventory (as defined in the Credit Agreement) at such time and (B) the product of 85% multiplied by the Net Recovery Percentage (as defined in the Credit Agreement) identified in the most recent Acceptable Appraisal of Inventory (as defined in the Credit Agreement), multiplied by the value of Eligible Inventory at such time, provided that this amount will not equal more than 30% of the borrowing base, minus (iv) the aggregate amount of Reserves (as defined in the Credit Agreement), if any, established by the Administrative Agent from time to time, including, if any, the amount of the Dilution Reserve (as defined in the Credit Agreement). The borrowing base is calculated on a monthly basis pursuant to a borrowing base certificate delivered by Select LLC to the Administrative Agent. Borrowings under the Credit Agreement bear interest, at Select LLC’s election, at either the (a) one-, two-, three- or six-month LIBOR (“Eurocurrency Rate”) or (b) the greatest of (i) the federal funds rate plus 0.5%, (ii) the one-month Eurocurrency Rate plus 1% and (iii) the Administrative Agent’s prime rate (the ”Base Rate”), in each case plus an applicable margin. Interest is payable monthly in arrears. The applicable margin for Eurocurrency Rate loans ranges from 1.50% to 2.00% and the applicable margin for Base Rate loans ranges from 0.50% to 1.00%, in each case, depending on Select LLC’s average excess availability under the Credit Agreement. During the continuance of a bankruptcy event of default, automatically and during the continuance of any other default, upon the Administrative Agent’s or the required lenders’ election, all outstanding amounts under the Credit Agreement will bear interest at 2.00% plus the otherwise applicable interest rate. Level Average Excess Availability Base Rate Margin Eurocurrency Rate Margin I < 33% of the commitments 1.00% 2.00% II < 66.67% of the commitments and ≥ 33.33% of the commitments 0.75% 1.75% III ≥ 66.67% of the commitments 0.50% 1.50% Level Average Revolver Usage Unused Line Fee Percentage I ≥ 50% of the commitments 0.250% II < 50% of the commitments 0.375% The obligations under the Credit Agreement are guaranteed by SES Holdings and certain subsidiaries of SES Holdings and Select LLC and secured by a security interest in substantially all of the personal property assets of SES Holdings, Select LLC and their domestic subsidiaries. The Credit Agreement contains certain customary representations and warranties, affirmative and negative covenants and events of default. If an event of default occurs and is continuing, the lenders may declare all amounts outstanding under the Credit Agreement to be immediately due and payable. In addition, the Credit Agreement restricts SES Holdings’ and Select LLC’s ability to make distributions on, or redeem or repurchase, its equity interests, except for certain distributions, including distributions of cash so long as, both at the time of the distribution and after giving effect to the distribution, no default exists under the Credit Agreement and either (a) excess availability at all times during the preceding 30 consecutive days, on a pro forma basis and after giving effect to such distribution, is not less than the greater of (1) 25% of the lesser of (A) the maximum revolver amount and (B) the then-effective borrowing base and (2) $37.5 million or (b) if SES Holdings’ fixed charge coverage ratio is at least 1.0 to 1.0 on a pro forma basis, and excess availability at all times during the preceding 30 consecutive days, on a pro forma basis and after giving effect to such distribution, is not less than the greater of (1) 20% of the lesser of (A) the maximum revolver amount and (B) the then-effective borrowing base and (2) $30.0 million. Additionally, the Credit Agreement generally permits Select LLC to make distributions to allow Select Inc. to make payments required under the existing Tax Receivable Agreements. See “Note 11—Related-Party Transactions” for further discussion of the Tax Receivable Agreements. The Credit Agreement also requires SES Holdings to maintain a fixed charge coverage ratio of at least 1.0 to 1.0 at any time availability under the Credit Agreement is less than the greater of (i) 10% of the lesser of (A) the maximum revolver amount and (B) the then-effective borrowing base and (ii) $15.0 million and continuing through and including the first day after such time that availability under the Credit Agreement has equaled or exceeded the greater of (i) 10% of the lesser of (A) the maximum revolver amount and (B) the then-effective borrowing base and (ii) $15.0 million for 60 consecutive calendar days. Certain lenders party to the Credit Agreement and their respective affiliates have from time to time performed, and may in the future perform, various financial advisory, commercial banking and investment banking services for the Company and its affiliates in the ordinary course of business for which they have received and would receive customary compensation. In addition, in the ordinary course of their various business activities, such parties and their respective affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers, and such investments and securities activities may involve the Company’s securities and/or instruments. The Company had no borrowings outstanding under the Credit Agreement as of June 30, 2021 and December 31, 2020. As of June 30, 2021 and December 31, 2020, the borrowing base under the Credit Agreement was $128.3 million and $96.4 million, respectively. Debt issuance costs are amortized to interest expense over the life of the debt to which they pertain. Total unamortized debt issuance costs as of June 30, 2021 and December 31, 2020, were $0.9 million and $1.3 million, respectively. As these debt issuance costs relate to a revolving line of credit, they are presented as a deferred charge within other assets on the consolidated balance sheets. Amortization expense related to debt issuance costs was $0.2 million, $0.2 million, $0.3 million and $0.3 million for the Current Quarter, Prior Quarter, Current Period and Prior Period, respectively. The Company was in compliance with all debt covenants as of June 30, 2021. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 8—COMMITMENTS AND CONTINGENCIES Litigation The Company is subject to a number of lawsuits and claims arising out of the normal conduct of its business. The ability to predict the ultimate outcome of such matters involves judgments, estimates and inherent uncertainties. Based on a consideration of all relevant facts and circumstances, including applicable insurance coverage, it is not expected that the ultimate outcome of any currently pending lawsuits or claims against the Company will have a material adverse effect on its consolidated financial position, results of operations or cash flows; however, there can be no assurance as to the ultimate outcome of these matters. On April 20, 2021, an entity acquired in the 2017 merger (the “Rockwater Merger”) with Rockwater Energy Solutions, Inc. (“Rockwater”) formally pled guilty to violations of the Clean Air Act that occurred prior to the Rockwater Merger and entered a plea agreement before the U.S. District Court for the Middle District of Pennsylvania. Entry into this plea agreement has resolved the government’s prosecution related to Rockwater’s altering emissions controls systems on less than 5% of the vehicles in its fleet. The Company made final payments in April totaling $2.6 million, which was the amount accrued as of both March 31, 2021 and December 31, 2020, and did not incur additional monetary penalties or fines. The total amount paid in settlement of this matter was $4.3 million. In February 2021, the Company and certain subsidiaries received Notices of Proposed Debarment from the Environmental Protection Agency’s (“EPA”) Suspension and Debarment Official. On July 6, 2021, the Company was notified by the EPA that they terminated the proposed debarment proceedings and administratively closed this matter. Self-Insured Reserves We are self-insured up to certain retention limits with respect to workers’ compensation, general liability and vehicle liability matters and health insurance. We maintain accruals for self-insurance retentions that we estimate using third-party data and claims history. |
EQUITY-BASED COMPENSATION
EQUITY-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2021 | |
EQUITY-BASED COMPENSATION | |
EQUITY-BASED COMPENSATION | NOTE 9—EQUITY-BASED COMPENSATION The SES Holdings 2011 Equity Incentive Plan, (the “2011 Plan”) was approved by the board of managers of SES Holdings in April 2011. In conjunction with the private placement of 16,100,000 shares of the Company’s Class A Common Stock on December 20, 2016 (the “Select 144A Offering”), the Company adopted the Select Energy Services, Inc. 2016 Equity Incentive Plan (as amended, the “2016 Plan”) for employees, consultants and directors of the Company and its affiliates. Options that were outstanding under the 2011 Plan immediately prior to the Select 144A Offering were cancelled in exchange for new options granted under the 2016 Plan. On May 8, 2020, the Company’s stockholders approved an amendment to the 2016 Plan to increase the number of shares of the Company’s Class A Common Stock that may be issued under the 2016 Plan by 4,000,000 shares and to make certain other administrative changes. The 2016 Plan includes share recycling provisions that allow shares subject to an award that expires or is cancelled, forfeited or otherwise terminated without actual delivery of the underlying shares of Class A Common Stock to be considered not delivered and thus available to be granted as new awards under the 2016 Plan. Currently, the maximum number of shares reserved for issuance under the 2016 Plan is approximately 13.3 million shares, with approximately 3.1 million shares available to be issued as of June 30, 2021. For all share-based compensation award types, the Company accounts for forfeitures as they occur. Stock option awards Stock options were granted with an exercise price equal to or greater than the fair market value of a share of Class A Common Stock as of the date of grant. The expected life of the options was based on the vesting period and term of the options awarded, which is ten years. A summary of the Company’s stock option activity and related information as of and for the Current Period is as follows: For the six months ended June 30, 2021 Weighted-average Weighted-average Grant Date Value Aggregate Intrinsic Stock Options Exercise Price