|
|
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Delaware
|
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47-3282259
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|
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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11000 Equity Drive
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Houston
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Texas
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77041
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.01 par value per share
|
EXTN
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New York Stock Exchange
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Large accelerated filer
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☐
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Accelerated filer
|
☒
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Non-accelerated filer
|
☐
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Smaller reporting company
|
☐
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Emerging growth company
|
☐
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Page
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•
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conditions in the oil and natural gas industry, including a sustained imbalance in the level of supply or demand for oil or natural gas or a sustained low price of oil or natural gas, which could depress or reduce the demand or pricing for our natural gas compression and oil and natural gas production and processing equipment and services;
|
•
|
reduced profit margins or the loss of market share resulting from competition or the introduction of competing technologies by other companies;
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•
|
economic or political conditions in the countries in which we do business, including civil developments such as uprisings, riots, terrorism, kidnappings, violence associated with drug cartels, legislative changes and the expropriation, confiscation or nationalization of property without fair compensation;
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•
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changes in currency exchange rates, including the risk of currency devaluations by foreign governments, and restrictions on currency repatriation;
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•
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risks associated with cyber-based attacks or network security breaches;
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•
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changes in international trade relationships, including the imposition of trade restrictions or tariffs relating to any materials or products (such as aluminum and steel) used in the operation of our business;
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•
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risks associated with our operations, such as equipment defects, equipment malfunctions, environmental discharges and natural disasters;
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•
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the risk that counterparties will not perform their obligations under their contracts with us or other changes that could impact our ability to recover our fixed asset investment;
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•
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the financial condition of our customers;
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•
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our ability to timely and cost-effectively obtain components necessary to conduct our business;
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•
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employment and workforce factors, including our ability to hire, train and retain key employees;
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•
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our ability to implement our business and financial objectives, including:
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•
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winning profitable new business;
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•
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timely and cost-effective execution of projects;
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•
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enhancing or maintaining our asset utilization, particularly with respect to our fleet of compressors and other assets;
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•
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integrating acquired businesses;
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•
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generating sufficient cash to satisfy our operating needs, existing capital commitments and other contractual cash obligations, including our debt obligations; and
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•
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accessing the financial markets at an acceptable cost;
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•
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our ability to accurately estimate our costs and time required under our fixed price contracts;
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•
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liability related to the use of our products and services;
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•
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changes in governmental safety, health, environmental or other regulations, which could require us to make significant expenditures; and
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•
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our level of indebtedness and ability to fund our business.
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•
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Global footprint and expansive service and product offerings positioned to capitalize on the global energy infrastructure build-out. The global oil and natural gas production and processing infrastructure build out provides us with opportunities for growth. We are well positioned to capitalize on increased opportunities in both the U.S. and international markets. We believe our global customer base will continue to invest in infrastructure projects based on longer-term fundamentals that are less tied to near-term commodity prices and that our size and geographic presence provide us with a unique advantage in meeting our customers’ needs. We provide our customers with a broad variety of products and services in approximately 25 countries worldwide, including compression, production and processing services, natural gas compression, oil and natural gas processing and treating equipment, water treatment solutions, installation services and integrated power generation. By offering a broad range of products and services that leverage our core strengths, we believe we provide unique integrated solutions that meet our customers’ needs. We believe the breadth and quality of our products and services, the depth of our customer relationships and our presence in many major oil and natural gas producing regions place us in a position to capture additional business on a global basis.
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•
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Complementary businesses enable us to offer customers integrated infrastructure solutions. We aim to provide our customers with a single source to meet their energy infrastructure needs and we believe we have the ability to serve our customers’ changing needs in a variety of ways. For customers that seek to manage their capital spending on energy infrastructure projects, we offer our full project and operations services through our contract operations business. For customers that prefer to develop and acquire their own infrastructure assets, we are able to sell equipment and facilities to support their operations and, following the sale of our equipment, we can also provide commissioning, start-up, operations, maintenance, overhaul, upgrade and reconfiguration services through our aftermarket services business. Furthermore, we can combine our products into an integrated solution where we can design, engineer, procure and, in some cases, construct assets on-site for sale to our customers. Because of the breadth of our products and our unique ability to deliver those products through our different commercial models, we believe we are able to provide the right solution that is most suitable to our customers in the markets in which they operate. We believe this ability to provide our customers with a variety of products and services provides us with more business opportunities, as we are able to adjust the products and services we provide to reflect our customers’ changing needs.
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•
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High-quality products and services. We have built a network of high-quality energy infrastructure assets that are strategically deployed across our global platform. Through our history of operating a wide variety of products in many energy-producing markets around the world, we have developed the technical expertise and experience that we believe is required to understand the needs of our customers and to meet those needs through a range of products and services. These products and services include highly customized compression, production, processing and treating solutions as well as standard products based on our expertise, in support of a range of projects, from those requiring quick completion to those that may take several years to fully develop. Additionally, our experience has enabled us to develop efficient systems and work processes and a skilled workforce that allow us to provide high-quality services. We seek to continually improve our products and services to enable us to provide our customers with high-quality, comprehensive oil and natural gas infrastructure support worldwide.
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•
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Cash flows from our contract operations business are supported by long-term contracts. We provide contract operations services to customers located in 12 countries. Within our contract operations business, we seek to enter into long-term contracts with a diverse collection of customers, including large integrated oil and natural gas companies and national energy companies. These contracts generally involve initial terms ranging from three to 12 years, and typically require our customers to pay a monthly service fee even during periods of limited or disrupted oil or natural gas flows. Furthermore, our customer base includes companies that are among the largest and most well-known companies within their respective regions and countries.
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•
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Experienced management team. We have an experienced and skilled management team with a long track record of driving growth through organic expansion and selective acquisitions. The members of our management team have strong relationships in the oil and gas industry and have operated through numerous commodity price cycles throughout our areas of operations. Members of our management team have spent a significant portion of their respective careers at highly regarded energy and manufacturing companies serving the upstream, midstream and downstream segments of the oil and natural gas market.
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•
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Well-balanced capital structure with sufficient liquidity. We intend to maintain a capital structure with an appropriate amount of leverage and the financial flexibility to invest in our operations and pursue attractive growth opportunities which we believe will increase overall earnings and cash flow generated by our business. As of December 31, 2019, taking into account guarantees through outstanding letters of credit, we had undrawn capacity of $601.8 million under our revolving credit facility, of which $513.3 million was available for additional borrowings as a result of a covenant restriction included in our credit agreement. In addition, as of December 31, 2019, we had $16.7 million of cash and cash equivalents on hand.
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•
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Strategically grow our business. Our primary strategic focus involves the targeted growth of our core business by expanding our product and services offerings and by leveraging our existing, proven portfolio of products and services. We intend to infuse new technology and innovation into our existing midstream products and services while developing new product and service offerings in water treatment and integrated power generation. Additionally, our strategic focus includes targeting development opportunities in the U.S. energy market and expansion into new international markets benefiting from the global energy infrastructure build-out. We believe our diverse product and service portfolio allows us to readily respond to changes in industry and economic conditions and that our global footprint allows us to provide the prompt product availability our customers require. We have the ability to undertake projects in new locations as needed to meet customer demand and to readily deploy our capital to construct new or supplemental projects that we can build, own, operate and maintain on behalf of our customers through our contract operations business. In addition, we seek to provide our customers with integrated energy infrastructure solutions by combining product and service offerings across our businesses. We plan to supplement our organic growth with select acquisitions, partnerships and other commercial arrangements in key markets to further enhance our geographic reach, product offerings and other capabilities. We believe these arrangements will allow us to generate incremental revenues from existing and new customers and increase market share.
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•
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Expand customer base and deepen relationships with existing customers. We believe the unique, broad range of products and services we offer, the quality of our products and services and our diverse geographic footprint position us to attract new customers and cross-sell our products and services to existing customers. In addition, we have a long history of providing our products and services to our customers which, coupled with the technical expertise of our experienced personnel, enables us to understand and meet our customers’ needs, particularly as those needs develop and change over time. We intend to continue to devote significant business development resources to market our products and services, leverage existing relationships and expedite our growth potential. Additionally, we seek to evolve our products and services offerings by developing new technologies that will allow us to provide differentiated solutions to the critical midstream infrastructure needs of our customers.
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•
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Enhance our safety performance. We believe our safety performance and reputation help us to attract and retain customers and employees. We have adopted rigorous processes and procedures to facilitate our compliance with safety regulations and policies on a global basis. We work diligently to meet or exceed applicable safety regulations, and continue to focus on our safety as our business grows and operating conditions change.
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•
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Continue to optimize our global platform, products and services and enhance our profitability. We regularly review and evaluate the quality of our operations, products and services and portfolio of our product and service offerings. This evaluation process includes assessing the quality of our performance and potential opportunities to create value for our customers. We believe the development and introduction of new technology into our existing products and services offerings will create more value for our customers and us in the market place, which we believe will further differentiate us from our competitors. Additionally, we believe our ongoing focus on improving the quality of our operations, products and services results in greater satisfaction among our customers, which we believe results in greater profitability and value for our shareholders.
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•
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access to our specialized personnel and technical skills, including engineers, operators and field service and maintenance employees, which we believe generally leads to improved production rates and increased throughput and therefore higher revenues and margins;
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•
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the ability to increase their profitability by transporting or producing a higher volume of natural gas through decreased equipment downtime and reduced operating, maintenance and equipment costs by allowing us, as the service provider, to efficiently manage their operations; and
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•
|
the flexibility to deploy their capital on projects more directly related to their primary business of hydrocarbon exploration and production by reducing their investment in compression, production and processing equipment and related maintenance capital requirements.
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•
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our Code of Conduct;
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•
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our Corporate Governance Principles; and
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•
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the charters of our audit, compensation and nominating and corporate governance committees.
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•
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difficulties in managing international operations, including our ability to timely and cost effectively execute projects;
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•
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unexpected changes in regulatory requirements, laws or policies by foreign agencies or governments;
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•
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work stoppages;
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•
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training and retaining qualified personnel in international markets;
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•
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the burden of complying with multiple and potentially conflicting laws and regulations;
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•
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tariffs and other trade barriers;
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•
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actions by governments or national oil companies that result in the nullification or renegotiation on less than favorable terms of existing contracts, or otherwise result in the deprivation of contractual rights, and other difficulties in enforcing contractual obligations;
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•
|
governmental actions that: result in restricting the movement of property or that impede our ability to import or export parts or equipment; require a certain percentage of equipment to contain local or domestic content; or require certain local or domestic ownership, control or employee ratios in order to do business in or obtain special incentives or treatment in certain jurisdictions;
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•
|
potentially longer payment cycles;
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•
|
changes in political and economic conditions in the countries in which we operate, including general political unrest, the nationalization of energy related assets, civil uprisings, community protests, blockades, riots, kidnappings, violence associated with drug cartels and terrorist acts;
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•
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potentially adverse tax consequences or tax law changes;
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•
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currency controls or restrictions on repatriation of earnings;
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•
|
expropriation, confiscation or nationalization of property without fair compensation;
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•
|
the risk that our international customers may have reduced access to credit because of higher interest rates, reduced bank lending or a deterioration in our customers’ or their lenders’ financial condition;
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•
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complications associated with installing, operating and repairing equipment in remote locations;
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•
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limitations on insurance coverage;
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•
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inflation;
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•
|
the geographic, time zone, language and cultural differences among personnel in different areas of the world; and
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•
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difficulties in establishing new international offices and the risks inherent in establishing new relationships in foreign countries.
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•
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make it more difficult for us to satisfy our contractual obligations;
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•
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increase our vulnerability to general adverse economic and industry conditions;
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•
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limit our ability to fund future working capital, capital expenditures, investments, acquisitions or other corporate requirements;
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•
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increase our vulnerability to interest rate fluctuations because the interest payments on borrowings under our revolving credit facility are based upon variable interest rates and can adjust based upon certain financial covenant ratios;
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•
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limit our flexibility in planning for, or reacting to, changes in our business and our industry;
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•
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place us at a disadvantage compared to our competitors that have less debt or less restrictive covenants in such debt; and
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•
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limit our ability to borrow additional funds in the future.
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•
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the inability to meet the financial estimates of analysts who follow our common stock;
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•
|
strategic actions by us or our competitors;
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•
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announcements by us or our competitors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments;
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•
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variations in our quarterly operating results and those of our competitors;
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•
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general economic and stock market conditions;
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•
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risks relating to our business and our industry, including those discussed above;
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•
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changes in conditions or trends in our industry, markets or customers;
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•
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cyber-attacks, terrorist acts or armed hostilities;
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•
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future sales of our common stock or other securities;
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•
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material weaknesses in our internal control over financial reporting; and
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•
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investor perceptions of the investment opportunity associated with our common stock relative to other investment alternatives.