Term (Years) Value (in thousands) (a) Beginning balance, outstanding 3,519,159 $ 16.11 3.3 $ — Expired (1,386,469) 14.85 Ending balance, outstanding 2,132,690 $ 16.93 4.8 $ — Ending balance, exercisable 2,132,690 $ 16.93 4.8 $ — Nonvested at June 30, 2021 — $ — (a) The Company recognized no compensation expense related to stock options during the Current Quarter, a nominal amount of compensation expense during the Prior Quarter and the Current Period and $0.2 million of compensation expense in the Prior Period. As of June 30, 2021, all equity-based compensation expense related to stock options had been recognized. Restricted Stock Awards The value of the restricted stock awards granted was established by the market price of the Class A Common Stock on the date of grant and is recorded as compensation expense ratably over the vesting term, which is generally one Current Period and Prior Period, respectively. As of June 30, 2021, there was $14.0 million of unrecognized compensation expense with a weighted-average remaining life of 2.0 years related to unvested restricted stock awards. A summary of the Company’s restricted stock awards activity and related information for the Current Period is as follows: For the six months ended June 30, 2021 Weighted-average Restricted Stock Awards Grant Date Fair Value Nonvested at December 31, 2020 2,003,072 $ 6.97 Granted 1,843,808 6.41 Vested (693,582) 7.92 Forfeited (301,395) 6.38 Nonvested at June 30, 2021 2,851,903 $ 6.44 Performance Share Units (PSUs) During 2018 and 2019, the Company approved grants of performance share units (“PSUs”) that are subject to both performance-based and service-based vesting provisions. The number of shares of Class A Common Stock issued to a recipient upon vesting of the PSU will be calculated based on performance against certain metrics that relate to the Company’s return on asset performance over the January 1, 2018 through December 31, 2020, and January 1, 2019 through December 31, 2021 performance periods, respectively. The target number of shares of Class A Common Stock subject to each PSU granted in 2018 and 2019 is one; however, based on the achievement of performance criteria, the number of shares of Class A Common Stock that may be received in settlement of each PSU can range from zero to 1.75 times the target number. The PSUs become earned at the end of the performance period after the attainment of the performance level has been certified by the compensation committee, which will be no later than June 30, 2021 for the 2018 PSU grants, and June 30, 2022 for the 2019 PSU grants, assuming the minimum performance metrics are achieved. The target PSUs that become earned PSUs during the performance period will be determined in accordance with the following table: Return on Assets at Performance Period End Date Percentage of Target PSUs Earned Less than 9.6% 0% 9.6% 50% 12% 100% 14.4% 175% All PSUs granted in 2018 did not achieve the performance-based vesting conditions and were forfeited. Also, during 2020, the Company revised the estimates for the PSUs granted in 2019, which are not expected to achieve the performance-based vesting conditions. During 2020 and 2021, the Company approved grants of PSUs that are subject to both performance-based and service-based vesting provisions related to (i) return on asset performance (“ROA”) in comparison to thirteen peer companies and (ii) Adjusted Free Cash Flow (“FCF”) performance percentage. The number of shares of Class A Common Stock issued to a recipient upon vesting of the PSUs will be calculated based on ROA and FCF performance over the applicable period from either January 1, 2020 through December 31, 2022 or January 1, 2021 through December 31, 2023. During the Current Quarter, the Company also approved grants of PSUs subject to both performance-based and service-based vesting conditions based on adjusted earnings before taxes and depreciation (“Adjusted EBITDA”) as defined in the agreement. The target number of shares of Class A Common Stock subject to each PSU granted in 2020 and 2021 is one; however, based on the achievement of performance criteria, the number of shares of Class A Common Stock that may be received in settlement of each PSU can range from zero The target PSUs granted in 2020 that become earned connected with the ROA in comparison to other companies will be determined based on the Company’s Average Return on Assets (as defined in the applicable PSU agreement) relative to the Average Return on Assets of the peer companies (as defined in the applicable PSU agreement) in accordance with the following table, but only if the Company’s Average Return on Assets is equal to or greater than 5% during the performance period. The target PSUs granted in 2021 removed the 5% minimum ROA for the Company and added that the Company must have a positive Total Shareholder Return (as defined in the applicable PSU agreement) over the performance period. As a result of this market condition being added, the 2021 PSUs will be valued each reporting period utilizing a Black-Scholes model. Ranking Among Peer Group Percentage of Target Amount Earned Outside of Top 10 0% Top 10 50% Top 7 100% Top 3 175% The target PSUs that become earned in connection with the adjusted FCF performance percentage will be determined (as defined in the applicable PSU agreement) in accordance with the following table: Adjusted FCF Performance Percentage Percentage of Target Amount Earned Less than 70% 0% 70% 50% 100% 100% 130% 175% The target PSUs granted in 2021 connected with Adjusted EBITDA can only vest at 100% if the minimum Adjusted EBITDA threshold is met. Failure to meet this threshold would result in 0% vesting. The fair value on the date the PSUs were granted during 2021, 2020, and 2019 was $4.7 million, $4.4 million, $7.0 million, respectively. Compensation expense related to the PSUs is determined by multiplying the number of shares of Class A Common Stock underlying such awards that, based on the Company’s estimate, are probable to vest by the measurement date (i.e., the last day of each reporting period date) fair value and recognized using the accelerated attribution method. The Company recognized compensation expense of $0.4 million, a credit to compensation expense of $0.7 million, compensation expense of $0.9 million and a credit to compensation expense of $2.2 million related to the PSUs for the Current Quarter, Prior Quarter, Current Period and Prior Period, respectively. As of June 30, 2021, the unrecognized compensation cost related to our unvested PSUs is estimated to be $ million and is expected to be recognized over a weighted-average period of 2.1 years. However, this compensation cost will be adjusted as appropriate throughout the applicable performance periods. The following table summarizes the information about the performance share units outstanding as of June 30, 2021: Performance Share Units Nonvested as of December 31, 2020 1,763,909 Target shares granted 689,551 Target shares forfeited (242,087) Target shares outstanding as of June 30, 2021 2,211,373 Employee Stock Purchase Plan (ESPP) The Company has an Employee Stock Purchase Plan (“ESPP”) under which employees that have been continuously employed for at least one year may purchase shares of Class A Common Stock at a discount. The plan provides for four The following table summarizes ESPP activity (in thousands, except shares): For the six months ended June 30, 2021 Cash received for shares issued $ 29 Shares issued 4,881 Share Repurchases During the Current Quarter, the Company repurchased 55,898 shares of Class A Common Stock in connection with employee minimum tax withholding requirements for units vested under the 2016 Plan. All repurchased shares were retired. During the Current Quarter, the repurchases were accounted for as a decrease to paid-in-capital of $0.3 million and a decrease to Class A Common Stock of approximately $600. During the Prior Quarter, the Company repurchased 1,139,729 shares in the open market and repurchased 36,781 shares in connection with employee minimum tax withholding requirements. During the Current Period, the Company repurchased 199,976 |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 6 Months Ended |
Jun. 30, 2021 | |
FAIR VALUE MEASUREMENT | |
FAIR VALUE MEASUREMENT | NOTE 10—FAIR VALUE MEASUREMENT The Company utilizes fair value measurements to measure assets and liabilities in a business combination, assess impairment and abandonment of property and equipment, intangible assets and goodwill or to measure the value of securities marked to market. Fair value is defined as the amount at which an asset (or liability) could be bought (or incurred) or sold (or settled) in an orderly transaction between market participants at the measurement date. Further, ASC 820, Fair Value Measurements ASC 820 establishes a three-level valuation hierarchy for the disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement. The three levels are defined as follows: Level 1 Level 2 Level 3 A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. There were no transfers into, or out of, the three levels of the fair value hierarchy for the six months ended June 30, 2021 or the year ended December 31, 2020. The following table presents information about the Company’s assets measured at fair value on a recurring basis as of June 30, 2021: Fair Value Measurements Using Carrying Frequency Measurement Date Level 1 Level 2 Level 3 Value (1) Impairment (in thousands) Six months ended June 30, 2021 Investments Recurring March 31 $ 1,546 $ — $ — $ 1,546 $ — Investments Recurring June 30 2,208 — — 2,208 — (1) Amount represents carrying value at the date of assessment. Other fair value considerations The carrying values of the Company’s current financial instruments, which include cash and cash equivalents, accounts receivable trade and accounts payable, approximate their fair value as of June 30, 2021 and December 31, 2020, due to the short-term maturity of these instruments. The Company did not have any bank debt as of June 30, 2021 or December 31, 2020. The estimated fair values of the Company’s financial instruments are not necessarily indicative of the amounts that would be realized in a current market exchange. Nonmonetary transaction |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2021 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 11—RELATED-PARTY TRANSACTIONS The Company considers its related parties to be those stockholders who are beneficial owners of more than 5.0% of its common stock, executive officers, members of its board of directors or immediate family members of any of the foregoing persons, an investment in a company that is significantly influenced by another related party, and cost-method and equity-method investees. The Company has entered into a number of transactions with related parties. In accordance with the Company’s related persons transactions policy, the audit committee of the Company’s board of directors regularly reviews these transactions. However, the Company’s results of operations may have been different if these transactions were conducted with non-related parties. During the Current Quarter, sales to related parties were $0.3 million and purchases from related-party vendors were $2.4 million. These purchases consisted of $1.5 million relating to the rental of certain equipment or other services used in operations, $0.8 million relating to management, consulting and other services and $0.1 million related to purchases of property and equipment. During the Prior Quarter, sales to related parties were $0.2 million and purchases from related-party vendors were $1.5 million. These purchases consisted of $1.4 million relating to the rental of certain equipment or other services used in operations, $0.1 million relating to purchases of property and equipment, management, consulting and other services. During the Current Period, sales to related parties were $0.6 million and purchases from related-party vendors were $3.5 million. These purchases consisted of $2.4 million relating to the rental of certain equipment or other services used in operations, $1.0 million relating to management, consulting and other services and $0.1 million related to purchases of property and equipment. During the Prior Period, sales to related parties were $2.6 million and purchases from related-party vendors were $5.7 million. These purchases consisted of $5.1 million relating to the rental of certain equipment or other services used in operations, $0.3 million relating to purchases of property and equipment, $0.2 million relating to management, consulting and other services and $0.1 million relating to inventory and consumables. Tax Receivable Agreements In connection with the Select 144A Offering, the Company entered into two tax receivable agreements (the “Tax Receivable Agreements”) with Legacy Owner Holdco and certain other affiliates of the then holders of SES Holdings LLC Units (each such person and any permitted transferee thereof, a “TRA Holder,” and together, the “TRA Holders”). The first of the Tax Receivable Agreements, which the Company entered into with Legacy Owner Holdco and Crestview Partners II GP, L.P. (“Crestview GP”), generally provides for the payment by the Company to such TRA Holders of 85% of the net cash savings, if any, in U.S. federal, state and local income and franchise tax that the Company actually realizes (computed using simplifying assumptions to address the impact of state and local taxes) or is deemed to realize in certain circumstances in periods after the Select 144A Offering as a result of, as applicable to each such TRA Holder, (i) certain increases in tax basis that occur as a result of the Company’s acquisition (or deemed acquisition for U.S. federal income tax purposes) of all or a portion of such TRA Holder’s SES Holdings LLC Units in connection with the Select 144A Offering or pursuant to the exercise of the Exchange Right or the Company’s Call Right and (ii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, any payments the Company makes under such Tax Receivable Agreement. The second of the Tax Receivable Agreements, which the Company entered into with an affiliate of certain Legacy Owners and Crestview GP, generally provides for the payment by the Company to such TRA Holders of 85% of the net cash savings, if any, in U.S. federal, state and local income and franchise tax that the Company actually realizes (computed using simplifying assumptions to address the impact of state and local taxes) or is deemed to realize in certain circumstances in periods after the Select 144A Offering as a result of, as applicable to each such TRA Holder, (i) any net operating losses available to the Company as a result of certain reorganization transactions entered into in connection with the Select 144A Offering and (ii) imputed interest deemed to be paid by the Company as a result of any payments the Company makes under such Tax Receivable Agreement. The Company has not recognized a liability associated with the Tax Receivable Agreements as of June 30, 2021 or December 31, 2020. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2021 | |
INCOME TAXES | |
INCOME TAXES | NOTE 12—INCOME TAXES The Company’s income tax information is presented in the table below. The effective tax rate is different than the 21% standard Federal rate due to net income allocated to noncontrolling interests, state income taxes and valuation allowances. Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Current income tax expense (benefit) $ 12 $ (607) $ (185) $ (679) Deferred income tax expense (benefit) 72 477 6 385 Total income tax expense (benefit) $ 84 $ (130) $ (179) $ (294) Effective Tax Rate (0.4)% 0.2% 0.4% 0.1% On March 27, 2020, the CARES Act was enacted. The CARES Act includes, among other things, certain income tax provisions for businesses. The Company recognized an income tax benefit of $0.5 million during the Prior Period, as a result of the net operating loss carryback and interest expense limitation provisions of the CARES Act. |
NONCONTROLLING INTERESTS
NONCONTROLLING INTERESTS | 6 Months Ended |
Jun. 30, 2021 | |
NONCONTROLLING INTERESTS | |
NONCONTROLLING INTERESTS | NOTE 13—NONCONTROLLING INTERESTS The Company’s noncontrolling interests fall into two categories as follows: ● Noncontrolling interests attributable to joint ventures formed for water-related services. ● Noncontrolling interests attributable to holders of Class B Common Stock. As of As of June 30, 2021 December 31, 2020 (in thousands) Noncontrolling interests attributable to joint ventures formed for water-related services $ 1,068 $ 2,002 Noncontrolling interests attributable to holders of Class B Common Stock 102,483 110,819 Total noncontrolling interests $ 103,551 $ 112,821 During the Current Period, the Company initiated the dissolution of one of its water-related services joint ventures and increased its ownership interest in another joint venture, which, combined, eliminated $0.9 million of noncontrolling interest. During the Prior Period, the Company sold a 50% interest in one of its water-related services joint ventures, which eliminated $0.1 million of noncontrolling interest. Additionally, for all periods presented, there were changes in Select Inc.’s ownership interest in SES Holdings LLC. The effects of the changes in Select Inc.’s ownership interest in SES Holdings LLC are as follows: For the six months ended June 30, 2021 2020 (in thousands) Net loss attributable to Select Energy Services, Inc. $ (39,674) $ (290,160) Transfers from (to) noncontrolling interests: Increase in additional paid-in capital as a result of restricted stock issuance, net of forfeitures 1,582 1,911 Increase in additional paid-in capital as a result of issuance of common stock due to vesting of restricted stock units — 1 Decrease in additional paid-in capital as a result of the repurchase of SES Holdings LLC Units (19) (1,405) Increase in additional paid-in capital as a result of the Employee Stock Purchase Plan shares issued 1 4 Change to equity from net loss attributable to Select Energy Services, Inc. and transfers from noncontrolling interests $ (38,110) $ (289,649) |
LOSS PER SHARE
LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2021 | |
LOSS PER SHARE | |
LOSS PER SHARE | NOTE 14—LOSS PER SHARE Loss per share is based on the amount of loss allocated to the stockholders and the weighted-average number of shares outstanding during the period for each class of common stock. Outstanding options to purchase 2,132,690, 3,542,939, 2,132,690 and 3,542,939 shares of Class A Common Stock are not included in the calculation of diluted weighted-average shares outstanding for the Current Quarter, Prior Quarter, Current Period and Prior Period, respectively, as the effect is antidilutive. The following tables present the Company’s calculation of basic and diluted loss per share for the Current and Prior Quarter and the Current and Prior Period (dollars in thousands, except share and per share amounts): Three months ended June 30, 2021 Three months ended June 30, 2020 Select Energy Select Energy Services, Inc. Class A Class B Services, Inc. Class A Class B Numerator: Net loss $ (19,615) $ (53,044) Net loss attributable to noncontrolling interests 3,048 8,746 Net loss attributable to Select Energy Services, Inc. — basic $ (16,567) $ (16,567) $ — $ (44,298) $ (44,298) $ — Net loss attributable to Select Energy Services, Inc. — diluted $ (16,567) $ (16,567) $ — $ (44,298) $ (44,298) $ — Denominator: Weighted-average shares of common stock outstanding — basic 85,244,439 16,221,101 84,937,043 16,221,101 Weighted-average shares of common stock outstanding — diluted 85,244,439 16,221,101 84,937,043 16,221,101 Loss per share: Basic $ (0.19) $ — $ (0.52) $ — Diluted $ (0.19) $ — $ (0.52) $ — Six months ended June 30, 2021 Six months ended June 30, 2020 Select Energy Select Energy Services, Inc. Class A Class B Services, Inc. Class A Class B Numerator: Net loss $ (47,036) $ (344,264) Net loss attributable to noncontrolling interests 7,362 54,104 Net loss income attributable to Select Energy Services, Inc. — basic $ (39,674) $ (39,674) $ — (290,160) $ (290,160) $ — Net loss income attributable to Select Energy Services, Inc. — diluted $ (39,674) $ (39,674) $ — $ (290,160) $ (290,160) $ — Denominator: Weighted-average shares of common stock outstanding — basic 85,118,851 16,221,101 85,520,935 16,221,101 Weighted-average shares of common stock outstanding — diluted 85,118,851 16,221,101 85,520,935 16,221,101 Loss per share: Basic $ (0.47) $ — $ (3.39) $ — Diluted $ (0.47) $ — $ (3.39) $ — |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2021 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | NOTE 15—SEGMENT INFORMATION Select Inc. is a leading provider of comprehensive water-management and chemical solutions to the oil and gas industry in the U.S. The Company’s services are offered through three reportable segments. Reportable segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the CODM in deciding how to allocate resources and assess performance. The Company’s