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Location
|
|
Status
|
|
Square Feet
|
|
Uses
|
Houston, Texas
|
|
Leased
|
|
58,857
|
|
Corporate office
|
Port Harcourt, Nigeria
|
|
Leased
|
|
47,333
|
|
Contract operations and aftermarket services
|
Neuquen, Argentina
|
|
Owned
|
|
43,233
|
|
Contract operations and aftermarket services
|
Reynosa, Mexico
|
|
Owned
|
|
28,912
|
|
Contract operations and aftermarket services
|
Veracruz, Mexico
|
|
Leased
|
|
25,833
|
|
Contract operations and aftermarket services
|
Santa Cruz, Bolivia
|
|
Leased
|
|
22,017
|
|
Contract operations and aftermarket services
|
Camacari, Brazil
|
|
Owned
|
|
86,112
|
|
Contract operations
|
Bangkok, Thailand
|
|
Leased
|
|
51,667
|
|
Aftermarket services
|
Houston, Texas
|
|
Owned
|
|
261,609
|
|
Product sales
|
Hamriyah Free Zone, UAE
|
|
Leased
|
|
212,742
|
|
Product sales
|
Broken Arrow, Oklahoma
|
|
Owned
|
|
145,755
|
|
Product sales
|
Singapore, Singapore
|
|
Leased
|
|
111,693
|
|
Product sales
|
Period
|
|
Total Number of
Shares Repurchased (1)
|
|
Average
Price Paid
Per Unit
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced
Program
|
|
Dollar Value of Shares that
may yet to be Purchased
Under the Publicly Announced
Program
|
||||||
October 1, 2019 - October 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
61,061,250
|
|
November 1, 2019 - November 30, 2019
|
|
350,640
|
|
|
8.14
|
|
|
342,021
|
|
|
58,282,207
|
|
||
December 1, 2019 - December 31, 2019
|
|
99,089
|
|
|
5.61
|
|
|
99,089
|
|
|
57,726,011
|
|
||
Total
|
|
449,729
|
|
|
$
|
7.58
|
|
|
441,110
|
|
|
$
|
57,726,011
|
|
|
(1)
|
Total number of shares repurchased includes 8,619 shares withheld to satisfy employees’ tax withholding obligations in connection with vesting of restricted stock awards during the period.
|
|
Years Ended December 31,
|
||||||||||||||||||
(in thousands, except per share data)
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
1,317,440
|
|
|
$
|
1,360,856
|
|
|
$
|
1,215,294
|
|
|
$
|
905,397
|
|
|
$
|
1,687,264
|
|
Cost of sales (excluding depreciation and amortization expense)
|
954,218
|
|
|
977,428
|
|
|
868,154
|
|
|
596,406
|
|
|
1,189,361
|
|
|||||
Selling, general and administrative
|
164,314
|
|
|
178,401
|
|
|
176,318
|
|
|
157,485
|
|
|
210,483
|
|
|||||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|
132,886
|
|
|
146,318
|
|
|||||
Impairments
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|
14,495
|
|
|
20,788
|
|
|||||
Restatement related charges (recoveries), net
|
48
|
|
|
(276
|
)
|
|
3,419
|
|
|
18,879
|
|
|
—
|
|
|||||
Restructuring and other charges
|
8,712
|
|
|
1,997
|
|
|
3,189
|
|
|
22,038
|
|
|
31,315
|
|
|||||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
34,826
|
|
|
34,181
|
|
|
7,272
|
|
|||||
Equity in income of non-consolidated affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,403
|
)
|
|
(15,152
|
)
|
|||||
Other (income) expense, net
|
(1,829
|
)
|
|
6,484
|
|
|
(975
|
)
|
|
(13,046
|
)
|
|
35,516
|
|
|||||
Income (loss) before income taxes
|
(83,573
|
)
|
|
39,825
|
|
|
16,839
|
|
|
(47,524
|
)
|
|
61,363
|
|
|||||
Provision for income taxes
|
25,290
|
|
|
39,433
|
|
|
22,695
|
|
|
124,242
|
|
|
39,438
|
|
|||||
Income (loss) from continuing operations
|
(108,863
|
)
|
|
392
|
|
|
(5,856
|
)
|
|
(171,766
|
)
|
|
21,925
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
6,486
|
|
|
24,462
|
|
|
39,736
|
|
|
(56,171
|
)
|
|
4,723
|
|
|||||
Net income (loss)
|
(102,377
|
)
|
|
24,854
|
|
|
33,880
|
|
|
(227,937
|
)
|
|
26,648
|
|
|||||
Income (loss) from continuing operations per common share: (1)
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(3.18
|
)
|
|
$
|
0.01
|
|
|
$
|
(0.17
|
)
|
|
$
|
(4.97
|
)
|
|
$
|
0.64
|
|
Diluted
|
(3.18
|
)
|
|
0.01
|
|
|
(0.17
|
)
|
|
(4.97
|
)
|
|
0.64
|
|
|||||
Weighted average common shares outstanding used in income (loss) from continuing operations per common share: (1)
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
34,283
|
|
|
35,433
|
|
|
34,959
|
|
|
34,568
|
|
|
34,288
|
|
|||||
Diluted
|
34,283
|
|
|
35,489
|
|
|
34,959
|
|
|
34,568
|
|
|
34,304
|
|
|||||
Other Financial Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total gross margin (2)
|
$
|
363,222
|
|
|
$
|
383,428
|
|
|
$
|
347,140
|
|
|
$
|
308,991
|
|
|
$
|
497,903
|
|
EBITDA, as adjusted (2)
|
200,657
|
|
|
205,498
|
|
|
173,155
|
|
|
155,993
|
|
|
282,031
|
|
|||||
Capital expenditures:
|
|
|
|
|
|
|
|
|
|
||||||||||
Contract Operations Equipment:
|
|
|
|
|
|
|
|
|
|
||||||||||
Growth (3)
|
$
|
163,731
|
|
|
$
|
186,240
|
|
|
$
|
104,909
|
|
|
$
|
53,005
|
|
|
$
|
105,169
|
|
Maintenance (4)
|
8,753
|
|
|
6,616
|
|
|
15,691
|
|
|
14,440
|
|
|
27,282
|
|
|||||
Other
|
20,790
|
|
|
22,252
|
|
|
11,073
|
|
|
6,225
|
|
|
22,893
|
|
|||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
16,683
|
|
|
$
|
19,300
|
|
|
$
|
49,145
|
|
|
$
|
35,678
|
|
|
$
|
29,032
|
|
Working capital (5) (6)
|
109,278
|
|
|
108,746
|
|
|
134,048
|
|
|
177,824
|
|
|
408,488
|
|
|||||
Property, plant and equipment, net
|
844,410
|
|
|
901,577
|
|
|
822,279
|
|
|
790,922
|
|
|
846,977
|
|
|||||
Total assets (6)
|
1,418,004
|
|
|
1,567,054
|
|
|
1,460,807
|
|
|
1,374,778
|
|
|
1,788,396
|
|
|||||
Long-term debt (7)
|
443,587
|
|
|
403,810
|
|
|
368,472
|
|
|
348,970
|
|
|
525,593
|
|
|||||
Total stockholders’ equity (6) (7)
|
409,538
|
|
|
552,821
|
|
|
554,786
|
|
|
556,771
|
|
|
805,936
|
|
|
(1)
|
For the periods prior to November 3, 2015, the average number of common shares outstanding used to calculate basic and diluted net income (loss) from continuing operations per common share was based on 34,286,267 shares of our common stock that were distributed by Archrock in the Spin-off on November 3, 2015.
|
(2)
|
Total gross margin and EBITDA, as adjusted, are non-GAAP financial measures. Total gross margin and EBITDA, as adjusted, are defined, reconciled to income (loss) before income taxes and net income (loss), respectively, and discussed further below under “Non-GAAP Financial Measures.”
|
(3)
|
Growth capital expenditures are made to expand or to replace partially or fully depreciated assets or to expand the operating capacity or revenue generating capabilities of existing or new assets, whether through construction, acquisition or modification. The majority of our growth capital expenditures are related to contract operations projects including acquisition costs of new compressor units and processing and treating equipment and installation costs for projects that we add to our contract operations business. In addition, growth capital expenditures can include the upgrading of major components on an existing compressor unit where the current configuration of the compressor unit is no longer in demand and the compressor unit is not likely to return to an operating status without the capital expenditures. These latter expenditures substantially modify the operating parameters of the compressor unit such that it can be used in applications for which it previously was not suited.
|
(4)
|
Maintenance capital expenditures are made to maintain the existing operating capacity of our assets and related cash flows further extending the useful lives of the assets. Maintenance capital expenditures are related to major overhauls of significant components of a compressor unit, such as the engine, compressor and cooler, that return the components to a “like new” condition, but do not modify the applications for which the compressor unit was designed.
|
(5)
|
Working capital is defined as current assets minus current liabilities.
|
(6)
|
Amounts include balance sheet data for discontinued operations.
|
(7)
|
Pursuant to the separation and distribution agreement with Archrock and certain of our and Archrock’s respective affiliates, on November 3, 2015, we transferred $532.6 million of net proceeds from borrowings under our credit facility to Archrock to allow it to repay a portion of its indebtedness in connection with the Spin-off.
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Income (loss) before income taxes
|
$
|
(83,573
|
)
|
|
$
|
39,825
|
|
|
$
|
16,839
|
|
|
$
|
(47,524
|
)
|
|
$
|
61,363
|
|
Selling, general and administrative
|
164,314
|
|
|
178,401
|
|
|
176,318
|
|
|
157,485
|
|
|
210,483
|
|
|||||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|
132,886
|
|
|
146,318
|
|
|||||
Impairments
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|
14,495
|
|
|
20,788
|
|
|||||
Restatement related charges (recoveries), net
|
48
|
|
|
(276
|
)
|
|
3,419
|
|
|
18,879
|
|
|
—
|
|
|||||
Restructuring and other charges
|
8,712
|
|
|
1,997
|
|
|
3,189
|
|
|
22,038
|
|
|
31,315
|
|
|||||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
34,826
|
|
|
34,181
|
|
|
7,272
|
|
|||||
Equity in income of non-consolidated affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,403
|
)
|
|
(15,152
|
)
|
|||||
Other (income) expense, net
|
(1,829
|
)
|
|
6,484
|
|
|
(975
|
)
|
|
(13,046
|
)
|
|
35,516
|
|
|||||
Total gross margin
|
$
|
363,222
|
|
|
$
|
383,428
|
|
|
$
|
347,140
|
|
|
$
|
308,991
|
|
|
$
|
497,903
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Net income (loss)
|
$
|
(102,377
|
)
|
|
$
|
24,854
|
|
|
$
|
33,880
|
|
|
$
|
(227,937
|
)
|
|
$
|
26,648
|
|
(Income) loss from discontinued operations, net of tax
|
(6,486
|
)
|
|
(24,462
|
)
|
|
(39,736
|
)
|
|
56,171
|
|
|
(4,723
|
)
|
|||||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|
132,886
|
|
|
146,318
|
|
|||||
Impairments
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|
14,495
|
|
|
20,788
|
|
|||||
Restatement related charges (recoveries), net
|
48
|
|
|
(276
|
)
|
|
3,419
|
|
|
18,879
|
|
|
—
|
|
|||||
Restructuring and other charges
|
8,712
|
|
|
1,997
|
|
|
3,189
|
|
|
22,038
|
|
|
31,315
|
|
|||||
Investment in non-consolidated affiliates impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33
|
|
|||||
Proceeds from sale of joint venture assets
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,403
|
)
|
|
(15,185
|
)
|
|||||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
34,826
|
|
|
34,181
|
|
|
7,272
|
|
|||||
(Gain) loss on currency exchange rate remeasurement of intercompany balances
|
(80
|
)
|
|
5,241
|
|
|
(516
|
)
|
|
(8,559
|
)
|
|
30,127
|
|
|||||
Loss on sale of businesses
|
—
|
|
|
1,714
|
|
|
111
|
|
|
—
|
|
|
—
|
|
|||||
Penalties from Brazilian tax programs
|
—
|
|
|
—
|
|
|
1,763
|
|
|
—
|
|
|
—
|
|
|||||
Provision for income taxes
|
25,290
|
|
|
39,433
|
|
|
22,695
|
|
|
124,242
|
|
|
39,438
|
|
|||||
EBITDA, as adjusted
|
$
|
200,657
|
|
|
$
|
205,498
|
|
|
$
|
173,155
|
|
|
$
|
155,993
|
|
|
$
|
282,031
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue:
|
|
|
|
|
|
||||||
Contract Operations
|
$
|
368,126
|
|
|
$
|
360,973
|
|
|
$
|
375,269
|
|
Aftermarket Services
|
129,217
|
|
|
120,676
|
|
|
107,063
|
|
|||
Product Sales
|
820,097
|
|
|
879,207
|
|
|
732,962
|
|
|||
|
$
|
1,317,440
|
|
|
$
|
1,360,856
|
|
|
$
|
1,215,294
|
|
Gross Margin: (1)
|
|
|
|
|
|
||||||
Contract Operations
|
$
|
239,963
|
|
|
$
|
238,835
|
|
|
$
|
241,889
|
|
Aftermarket Services
|
33,610
|
|
|
31,010
|
|
|
28,842
|
|
|||
Product Sales
|
89,649
|
|
|
113,583
|
|
|
76,409
|
|
|||
|
$
|
363,222
|
|
|
$
|
383,428
|
|
|
$
|
347,140
|
|
Gross Margin Percentage: (2)
|
|
|
|
|
|
||||||
Contract Operations
|
65
|
%
|
|
66
|
%
|
|
64
|
%
|
|||
Aftermarket Services
|
26
|
%
|
|
26
|
%
|
|
27
|
%
|
|||
Product Sales
|
11
|
%
|
|
13
|
%
|
|
10
|
%
|
|
(1)
|
Gross margin is defined as revenue less cost of sales (excluding depreciation and amortization expense). We evaluate the performance of each of our segments based on gross margin.
|
(2)
|
Gross margin percentage is defined as gross margin divided by revenue.
|
|
December 31,
2019 |
||
Contract Operations Backlog: (1)
|
|
||
2020
|
$
|
268,082
|
|
2021
|
232,057
|
|
|
2022
|
181,759
|
|
|
2023
|
152,503
|
|
|
2024
|
118,465
|
|
|
Thereafter
|
299,135
|
|
|
Total contract operations backlog
|
$
|
1,252,001
|
|
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Product Sales Backlog: (1)
|
|
|
|
|
|
||||||
Compression equipment
|
$
|
160,946
|
|
|
$
|
471,827
|
|
|
$
|
254,745
|
|
Processing and treating equipment
|
69,912
|
|
|
229,258
|
|
|
178,814
|
|
|||
Production equipment (2)
|
593
|
|
|
2,438
|
|
|
14,138
|
|
|||
Other product sales
|
46,501
|
|
|
2,246
|
|
|
13,349
|
|
|||
Total product sales backlog
|
$
|
277,952
|
|
|
$
|
705,769
|
|
|
$
|
461,046
|
|
|
(1)
|
We expect that approximately $266 million of our product sales backlog as of December 31, 2019 will be recognized as revenue before December 31, 2020.
|
(2)
|
In June 2018, we completed the sale of our North America production equipment assets (“PEQ assets”), which included $12.0 million in backlog.