CODM assesses performance and allocates resources on the basis of the three reportable segments. Corporate and other expenses that do not individually meet the criteria for segment reporting are reported separately as Corporate or Other. The Company’s CODM assesses performance and allocates resources on the basis of the following three reportable segments: Water Services Water Infrastructure Oilfield Chemicals Financial information by segment for the Current and Prior Quarter and the Current and Prior Period is as follows: For the three months ended June 30, 2021 (Loss) Income Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 77,230 $ (9,902) $ 12,339 $ 2,704 Water Infrastructure 33,330 (885) 6,446 5,122 Oilfield Chemicals 51,467 1,225 2,234 639 Other — (3) — — Eliminations (910) — — — Loss from operations (9,565) Corporate — (8,808) 623 — Interest expense, net — (400) — — Other expense, net — (758) — — $ 161,117 $ (19,531) $ 21,642 $ 8,465 For the three months ended June 30, 2020 Loss Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 56,090 $ (22,518) $ 15,880 $ (48) Water Infrastructure 15,439 (11,037) 7,024 (205) Oilfield Chemicals 21,174 (7,216) 2,604 1,614 Other — (38) — — Eliminations (464) — — — Loss from operations (40,809) Corporate — (6,996) 834 — Interest expense, net — (513) — — Other expense, net — (4,856) — — $ 92,239 $ (53,174) $ 26,342 $ 1,361 For the six months ended June 30, 2021 (Loss) Income Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 143,947 $ (23,212) $ 25,393 $ 2,973 Water Infrastructure 71,135 772 12,701 9,582 Oilfield Chemicals 93,279 (252) 4,574 1,200 Other — (16) — 1 Eliminations (3,502) — — — Loss from operations (22,708) Corporate — (20,709) 1,273 — Interest expense, net — (835) — — Other expense, net — (2,963) — — $ 304,859 $ (47,215) $ 43,941 $ 13,756 For the six months ended June 30, 2020 Loss Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 206,242 $ (218,418) $ 33,036 $ 1,219 Water Infrastructure 73,323 (93,114) 14,052 2,363 Oilfield Chemicals 92,202 (10,112) 4,602 4,504 Other — (13) — 325 Eliminations (1,243) — — — Loss from operations (321,657) Corporate — (16,979) 1,519 — Interest expense, net — (844) — — Other expense, net — (5,078) — — $ 370,524 $ (344,558) $ 53,209 $ 8,411 Total assets by segment as of June 30, 2021 and December 31, 2020, is as follows: As of As of June 30, 2021 December 31, 2020 (in thousands) Water Services $ 478,460 $ 515,856 Water Infrastructure 195,523 204,995 Oilfield Chemicals 160,146 147,612 Other 5,734 6,896 $ 839,863 $ 875,359 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2021 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 16—SUBSEQUENT EVENTS On July 9, 2021, the Company acquired Complete Energy Services, Inc., an operating subsidiary of Superior Energy Services, Inc. ("Superior"). The Company acquired substantially all of the water-related assets, liabilities and ongoing operations of the business, including working capital. In consideration, the Company issued 3.6 million shares of Class A Common Stock and paid $14.2 million in cash, subject to standard post-closing adjustments, to Superior to close the transaction. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Use of estimates | Use of estimates : The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. On an ongoing basis, the Company evaluates its estimates, including those related to the recoverability of long-lived assets and intangibles, useful lives used in depreciation and amortization, uncollectible accounts receivable, inventory reserve, income taxes, self-insurance liabilities, share-based compensation, contingent liabilities and the incremental borrowing rate for leases. The Company bases its estimates on historical and other pertinent information that are believed to be reasonable under the circumstances. The accounting estimates used in the preparation of the consolidated financial statements may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. |
Allowance for credit losses | Allowance for credit losses: The change in the allowance for credit losses is as follows: Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 9,157 Increase to allowance based on a percentage of revenue 607 Adjustment based on aged receivable analysis (1,000) Charge-offs (1,252) Recoveries 2 Balance at June 30, 2021 $ 7,514 The Company also has a $4.3 million note receivable resulting from an initial investment in the fourth quarter of 2020 and additional investment in the Current Quarter, with no allowance for credit losses as of June 30, 2021. See “Note 11— Related-Party Transactions” for additional information. |
Asset retirement obligations | Asset retirement obligations: Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 999 Accretion expense, included in depreciation and amortization expense 1 Disposals (188) Payments (213) Balance at June 30, 2021 $ 599 We review the adequacy of our ARO liabilities whenever indicators suggest that the estimated cash flows underlying the liabilities have changed. The Company’s ARO liabilities are included in accrued expenses and other current liabilities and other long-term liabilities in the accompanying consolidated balance sheets. |
Lessor Income | Lessor Income: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Category Classification Lessor income Costs of revenue $ 60 $ 96 $ 126 $ 212 Sublease income Lease abandonment costs and Costs of revenue 231 335 474 736 The Company also generates short-term equipment rental revenue. See “Note 3—Revenue” for a discussion of revenue recognition for the accommodations and rentals business. |
Defined Contribution Plan | Defined Contribution Plan: |
Payroll Tax Deferral | Payroll Tax Deferral: |
Severance | Severance: Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Severance Costs of revenue - Water services $ — $ 1,453 $ — $ 2,929 Costs of revenue - Water infrastructure — 206 — 452 Costs of revenue - Oilfield chemicals — 514 — 626 Selling, general and administrative — 1,493 3,225 3,161 Total severance expense $ — $ 3,666 $ 3,225 $ 7,168 |
BUSINESS AND BASIS OF PRESENT_2
BUSINESS AND BASIS OF PRESENTATION (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
BUSINESS AND BASIS OF PRESENTATION | |
Schedule of investments in unconsolidated entities | Year (in thousands) Type of Investment attained Accounting method Balance Sheet Location June 30, 2021 December 31, 2020 20% minority interest 2011 Cost-method Other long-term assets, net $ 180 $ 300 Notes receivable 2020 Amortized cost basis Other long-term assets, net 4,276 3,037 33% minority interest 2021 Equity-method Other long-term assets, net 2,000 — 45% minority interest 2021 Equity-method Other long-term assets, net 200 — Publicly traded securities 2020 Fair value option Prepaid expenses and other current assets 2,208 3,377 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of change in allowance for doubtful accounts | Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 9,157 Increase to allowance based on a percentage of revenue 607 Adjustment based on aged receivable analysis (1,000) Charge-offs (1,252) Recoveries 2 Balance at June 30, 2021 $ 7,514 |
Summary of change in asset retirement obligations | Six months ended June 30, 2021 (in thousands) Balance at December 31, 2020 $ 999 Accretion expense, included in depreciation and amortization expense 1 Disposals (188) Payments (213) Balance at June 30, 2021 $ 599 |
Schedule of lessor income | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Category Classification Lessor income Costs of revenue $ 60 $ 96 $ 126 $ 212 Sublease income Lease abandonment costs and Costs of revenue 231 335 474 736 |
Schedule of severance costs | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Severance Costs of revenue - Water services $ — $ 1,453 $ — $ 2,929 Costs of revenue - Water infrastructure — 206 — 452 Costs of revenue - Oilfield chemicals — 514 — 626 Selling, general and administrative — 1,493 3,225 3,161 Total severance expense $ — $ 3,666 $ 3,225 $ 7,168 |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
REVENUE | |
Schedule of disaggregation of revenue by geographic location | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Geographic Region Permian Basin $ 83,355 $ 36,638 $ 154,559 $ 174,636 Eagle Ford 24,569 10,672 45,354 46,336 Haynesville/E. Texas 18,303 14,708 35,568 33,723 Marcellus/Utica 13,251 13,251 24,918 33,090 Rockies 9,196 6,927 19,218 25,796 MidCon 9,527 7,825 18,003 32,698 Bakken 3,864 2,542 10,767 25,102 Eliminations and other regions (948) (324) (3,528) (857) Total $ 161,117 $ 92,239 $ 304,859 $ 370,524 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
INVENTORIES | |
Schedule of inventory | June 30, 2021 December 31, 2020 (in thousands) Raw materials $ 21,601 $ 16,701 Finished goods 16,945 16,683 Total $ 38,546 $ 33,384 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
PROPERTY AND EQUIPMENT.. | |
Schedule of property and equipment | June 30, 2021 December 31, 2020 (in thousands) Machinery and equipment $ 585,728 $ 596,441 Buildings and leasehold improvements 96,793 93,236 Pipelines 72,803 72,458 Disposal wells 44,392 48,097 Vehicles and equipment 29,477 30,975 Land 10,624 13,497 Computer equipment and software 6,222 7,127 Office furniture and equipment 857 892 Machinery and equipment - finance lease 544 537 Vehicles and equipment - finance lease 422 475 Computer equipment and software - finance lease 412 356 Construction in progress 10,318 14,811 858,592 878,902 Less accumulated depreciation (1) (541,021) (528,537) Total property and equipment, net $ 317,571 $ 350,365 (1) Includes $1.1 million of accumulated depreciation related to finance leases as of both June 30, 2021 and December 31, 2020. |
Schedule of amortization of intangible assets | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Category Depreciation expense from property and equipment $ 19,017 $ 23,286 $ 38,604 $ 47,271 Amortization expense from finance leases 21 39 103 116 Amortization expense from intangible assets 2,616 2,986 5,233 5,979 Accretion expense from asset retirement obligations (12) 31 1 (157) Total depreciation and amortization $ 21,642 $ 26,342 $ 43,941 $ 53,209 |
Schedule of impairment and abandonment of property and equipment | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Impairment and abandonment of property and equipment Water Services $ — $ 1,396 $ — $ 3,894 Water Infrastructure — 3,330 — 4,016 Total impairment and abandonment of property and equipment $ — $ 4,726 $ — $ 7,910 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS. | |