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
Change
|
|
% change
|
||||||||
Revenue
|
$
|
368,126
|
|
|
$
|
360,973
|
|
|
$
|
7,153
|
|
|
2
|
%
|
Cost of sales (excluding depreciation and amortization expense)
|
128,163
|
|
|
122,138
|
|
|
6,025
|
|
|
5
|
%
|
|||
Gross margin
|
$
|
239,963
|
|
|
$
|
238,835
|
|
|
$
|
1,128
|
|
|
—
|
%
|
Gross margin percentage
|
65
|
%
|
|
66
|
%
|
|
(1
|
)%
|
|
(2
|
)%
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
|
Change
|
|
% change
|
|||||||
Revenue
|
$
|
129,217
|
|
|
$
|
120,676
|
|
|
$
|
8,541
|
|
|
7
|
%
|
Cost of sales (excluding depreciation and amortization expense)
|
95,607
|
|
|
89,666
|
|
|
5,941
|
|
|
7
|
%
|
|||
Gross margin
|
$
|
33,610
|
|
|
$
|
31,010
|
|
|
$
|
2,600
|
|
|
8
|
%
|
Gross margin percentage
|
26
|
%
|
|
26
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
|
Change
|
|
% change
|
|||||||
Revenue
|
$
|
820,097
|
|
|
$
|
879,207
|
|
|
$
|
(59,110
|
)
|
|
(7
|
)%
|
Cost of sales (excluding depreciation and amortization expense)
|
730,448
|
|
|
765,624
|
|
|
(35,176
|
)
|
|
(5
|
)%
|
|||
Gross margin
|
$
|
89,649
|
|
|
$
|
113,583
|
|
|
$
|
(23,934
|
)
|
|
(21
|
)%
|
Gross margin percentage
|
11
|
%
|
|
13
|
%
|
|
(2
|
)%
|
|
(15
|
)%
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
|
Change
|
|
% change
|
|||||||
Selling, general and administrative
|
$
|
164,314
|
|
|
$
|
178,401
|
|
|
$
|
(14,087
|
)
|
|
(8
|
)%
|
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
38,635
|
|
|
31
|
%
|
|||
Impairments
|
74,373
|
|
|
3,858
|
|
|
70,515
|
|
|
1,828
|
%
|
|||
Restatement related charges (recoveries), net
|
48
|
|
|
(276
|
)
|
|
324
|
|
|
(117
|
)%
|
|||
Restructuring and other charges
|
8,712
|
|
|
1,997
|
|
|
6,715
|
|
|
336
|
%
|
|||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
9,403
|
|
|
32
|
%
|
|||
Other (income) expense, net
|
(1,829
|
)
|
|
6,484
|
|
|
(8,313
|
)
|
|
(128
|
)%
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
|
Change
|
|
% change
|
|||||||
Provision for income taxes
|
$
|
25,290
|
|
|
$
|
39,433
|
|
|
$
|
(14,143
|
)
|
|
(36
|
)%
|
Effective tax rate
|
(30.3
|
)%
|
|
99.0
|
%
|
|
(129.3
|
)%
|
|
(130.6
|
)%
|
•
|
A $13.8 million increase (16.5% decrease) resulting from negative impacts of foreign currency devaluations primarily from Argentina.
|
•
|
A $14.0 million increase (16.7% decrease) resulting from the addition of valuation allowances primarily recorded against U.S. federal net operating losses and certain net operating losses of our foreign subsidiaries.
|
•
|
A $5.5 million increase (6.6% decrease) resulting from foreign withholding taxes primarily against U.S. income, net of U.S. tax benefits.
|
•
|
A $9.4 million decrease (11.2% increase) resulting from differences in income tax rates for international operations as compared to U.S. taxes at 21%.
|
•
|
A $14.8 million increase (37.3% increase) resulting from negative impacts of foreign currency devaluations primarily from Argentina.
|
•
|
A $19.0 million decrease (47.6% decrease) resulting from the release of valuation allowances primarily recorded against U.S. federal net operating losses and certain deferred tax assets of our foreign subsidiaries.
|
•
|
A $14.8 million increase (37.2% increase) resulting from foreign withholding taxes primarily against U.S. income, net of U.S. tax benefits.
|
•
|
A $9.5 million increase (23.8% increase) related to unrecognized tax benefits recorded in 2018.
|
|
Years Ended December 31,
|
|
|
|||||||||||
|
2019
|
|
2018
|
|
Change
|
|
% change
|
|||||||
Income from discontinued operations, net of tax
|
$
|
6,486
|
|
|
$
|
24,462
|
|
|
$
|
(17,976
|
)
|
|
(73
|
)%
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Net cash provided by (used in) continuing operations:
|
|
|
|
||||
Operating activities
|
$
|
176,198
|
|
|
$
|
153,296
|
|
Investing activities
|
(174,406
|
)
|
|
(207,578
|
)
|
||
Financing activities
|
(6,038
|
)
|
|
6,897
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(1,058
|
)
|
|
(3,841
|
)
|
||
Discontinued operations
|
2,528
|
|
|
21,013
|
|
||
Net change in cash, cash equivalents and restricted cash
|
$
|
(2,776
|
)
|
|
$
|
(30,213
|
)
|
•
|
growth capital expenditures, which are made to expand or to replace partially or fully depreciated assets or to expand the operating capacity or revenue generating capabilities of existing or new assets, whether through construction, acquisition or modification; and
|
•
|
maintenance capital expenditures, which are made to maintain the existing operating capacity of our assets and related cash flows further extending the useful lives of the assets.
|
|
Total
|
|
2020
|
|
2021-2022
|
|
2023-2024
|
|
Thereafter
|
||||||||||
Debt:(1)
|
|
|
|
|
|
|
|
|
|
||||||||||
Revolving credit facility due October 2023
|
$
|
74,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
74,000
|
|
|
$
|
—
|
|
8.125% senior notes due May 2025 (2)
|
375,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
375,000
|
|
|||||
Other
|
237
|
|
|
237
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total debt
|
449,237
|
|
|
237
|
|
|
—
|
|
|
74,000
|
|
|
375,000
|
|
|||||
Interest on debt
|
185,638
|
|
|
35,953
|
|
|
71,906
|
|
|
65,174
|
|
|
12,605
|
|
|||||
Purchase commitments
|
178,849
|
|
|
171,448
|
|
|
7,401
|
|
|
—
|
|
|
—
|
|
|||||
Facilities and other operating leases
|
51,609
|
|
|
7,154
|
|
|
12,876
|
|
|
9,649
|
|
|
21,930
|
|
|||||
Total contractual obligations
|
$
|
865,333
|
|
|
$
|
214,792
|
|
|
$
|
92,183
|
|
|
$
|
148,823
|
|
|
$
|
409,535
|
|
|
(1)
|
(2)
|
Amounts represent the full face value of the 2017 Notes and do not include unamortized debt financing costs of $5.4 million as of December 31, 2019.
|
|
|
(a)
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
|
|
(b)
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
|
|
(c)
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation Plans (Excluding Securities
Reflected in Column (a))
|
||||
Plan Category
|
|
(#)
|
|
($)
|
|
(#)
|
||||
Equity compensation plans approved by security holders (1)
|
|
68,632
|
|
|
$
|
25.33
|
|
|
857,514
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
68,632
|
|
|
|
|
857,514
|
|
|
(1)
|
Comprised of (i) the Exterran Corporation 2015 Stock Incentive Plan, the (“2015 Plan”) and (ii) the Exterran Corporation 2015 Directors’ Stock and Deferral Plan. The 2015 Plan also governs awards originally granted by Archrock under the Archrock, Inc. 2013 Stock Incentive Plan. In addition to the outstanding options, as of December 31, 2019, there were 320,229 restricted stock units outstanding, payable in common stock upon vesting, under the 2015 Plan.
|
(a)
|
Documents filed as a part of this report.
|
1.
|
Financial Statements. The following financial statements are filed as a part of this report.
|
2.
|
Financial Statement Schedule
|
Exhibit No.
|
|
Description
|
2.1
|
|
|
2.2
|
|
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
|
4.2
|
|
|
10.1
|
|
|
10.2
|
|
|
10.3
|
|
|
10.4†
|
|
|
10.5†
|
|
Exhibit No.
|
|
Description
|
10.6†
|
|
|
10.7†
|
|
|
10.8†
|
|
|
10.9†
|
|
|
10.10†
|
|
|
10.11†
|
|
|
10.12†
|
|
|
10.13†
|
|
|
10.14†
|
|
|
10.15†
|
|
|
10.16†
|
|
|
10.17†
|
|
|
10.18†
|
|
|
10.19†
|
|
|
10.20†
|
|
|
10.21†
|
|
|
10.22†
|
|
|
10.23†
|
|
|
10.24†
|
|
|
10.25†
|
|
Exhibit No.
|
|
Description
|
10.26†
|
|
|
10.27†
|
|
|
10.28†
|
|
|
10.29†
|
|
|
10.30
|
|
|
10.31†
|
|
|
10.32†
|
|
|
10.33†
|
|
|
10.34†
|
|
|
10.35†*
|
|
|
10.36†*
|
|
|
10.37†*
|
|
|
16.1
|
|
|
21.1*
|
|
|
23.1*
|
|
|
23.2*
|
|
|
24.1*
|
|
Powers of Attorney (included on the signature page to this Report)
|
31.1*
|
|
|
31.2*
|
|
|
32.1**
|
|
|
32.2**
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
101.CAL
|
|
XBRL Extension Calculation Linkbase Document.
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document.
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
Exhibit No.
|
|
Description
|
104
|
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
|
†
|
Management contract or compensatory plan or arrangement.
|
*
|
Filed herewith.
|
**
|
Furnished, not filed.
|
|
Exterran Corporation
|
|
|
|
/s/ ANDREW J. WAY
|
|
Name: Andrew J. Way
|
|
Title: President and Chief Executive Officer
|
|
|
|
Date: February 28, 2020
|
Signature
|
|
Title
|
|
|
|
/s/ ANDREW J. WAY
|
|
President and Chief Executive Officer and Director
|
Andrew J. Way
|
|
(Principal Executive Officer)
|
|
|
|
/s/ DAVID A. BARTA
|
|
Senior Vice President and Chief Financial Officer
|
David A. Barta
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
|
|
/s/ WILLIAM M. GOODYEAR
|
|
Director
|
William M. Goodyear
|
|
|
|
|
|
/s/ JOHN P. RYAN
|
|
Director
|
John P. Ryan
|
|
|
|
|
|
/s/ CHRISTOPHER T. SEAVER
|
|
Director
|
Christopher T. Seaver
|
|
|
|
|
|
/s/ IEDA GOMES YELL
|
|
Director
|
Ieda Gomes Yell
|
|
|
|
|
|
/s/ HATEM SOLIMAN
|
|
Director
|
Hatem Soliman
|
|
|
|
|
|
/s/ JAMES C. GOUIN
|
|
Director
|
James C. Gouin
|
|
|
|
|
|
/s/ MARK R. SOTIR
|
|
Director
|
Mark R. Sotir
|
|
|
/s/ PricewaterhouseCoopers LLP
|
|
Houston, Texas
|
February 28, 2020
|
/s/ DELOITTE & TOUCHE LLP
|
|
Houston, Texas
|
February 26, 2019
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
||||
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
16,683
|
|
|
$
|
19,300
|
|
Restricted cash
|
19
|
|
|
178
|
|
||
Accounts receivable, net of allowance of $6,019 and $5,474, respectively
|
202,337
|
|
|
248,467
|
|
||
Inventory, net (Note 6)
|
143,538
|
|
|
150,689
|
|
||
Contract assets (Note 3)
|
46,537
|
|
|
91,602
|
|
||
Other current assets
|
22,477
|
|
|
44,234
|
|
||
Current assets associated with discontinued operations (Note 5)
|
4,332
|
|
|
11,605
|
|
||
Total current assets
|
435,923
|
|
|
566,075
|
|
||
Property, plant and equipment, net (Note 7)
|
844,410
|
|
|
901,577
|
|
||
Operating lease right-of-use assets (Note 4)
|
26,783
|
|
|
—
|
|
||
Deferred income taxes (Note 16)
|
13,994
|
|
|
11,370
|
|
||
Intangible and other assets, net (Note 8)
|
93,300
|
|
|
86,371
|
|
||
Long-term assets held for sale (Note 13)
|
624
|
|
|
—
|
|
||
Long-term assets associated with discontinued operations (Note 5)
|
2,970
|
|
|
1,661
|
|
||
Total assets
|
$
|
1,418,004
|
|
|
$
|
1,567,054
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable, trade
|
$
|
123,444
|
|
|
$
|
165,744
|
|
Accrued liabilities (Note 10)
|
104,081
|
|
|
123,335
|
|
||
Contract liabilities (Note 3)
|
82,854
|
|
|
153,483
|
|
||
Current operating lease liabilities (Note 4)
|
6,268
|
|
|
—
|
|
||
Current liabilities associated with discontinued operations (Note 5)
|
9,998
|
|
|
14,767
|
|
||
Total current liabilities
|
326,645
|
|
|
457,329
|
|
||
Long-term debt (Note 11)
|
443,587
|
|
|
403,810
|
|
||
Deferred income taxes (Note 16)
|
993
|
|
|
6,005
|
|
||
Long-term contract liabilities (Note 3)
|
156,262
|
|
|
101,363
|
|
||
Long-term operating lease liabilities (Note 4)
|
30,958
|
|
|
—
|
|
||
Other long-term liabilities
|
49,263
|
|
|
39,812
|
|
||
Long-term liabilities associated with discontinued operations (Note 5)
|
758
|
|
|
5,914
|
|
||
Total liabilities
|
1,008,466
|
|
|
1,014,233
|
|
||
Commitments and contingencies (Note 21)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.01 par value per share; 50,000,000 shares authorized; zero issued
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value per share; 250,000,000 shares authorized; 37,508,286 and 36,868,066 shares issued, respectively
|
375
|
|
|
369
|
|
||
Additional paid-in capital
|
747,622
|
|
|
734,458
|
|
||
Accumulated deficit
|
(317,238
|
)
|
|
(208,677
|
)
|
||
Treasury stock — 4,467,600 and 721,280 common shares, at cost, respectively
|
(56,567
|
)
|
|
(11,560
|
)
|
||
Accumulated other comprehensive income
|
35,346
|
|
|
38,231
|
|
||
Total stockholders’ equity (Note 17)
|
409,538
|
|
|
552,821
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,418,004
|
|
|
$
|
1,567,054
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues (Note 3):
|
|
|
|
|
|
||||||
Contract operations
|
$
|
368,126
|
|
|
$
|
360,973
|
|
|
$
|
375,269
|
|
Aftermarket services
|
129,217
|
|
|
120,676
|
|
|
107,063
|
|
|||
Product sales
|
820,097
|
|
|
879,207
|
|
|
732,962
|
|
|||
|
1,317,440
|
|
|
1,360,856
|
|
|
1,215,294
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Cost of sales (excluding depreciation and amortization expense):
|
|
|
|
|
|
||||||
Contract operations
|
128,163
|
|
|
122,138
|
|
|
133,380
|
|
|||
Aftermarket services
|
95,607
|
|
|
89,666
|
|
|
78,221
|
|
|||
Product sales
|
730,448
|
|
|
765,624
|
|
|
656,553
|
|
|||
Selling, general and administrative
|
164,314
|
|
|
178,401
|
|
|
176,318
|
|
|||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|||
Impairments (Note 13)
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|||
Restatement related charges (recoveries), net (Note 14)
|
48
|
|
|
(276
|
)
|
|
3,419
|
|
|||
Restructuring and other charges (Note 15)
|
8,712
|
|
|
1,997
|
|
|
3,189
|
|
|||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
34,826
|
|
|||
Other (income) expense, net
|
(1,829
|
)
|
|
6,484
|
|
|
(975
|
)
|
|||
|
1,401,013
|
|
|
1,321,031
|
|
|
1,198,455
|
|
|||
Income (loss) before income taxes
|
(83,573
|
)
|
|
39,825
|
|
|
16,839
|
|
|||
Provision for income taxes (Note 16)
|
25,290
|
|
|
39,433
|
|
|
22,695
|
|
|||
Income (loss) from continuing operations
|
(108,863
|
)
|
|
392
|
|
|
(5,856
|
)
|
|||
Income from discontinued operations, net of tax (Note 5)
|
6,486
|
|
|
24,462
|
|
|
39,736
|
|
|||
Net income (loss)
|
$
|
(102,377
|
)
|
|
$
|
24,854
|
|
|
$
|
33,880
|
|
|
|
|
|
|
|
||||||
Basic net income (loss) per common share (Note 19):
|
|
|
|
|
|
||||||
Income (loss) from continuing operations per common share
|
$
|
(3.18
|
)
|
|
$
|
0.01
|
|
|
$
|
(0.17
|
)
|
Income from discontinued operations per common share
|
0.19
|
|
|
0.67
|
|
|
1.14
|
|
|||
Net income (loss) per common share
|
$
|
(2.99
|
)
|
|
$
|
0.68
|
|
|
$
|
0.97
|
|
|
|
|
|
|
|
||||||
Diluted net income (loss) per common share (Note 19):
|
|
|
|
|
|
||||||
Income (loss) from continuing operations per common share
|
$
|
(3.18
|
)
|
|
$
|
0.01
|
|
|
$
|
(0.17
|
)
|
Income from discontinued operations per common share
|
0.19
|
|
|
0.67
|
|
|
1.14
|
|
|||
Net income (loss) per common share
|
$
|
(2.99
|
)
|
|
$
|
0.68
|
|
|
$
|
0.97
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding used in net income (loss) per common share (Note 19):
|
|
|
|
|
|
||||||
Basic
|
34,283
|
|
|
35,433
|
|
|
34,959
|
|
|||
Diluted
|
34,283
|
|
|
35,489
|
|
|
34,959
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income (loss)
|
$
|
(102,377
|
)
|
|
$
|
24,854
|
|
|
$
|
33,880
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
||||
Foreign currency translation adjustment
|
(2,885
|
)
|
|
(7,476
|
)
|
|
(1,801
|
)
|
|||
Comprehensive income (loss)
|
$
|
(105,262
|
)
|
|
$
|
17,378
|
|
|
$
|
32,079
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Deficit
|
|
Treasury Stock
|
|
Accumulated
Other
Comprehensive
Income
|
|
Total
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
Shares
|
|
Amount
|
|
|
||||||||||||||||||
Balance at January 1, 2017
|
35,641,113
|
|
|
$
|
356
|
|
|
$
|
768,304
|
|
|
$
|
(257,252
|
)
|
|
(202,430
|
)
|
|
$
|
(2,145
|
)
|
|
$
|
47,508
|
|
|
$
|
556,771
|
|
Cumulative-effect adjustment from adoption of ASU 2016-09
|
|
|
|
|
|
|
138
|
|
|
(138
|
)
|
|
|
|
|
|
|
|
|
|
|
—
|
|
||||||
Net income
|
|
|
|
|
|
|
|
|
|
33,880
|
|
|
|
|
|
|
|
|
|
|
|
33,880
|
|
||||||
Options exercised
|
69,122
|
|
|
1
|
|
|
683
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
684
|
|
||||||
Foreign currency translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,801
|
)
|
|
(1,801
|
)
|
||||||
Transfer to Archrock, Inc. (Note 17)
|
|
|
|
|
|
|
(44,720
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(44,720
|
)
|
||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
|
|
|
(250,748
|
)
|
|
(4,792
|
)
|
|
|
|
|
(4,792
|
)
|
||||||
Stock-based compensation, net of forfeitures
|
483,695
|
|
|
5
|
|
|
14,759
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,764
|
|
||||||
Balance at December 31, 2017
|
36,193,930
|
|
|
$
|
362
|
|
|
$
|
739,164
|
|
|
$
|
(223,510
|
)
|
|
(453,178
|
)
|
|
$
|
(6,937
|
)
|
|
$
|
45,707
|
|
|
$
|
554,786
|
|
Cumulative-effect adjustment from adoption of ASC 606 (Note 2)
|
|
|
|
|
|
|
|
|
|
(10,021
|
)
|
|
|
|
|
|
|
|
|
|
|
(10,021
|
)
|
||||||
Net income
|
|
|
|
|
|
|
|
|
|
24,854
|
|
|
|
|
|
|
|
|
|
|
|
24,854
|
|
||||||
Options exercised
|
136,847
|
|
|
1
|
|
|
547
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
548
|
|
||||||
Foreign currency translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7,476
|
)
|
|
(7,476
|
)
|
||||||
Transfer to Archrock, Inc. (Note 17)
|
|
|
|
|
|
|
(19,814
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19,814
|
)
|
||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
|
|
|
(268,102
|
)
|
|
(4,623
|
)
|
|
|
|
|
(4,623
|
)
|
||||||
Stock-based compensation, net of forfeitures
|
537,289
|
|
|
6
|
|
|
14,561
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,567
|
|
||||||
Balance at December 31, 2018
|
36,868,066
|
|
|
$
|
369
|
|
|
$
|
734,458
|
|
|
$
|
(208,677
|
)
|
|
(721,280
|
)
|
|
$
|
(11,560
|
)
|
|
$
|
38,231
|
|
|
$
|
552,821
|
|
Cumulative-effect adjustment from adoption of ASC 842 (Note 2)
|
|
|
|
|
|
|
|
|
|
(6,184
|
)
|
|
|
|
|
|
|
|
|
|
|
(6,184
|
)
|
||||||
Net loss
|
|
|
|
|
|
|
|
|
|
(102,377
|
)
|
|
|
|
|
|
|
|
|
|
|
(102,377
|
)
|
||||||
Foreign currency translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,885
|
)
|
|
(2,885
|
)
|
||||||
Transfer from Archrock, Inc. (Note 17)
|
|
|
|
|
|
|
420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
420
|
|
||||||
Treasury stock purchased
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,746,320
|
)
|
|
(45,007
|
)
|
|
|
|
|
(45,007
|
)
|
||||||
Stock-based compensation, net of forfeitures
|
640,220
|
|
|
6
|
|
|
12,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,750
|
|
||||||
Balance at December 31, 2019
|
37,508,286
|
|
|
$
|
375
|
|
|
$
|
747,622
|
|
|
$
|
(317,238
|
)
|
|
(4,467,600
|
)
|
|
$
|
(56,567
|
)
|
|
$
|
35,346
|
|
|
$
|
409,538
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(102,377
|
)
|
|
$
|
24,854
|
|
|
$
|
33,880
|
|
Adjustments to reconcile net income (loss) to cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|||
Impairments
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|||
Amortization of deferred financing costs
|
2,512
|
|
|
3,347
|
|
|
4,714
|
|
|||
Income from discontinued operations, net of tax
|
(6,486
|
)
|
|
(24,462
|
)
|
|
(39,736
|
)
|
|||
Provision for doubtful accounts
|
32
|
|
|
86
|
|
|
863
|
|
|||
Gain on sale of property, plant and equipment
|
(3,187
|
)
|
|
(629
|
)
|
|
(2,517
|
)
|
|||
(Gain) loss on remeasurement of intercompany balances
|
(287
|
)
|
|
5,241
|
|
|
(516
|
)
|
|||
Loss on foreign currency derivatives
|
794
|
|
|
—
|
|
|
—
|
|
|||
Loss on sale of businesses
|
—
|
|
|
1,714
|
|
|
111
|
|
|||
Stock-based compensation expense
|
12,750
|
|
|
14,567
|
|
|
14,764
|
|
|||
Deferred income tax provision (benefit)
|
(10,007
|
)
|
|
1,537
|
|
|
(3,193
|
)
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable and notes
|
50,730
|
|
|
8,669
|
|
|
(65,311
|
)
|
|||
Inventory
|
(8,369
|
)
|
|
(59,676
|
)
|
|
20,594
|
|
|||
Costs and estimated earnings versus billings on uncompleted contracts
|
—
|
|
|
—
|
|
|
40,949
|
|
|||
Contract assets
|
28,352
|
|
|
(34,571
|
)
|
|
—
|
|
|||
Other current assets
|
20,312
|
|
|
5,045
|
|
|
(1,541
|
)
|
|||
Accounts payable and other liabilities
|
(41,092
|
)
|
|
13,801
|
|
|
62,029
|
|
|||
Deferred revenue
|
—
|
|
|
—
|
|
|
(13,711
|
)
|
|||
Contract liabilities
|
(8,263
|
)
|
|
62,934
|
|
|
—
|
|
|||
Other
|
3,854
|
|
|
3,059
|
|
|
(14,483
|
)
|
|||
Net cash provided by continuing operations
|
176,198
|
|
|
153,296
|
|
|
150,420
|
|
|||
Net cash provided by (used in) discontinued operations
|
2,528
|
|
|
4,004
|
|
|
(1,794
|
)
|
|||
Net cash provided by operating activities
|
178,726
|
|
|
157,300
|
|
|
148,626
|
|
|||
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(193,274
|
)
|
|
(215,108
|
)
|
|
(131,673
|
)
|
|||
Proceeds from sale of property, plant and equipment
|
19,662
|
|
|
2,530
|
|
|
8,866
|
|
|||
Proceeds from sale of businesses
|
—
|
|
|
5,000
|
|
|
894
|
|
|||
Settlement of foreign currency derivatives
|
(794
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in continuing operations
|
(174,406
|
)
|
|
(207,578
|
)
|
|
(121,913
|
)
|
|||
Net cash provided by discontinued operations
|
—
|
|
|
17,009
|
|
|
19,575
|
|
|||
Net cash used in investing activities
|
(174,406
|
)
|
|
(190,569
|
)
|
|
(102,338
|
)
|
|||
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from borrowings of debt
|
642,500
|
|
|
585,014
|
|
|
501,088
|
|
|||
Repayments of debt
|
(603,951
|
)
|
|
(550,497
|
)
|
|
(476,503
|
)
|
|||
Cash transfer from (to) Archrock, Inc. (Note 17)
|
420
|
|
|
(18,744
|
)
|
|
(44,720
|
)
|
|||
Payments for debt issuance costs
|
—
|
|
|
(4,801
|
)
|
|
(7,911
|
)
|
|||
Proceeds from stock options exercised
|
—
|
|
|
548
|
|
|
684
|
|
|||
Purchases of treasury stock
|
(45,007
|
)
|
|
(4,623
|
)
|
|
(4,792
|
)
|
|||
Net cash provided by (used in) financing activities
|
(6,038
|
)
|
|
6,897
|
|
|
(32,154
|
)
|
|||
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(1,058
|
)
|
|
(3,841
|
)
|
|
(792
|
)
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(2,776
|
)
|
|
(30,213
|
)
|
|
13,342
|
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
19,478
|
|
|
49,691
|
|
|
36,349
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
16,702
|
|
|
$
|
19,478
|
|
|
$
|
49,691
|
|
|
|
|
|
|
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Income taxes paid, net
|
$
|
30,436
|
|
|
$
|
11,601
|
|
|
$
|
47,403
|
|
Interest paid, net of capitalized amounts
|
$
|
35,891
|
|
|
$
|
26,278
|
|
|
$
|
28,178
|
|
|
|
|
|
|
|
||||||
Supplemental disclosure of non-cash transactions:
|
|
|
|
|
|
||||||
Accrued capital expenditures
|
$
|
5,711
|
|
|
$
|
21,479
|
|
|
$
|
16,735
|
|
Non-cash proceeds from sale of business
|
$
|
—
|
|
|
$
|
14,573
|
|
|
$
|
—
|
|
Compression equipment, processing facilities and other contract operations assets
|
3 to 23 years
|
Buildings
|
20 to 35 years
|
Transportation, shop equipment and other
|
3 to 10 years
|
|
Impact of Changes in Accounting Policies
|
||||||||||
|
December 31, 2018
|
|
Adjustments
|
|
January 1, 2019
|
||||||
ASSETS
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Other current assets
|
$
|
44,234
|
|
|
$
|
(506
|
)
|
|
$
|
43,728
|
|
Operating lease right-of-use assets
|
—
|
|
|
21,181
|
|
|
21,181
|
|
|||
Intangible and other assets, net
|
86,371
|
|
|
(353
|
)
|
|
86,018
|
|
|||
Total assets
|
$
|
1,567,054
|
|
|
$
|
20,322
|
|
|
$
|
1,587,376
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
Current operating lease liabilities
|
$
|
—
|
|
|
$
|
6,769
|
|
|
$
|
6,769
|
|
Long-term operating lease liabilities
|
—
|
|
|
19,737
|
|
|
19,737
|
|
|||
Total liabilities
|
1,014,233
|
|
|
26,506
|
|
|
1,040,739
|
|
|||
Accumulated deficit
|
(208,677
|
)
|
|
(6,184
|
)
|
|
(214,861
|
)
|
|||
Total stockholders’ equity
|
552,821
|
|
|
(6,184
|
)
|
|
546,637
|
|
|||
Total liabilities and stockholders’ equity
|
$
|
1,567,054
|
|
|
$
|
20,322
|
|
|
$
|
1,587,376
|
|
|
|
Year Ended December 31,
|
||||||
Revenue by Products and Services
|
|
2019
|
|
2018
|
||||
Contract Operations Segment:
|
|
|
|
|
||||
Contract operations services (1)
|
|
$
|
368,126
|
|
|
$
|
360,973
|
|
|
|
|
|
|
||||
Aftermarket Services Segment:
|
|
|
|
|
||||
Operation and maintenance services (1)
|
|
$
|
53,944
|
|
|
$
|
57,123
|
|
Part sales (2)
|
|
49,721
|
|
|
43,928
|
|
||
Other services (1)
|
|
25,552
|
|
|
19,625
|
|
||
Total aftermarket services
|
|
$
|
129,217
|
|
|
$
|
120,676
|
|
|
|
|
|
|
||||
Product Sales Segment:
|
|
|
|
|
||||
Compression equipment (1)
|
|
$
|
539,897
|
|
|
$
|
476,480
|
|
Processing and treating equipment (1)
|
|
257,477
|
|
|
368,137
|
|
||
Production equipment (2)
|
|
2,458
|
|
|
18,932
|
|
||
Other product sales (1) (2)
|
|
20,265
|
|
|
15,658
|
|
||
Total product sales revenues
|
|
$
|
820,097
|
|
|
$
|
879,207
|
|
|
|
|
|
|
||||
Total revenues
|
|
$
|
1,317,440
|
|
|
$
|
1,360,856
|
|
|
(1)
|
Revenue recognized over time.
|
(2)
|
Revenue recognized at a point in time.
|
|
|
Year Ended December 31,
|
||||||
Revenue by Geographical Regions
|
|
2019
|
|
2018
|
||||
North America
|
|
$
|
705,484
|
|
|
$
|
858,934
|
|
Latin America
|
|
246,290
|
|
|
274,414
|
|
||
Middle East and Africa
|
|
319,866
|
|
|
163,093
|
|
||
Asia Pacific
|
|
45,800
|
|
|
64,415
|
|
||
Total revenues
|
|
$
|
1,317,440
|
|
|
$
|
1,360,856
|
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
Accounts receivables, net
|
|
$
|
202,337
|
|
|
$
|
248,467
|
|
Contract assets and contract liabilities:
|
|
|
|
|
||||
Current contract assets
|
|
46,537
|
|
|
91,602
|
|
||
Long-term contract assets
|
|
16,280
|
|
|
5,430
|
|
||
Current contract liabilities
|
|
82,854
|
|
|
153,483
|
|
||
Long-term contract liabilities
|
|
156,262
|
|
|
101,363
|
|
•
|
We do not adjust the promised amount of consideration for the effects of a significant financing component when we expect, at contract inception, that the period between our transfer of a promised product or service to a customer and when the customer pays for that product or service will be one year or less.