Summary of components of other intangible assets | As of June 30, 2021 As of December 31, 2020 Gross Accumulated Net Gross Accumulated Net Value Amortization Value Value Impairment Amortization Value (in thousands) (in thousands) Definite-lived Customer relationships $ 116,554 $ (33,836) $ 82,718 $ 116,554 $ — $ (29,302) $ 87,252 Patents 9,741 (3,653) 6,088 9,741 — (3,166) 6,575 Other 7,234 (6,585) 649 7,234 — (6,373) 861 Total definite-lived 133,529 (44,074) 89,455 133,529 — (38,841) 94,688 Indefinite-lived Water rights 7,031 — 7,031 7,031 — — 7,031 Trademarks 14,360 — 14,360 23,442 (9,082) — 14,360 Total indefinite-lived 21,391 — 21,391 30,473 (9,082) — 21,391 Total other intangible assets, net $ 154,920 $ (44,074) $ 110,846 $ 164,002 $ (9,082) $ (38,841) $ 116,079 |
Summary of future estimated amortization expense for other intangible assets | Amount (in thousands) Remainder of 2021 $ 5,233 Year ending December 31, 2022 10,252 Year ending December 31, 2023 10,180 Year ending December 31, 2024 10,111 Year ending December 31, 2025 9,948 Thereafter 43,731 Total $ 89,455 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
DEBT | |
Summary of Company's leverage ratio | Level Average Excess Availability Base Rate Margin Eurocurrency Rate Margin I < 33% of the commitments 1.00% 2.00% II < 66.67% of the commitments and ≥ 33.33% of the commitments 0.75% 1.75% III ≥ 66.67% of the commitments 0.50% 1.50% |
Schedule of fee Percentage on unused credit facility | Level Average Revolver Usage Unused Line Fee Percentage I ≥ 50% of the commitments 0.250% II < 50% of the commitments 0.375% |
EQUITY-BASED COMPENSATION (Tabl
EQUITY-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Schedule of equity option activity and related information | For the six months ended June 30, 2021 Weighted-average Weighted-average Grant Date Value Aggregate Intrinsic Stock Options Exercise Price Term (Years) Value (in thousands) (a) Beginning balance, outstanding 3,519,159 $ 16.11 3.3 $ — Expired (1,386,469) 14.85 Ending balance, outstanding 2,132,690 $ 16.93 4.8 $ — Ending balance, exercisable 2,132,690 $ 16.93 4.8 $ — Nonvested at June 30, 2021 — $ — (a) |
summary of ESPP activity | The following table summarizes ESPP activity (in thousands, except shares): For the six months ended June 30, 2021 Cash received for shares issued $ 29 Shares issued 4,881 |
Restricted Stock | |
Schedule of restricted stock activity | For the six months ended June 30, 2021 Weighted-average Restricted Stock Awards Grant Date Fair Value Nonvested at December 31, 2020 2,003,072 $ 6.97 Granted 1,843,808 6.41 Vested (693,582) 7.92 Forfeited (301,395) 6.38 Nonvested at June 30, 2021 2,851,903 $ 6.44 |
Performance share units | |
Schedule of percentage of target PSUs earned | Return on Assets at Performance Period End Date Percentage of Target PSUs Earned Less than 9.6% 0% 9.6% 50% 12% 100% 14.4% 175% Ranking Among Peer Group Percentage of Target Amount Earned Outside of Top 10 0% Top 10 50% Top 7 100% Top 3 175% Adjusted FCF Performance Percentage Percentage of Target Amount Earned Less than 70% 0% 70% 50% 100% 100% 130% 175% |
Summary of activity related to the units outstanding | Performance Share Units Nonvested as of December 31, 2020 1,763,909 Target shares granted 689,551 Target shares forfeited (242,087) Target shares outstanding as of June 30, 2021 2,211,373 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
FAIR VALUE MEASUREMENT | |
Summary of assets and liabilities measured at fair value on a non-recurring basis | Fair Value Measurements Using Carrying Frequency Measurement Date Level 1 Level 2 Level 3 Value (1) Impairment (in thousands) Six months ended June 30, 2021 Investments Recurring March 31 $ 1,546 $ — $ — $ 1,546 $ — Investments Recurring June 30 2,208 — — 2,208 — (1) Amount represents carrying value at the date of assessment. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
INCOME TAXES | |
Summary of components of the federal and state income tax expense (benefit) | Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 (in thousands) Current income tax expense (benefit) $ 12 $ (607) $ (185) $ (679) Deferred income tax expense (benefit) 72 477 6 385 Total income tax expense (benefit) $ 84 $ (130) $ (179) $ (294) Effective Tax Rate (0.4)% 0.2% 0.4% 0.1% |
NONCONTROLLING INTERESTS (Table
NONCONTROLLING INTERESTS (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
NONCONTROLLING INTERESTS | |
Schedule of Non Controlling Interests Categories | As of As of June 30, 2021 December 31, 2020 (in thousands) Noncontrolling interests attributable to joint ventures formed for water-related services $ 1,068 $ 2,002 Noncontrolling interests attributable to holders of Class B Common Stock 102,483 110,819 Total noncontrolling interests $ 103,551 $ 112,821 |
Summary of the effects of changes in noncontrolling interests | For the six months ended June 30, 2021 2020 (in thousands) Net loss attributable to Select Energy Services, Inc. $ (39,674) $ (290,160) Transfers from (to) noncontrolling interests: Increase in additional paid-in capital as a result of restricted stock issuance, net of forfeitures 1,582 1,911 Increase in additional paid-in capital as a result of issuance of common stock due to vesting of restricted stock units — 1 Decrease in additional paid-in capital as a result of the repurchase of SES Holdings LLC Units (19) (1,405) Increase in additional paid-in capital as a result of the Employee Stock Purchase Plan shares issued 1 4 Change to equity from net loss attributable to Select Energy Services, Inc. and transfers from noncontrolling interests $ (38,110) $ (289,649) |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
LOSS PER SHARE | |
Summary of calculation of basic and diluted earnings per share | The following tables present the Company’s calculation of basic and diluted loss per share for the Current and Prior Quarter and the Current and Prior Period (dollars in thousands, except share and per share amounts): Three months ended June 30, 2021 Three months ended June 30, 2020 Select Energy Select Energy Services, Inc. Class A Class B Services, Inc. Class A Class B Numerator: Net loss $ (19,615) $ (53,044) Net loss attributable to noncontrolling interests 3,048 8,746 Net loss attributable to Select Energy Services, Inc. — basic $ (16,567) $ (16,567) $ — $ (44,298) $ (44,298) $ — Net loss attributable to Select Energy Services, Inc. — diluted $ (16,567) $ (16,567) $ — $ (44,298) $ (44,298) $ — Denominator: Weighted-average shares of common stock outstanding — basic 85,244,439 16,221,101 84,937,043 16,221,101 Weighted-average shares of common stock outstanding — diluted 85,244,439 16,221,101 84,937,043 16,221,101 Loss per share: Basic $ (0.19) $ — $ (0.52) $ — Diluted $ (0.19) $ — $ (0.52) $ — Six months ended June 30, 2021 Six months ended June 30, 2020 Select Energy Select Energy Services, Inc. Class A Class B Services, Inc. Class A Class B Numerator: Net loss $ (47,036) $ (344,264) Net loss attributable to noncontrolling interests 7,362 54,104 Net loss income attributable to Select Energy Services, Inc. — basic $ (39,674) $ (39,674) $ — (290,160) $ (290,160) $ — Net loss income attributable to Select Energy Services, Inc. — diluted $ (39,674) $ (39,674) $ — $ (290,160) $ (290,160) $ — Denominator: Weighted-average shares of common stock outstanding — basic 85,118,851 16,221,101 85,520,935 16,221,101 Weighted-average shares of common stock outstanding — diluted 85,118,851 16,221,101 85,520,935 16,221,101 Loss per share: Basic $ (0.47) $ — $ (3.39) $ — Diluted $ (0.47) $ — $ (3.39) $ — |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
SEGMENT INFORMATION | |
Summary of financial information by segment | For the three months ended June 30, 2021 (Loss) Income Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 77,230 $ (9,902) $ 12,339 $ 2,704 Water Infrastructure 33,330 (885) 6,446 5,122 Oilfield Chemicals 51,467 1,225 2,234 639 Other — (3) — — Eliminations (910) — — — Loss from operations (9,565) Corporate — (8,808) 623 — Interest expense, net — (400) — — Other expense, net — (758) — — $ 161,117 $ (19,531) $ 21,642 $ 8,465 For the three months ended June 30, 2020 Loss Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 56,090 $ (22,518) $ 15,880 $ (48) Water Infrastructure 15,439 (11,037) 7,024 (205) Oilfield Chemicals 21,174 (7,216) 2,604 1,614 Other — (38) — — Eliminations (464) — — — Loss from operations (40,809) Corporate — (6,996) 834 — Interest expense, net — (513) — — Other expense, net — (4,856) — — $ 92,239 $ (53,174) $ 26,342 $ 1,361 For the six months ended June 30, 2021 (Loss) Income Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 143,947 $ (23,212) $ 25,393 $ 2,973 Water Infrastructure 71,135 772 12,701 9,582 Oilfield Chemicals 93,279 (252) 4,574 1,200 Other — (16) — 1 Eliminations (3,502) — — — Loss from operations (22,708) Corporate — (20,709) 1,273 — Interest expense, net — (835) — — Other expense, net — (2,963) — — $ 304,859 $ (47,215) $ 43,941 $ 13,756 For the six months ended June 30, 2020 Loss Depreciation and Capital Revenue before taxes Amortization Expenditures (in thousands) Water Services $ 206,242 $ (218,418) $ 33,036 $ 1,219 Water Infrastructure 73,323 (93,114) 14,052 2,363 Oilfield Chemicals 92,202 (10,112) 4,602 4,504 Other — (13) — 325 Eliminations (1,243) — — — Loss from operations (321,657) Corporate — (16,979) 1,519 — Interest expense, net — (844) — — Other expense, net — (5,078) — — $ 370,524 $ (344,558) $ 53,209 $ 8,411 Total assets by segment as of June 30, 2021 and December 31, 2020, is as follows: As of As of June 30, 2021 December 31, 2020 (in thousands) Water Services $ 478,460 $ 515,856 Water Infrastructure 195,523 204,995 Oilfield Chemicals 160,146 147,612 Other 5,734 6,896 $ 839,863 $ 875,359 |
BUSINESS AND BASIS OF PRESENT_3
BUSINESS AND BASIS OF PRESENTATION (Details) | 6 Months Ended | |
Jun. 30, 2021segmentitemVote$ / shares | Dec. 31, 2020$ / shares | |
Number of vote per share | Vote | 1 | |
Number of equity method investee | 2 | |
Number of cost-method investee | 1 | |
Number of investment in notes receivable | 1 | |
Number of investment in publicly traded securities | 1 | |
Number of operating segments | segment | 3 | |
Class A Common Stock | ||
Par value | $ / shares | $ 0.01 | $ 0.01 |
Class B Common Stock | ||
Par value | $ / shares | $ 0.01 | $ 0.01 |
BUSINESS AND BASIS OF PRESENT_4
BUSINESS AND BASIS OF PRESENTATION - Investments in Unconsolidated (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Other long-term assets, net | ||
Notes receivable | $ 4,276 | $ 3,037 |
Prepaid Expenses and Other Current Assets | ||
Prepaid expenses and other current assets | $ 2,208 | 3,377 |
Investment in Joint Venture One | ||
Percentage of interest in a joint venture | 20.00% | |
Investment in Joint Venture One | Other long-term assets, net | ||
20% minority interest | $ 180 | $ 300 |
Investment in Joint Venture Two | ||
Percentage of interest in a joint venture | 33.00% | |
Investment in Joint Venture Two | Other long-term assets, net | ||
percentage of minority interest | $ 2,000 | |
Investment In Joint Venture Three [Member] | ||
Percentage of interest in a joint venture | 45.00% | |
Investment In Joint Venture Three [Member] | Other long-term assets, net | ||
percentage of minority interest | $ 200 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - Allowance activity (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2021USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance at beginning of year | $ 9,157 |
Increase to allowance based on a percentage of revenue | 607 |
Adjustment based on aged receivable analysis | (1,000) |
Charge-offs | (1,252) |
Recoveries | 2 |
Balance at end of year | 7,514 |
Notes receivable with affiliates | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance at end of year | 0 |
Notes Receivables | $ 4,300 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||||
Balance at beginning of Current Period | $ 999 | ||||
Accretion expense, included in depreciation and amortization expense | 1 | ||||
Disposals | (188) | ||||
Payments | (213) | ||||
Balance at end of Current Period | $ 599 | 599 | |||
Lessor Income | |||||
Lessor income | 60 | $ 96 | 126 | $ 212 | |
Sublease income | 231 | $ 335 | 474 | 736 | |
Defined Contribution Plan | |||||
401(k) match expense | 0 | $ 0 | |||
Payroll Tax Deferral | $ 6,000 | $ 6,000 | $ 6,000 |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES - Severance (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||
Severance Costs | $ 3,666 | $ 3,225 | $ 7,168 |
Water Services | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance Costs | 1,453 | 2,929 | |
Water Infrastructure | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance Costs | 206 | 452 | |
Oilfield Chemicals | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance Costs | 514 | 626 | |
Other. | |||
Restructuring Cost and Reserve [Line Items] | |||
Severance Costs | $ 1,493 | $ 3,225 | $ 3,161 |
REVENUE (Details)
REVENUE (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2021USD ($)segmentregion | Jun. 30, 2020USD ($)segment | |
REVENUE | ||||
Number of Reportable Segments | segment | 3 | 3 | ||
Contract liability | $ 8,200 | $ 8,200 | ||
Revenue | 161,117 | $ 92,239 | 304,859 | $ 370,524 |
Accommodations and rentals | ASC 842 | ||||
REVENUE | ||||
Revenue | 6,700 | 4,600 | 12,900 | 19,800 |
Permian Basin | ||||
REVENUE | ||||
Revenue | 83,355 | 36,638 | 154,559 | 174,636 |
Eagle Ford | ||||
REVENUE | ||||
Revenue | 24,569 | 10,672 | 45,354 | 46,336 |
Haynesville/E. Texas | ||||
REVENUE | ||||
Revenue | 18,303 | 14,708 | 35,568 | 33,723 |
Marcellus/Utica | ||||
REVENUE | ||||
Revenue | 13,251 | 13,251 | 24,918 | 33,090 |
Rockies | ||||
REVENUE | ||||
Revenue | 9,196 | 6,927 | 19,218 | 25,796 |
MidCon | ||||
REVENUE | ||||
Revenue | 9,527 | 7,825 | 18,003 | 32,698 |
Bakken | ||||
REVENUE | ||||
Revenue | 3,864 | 2,542 | 10,767 | 25,102 |
Eliminations and other regions | ||||
REVENUE | ||||
Revenue | $ (948) | $ (324) | $ (3,528) | $ (857) |
Permian Basin, Eagle Ford and Marcellus/Utica | Water Services | ||||
REVENUE | ||||
Number of revenue producing regions | region | 3 | |||
Percentage of revenue | 78.00% | 69.00% | 77.00% | 73.00% |
Permian Basin and Bakken | Water Infrastructure | ||||
REVENUE | ||||
Number of revenue producing regions | region | 3 | |||
Percentage of revenue | 97.00% | 96.00% | 97.00% | 97.00% |
Permian Basin, Haynesville/E. Texas and MidCon | Oilfield Chemicals | ||||
REVENUE | ||||
Number of revenue producing regions | region | 3 | |||
Percentage of revenue | 84.00% | 89.00% | 86.00% | 83.00% |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Significant components of inventory | ||||
Raw materials | $ 21,601 | $ 16,701 | ||
Finished goods | 16,945 | 16,683 | ||
Total | 38,546 | $ 33,384 | ||
Inventory write-downs | $ 500 | 82 | $ 566 | |
Inventory Valuation Reserves | $ 4,100 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Property and equipment | |||||
Property and equipment | $ 858,592 | $ 858,592 | $ 878,902 | ||
Accumulated depreciation | (541,021) | (541,021) | (528,537) | ||
Total property and equipment, net | 317,571 | 317,571 | 350,365 | ||
Accumulated depreciation related to finance leases | 1,100 | 1,100 | 1,100 | ||
Depreciation and amortization expense | |||||
Depreciation expense from property and equipment | 19,017 | $ 23,286 | 38,604 | $ 47,271 | |
Amortization expense from finance lease | 21 | 39 | 103 | 116 | |
Amortization expense from intangible assets | 2,616 | 2,986 | 5,233 | 5,979 | |
Accretion expense from asset retirement obligations | (12) | 31 | 1 | (157) | |
Total depreciation and amortization | 21,642 | 26,342 | 43,941 | 53,209 | |
Property and Equipment Held-for-Sale and Impairments | |||||
Total impairment and abandonment of property and equipment | $ 4,726 | $ 7,910 | |||
Machinery and equipment | |||||
Property and equipment | |||||
Property and equipment | 585,728 | 585,728 | 596,441 | ||
Buildings and leasehold improvements | |||||
Property and equipment | |||||
Property and equipment | 96,793 | 96,793 | 93,236 | ||
Pipelines | |||||
Property and equipment | |||||
Property and equipment | 72,803 | 72,803 | 72,458 | ||
Disposal wells | |||||
Property and equipment | |||||
Property and equipment | 44,392 | 44,392 | 48,097 | ||
Vehicles and equipment | |||||
Property and equipment | |||||
Property and equipment | 29,477 | 29,477 | 30,975 | ||
Land | |||||
Property and equipment | |||||
Property and equipment | 10,624 | 10,624 | 13,497 | ||
Computer equipment and software | |||||
Property and equipment | |||||
Property and equipment | 6,222 | 6,222 | 7,127 | ||
Office furniture and equipment | |||||
Property and equipment | |||||
Property and equipment | 857 | 857 | 892 | ||
Machinery and equipment - finance lease | |||||
Property and equipment | |||||
Property and equipment | 544 | 544 | 537 | ||
Vehicles and equipment - finance lease | |||||
Property and equipment | |||||
Property and equipment | 422 | 422 | 475 | ||
Computer equipment and software - finance lease | |||||
Property and equipment | |||||
Property and equipment | 412 | 412 | 356 | ||
Construction in progress | |||||
Property and equipment | |||||
Property and equipment | $ 10,318 | $ 10,318 | $ 14,811 |
PROPERTY AND EQUIPMENT - Impair
PROPERTY AND EQUIPMENT - Impairment and abandonment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Restructuring Cost and Reserve [Line Items] | ||
Total impairment and abandonment of property and equipment | $ 4,726 | $ 7,910 |
Water Services | ||
Restructuring Cost and Reserve [Line Items] | ||
Total impairment and abandonment of property and equipment | 1,396 | 3,894 |
Water Infrastructure | ||
Restructuring Cost and Reserve [Line Items] | ||
Total impairment and abandonment of property and equipment | $ 3,330 | $ 4,016 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Water Services And Water Infrastructure | |
Goodwill | |
Impairment of Goodwill | $ 266.9 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Definite-lived | $ 133,529 | $ 133,529 | $ 133,529 | ||
Accumulated Amortization, Definite-lived | (44,074) | $ (44,074) | (44,074) | $ (44,074) | (38,841) |
Total | 89,455 | 89,455 | 94,688 | ||
Gross Value, Indefinite-lived | 21,391 | 21,391 | 30,473 | ||
Impairment, Indefinite-lived | (9,082) | ||||
Net Value, Indefinite-lived | 21,391 | 21,391 | 21,391 | ||
Intangible Assets, Gross (Excluding Goodwill) | 154,920 | 154,920 | 164,002 | ||
Intangible Assets, Net (Excluding Goodwill) | 110,846 | 110,846 | 116,079 | ||
Amortization of Intangible Assets | 2,616 | 2,986 | 5,233 | $ 5,979 | |
Customer relationships | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Definite-lived | 116,554 | 116,554 | 116,554 | ||
Accumulated Amortization, Definite-lived | (33,836) | (33,836) | (29,302) | ||
Total | 82,718 | $ 82,718 | 87,252 | ||
Weighted average amortization period | 9 years 2 months 12 days | ||||
Patents | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Definite-lived | 9,741 | $ 9,741 | 9,741 | ||
Accumulated Amortization, Definite-lived | (3,653) | (3,653) | (3,166) | ||
Total | 6,088 | $ 6,088 | 6,575 | ||
Weighted average amortization period | 6 years 3 months 18 days | ||||
Other intangibles | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Definite-lived | 7,234 | $ 7,234 | 7,234 | ||
Accumulated Amortization, Definite-lived | (6,585) | (6,585) | (6,373) | ||
Total | 649 | $ 649 | 861 | ||
Weighted average amortization period | 2 years 6 months | ||||
Water rights | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Indefinite-lived | 7,031 | $ 7,031 | 7,031 | ||
Net Value, Indefinite-lived | 7,031 | $ 7,031 | 7,031 | ||
Renewal term | 5 years | ||||
Trademarks | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Value, Indefinite-lived | 14,360 | $ 14,360 | 23,442 | ||
Impairment, Indefinite-lived | $ (9,100) | (9,082) | |||
Net Value, Indefinite-lived | $ 14,360 | $ 14,360 | $ 14,360 | ||
Renewal term | 10 years |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Annual Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Annual amortization of intangible assets | ||
Remainder of 2021 | $ 5,233 | |
Year Ending December 31, 2022 | 10,252 | |
Year ending December 31, 2023 | 10,180 | |
Year ending December 31, 2024 | 10,111 | |
Year ending December 31, 2025 | 9,948 | |
Thereafter | 43,731 | |
Total | $ 89,455 | $ 94,688 |
DEBT (Details)
DEBT (Details) - USD ($) $ in Thousands | Nov. 01, 2017 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 |
DEBT | ||||||
Amortization of debt issuance costs | $ 200 | $ 200 | $ 344 | $ 344 | ||
Average excess availability, less than 33% of the commitments | Base Rate Advances | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 1.00% | 1.00% | ||||
Average excess availability, less than 33% of the commitments | LIBOR | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 2.00% | 2.00% | ||||
Average excess availability, less than 66.67% of the commitments and more than or equal to 33.33% of the commitments | Base Rate Advances | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 0.75% | 0.75% | ||||