|
•
|
We treat shipping and handling activities that occur after the transfer of control as costs to fulfill a contract rather than a separate performance obligation.
|
•
|
We record taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by us from our customers on a net basis, and thus, such taxes are excluded from the measurement of a performance obligation’s transaction price.
|
•
|
We expense sales commissions as incurred when we expect that the amortization period of such costs will be one year or less.
|
Leases
|
|
Classification
|
|
December 31, 2019
|
||
Assets
|
|
|
|
|
||
Operating lease assets
|
|
Operating lease right-of-use assets
|
|
$
|
26,783
|
|
|
|
|
|
|
||
Liabilities
|
|
|
|
|
||
Operating - current
|
|
Current operating lease liabilities
|
|
$
|
6,268
|
|
Operating - noncurrent
|
|
Long-term operating lease liabilities
|
|
30,958
|
|
|
Total lease liabilities
|
|
|
|
$
|
37,226
|
|
Maturity of Operating Lease Liabilities
|
|
December 31, 2019
|
||
2020
|
|
$
|
7,154
|
|
2021
|
|
6,945
|
|
|
2022
|
|
5,931
|
|
|
2023
|
|
5,147
|
|
|
2024
|
|
4,502
|
|
|
Thereafter
|
|
21,930
|
|
|
Total lease payments
|
|
51,609
|
|
|
Less: Imputed interest
|
|
(14,383
|
)
|
|
Present value of lease liabilities
|
|
$
|
37,226
|
|
Future Minimum Rental Payments
|
|
December 31, 2018
|
||
2019
|
|
$
|
6,076
|
|
2020
|
|
5,929
|
|
|
2021
|
|
4,583
|
|
|
2022
|
|
3,756
|
|
|
2023
|
|
3,038
|
|
|
Thereafter
|
|
11,615
|
|
|
Total lease payments
|
|
$
|
34,997
|
|
Cash Flow Information
|
|
Classification
|
|
Year Ended December 31, 2019
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
|
Net cash provided by operating activities
|
|
$
|
2,134
|
|
Leased assets obtained in exchange for new operating lease liabilities
|
|
Non-cash
|
|
12,507
|
|
|
Years Ended December 31,
|
||||||||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||||||||||||||
|
|
|
Belleli
|
|
|
|
|
|
Belleli
|
|
|
|
|
|
Belleli
|
|
|
||||||||||||||||||
|
Venezuela
|
|
EPC
|
|
Total
|
|
Venezuela
|
|
EPC
|
|
Total
|
|
Venezuela
|
|
EPC
|
|
Total
|
||||||||||||||||||
Revenue
|
$
|
—
|
|
|
$
|
394
|
|
|
$
|
394
|
|
|
$
|
—
|
|
|
$
|
16,274
|
|
|
$
|
16,274
|
|
|
$
|
—
|
|
|
$
|
72,693
|
|
|
$
|
72,693
|
|
Cost of sales (excluding depreciation and amortization expense)
|
—
|
|
|
(1,073
|
)
|
|
(1,073
|
)
|
|
—
|
|
|
10,271
|
|
|
10,271
|
|
|
—
|
|
|
41,329
|
|
|
41,329
|
|
|||||||||
Selling, general and administrative
|
188
|
|
|
1,176
|
|
|
1,364
|
|
|
131
|
|
|
1,652
|
|
|
1,783
|
|
|
131
|
|
|
5,262
|
|
|
5,393
|
|
|||||||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
480
|
|
|
480
|
|
|
—
|
|
|
5,653
|
|
|
5,653
|
|
|||||||||
Recovery attributable to expropriation
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,564
|
)
|
|
—
|
|
|
(16,564
|
)
|
|
(16,514
|
)
|
|
—
|
|
|
(16,514
|
)
|
|||||||||
Restructuring related recoveries, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(439
|
)
|
|
(439
|
)
|
|||||||||
Other (income) expense, net
|
1
|
|
|
(353
|
)
|
|
(352
|
)
|
|
(3,249
|
)
|
|
(1,342
|
)
|
|
(4,591
|
)
|
|
(3,157
|
)
|
|
539
|
|
|
(2,618
|
)
|
|||||||||
Provision for (benefit from) income taxes
|
—
|
|
|
(6,031
|
)
|
|
(6,031
|
)
|
|
—
|
|
|
433
|
|
|
433
|
|
|
—
|
|
|
153
|
|
|
153
|
|
|||||||||
Income (loss) from discontinued operations, net of tax
|
$
|
(189
|
)
|
|
$
|
6,675
|
|
|
$
|
6,486
|
|
|
$
|
19,682
|
|
|
$
|
4,780
|
|
|
$
|
24,462
|
|
|
$
|
19,540
|
|
|
$
|
20,196
|
|
|
$
|
39,736
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Belleli EPC
|
|
Venezuela
|
|
Belleli EPC
|
|
Total
|
||||||||
Cash
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Accounts receivable
|
3,990
|
|
|
—
|
|
|
11,509
|
|
|
11,509
|
|
||||
Contract assets
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other current assets
|
296
|
|
|
7
|
|
|
86
|
|
|
93
|
|
||||
Total current assets associated with discontinued operations
|
4,332
|
|
|
10
|
|
|
11,595
|
|
|
11,605
|
|
||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
28
|
|
|
28
|
|
||||
Intangible and other assets, net
|
2,970
|
|
|
—
|
|
|
1,633
|
|
|
1,633
|
|
||||
Total assets associated with discontinued operations
|
$
|
7,302
|
|
|
$
|
10
|
|
|
$
|
13,256
|
|
|
$
|
13,266
|
|
|
|
|
|
|
|
|
|
||||||||
Accounts payable
|
$
|
1,503
|
|
|
$
|
—
|
|
|
$
|
4,382
|
|
|
$
|
4,382
|
|
Accrued liabilities
|
5,959
|
|
|
12
|
|
|
7,831
|
|
|
7,843
|
|
||||
Contract liabilities
|
2,536
|
|
|
—
|
|
|
2,542
|
|
|
2,542
|
|
||||
Total current liabilities associated with discontinued operations
|
9,998
|
|
|
12
|
|
|
14,755
|
|
|
14,767
|
|
||||
Other long-term liabilities
|
758
|
|
|
—
|
|
|
5,914
|
|
|
5,914
|
|
||||
Total liabilities associated with discontinued operations
|
$
|
10,756
|
|
|
$
|
12
|
|
|
$
|
20,669
|
|
|
$
|
20,681
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Parts and supplies
|
$
|
92,005
|
|
|
$
|
92,016
|
|
Work in progress
|
44,565
|
|
|
49,547
|
|
||
Finished goods
|
6,968
|
|
|
9,126
|
|
||
Inventory, net
|
$
|
143,538
|
|
|
$
|
150,689
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Compression equipment, processing facilities and other contract operations assets
|
$
|
1,607,769
|
|
|
$
|
1,713,153
|
|
Land and buildings
|
67,187
|
|
|
101,571
|
|
||
Transportation and shop equipment
|
59,693
|
|
|
82,960
|
|
||
Computer software
|
51,663
|
|
|
54,572
|
|
||
Other
|
38,111
|
|
|
47,210
|
|
||
|
1,824,423
|
|
|
1,999,466
|
|
||
Accumulated depreciation
|
(980,013
|
)
|
|
(1,097,889
|
)
|
||
Property, plant and equipment, net
|
$
|
844,410
|
|
|
$
|
901,577
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Intangible assets, net
|
$
|
5,643
|
|
|
$
|
8,174
|
|
Deferred financing costs
|
5,740
|
|
|
7,237
|
|
||
Long-term non-income tax receivable
|
8,532
|
|
|
8,621
|
|
||
Long-term income tax credits
|
1,994
|
|
|
2,412
|
|
||
Long-term notes receivable
|
16,145
|
|
|
20,399
|
|
||
Long-term deposits
|
14,560
|
|
|
13,492
|
|
||
Long-term contract assets
|
16,280
|
|
|
5,430
|
|
||
Contract fulfillment costs
|
13,907
|
|
|
6,580
|
|
||
Contract obtainment costs
|
4,865
|
|
|
6,739
|
|
||
Other
|
5,634
|
|
|
7,287
|
|
||
Intangibles and other assets, net
|
$
|
93,300
|
|
|
$
|
86,371
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Deferred financing costs (1)
|
$
|
13,164
|
|
|
$
|
(7,424
|
)
|
|
$
|
13,164
|
|
|
$
|
(5,927
|
)
|
Marketing related (20 year life)
|
566
|
|
|
(566
|
)
|
|
542
|
|
|
(542
|
)
|
||||
Customer related (17-20 year life)
|
40,608
|
|
|
(35,934
|
)
|
|
75,331
|
|
|
(68,423
|
)
|
||||
Technology based (20 year life)
|
3,291
|
|
|
(3,291
|
)
|
|
3,153
|
|
|
(3,153
|
)
|
||||
Contract based (2-11 year life)
|
45,092
|
|
|
(44,123
|
)
|
|
45,059
|
|
|
(43,793
|
)
|
||||
Intangible assets and deferred financing costs
|
$
|
102,721
|
|
|
$
|
(91,338
|
)
|
|
$
|
137,249
|
|
|
$
|
(121,838
|
)
|
|
(1)
|
Represents debt issuance costs relating to our revolving credit facility. See Note 11 for further discussion regarding our revolving credit facility.
|
2020
|
$
|
1,615
|
|
2021
|
1,320
|
|
|
2022
|
952
|
|
|
2023
|
805
|
|
|
2024
|
682
|
|
|
Thereafter
|
269
|
|
|
Total
|
$
|
5,643
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Accrued salaries and other benefits
|
$
|
39,786
|
|
|
$
|
46,836
|
|
Accrued income and other taxes
|
23,803
|
|
|
31,862
|
|
||
Accrued demobilization costs
|
13,348
|
|
|
14,839
|
|
||
Accrued warranty expense
|
2,731
|
|
|
2,191
|
|
||
Accrued interest
|
5,857
|
|
|
5,778
|
|
||
Accrued other liabilities
|
18,556
|
|
|
21,829
|
|
||
Accrued liabilities
|
$
|
104,081
|
|
|
$
|
123,335
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Revolving credit facility due October 2023
|
$
|
74,000
|
|
|
$
|
35,000
|
|
8.125% senior notes due May 2025
|
375,000
|
|
|
375,000
|
|
||
Other debt
|
237
|
|
|
687
|
|
||
Unamortized deferred financing costs of 8.125% senior notes
|
(5,413
|
)
|
|
(6,428
|
)
|
||
Total debt
|
443,824
|
|
|
404,259
|
|
||
Less: Amounts due within one year (1)
|
(237
|
)
|
|
(449
|
)
|
||
Long- term debt
|
$
|
443,587
|
|
|
$
|
403,810
|
|
|
(1)
|
Short-term debt and the current portion of long-term debt are included in accrued liabilities in our balance sheets.
|
|
December 31,
2019 |
||
2020
|
$
|
237
|
|
2021
|
—
|
|
|
2022
|
—
|
|
|
2023
|
74,000
|
|
|
2024
|
—
|
|
|
Thereafter
|
375,000
|
|
|
Total debt (1)
|
$
|
449,237
|
|
|
(1)
|
This amount includes the full face value of the 2017 Notes and does not include unamortized debt financing costs of $5.4 million as of December 31, 2019.
|
•
|
Level 1 — Quoted unadjusted prices for identical instruments in active markets to which we have access at the date of measurement.
|
•
|
Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, little public information exists or prices vary substantially over time or among brokered market makers.
|
•
|
Level 3 — Model derived valuations in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect our own assumptions regarding how market participants would price the asset or liability based on the best available information.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||||||
Impaired long-lived assets (1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,565
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
550
|
|
Impaired assets—assets held for sale (2)
|
—
|
|
|
—
|
|
|
624
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Long-term note receivable (3)
|
—
|
|
|
—
|
|
|
15,312
|
|
|
—
|
|
|
—
|
|
|
14,573
|
|
|
(1)
|
Our estimate of the fair value of the impaired long-lived assets as of December 31, 2019 and 2018 were primarily based on the expected net sale proceeds compared to other fleet units we sold and/or our estimate of fair value based on offers to purchase such assets.
|
(2)
|
Our estimate of the fair value of the impaired assets, which were classified as held for sale as of December 31, 2019, was based on the expected net proceeds from the sale of the assets.
|
(3)
|
Our estimate of the fair value of a note receivable was discounted based on a settlement period of eight years and a discount rate of 5.2%.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
External accounting costs
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,071
|
|
External legal costs
|
48
|
|
|
531
|
|
|
4,396
|
|
|||
Other
|
—
|
|
|
413
|
|
|
753
|
|
|||
Recoveries from Archrock
|
—
|
|
|
(1,220
|
)
|
|
(2,801
|
)
|
|||
Total restatement related charges (recoveries), net
|
$
|
48
|
|
|
$
|
(276
|
)
|
|
$
|
3,419
|
|
|
2019 Cost
|
|
2015 Cost
|
|
|
|
|
||||||||
|
Reduction Plan
|
|
Reduction Plan
|
|
Relocation Plan
|
|
Total
|
||||||||
Beginning balance at January 1, 2018
|
$
|
—
|
|
|
$
|
612
|
|
|
$
|
—
|
|
|
$
|
612
|
|
Additions for costs expensed
|
—
|
|
|
—
|
|
|
1,997
|
|
|
1,997
|
|
||||
Reductions for payments
|
—
|
|
|
(612
|
)
|
|
(1,688
|
)
|
|
(2,300
|
)
|
||||
Ending balance at December 31, 2018
|
—
|
|
|
—
|
|
|
309
|
|
|
309
|
|
||||
Additions for costs expensed
|
8,419
|
|
|
—
|
|
|
293
|
|
|
8,712
|
|
||||
Reductions for payments
|
(6,049
|
)
|
|
—
|
|
|
(602
|
)
|
|
(6,651
|
)
|
||||
Foreign exchange impact
|
(89
|
)
|
|
—
|
|
|
—
|
|
|
(89
|
)
|
||||
Ending balance at December 31, 2019
|
$
|
2,281
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,281
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Retention awards to certain employees
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
599
|
|
Employee termination benefits
|
7,036
|
|
|
910
|
|
|
2,100
|
|
|||
Relocation costs
|
1,035
|
|
|
1,087
|
|
|
—
|
|
|||
Other
|
641
|
|
|
—
|
|
|
490
|
|
|||
Total restructuring and other charges
|
$
|
8,712
|
|
|
$
|
1,997
|
|
|
$
|
3,189
|
|
|
Total
|
||
Employee termination benefits
|
$
|
7,036
|
|
Relocation costs
|
742
|
|
|
Other
|
641
|
|
|
Total restructuring and other charges
|
$
|
8,419
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
United States
|
$
|
(86,918
|
)
|
|
$
|
(6,899
|
)
|
|
$
|
(43,403
|
)
|
Foreign
|
3,345
|
|
|
46,724
|
|
|
60,242
|
|
|||
Income (loss) before income taxes
|
$
|
(83,573
|
)
|
|
$
|
39,825
|
|
|
$
|
16,839
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current tax provision (benefit):
|
|
|
|
|
|
||||||
U.S. federal
|
$
|
(534
|
)
|
|
$
|
769
|
|
|
$
|
—
|
|
State
|
228
|
|
|
258
|
|
|
250
|
|
|||
Foreign
|
35,603
|
|
|
36,869
|
|
|
25,638
|
|
|||
Total current
|
35,297
|
|
|
37,896
|
|
|
25,888
|
|
|||
Deferred tax provision (benefit):
|
|
|
|
|
|
||||||
U.S. federal
|
1,673
|
|
|
242
|
|
|
(5,102
|
)
|
|||
State
|
(61
|
)
|
|
(71
|
)
|
|
(15
|
)
|
|||
Foreign
|
(11,619
|
)
|
|
1,366
|
|
|
1,924
|
|
|||
Total deferred
|
(10,007
|
)
|
|
1,537
|
|
|
(3,193
|
)
|
|||
Provision for income taxes
|
$
|
25,290
|
|
|
$
|
39,433
|
|
|
$
|
22,695
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Income taxes at U.S. federal statutory rate of 21% (35% for 2017)
|
$
|
(17,550
|
)
|
|
$
|
8,363
|
|
|
$
|
5,894
|
|
Brazil PRT/PERT programs
|
—
|
|
|
—
|
|
|
(15,148
|
)
|
|||
Unrecognized tax benefits
|
529
|
|
|
9,496
|
|
|
3,332
|
|
|||
Change in valuation allowances
|
13,982
|
|
|
(18,973
|
)
|
|
(48,059
|
)
|
|||
Nondeductible expenses
|
5,004
|
|
|
4,340
|
|
|
4,517
|
|
|||
Capital contributions and distributions related to Spin-off
|
52
|
|
|
(352
|
)
|
|
(1,084
|
)
|
|||
Impact of Tax Reform
|
—
|
|
|
873
|
|
|
25,578
|
|
|||
Foreign tax rate differential
|
(9,378
|
)
|
|
(1,854
|
)
|
|
(3,261
|
)
|
|||
Deferred tax adjustments
|
4,844
|
|
|
1,112
|
|
|
39,067
|
|
|||
Foreign exchange differences
|
13,821
|
|
|
14,835
|
|
|
7,606
|
|
|||
Withholding tax, net of U.S. benefit
|
5,491
|
|
|
14,825
|
|
|
501
|
|
|||
Deemed and actual distributions
|
4,873
|
|
|
1,742
|
|
|
2,214
|
|
|||
Other
|
3,622
|
|
|
5,026
|
|
|
1,538
|
|
|||
Provision for income taxes
|
$
|
25,290
|
|
|
$
|
39,433
|
|
|
$
|
22,695
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
71,598
|
|
|
$
|
68,377
|
|
Foreign tax credit carryforwards
|
81,759
|
|
|
81,759
|
|
||
Research and development credit carryforwards
|
31,251
|
|
|
31,251
|
|
||
Alternative minimum tax credit carryforwards
|
2,943
|
|
|
5,493
|
|
||
Deferred revenue
|
46,137
|
|
|
25,858
|
|
||
Accrued liabilities
|
13,094
|
|
|
7,672
|
|
||
Other
|
33,758
|
|
|
32,079
|
|
||
Subtotal
|
280,540
|
|
|
252,489
|
|
||
Valuation allowances
|
(213,034
|
)
|
|
(200,105
|
)
|
||
Total deferred tax assets
|
67,506
|
|
|
52,384
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Property, plant and equipment
|
(42,566
|
)
|
|
(28,413
|
)
|
||
Other
|
(11,939
|
)
|
|
(18,606
|
)
|
||
Total deferred tax liabilities
|
(54,505
|
)
|
|
(47,019
|
)
|
||
Net deferred tax assets
|
$
|
13,001
|
|
|
$
|
5,365
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Beginning balance
|
$
|
27,783
|
|
|
$
|
20,548
|
|
|
$
|
18,237
|
|
Additions based on tax positions related to prior years
|
142
|
|
|
2,542
|
|
|
2,034
|
|
|||
Additions based on tax positions related to current year
|
1,648
|
|
|
9,983
|
|
|
1,686
|
|
|||
Reductions based on settlement with government authority
|
(5,086
|
)
|
|
(1,391
|
)
|
|
(241
|
)
|
|||
Reductions based on lapse of statute of limitations
|
(1,148
|
)
|
|
(1,997
|
)
|
|
(378
|
)
|
|||
Reductions based on tax positions related to prior years
|
—
|
|
|
(1,902
|
)
|
|
(790
|
)
|
|||
Ending balance
|
$
|
23,339
|
|
|
$
|
27,783
|
|
|
$
|
20,548
|
|
|
Foreign Currency
Translation Adjustment
|
||
Accumulated other comprehensive income, January 1, 2017
|
$
|
47,508
|
|
Loss recognized in other comprehensive income (loss)
|
(1,801
|
)
|
|
Accumulated other comprehensive income, December 31, 2017
|
45,707
|
|
|
Loss recognized in other comprehensive income (loss)
|
(7,476
|
)
|
|
Accumulated other comprehensive income, December 31, 2018
|
38,231
|
|
|
Loss recognized in other comprehensive income (loss)
|
(2,885
|
)
|
|
Accumulated other comprehensive income, December 31, 2019
|
$
|
35,346
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Stock options
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21
|
|
Restricted stock, restricted stock units, performance units, cash settled restricted stock units and cash settled performance units
|
13,325
|
|
|
14,088
|
|
|
14,685
|
|
|||
Restructuring and other charges—stock-based compensation expense
|
—
|
|
|
—
|
|
|
662
|
|
|||
Total stock-based compensation expense
|
$
|
13,325
|
|
|
$
|
14,088
|
|
|
$
|
15,368
|
|
|
Stock
Options
(in thousands)
|
|
Weighted
Average
Exercise Price
Per Share
|
|
Weighted
Average
Remaining
Life
(in years)
|
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||
Options outstanding, January 1, 2019
|
74
|
|
|
$
|
25.81
|
|
|
|
|
|
||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
|||
Cancelled
|
(5
|
)
|
|
32.49
|
|
|
|
|
|
|||
Options outstanding, December 31, 2019
|
69
|
|
|
25.33
|
|
|
0.6
|
|
$
|
—
|
|
|
Options exercisable, December 31, 2019
|
69
|
|
|
25.33
|
|
|
0.6
|
|
—
|
|
|
Shares
(in thousands)
|
|
Weighted
Average
Grant-Date
Fair Value
Per Share
|
|||
Non-vested awards, January 1, 2019
|
1,044
|
|
|
$
|
25.89
|
|
Granted
|
837
|
|
|
16.80
|
|
|
Vested
|
(541
|
)
|
|
23.24
|
|
|
Cancelled (1)
|
(498
|
)
|
|
18.74
|
|
|
Non-vested awards, December 31, 2019
|
842
|
|
|
22.79
|
|
|
(1)
|
During the year ended December 31, 2019, 318,216 performance units were cancelled and presented within our balance sheets as liabilities due to their expected cash settlement.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator for basic and diluted net income (loss) per common share:
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
(108,863
|
)
|
|
$
|
392
|
|
|
$
|
(5,856
|
)
|
Income from discontinued operations, net of tax
|
6,486
|
|
|
24,462
|
|
|
39,736
|
|
|||
Less: Net income attributable to participating securities
|
—
|
|
|
(641
|
)
|
|
—
|
|
|||
Net income (loss) — used in basic and diluted net income (loss) per common share
|
$
|
(102,377
|
)
|
|
$
|
24,213
|
|
|
$
|
33,880
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding including participating securities
|
35,040
|
|
|
36,371
|
|
|
35,961
|
|
|||
Less: Weighted average participating securities outstanding
|
(757
|
)
|
|
(938
|
)
|
|
(1,002
|
)
|
|||
Weighted average common shares outstanding — used in basic net income (loss) per common share
|
34,283
|
|
|
35,433
|
|
|
34,959
|
|
|||
Net dilutive potential common shares issuable:
|
|
|
|
|
|
|
|||||
On exercise of options and vesting of restricted stock units
|
*
|
|
|
56
|
|
|
*
|
|
|||
Weighted average common shares outstanding — used in diluted net income (loss) per common share
|
34,283
|
|
|
35,489
|
|
|
34,959
|
|
|||
|
|
|
|
|
|
||||||
Net income (loss) per common share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(2.99
|
)
|
|
$
|
0.68
|
|
|
$
|
0.97
|
|
Diluted
|
$
|
(2.99
|
)
|
|
$
|
0.68
|
|
|
$
|
0.97
|
|
|
*
|
Excluded from diluted net income (loss) per common share as their inclusion would have been anti-dilutive.
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Net dilutive potential common shares issuable:
|
|
|
|
|
|
|||
On exercise of options where exercise price is greater than average market value for the period
|
70
|
|
|
35
|
|
|
43
|
|
On exercise of options and vesting of restricted stock units
|
—
|
|
|
—
|
|
|
81
|
|
Net dilutive potential common shares issuable
|
70
|
|
|
35
|
|
|
124
|
|
|
Contract
Operations
|
|
Aftermarket
Services
|
|
Product Sales
|
|
Reportable
Segments
Total
|
|
Other (1)
|
|
Total (2)
|
||||||||||||
2019:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue
|
$
|
368,126
|
|
|
$
|
129,217
|
|
|
$
|
820,097
|
|
|
$
|
1,317,440
|
|
|
$
|
—
|
|
|
$
|
1,317,440
|
|
Gross margin (3)
|
239,963
|
|
|
33,610
|
|
|
89,649
|
|
|
363,222
|
|
|
—
|
|
|
363,222
|
|
||||||
Total assets
|
816,625
|
|
|
26,456
|
|
|
142,461
|
|
|
985,542
|
|
|
425,160
|
|
|
1,410,702
|
|
||||||
Capital expenditures
|
176,663
|
|
|
386
|
|
|
12,562
|
|
|
189,611
|
|
|
3,663
|
|
|
193,274
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2018:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue
|
$
|
360,973
|
|
|
$
|
120,676
|
|
|
$
|
879,207
|
|
|
$
|
1,360,856
|
|
|
$
|
—
|
|
|
$
|
1,360,856
|
|
Gross margin (3)
|
238,835
|
|
|
31,010
|
|
|
113,583
|
|
|
383,428
|
|
|
—
|
|
|
383,428
|
|
||||||
Total assets
|
860,896
|
|
|
28,071
|
|
|
205,302
|
|
|
1,094,269
|
|
|
459,519
|
|
|
1,553,788
|
|
||||||
Capital expenditures
|
197,025
|
|
|
474
|
|
|
7,552
|
|
|
205,051
|
|
|
10,057
|
|
|
215,108
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
2017:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue
|
$
|
375,269
|
|
|
$
|
107,063
|
|
|
$
|
732,962
|
|
|
$
|
1,215,294
|
|
|
$
|
—
|
|
|
$
|
1,215,294
|
|
Gross margin (3)
|
241,889
|
|
|
28,842
|
|
|
76,409
|
|
|
347,140
|
|
|
—
|
|
|
347,140
|
|
||||||
Total assets
|
783,340
|
|
|
22,882
|
|
|
139,454
|
|
|
945,676
|
|
|
487,680
|
|
|
1,433,356
|
|
||||||
Capital expenditures
|
123,842
|
|
|
339
|
|
|
2,712
|
|
|
126,893
|
|
|
4,780
|
|
|
131,673
|
|
|
(1)
|
Includes corporate related items.
|
(2)
|
Totals exclude assets, capital expenditures and the operating results of discontinued operations.
|
(3)
|
Gross margin is defined as revenue less cost of sales (excluding depreciation and amortization expense).
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Assets from reportable segments
|
$
|
985,542
|
|
|
$
|
1,094,269
|
|
Other assets (1)
|
425,160
|
|
|
459,519
|
|
||
Assets associated with discontinued operations
|
7,302
|
|
|
13,266
|
|
||
Total assets
|
$
|
1,418,004
|
|
|
$
|
1,567,054
|
|
|
(1)
|
Includes corporate related items.