Average excess availability, less than 66.67% of the commitments and more than or equal to 33.33% of the commitments | LIBOR | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 1.75% | 1.75% | ||||
Average excess availability, more than or equal to 66.67% of the commitments | Base Rate Advances | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 0.50% | 0.50% | ||||
Average excess availability, more than or equal to 66.67% of the commitments | LIBOR | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 1.50% | 1.50% | ||||
Average excess availability more than or equal to fifty percent | ||||||
DEBT | ||||||
Unused line fee (as a percent) | 0.25% | |||||
Average excess availability less than fifty percent | ||||||
DEBT | ||||||
Unused line fee (as a percent) | 0.375% | |||||
Eligible unbilled receivables | ||||||
DEBT | ||||||
Borrowing base (as a percent) | 75.00% | |||||
Letter of credit | ||||||
DEBT | ||||||
Amount outstanding | $ 0 | $ 0 | $ 0 | |||
Revolving line of credit | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 300,000 | |||||
Revolving line of credit | Letter of credit | ||||||
DEBT | ||||||
Maximum borrowing capacity | 128,300 | 128,300 | 96,400 | |||
Senior secured credit facility | ||||||
DEBT | ||||||
Percentage of borrowing base allowed | 35.00% | |||||
Margin (as a percent) | 2.00% | |||||
Reduction in borrowing capacity | 15,100 | 15,100 | 15,600 | |||
Unused portion of available borrowing | 113,200 | 113,200 | ||||
Debt issuance costs | $ 900 | $ 900 | $ 1,300 | |||
Senior secured credit facility | Minimum | ||||||
DEBT | ||||||
Percentage of borrowing base allowed | 30.00% | |||||
Variable interest rate (as a percent) | 1.50% | 1.50% | ||||
Senior secured credit facility | Maximum | ||||||
DEBT | ||||||
Variable interest rate (as a percent) | 2.00% | 2.00% | ||||
Senior secured credit facility | Base Rate Advances | Minimum | ||||||
DEBT | ||||||
Margin (as a percent) | 0.50% | |||||
Senior secured credit facility | Base Rate Advances | Maximum | ||||||
DEBT | ||||||
Margin (as a percent) | 1.00% | |||||
Senior secured credit facility | LIBOR | ||||||
DEBT | ||||||
Margin (as a percent) | 1.00% | |||||
Senior secured credit facility | LIBOR | Minimum | ||||||
DEBT | ||||||
Margin (as a percent) | 1.50% | |||||
Senior secured credit facility | LIBOR | Maximum | ||||||
DEBT | ||||||
Margin (as a percent) | 2.00% | |||||
Senior secured credit facility | Federal Funds Rate | ||||||
DEBT | ||||||
Margin (as a percent) | 0.50% | |||||
Senior secured credit facility | Eligible billed receivables | ||||||
DEBT | ||||||
Borrowing base (as a percent) | 85.00% | |||||
Senior secured credit facility | Eligible inventory | ||||||
DEBT | ||||||
Borrowing base (as a percent) | 70.00% | |||||
Senior secured credit facility | Net recovery percentage | ||||||
DEBT | ||||||
Borrowing base (as a percent) | 85.00% | |||||
Senior secured credit facility | Criteria for distributions, scenario one | ||||||
DEBT | ||||||
Lookback period | 30 days | |||||
Percentage outstanding | 25.00% | |||||
Base amount | $ 37,500 | |||||
Senior secured credit facility | Criteria for distributions, scenario two | ||||||
DEBT | ||||||
Lookback period | 30 days | |||||
Percentage outstanding | 20.00% | |||||
Base amount | $ 30,000 | |||||
Fixed charge coverage ratio | 1.00% | |||||
Senior secured credit facility | Coverage Ratio Criteria | ||||||
DEBT | ||||||
Lookback period | 60 days | |||||
Percentage outstanding | 10.00% | |||||
Base amount | $ 15,000 | |||||
Fixed charge coverage ratio | 1.00% | |||||
Senior secured credit facility | Letter of credit | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 40,000 | |||||
Senior secured credit facility | Swingline loan | ||||||
DEBT | ||||||
Maximum borrowing capacity | $ 30,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |||
Percentage of vehicles in which certain employees at some of the facilities altered emissions controls systems | 5.00% | ||
Litigation Settlement Accrual | $ 2.6 | $ 2.6 | |
Litigation Payment Accrual | $ 4.3 |
EQUITY-BASED COMPENSATION (Deta
EQUITY-BASED COMPENSATION (Details) - shares | Nov. 01, 2017 | Dec. 20, 2016 | Jun. 30, 2021 | May 08, 2020 |
Class A-1 Common Stock | Private Placement | ||||
EQUITY-BASED COMPENSATION | ||||
Shares issued | 16,100,000 | |||
2016 plan | ||||
EQUITY-BASED COMPENSATION | ||||
Maximum number of shares | 13,300,000 | 3,100,000 | ||
2016 plan | Maximum | ||||
EQUITY-BASED COMPENSATION | ||||
Equity options term | 10 years | |||
Second Amendment to the 2016 Plan [Member] | Class A Common Stock | ||||
EQUITY-BASED COMPENSATION | ||||
Maximum number of shares | 4,000,000 |
EQUITY BASED COMPENSATION - Roc
EQUITY BASED COMPENSATION - Rockwater awards (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Restricted Stock | |||||
Assumptions for equity options granted: | |||||
Equity-based compensation expense | $ 2.1 | $ 1.9 | $ 3.1 | $ 3.8 | |
Equity options | |||||
Assumptions for equity options granted: | |||||
Equity-based compensation expense | $ 0 | $ 0.2 | |||
Equity options | Class A Common Stock | |||||
Assumptions for equity options granted: | |||||
Underlying Equity | $ 6.04 | $ 6.04 | $ 4.10 |
EQUITY-BASED COMPENSATION - Equ
EQUITY-BASED COMPENSATION - Equity Options Changed During Period (Details) - Equity options - $ / shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Equity Options | ||
Beginning balance (in shares) | 3,519,159 | |
Expired (in shares) | (1,386,469) | |
Ending balance (in shares) | 2,132,690 | 3,519,159 |
Ending balance, exercisable (in shares) | 2,132,690 | |
Weighted-average Exercise Price | ||
Beginning balance (in dollars per share) | $ 16.11 | |
Expired (in dollars per share) | 14.85 | |
Ending balance (in dollars per share) | 16.93 | $ 16.11 |
Ending balance, exercisable | $ 16.93 | |
Weighted-average Remaining Contractual Term (Years) | ||
Outstanding | 4 years 9 months 18 days | 3 years 3 months 18 days |
Ending balance, exercisable | 4 years 9 months 18 days |
EQUITY-BASED COMPENSATION - Res
EQUITY-BASED COMPENSATION - Restricted stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
EQUITY-BASED COMPENSATION | ||||
Payments for repurchase of common stock | $ 1,206 | $ 10,638 | ||
Restricted Stock | ||||
EQUITY-BASED COMPENSATION | ||||
Compensation expense | $ 2,100 | $ 1,900 | $ 3,100 | $ 3,800 |
Restricted Stock | Minimum | ||||
EQUITY-BASED COMPENSATION | ||||
offering period | 1 year | |||
Restricted Stock | Maximum | ||||
EQUITY-BASED COMPENSATION | ||||
offering period | 3 years | |||
Restricted Stock Awards | ||||
EQUITY-BASED COMPENSATION | ||||
Unrecognized compensation expense | $ 14,000 | $ 14,000 | ||
Weighted-average remaining life | 2 years | |||
Restricted stock | ||||
Beginning balance (in shares) | 2,003,072 | |||
Granted (in shares) | 1,843,808 | |||
Vested (in shares) | (693,582) | |||
Forfeited (in shares) | (301,395) | |||
Ending balance (in shares) | 2,851,903 | 2,851,903 | ||
Grant Date Fair Value | ||||
Beginning balance (in dollars per share) | $ 6.97 | |||
Granted (in dollars per share) | 6.41 | |||
Vested (in dollars per share) | 7.92 | |||
Forfeited (in dollars per share) | 6.38 | |||
Ending balance (in dollars per share) | $ 6.44 | $ 6.44 |
EQUITY-BASED COMPENSATION - Per
EQUITY-BASED COMPENSATION - Performance share units (Details) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2021USD ($)item | Jun. 30, 2020USD ($) | Dec. 31, 2019item | Dec. 31, 2018item | |
Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of times shares issued for each performance share settlement | item | 1 | 1 | |||||
Grant date fair value of PSUs | $ | $ 4.4 | $ 7 | $ 4.7 | ||||
Compensation expense | $ | $ 0.4 | $ (0.7) | 0.9 | $ (2.2) | |||
Unrecognized compensation expense | $ | $ 4.6 | $ 4.6 | |||||
Weighted-average remaining life | 2 years 1 month 6 days | ||||||
Performance share units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of times shares issued for each performance share settlement | item | 0 | ||||||
Percentage of Target PSUs Earned | 0.00% | ||||||
Performance share units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of times shares issued for each performance share settlement | item | 1.75 | ||||||
Percentage of Target PSUs Earned | 175.00% | ||||||
Return on assets Less than 9.6% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target PSUs Earned | 0.00% | ||||||
Return on assets 9.6% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target PSUs Earned | 50.00% | ||||||
Return on assets 12% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target PSUs Earned | 100.00% | ||||||
Return on assets 14.4% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target PSUs Earned | 175.00% | ||||||
Peer Group Outside of Top 10 | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 0.00% | ||||||
Peer Group Top 10 | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 50.00% | ||||||
Peer Group Top 7 | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 100.00% | ||||||
Peer Group Top 3 | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 175.00% | ||||||
Adjusted FCF Performance Percentage Less than 70% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 0.00% | ||||||
Adjusted FCF Performance Percentage 70% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 50.00% | ||||||
Adjusted FCF Performance Percentage 100% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 100.00% | ||||||
Adjusted FCF Performance Percentage 130% | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target Amount Earned | 175.00% | ||||||
Return On Assets Five Percent [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Percentage of Target PSUs Earned | 5.00% | ||||||
Percentage of Target Amount Earned | 5.00% | ||||||
Adjusted EBITDA Threshold Met [Member] | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting percentage | 100.00% | ||||||
Failure To Meet Adjusted EBITDA Threshold [Member] | Performance share units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting percentage | 0.00% |
EQUITY-BASED COMPENSATION - P_2
EQUITY-BASED COMPENSATION - Performance share units outstanding (Details) - Performance share units | 6 Months Ended |
Jun. 30, 2021shares | |
Performance share units | |
Beginning balance (in shares) | 1,763,909 |
Target shares granted | 689,551 |
Target shares forfeited | (242,087) |
Ending balance (in shares) | 2,211,373 |
EQUITY-BASED COMPENSATION - Emp
EQUITY-BASED COMPENSATION - Employee Stock Purchase Plan (ESPP) (Details) - ESPP | 6 Months Ended |
Jun. 30, 2021USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
offering period | 4 years |
Issue price (percentage) | 95.00% |
Maximum annual employees contribution | $ 15,000 |
Cash received for shares issued | $ 29,000 |
Shares issued | shares | 4,881 |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Employee service period | 1 year |
EQUITY-BASED COMPENSATION - Sha
EQUITY-BASED COMPENSATION - Share-repurchases (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Decrease in paid-in capital | $ 332,000 | $ 4,002,000 | $ 1,206,000 | $ 10,638,000 |
2016 plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares repurchased in open market | 1,139,729 | 1,989,440 | ||
Number of shares repurchased with employee minimum tax withholding requirements | 36,781 | 166,461 | ||
Decrease in paid-in capital | 300,000 | $ 1,200,000 | ||
Class A Common Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Decrease in Class A common stock | $ 600 | |||
Class A Common Stock | 2016 plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares repurchased with employee minimum tax withholding requirements | 55,898 | 199,976 | ||
Decrease in Class A common stock | $ 2,000 |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | Mar. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Transfers into or out of all levels of the fair value hierarchy | $ 0 | $ 0 | ||
Impairment of property and equipment | $ 7,910 | |||
Recurring | March 31 | Carrying value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments | $ 1,546 | |||
Recurring | June 30 | Carrying value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments | 2,208 | |||
Level 1 | Recurring | March 31 | Fair value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments | $ 1,546 | |||
Level 1 | Recurring | June 30 | Fair value | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Investments | $ 2,208 |
FAIR VALUE MEASUREMENT - Nonmon
FAIR VALUE MEASUREMENT - Nonmonetary transaction (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Exchange for accounts receivable | $ 1,600 | |||
Prepaid Expenses and Other Current Assets | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
common stock and related securities prepaid expenses | $ 2,208 | $ 2,208 | $ 3,377 | |
Other Nonoperating Income (Expense) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Unrealized gains/losses | $ 700 | $ (1,200) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
RELATED PARTY TRANSACTIONS | ||||
Sales to related parties | $ 0.3 | $ 0.2 | $ 0.6 | $ 2.6 |
Purchases from related party vendors | $ 2.4 | 1.5 | $ 3.5 | 5.7 |
Minimum | ||||
RELATED PARTY TRANSACTIONS | ||||
Beneficial ownership (as a percent) | 5.00% | 5.00% | ||
Tax Receivable Agreement | Legacy Owner Holdco and Crestview GP | ||||
RELATED PARTY TRANSACTIONS | ||||
Percentage of net tax savings for payment to TRA Holders | 85.00% | |||
Tax Receivable Agreement | Contributing Legacy Owners | ||||
RELATED PARTY TRANSACTIONS | ||||
Percentage of net tax savings for payment to TRA Holders | 85.00% | |||
Property and equipment | ||||
RELATED PARTY TRANSACTIONS | ||||
Purchases from related party vendors | $ 0.1 | 0.1 | $ 0.1 | 0.3 |
Inventory and consumables | ||||
RELATED PARTY TRANSACTIONS | ||||
Purchases from related party vendors | 0.1 | |||
Rent of certain equipment or other services | ||||
RELATED PARTY TRANSACTIONS | ||||
Purchases from related party vendors | 1.5 | $ 1.4 | 2.4 | 5.1 |
Management, consulting and other services | ||||
RELATED PARTY TRANSACTIONS | ||||
Purchases from related party vendors | $ 0.8 | $ 1 | $ 0.2 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
INCOME TAXES | ||||
Current income tax benefit | $ 12 | $ (607) | $ (185) | $ (679) |
Deferred income tax benefit | 72 | 477 | 6 | 385 |
Total income tax benefit | $ 84 | $ (130) | $ (179) | $ (294) |
Effective Income tax (as percent) | (0.40%) | 0.20% | 0.40% | 0.10% |
Statutory tax rate (as a percent) | 21.00% | |||
Income tax benefit | $ 500 |
NONCONTROLLING INTERESTS (Detai
NONCONTROLLING INTERESTS (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
NONCONTROLLING INTERESTS | ||
Noncontrolling interests attributable to joint ventures formed for water-related services | $ 1,068 | $ 2,002 |
Noncontrolling interests attributable to holders of Class B Common Stock | 102,483 | 110,819 |
Total noncontrolling interests | $ 103,551 | $ 112,821 |
NONCONTROLLING INTERESTS - Effe
NONCONTROLLING INTERESTS - Effect of Changes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Effects of changes in noncontrolling interests on equity | ||||
Net loss attributable to Select Energy Services, Inc. | $ (16,567) | $ (44,298) | $ (39,674) | $ (290,160) |
Transfers from (to) noncontrolling interests: | ||||
Noncontrolling interest in subsidiary | $ 133 | 1,074 | 133 | |
Increase in additional paid-in capital as a result of restricted stock issuance, net of forfeitures | 1,582 | 1,911 | ||
Increase in additional paid-in capital as a result of issuance of common stock due to vesting of restricted stock units | 1 | |||
Decrease in additional paid-in capital as a result of the repurchase of SES Holdings LLC Units | (19) | (1,405) | ||
Increase in additional paid-in capital as a result of the Employee Stock Purchase Plan shares issued | 1 | 4 | ||
Change to equity from net loss attributable to Select Energy Services, Inc. and transfers from noncontrolling interests | (38,110) | $ (289,649) | ||
SES Holdings LLC [Member] | ||||
Effects of changes in noncontrolling interests on equity | ||||
Noncontrolling Interest | 50.00% | 50.00% | ||
Transfers from (to) noncontrolling interests: | ||||
Noncontrolling interest in subsidiary | $ 900 | $ 100 |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Calculation of basic and diluted earnings per share: | ||||
Antidilutive shares | 2,132,690 | 3,542,939 | 2,132,690 | 3,542,939 |
Net loss | $ (19,615) | $ (53,044) | $ (47,036) | $ (344,264) |
Net loss attributable to noncontrolling interests | 3,048 | 8,746 | 7,362 | 54,104 |
Net loss attributable to Select Energy Services, Inc. | (16,567) | (44,298) | (39,674) | (290,160) |
Net loss attributable to Select Energy Services, Inc. - diluted | (16,567) | (44,298) | (39,674) | (290,160) |
Class A Common Stock | ||||
Calculation of basic and diluted earnings per share: | ||||
Net loss attributable to Select Energy Services, Inc. | (16,567) | (44,298) | (39,674) | (290,160) |
Net loss attributable to Select Energy Services, Inc. - diluted | $ (16,567) | $ (44,298) | $ (39,674) | $ (290,160) |
Weighted-average shares of common stock outstanding - basic | 85,244,439 | 84,937,043 | 85,118,851,000 | 85,520,935,000 |
Weighted-average shares of common stock outstanding - diluted | 85,244,439 | 84,937,043 | 85,118,851,000 | 85,520,935,000 |
Loss per share, Basic (in dollars per share) | $ (0.19) | $ (0.52) | $ (0.47) | $ (3.39) |
Loss per share, Diluted (in dollars per share) | $ (0.19) | $ (0.52) | $ (0.47) | $ (3.39) |
Class B Common Stock | ||||
Calculation of basic and diluted earnings per share: | ||||
Weighted-average shares of common stock outstanding - basic | 16,221,101 | 16,221,101 | 16,221,101,000 | 16,221,101,000 |
Weighted-average shares of common stock outstanding - diluted | 16,221,101 | 16,221,101 | 16,221,101,000 | 16,221,101,000 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2021USD ($)segment | Jun. 30, 2020USD ($)segment | |
SEGMENT INFORMATION | ||||
Number of reportable segments | segment | 3 | 3 | ||
Segment information | ||||
Revenue | $ 161,117 | $ 92,239 | $ 304,859 | $ 370,524 |
(Loss) Income before taxes | (19,531) | (53,174) | (47,215) | (344,558) |
Depreciation and Amortization | 21,642 | 26,342 | 43,941 | 53,209 |
Capital Expenditures | 8,465 | 1,361 | 13,756 | 8,411 |
Loss from operations | (18,373) | (47,805) | (43,417) | (338,636) |
Other (expense) income, net | 895 | (2,700) | (734) | (2,441) |
Operating segment | Water Services | ||||
Segment information | ||||
Revenue | 77,230 | 56,090 | 143,947 | 206,242 |
(Loss) Income before taxes | (9,902) | (22,518) | (23,212) | (218,418) |
Depreciation and Amortization | 12,339 | 15,880 | 25,393 | 33,036 |
Capital Expenditures | 2,704 | (48) | 2,973 | 1,219 |
Operating segment | Water Infrastructure | ||||
Segment information | ||||
Revenue | 33,330 | 15,439 | 71,135 | 73,323 |
(Loss) Income before taxes | (885) | (11,037) | 772 | (93,114) |
Depreciation and Amortization | 6,446 | 7,024 | 12,701 | 14,052 |
Capital Expenditures | 5,122 | (205) | 9,582 | 2,363 |
Operating segment | Oilfield Chemicals | ||||
Segment information | ||||
Revenue | 51,467 | 21,174 | 93,279 | 92,202 |
(Loss) Income before taxes | 1,225 | (7,216) | (252) | (10,112) |
Depreciation and Amortization | 2,234 | 2,604 | 4,574 | 4,602 |
Capital Expenditures | 639 | 1,614 | 1,200 | 4,504 |
Operating segment | Other | ||||
Segment information | ||||
(Loss) Income before taxes | (3) | (38) | (16) | (13) |
Capital Expenditures | 1 | 325 | ||
Elimination | ||||
Segment information | ||||
Revenue | (910) | (464) | (3,502) | (1,243) |
Corporate | ||||
Segment information | ||||
(Loss) Income before taxes | (8,808) | (6,996) | (20,709) | (16,979) |
Depreciation and Amortization | 623 | 834 | 1,273 | 1,519 |
Material reconciling items | ||||
Segment information | ||||
Loss from operations | (9,565) | (40,809) | (22,708) | (321,657) |
Interest expense, net | (400) | (513) | (835) | (844) |
Other (expense) income, net | $ (758) | $ (4,856) | $ (2,963) | $ (5,078) |
SEGMENT INFORMATION - Total Ass
SEGMENT INFORMATION - Total Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Segment Reporting Information [Line Items] | ||
Assets | $ 839,863 | $ 875,359 |
Operating segment | Water Services | ||
Segment Reporting Information [Line Items] | ||
Assets | 478,460 | 515,856 |
Operating segment | Water Infrastructure | ||
Segment Reporting Information [Line Items] | ||
Assets | 195,523 | 204,995 |
Operating segment | Oilfield Chemicals | ||
Segment Reporting Information [Line Items] | ||
Assets | 160,146 | 147,612 |
Operating segment | Other | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 5,734 | $ 6,896 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) shares in Millions, $ in Millions | Jul. 09, 2021 | Jun. 30, 2021 |
Sale of subsidiary | ||
Percentage of vehicles in which certain employees at some of the facilities altered emissions controls systems | 5.00% | |
Settlement amount paid | $ 4.3 | |
Subsequent Event | Complete Energy Services, Inc. | ||
Sale of subsidiary | ||
Payments to Acquire Businesses, Gross | $ 14.2 | |
Subsequent Event | Class A Common Stock | Complete Energy Services, Inc. | ||
Sale of subsidiary | ||
Stock Issued During Period, Shares, Acquisitions | 3.6 |