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenue:
|
|
|
|
|
|
||||||
U.S.
|
$
|
631,524
|
|
|
$
|
789,528
|
|
|
$
|
648,290
|
|
Argentina
|
125,333
|
|
|
139,987
|
|
|
156,340
|
|
|||
Brazil
|
74,017
|
|
|
94,619
|
|
|
98,419
|
|
|||
Iraq
|
177,100
|
|
|
58,715
|
|
|
8,091
|
|
|||
Mexico
|
73,945
|
|
|
68,745
|
|
|
75,388
|
|
|||
Other international
|
235,521
|
|
|
209,262
|
|
|
228,766
|
|
|||
Total
|
$
|
1,317,440
|
|
|
$
|
1,360,856
|
|
|
$
|
1,215,294
|
|
|
December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Property, plant and equipment, net:
|
|
|
|
|
|
||||||
U.S.
|
$
|
83,127
|
|
|
$
|
112,420
|
|
|
$
|
76,562
|
|
Argentina
|
178,006
|
|
|
197,669
|
|
|
219,840
|
|
|||
Bolivia
|
141,776
|
|
|
81,957
|
|
|
42,598
|
|
|||
Brazil
|
84,676
|
|
|
105,979
|
|
|
138,835
|
|
|||
Mexico
|
68,142
|
|
|
121,312
|
|
|
148,405
|
|
|||
Oman
|
201,880
|
|
|
174,165
|
|
|
110,115
|
|
|||
Other international
|
86,803
|
|
|
108,075
|
|
|
85,924
|
|
|||
Total
|
$
|
844,410
|
|
|
$
|
901,577
|
|
|
$
|
822,279
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Income (loss) before income taxes
|
$
|
(83,573
|
)
|
|
$
|
39,825
|
|
|
$
|
16,839
|
|
Selling, general and administrative
|
164,314
|
|
|
178,401
|
|
|
176,318
|
|
|||
Depreciation and amortization
|
162,557
|
|
|
123,922
|
|
|
107,824
|
|
|||
Impairments
|
74,373
|
|
|
3,858
|
|
|
5,700
|
|
|||
Restatement related charges (recoveries), net
|
48
|
|
|
(276
|
)
|
|
3,419
|
|
|||
Restructuring and other charges
|
8,712
|
|
|
1,997
|
|
|
3,189
|
|
|||
Interest expense
|
38,620
|
|
|
29,217
|
|
|
34,826
|
|
|||
Other (income) expense, net
|
(1,829
|
)
|
|
6,484
|
|
|
(975
|
)
|
|||
Total gross margin
|
$
|
363,222
|
|
|
$
|
383,428
|
|
|
$
|
347,140
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
Year Ended December 31, 2019:
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
351,446
|
|
|
$
|
390,874
|
|
|
$
|
302,431
|
|
|
$
|
272,689
|
|
Gross profit (loss) (1)
|
59,020
|
|
|
59,352
|
|
|
46,823
|
|
|
(25,243
|
)
|
||||
Loss from continuing operations
|
(5,557
|
)
|
|
(14,762
|
)
|
|
(8,295
|
)
|
|
(80,249
|
)
|
||||
Income (loss) from discontinued operations, net of tax
|
163
|
|
|
7,457
|
|
|
(1,546
|
)
|
|
412
|
|
||||
Net loss
|
(5,394
|
)
|
|
(7,305
|
)
|
|
(9,841
|
)
|
|
(79,837
|
)
|
||||
Loss from continuing operations per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.16
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(2.45
|
)
|
Diluted
|
(0.16
|
)
|
|
(0.42
|
)
|
|
(0.25
|
)
|
|
(2.45
|
)
|
||||
Net loss per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.15
|
)
|
|
$
|
(0.21
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(2.44
|
)
|
Diluted
|
(0.15
|
)
|
|
(0.21
|
)
|
|
(0.29
|
)
|
|
(2.44
|
)
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
Year Ended December 31, 2018:
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
350,383
|
|
|
$
|
343,471
|
|
|
$
|
334,849
|
|
|
$
|
332,153
|
|
Gross profit (1)
|
66,059
|
|
|
68,598
|
|
|
66,723
|
|
|
66,172
|
|
||||
Income (loss) from continuing operations
|
3,938
|
|
|
(1,469
|
)
|
|
3,196
|
|
|
(5,273
|
)
|
||||
Income from discontinued operations, net of tax
|
1,399
|
|
|
1,544
|
|
|
2,173
|
|
|
19,346
|
|
||||
Net income
|
5,337
|
|
|
75
|
|
|
5,369
|
|
|
14,073
|
|
||||
Income (loss) from continuing operations per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.11
|
|
|
$
|
(0.04
|
)
|
|
$
|
0.09
|
|
|
$
|
(0.15
|
)
|
Diluted
|
0.11
|
|
|
(0.04
|
)
|
|
0.09
|
|
|
(0.15
|
)
|
||||
Net income per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.15
|
|
|
$
|
—
|
|
|
$
|
0.15
|
|
|
$
|
0.40
|
|
Diluted
|
0.15
|
|
|
—
|
|
|
0.15
|
|
|
0.40
|
|
|
(1)
|
Gross profit (loss) is defined as revenue less cost of sales, direct depreciation and amortization expense and direct impairment charges.
|
•
|
During the fourth quarter of 2018, we received an installment payment, including an annual charge, of $19.8 million from PDVSA Gas in respect to our Venezuelan subsidiary’s sale of its previously nationalized assets (see Note 5).
|
•
|
During the second quarter, third quarter and fourth quarter of 2019, we recorded impairment charges of $5.9 million, $3.0 million and $65.5 million, respectively (see Note 13).
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
149
|
|
|
$
|
643
|
|
|
$
|
15,891
|
|
|
$
|
—
|
|
|
$
|
16,683
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
19
|
|
|
—
|
|
|
19
|
|
|||||
Accounts receivable, net
|
—
|
|
|
57,831
|
|
|
144,506
|
|
|
—
|
|
|
202,337
|
|
|||||
Inventory, net
|
—
|
|
|
77,093
|
|
|
66,445
|
|
|
—
|
|
|
143,538
|
|
|||||
Contract assets
|
—
|
|
|
29,594
|
|
|
16,943
|
|
|
—
|
|
|
46,537
|
|
|||||
Intercompany receivables
|
—
|
|
|
224,680
|
|
|
399,645
|
|
|
(624,325
|
)
|
|
—
|
|
|||||
Other current assets
|
—
|
|
|
10,472
|
|
|
12,005
|
|
|
—
|
|
|
22,477
|
|
|||||
Current assets associated with discontinued operations
|
—
|
|
|
—
|
|
|
4,332
|
|
|
—
|
|
|
4,332
|
|
|||||
Total current assets
|
149
|
|
|
400,313
|
|
|
659,786
|
|
|
(624,325
|
)
|
|
435,923
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
196,693
|
|
|
647,717
|
|
|
—
|
|
|
844,410
|
|
|||||
Operating lease right-of-use assets
|
—
|
|
|
10,806
|
|
|
15,977
|
|
|
—
|
|
|
26,783
|
|
|||||
Investment in affiliates
|
456,420
|
|
|
855,145
|
|
|
(398,725
|
)
|
|
(912,840
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
—
|
|
|
2,838
|
|
|
11,156
|
|
|
—
|
|
|
13,994
|
|
|||||
Intangible and other assets, net
|
—
|
|
|
38,771
|
|
|
54,529
|
|
|
—
|
|
|
93,300
|
|
|||||
Long-term assets held for sale
|
—
|
|
|
624
|
|
|
—
|
|
|
—
|
|
|
624
|
|
|||||
Long-term assets associated with discontinued operations
|
—
|
|
|
—
|
|
|
2,970
|
|
|
—
|
|
|
2,970
|
|
|||||
Total assets
|
$
|
456,569
|
|
|
$
|
1,505,190
|
|
|
$
|
993,410
|
|
|
$
|
(1,537,165
|
)
|
|
$
|
1,418,004
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable, trade
|
$
|
—
|
|
|
$
|
71,382
|
|
|
$
|
52,062
|
|
|
$
|
—
|
|
|
$
|
123,444
|
|
Accrued liabilities
|
—
|
|
|
33,556
|
|
|
70,525
|
|
|
—
|
|
|
104,081
|
|
|||||
Contract liabilities
|
—
|
|
|
46,387
|
|
|
36,467
|
|
|
—
|
|
|
82,854
|
|
|||||
Current operating lease liabilities
|
—
|
|
|
1,971
|
|
|
4,297
|
|
|
—
|
|
|
6,268
|
|
|||||
Intercompany payables
|
47,031
|
|
|
399,645
|
|
|
177,649
|
|
|
(624,325
|
)
|
|
—
|
|
|||||
Current liabilities associated with discontinued operations
|
—
|
|
|
—
|
|
|
9,998
|
|
|
—
|
|
|
9,998
|
|
|||||
Total current liabilities
|
47,031
|
|
|
552,941
|
|
|
350,998
|
|
|
(624,325
|
)
|
|
326,645
|
|
|||||
Long-term debt
|
—
|
|
|
443,587
|
|
|
—
|
|
|
—
|
|
|
443,587
|
|
|||||
Deferred income taxes
|
—
|
|
|
445
|
|
|
548
|
|
|
—
|
|
|
993
|
|
|||||
Long-term contract liabilities
|
—
|
|
|
19,980
|
|
|
136,282
|
|
|
—
|
|
|
156,262
|
|
|||||
Long-term operating lease liabilities
|
—
|
|
|
20,054
|
|
|
10,904
|
|
|
—
|
|
|
30,958
|
|
|||||
Other long-term liabilities
|
—
|
|
|
11,763
|
|
|
37,500
|
|
|
—
|
|
|
49,263
|
|
|||||
Long-term liabilities associated with discontinued operations
|
—
|
|
|
—
|
|
|
758
|
|
|
—
|
|
|
758
|
|
|||||
Total liabilities
|
47,031
|
|
|
1,048,770
|
|
|
536,990
|
|
|
(624,325
|
)
|
|
1,008,466
|
|
|||||
Total equity
|
409,538
|
|
|
456,420
|
|
|
456,420
|
|
|
(912,840
|
)
|
|
409,538
|
|
|||||
Total liabilities and equity
|
$
|
456,569
|
|
|
$
|
1,505,190
|
|
|
$
|
993,410
|
|
|
$
|
(1,537,165
|
)
|
|
$
|
1,418,004
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
46
|
|
|
$
|
1,185
|
|
|
$
|
18,069
|
|
|
$
|
—
|
|
|
$
|
19,300
|
|
Restricted cash
|
—
|
|
|
—
|
|
|
178
|
|
|
—
|
|
|
178
|
|
|||||
Accounts receivable, net
|
—
|
|
|
92,880
|
|
|
155,587
|
|
|
—
|
|
|
248,467
|
|
|||||
Inventory, net
|
—
|
|
|
87,972
|
|
|
62,717
|
|
|
—
|
|
|
150,689
|
|
|||||
Contract assets
|
—
|
|
|
67,323
|
|
|
24,279
|
|
|
—
|
|
|
91,602
|
|
|||||
Intercompany receivables
|
—
|
|
|
158,977
|
|
|
379,628
|
|
|
(538,605
|
)
|
|
—
|
|
|||||
Other current assets
|
—
|
|
|
7,744
|
|
|
36,490
|
|
|
—
|
|
|
44,234
|
|
|||||
Current assets associated with discontinued operations
|
—
|
|
|
—
|
|
|
11,605
|
|
|
—
|
|
|
11,605
|
|
|||||
Total current assets
|
46
|
|
|
416,081
|
|
|
688,553
|
|
|
(538,605
|
)
|
|
566,075
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
303,813
|
|
|
597,764
|
|
|
—
|
|
|
901,577
|
|
|||||
Investment in affiliates
|
554,207
|
|
|
870,959
|
|
|
(316,752
|
)
|
|
(1,108,414
|
)
|
|
—
|
|
|||||
Deferred income taxes
|
—
|
|
|
5,493
|
|
|
5,877
|
|
|
—
|
|
|
11,370
|
|
|||||
Intangible and other assets, net
|
—
|
|
|
32,046
|
|
|
54,325
|
|
|
—
|
|
|
86,371
|
|
|||||
Long-term assets associated with discontinued operations
|
—
|
|
|
—
|
|
|
1,661
|
|
|
—
|
|
|
1,661
|
|
|||||
Total assets
|
$
|
554,253
|
|
|
$
|
1,628,392
|
|
|
$
|
1,031,428
|
|
|
$
|
(1,647,019
|
)
|
|
$
|
1,567,054
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable, trade
|
$
|
—
|
|
|
$
|
133,291
|
|
|
$
|
32,453
|
|
|
$
|
—
|
|
|
$
|
165,744
|
|
Accrued liabilities
|
—
|
|
|
47,012
|
|
|
76,323
|
|
|
—
|
|
|
123,335
|
|
|||||
Contract liabilities
|
—
|
|
|
82,367
|
|
|
71,116
|
|
|
—
|
|
|
153,483
|
|
|||||
Intercompany payables
|
1,432
|
|
|
379,628
|
|
|
157,545
|
|
|
(538,605
|
)
|
|
—
|
|
|||||
Current liabilities associated with discontinued operations
|
—
|
|
|
—
|
|
|
14,767
|
|
|
—
|
|
|
14,767
|
|
|||||
Total current liabilities
|
1,432
|
|
|
642,298
|
|
|
352,204
|
|
|
(538,605
|
)
|
|
457,329
|
|
|||||
Long-term debt
|
—
|
|
|
403,810
|
|
|
—
|
|
|
—
|
|
|
403,810
|
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
6,005
|
|
|
—
|
|
|
6,005
|
|
|||||
Long-term contract liabilities
|
—
|
|
|
17,226
|
|
|
84,137
|
|
|
—
|
|
|
101,363
|
|
|||||
Other long-term liabilities
|
—
|
|
|
10,851
|
|
|
28,961
|
|
|
—
|
|
|
39,812
|
|
|||||
Long-term liabilities associated with discontinued operations
|
—
|
|
|
—
|
|
|
5,914
|
|
|
—
|
|
|
5,914
|
|
|||||
Total liabilities
|
1,432
|
|
|
1,074,185
|
|
|
477,221
|
|
|
(538,605
|
)
|
|
1,014,233
|
|
|||||
Total Equity
|
552,821
|
|
|
554,207
|
|
|
554,207
|
|
|
(1,108,414
|
)
|
|
552,821
|
|
|||||
Total liabilities and equity
|
$
|
554,253
|
|
|
$
|
1,628,392
|
|
|
$
|
1,031,428
|
|
|
$
|
(1,647,019
|
)
|
|
$
|
1,567,054
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Revenues
|
$
|
—
|
|
|
$
|
815,456
|
|
|
$
|
604,625
|
|
|
$
|
(102,641
|
)
|
|
$
|
1,317,440
|
|
Cost of sales (excluding depreciation and amortization expense)
|
—
|
|
|
671,266
|
|
|
385,593
|
|
|
(102,641
|
)
|
|
954,218
|
|
|||||
Selling, general and administrative
|
1,216
|
|
|
74,260
|
|
|
88,838
|
|
|
—
|
|
|
164,314
|
|
|||||
Depreciation and amortization
|
—
|
|
|
60,814
|
|
|
101,743
|
|
|
—
|
|
|
162,557
|
|
|||||
Impairments
|
—
|
|
|
56,939
|
|
|
17,434
|
|
|
—
|
|
|
74,373
|
|
|||||
Restatement related recoveries, net
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|||||
Restructuring and other charges
|
—
|
|
|
4,732
|
|
|
3,980
|
|
|
—
|
|
|
8,712
|
|
|||||
Interest expense
|
—
|
|
|
38,330
|
|
|
290
|
|
|
—
|
|
|
38,620
|
|
|||||
Intercompany charges, net
|
—
|
|
|
3,028
|
|
|
(3,028
|
)
|
|
—
|
|
|
—
|
|
|||||
Equity in loss of affiliates
|
101,161
|
|
|
6,635
|
|
|
94,526
|
|
|
(202,322
|
)
|
|
—
|
|
|||||
Other (income) expense, net
|
—
|
|
|
(6,812
|
)
|
|
4,983
|
|
|
—
|
|
|
(1,829
|
)
|
|||||
Loss before income taxes
|
(102,377
|
)
|
|
(93,784
|
)
|
|
(89,734
|
)
|
|
202,322
|
|
|
(83,573
|
)
|
|||||
Provision for income taxes
|
—
|
|
|
7,377
|
|
|
17,913
|
|
|
—
|
|
|
25,290
|
|
|||||
Loss from continuing operations
|
(102,377
|
)
|
|
(101,161
|
)
|
|
(107,647
|
)
|
|
202,322
|
|
|
(108,863
|
)
|
|||||
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
6,486
|
|
|
—
|
|
|
6,486
|
|
|||||
Net loss
|
(102,377
|
)
|
|
(101,161
|
)
|
|
(101,161
|
)
|
|
202,322
|
|
|
(102,377
|
)
|
|||||
Other comprehensive loss
|
(2,885
|
)
|
|
(2,885
|
)
|
|
(2,885
|
)
|
|
5,770
|
|
|
(2,885
|
)
|
|||||
Comprehensive loss attributable to Exterran stockholders
|
$
|
(105,262
|
)
|
|
$
|
(104,046
|
)
|
|
$
|
(104,046
|
)
|
|
$
|
208,092
|
|
|
$
|
(105,262
|
)
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Revenues
|
$
|
—
|
|
|
$
|
927,849
|
|
|
$
|
521,879
|
|
|
$
|
(88,872
|
)
|
|
$
|
1,360,856
|
|
Cost of sales (excluding depreciation and amortization expense)
|
—
|
|
|
771,731
|
|
|
294,569
|
|
|
(88,872
|
)
|
|
977,428
|
|
|||||
Selling, general and administrative
|
1,285
|
|
|
86,208
|
|
|
90,908
|
|
|
—
|
|
|
178,401
|
|
|||||
Depreciation and amortization
|
—
|
|
|
35,754
|
|
|
88,168
|
|
|
—
|
|
|
123,922
|
|
|||||
Impairments
|
—
|
|
|
3,081
|
|
|
777
|
|
|
—
|
|
|
3,858
|
|
|||||
Restatement related recoveries, net
|
—
|
|
|
(276
|
)
|
|
—
|
|
|
—
|
|
|
(276
|
)
|
|||||
Restructuring and other charges
|
—
|
|
|
—
|
|
|
1,997
|
|
|
—
|
|
|
1,997
|
|
|||||
Interest expense
|
—
|
|
|
28,763
|
|
|
454
|
|
|
—
|
|
|
29,217
|
|
|||||
Intercompany charges, net
|
—
|
|
|
6,647
|
|
|
(6,647
|
)
|
|
—
|
|
|
—
|
|
|||||
Equity in (income) loss of affiliates
|
(25,986
|
)
|
|
(32,753
|
)
|
|
6,767
|
|
|
51,972
|
|
|
—
|
|
|||||
Other (income) expense, net
|
(153
|
)
|
|
(4,625
|
)
|
|
11,262
|
|
|
—
|
|
|
6,484
|
|
|||||
Income before income taxes
|
24,854
|
|
|
33,319
|
|
|
33,624
|
|
|
(51,972
|
)
|
|
39,825
|
|
|||||
Provision for income taxes
|
—
|
|
|
7,333
|
|
|
32,100
|
|
|
—
|
|
|
39,433
|
|
|||||
Income from continuing operations
|
24,854
|
|
|
25,986
|
|
|
1,524
|
|
|
(51,972
|
)
|
|
392
|
|
|||||
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
24,462
|
|
|
—
|
|
|
24,462
|
|
|||||
Net income
|
24,854
|
|
|
25,986
|
|
|
25,986
|
|
|
(51,972
|
)
|
|
24,854
|
|
|||||
Other comprehensive loss
|
(7,476
|
)
|
|
(7,476
|
)
|
|
(7,476
|
)
|
|
14,952
|
|
|
(7,476
|
)
|
|||||
Comprehensive income attributable to Exterran stockholders
|
$
|
17,378
|
|
|
$
|
18,510
|
|
|
$
|
18,510
|
|
|
$
|
(37,020
|
)
|
|
$
|
17,378
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Revenues
|
$
|
—
|
|
|
$
|
838,981
|
|
|
$
|
495,262
|
|
|
$
|
(118,949
|
)
|
|
$
|
1,215,294
|
|
Cost of sales (excluding depreciation and amortization expense)
|
—
|
|
|
716,002
|
|
|
271,101
|
|
|
(118,949
|
)
|
|
868,154
|
|
|||||
Selling, general and administrative
|
2,327
|
|
|
84,111
|
|
|
89,880
|
|
|
—
|
|
|
176,318
|
|
|||||
Depreciation and amortization
|
—
|
|
|
35,749
|
|
|
72,075
|
|
|
—
|
|
|
107,824
|
|
|||||
Impairments
|
—
|
|
|
5,700
|
|
|
—
|
|
|
—
|
|
|
5,700
|
|
|||||
Restatement related charges, net
|
—
|
|
|
3,250
|
|
|
169
|
|
|
—
|
|
|
3,419
|
|
|||||
Restructuring and other charges
|
—
|
|
|
2,145
|
|
|
1,044
|
|
|
—
|
|
|
3,189
|
|
|||||
Interest expense
|
—
|
|
|
32,399
|
|
|
2,427
|
|
|
—
|
|
|
34,826
|
|
|||||
Intercompany charges, net
|
—
|
|
|
6,355
|
|
|
(6,355
|
)
|
|
—
|
|
|
—
|
|
|||||
Equity in (income) loss of affiliates
|
(36,207
|
)
|
|
(85,335
|
)
|
|
49,128
|
|
|
72,414
|
|
|
—
|
|
|||||
Other (income) expense, net
|
—
|
|
|
(2,577
|
)
|
|
1,602
|
|
|
—
|
|
|
(975
|
)
|
|||||
Income before income taxes
|
33,880
|
|
|
41,182
|
|
|
14,191
|
|
|
(72,414
|
)
|
|
16,839
|
|
|||||
Provision for income taxes
|
—
|
|
|
4,974
|
|
|
17,721
|
|
|
—
|
|
|
22,695
|
|
|||||
Income (loss) from continuing operations
|
33,880
|
|
|
36,208
|
|
|
(3,530
|
)
|
|
(72,414
|
)
|
|
(5,856
|
)
|
|||||
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
39,736
|
|
|
—
|
|
|
39,736
|
|
|||||
Net income
|
33,880
|
|
|
36,208
|
|
|
36,206
|
|
|
(72,414
|
)
|
|
33,880
|
|
|||||
Other comprehensive loss
|
(1,801
|
)
|
|
(1,801
|
)
|
|
(1,801
|
)
|
|
3,602
|
|
|
(1,801
|
)
|
|||||
Comprehensive income attributable to Exterran stockholders
|
$
|
32,079
|
|
|
$
|
34,407
|
|
|
$
|
34,405
|
|
|
$
|
(68,812
|
)
|
|
$
|
32,079
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) continuing operations
|
$
|
(3,222
|
)
|
|
$
|
7,001
|
|
|
$
|
172,419
|
|
|
$
|
—
|
|
|
$
|
176,198
|
|
Net cash provided by discontinued operations
|
—
|
|
|
—
|
|
|
2,528
|
|
|
—
|
|
|
2,528
|
|
|||||
Net cash provided by (used in) operating activities
|
(3,222
|
)
|
|
7,001
|
|
|
174,947
|
|
|
—
|
|
|
178,726
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(77,490
|
)
|
|
(115,784
|
)
|
|
—
|
|
|
(193,274
|
)
|
|||||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
13,076
|
|
|
6,586
|
|
|
—
|
|
|
19,662
|
|
|||||
Intercompany transfers
|
—
|
|
|
(45,599
|
)
|
|
(67,028
|
)
|
|
112,627
|
|
|
—
|
|
|||||
Settlement of foreign currency derivatives
|
—
|
|
|
(794
|
)
|
|
—
|
|
|
—
|
|
|
(794
|
)
|
|||||
Net cash used in investing activities
|
—
|
|
|
(110,807
|
)
|
|
(176,226
|
)
|
|
112,627
|
|
|
(174,406
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from borrowings of debt
|
—
|
|
|
642,500
|
|
|
—
|
|
|
—
|
|
|
642,500
|
|
|||||
Repayments of debt
|
—
|
|
|
(603,951
|
)
|
|
—
|
|
|
—
|
|
|
(603,951
|
)
|
|||||
Intercompany transfers
|
45,599
|
|
|
67,028
|
|
|
—
|
|
|
(112,627
|
)
|
|
—
|
|
|||||
Cash transfer from Archrock, Inc.
|
—
|
|
|
420
|
|
|
—
|
|
|
—
|
|
|
420
|
|
|||||
Purchases of treasury stock
|
(42,274
|
)
|
|
(2,733
|
)
|
|
—
|
|
|
—
|
|
|
(45,007
|
)
|
|||||
Net cash provided by (used in) financing activities
|
3,325
|
|
|
103,264
|
|
|
—
|
|
|
(112,627
|
)
|
|
(6,038
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(1,058
|
)
|
|
—
|
|
|
(1,058
|
)
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
103
|
|
|
(542
|
)
|
|
(2,337
|
)
|
|
—
|
|
|
(2,776
|
)
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
46
|
|
|
1,185
|
|
|
18,247
|
|
|
—
|
|
|
19,478
|
|
|||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
149
|
|
|
$
|
643
|
|
|
$
|
15,910
|
|
|
$
|
—
|
|
|
$
|
16,702
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net cash provided by (used in) continuing operations
|
$
|
(494
|
)
|
|
$
|
21,192
|
|
|
$
|
132,598
|
|
|
$
|
—
|
|
|
$
|
153,296
|
|
Net cash provided by discontinued operations
|
—
|
|
|
—
|
|
|
4,004
|
|
|
—
|
|
|
4,004
|
|
|||||
Net cash provided by (used in) operating activities
|
(494
|
)
|
|
21,192
|
|
|
136,602
|
|
|
—
|
|
|
157,300
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(91,027
|
)
|
|
(124,081
|
)
|
|
—
|
|
|
(215,108
|
)
|
|||||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
106
|
|
|
2,424
|
|
|
—
|
|
|
2,530
|
|
|||||
Proceeds from sale of business
|
—
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
5,000
|
|
|||||
Intercompany transfers
|
—
|
|
|
(143
|
)
|
|
(34,965
|
)
|
|
35,108
|
|
|
—
|
|
|||||
Net cash used in continuing operations
|
—
|
|
|
(86,064
|
)
|
|
(156,622
|
)
|
|
35,108
|
|
|
(207,578
|
)
|
|||||
Net cash provided by discontinued operations
|
—
|
|
|
—
|
|
|
17,009
|
|
|
—
|
|
|
17,009
|
|
|||||
Net cash used in investing activities
|
—
|
|
|
(86,064
|
)
|
|
(139,613
|
)
|
|
35,108
|
|
|
(190,569
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from borrowings of debt
|
—
|
|
|
585,014
|
|
|
—
|
|
|
—
|
|
|
585,014
|
|
|||||
Repayments of debt
|
—
|
|
|
(550,497
|
)
|
|
—
|
|
|
—
|
|
|
(550,497
|
)
|
|||||
Intercompany transfers
|
143
|
|
|
34,965
|
|
|
—
|
|
|
(35,108
|
)
|
|
—
|
|
|||||
Cash transfer to Archrock, Inc.
|
—
|
|
|
(18,744
|
)
|
|
—
|
|
|
—
|
|
|
(18,744
|
)
|
|||||
Payments for debt issuance costs
|
—
|
|
|
(4,801
|
)
|
|
—
|
|
|
—
|
|
|
(4,801
|
)
|
|||||
Proceeds from stock options exercised
|
—
|
|
|
548
|
|
|
—
|
|
|
—
|
|
|
548
|
|
|||||
Purchases of treasury stock
|
—
|
|
|
(4,623
|
)
|
|
—
|
|
|
—
|
|
|
(4,623
|
)
|
|||||
Net cash provided by financing activities
|
143
|
|
|
41,862
|
|
|
—
|
|
|
(35,108
|
)
|
|
6,897
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(3,841
|
)
|
|
—
|
|
|
(3,841
|
)
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
(351
|
)
|
|
(23,010
|
)
|
|
(6,852
|
)
|
|
—
|
|
|
(30,213
|
)
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
397
|
|
|
24,195
|
|
|
25,099
|
|
|
—
|
|
|
49,691
|
|
|||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
46
|
|
|
$
|
1,185
|
|
|
$
|
18,247
|
|
|
$
|
—
|
|
|
$
|
19,478
|
|
|
|
|
|
|
Non- Guarantor Subsidiaries
|
|
|
|
|
||||||||||
|
Parent Guarantor
|
|
Issuers
|
|
|
Eliminations
|
|
Consolidation
|
|||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in) continuing operations
|
$
|
(476
|
)
|
|
$
|
74,003
|
|
|
$
|
76,893
|
|
|
$
|
—
|
|
|
$
|
150,420
|
|
Net cash used in discontinued operations
|
—
|
|
|
—
|
|
|
(1,794
|
)
|
|
—
|
|
|
(1,794
|
)
|
|||||
Net cash provided by (used in) operating activities
|
(476
|
)
|
|
74,003
|
|
|
75,099
|
|
|
—
|
|
|
148,626
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(54,527
|
)
|
|
(77,146
|
)
|
|
—
|
|
|
(131,673
|
)
|
|||||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
3,809
|
|
|
5,057
|
|
|
—
|
|
|
8,866
|
|
|||||
Proceeds from sale of business
|
—
|
|
|
894
|
|
|
—
|
|
|
—
|
|
|
894
|
|
|||||
Intercompany transfers
|
—
|
|
|
(742
|
)
|
|
(16,267
|
)
|
|
17,009
|
|
|
—
|
|
|||||
Net cash used in continuing operations
|
—
|
|
|
(50,566
|
)
|
|
(88,356
|
)
|
|
17,009
|
|
|
(121,913
|
)
|
|||||
Net cash provided by discontinued operations
|
—
|
|
|
—
|
|
|
19,575
|
|
|
—
|
|
|
19,575
|
|
|||||
Net cash used in investing activities
|
—
|
|
|
(50,566
|
)
|
|
(68,781
|
)
|
|
17,009
|
|
|
(102,338
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from borrowings of debt
|
—
|
|
|
501,088
|
|
|
—
|
|
|
—
|
|
|
501,088
|
|
|||||
Repayments of debt
|
—
|
|
|
(476,503
|
)
|
|
—
|
|
|
—
|
|
|
(476,503
|
)
|
|||||
Intercompany transfers
|
742
|
|
|
16,267
|
|
|
—
|
|
|
(17,009
|
)
|
|
—
|
|
|||||
Cash transfer to Archrock, Inc.
|
—
|
|
|
(44,720
|
)
|
|
—
|
|
|
—
|
|
|
(44,720
|
)
|
|||||
Payments for debt issuance costs
|
—
|
|
|
(7,911
|
)
|
|
—
|
|
|
—
|
|
|
(7,911
|
)
|
|||||
Proceeds from stock options exercised
|
—
|
|
|
684
|
|
|
—
|
|
|
—
|
|
|
684
|
|
|||||
Purchases of treasury stock
|
—
|
|
|
(4,792
|
)
|
|
—
|
|
|
—
|
|
|
(4,792
|
)
|
|||||
Net cash provided by (used in) financing activities
|
742
|
|
|
(15,887
|
)
|
|
—
|
|
|
(17,009
|
)
|
|
(32,154
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(792
|
)
|
|
—
|
|
|
(792
|
)
|
|||||
Net increase in cash, cash equivalents and restricted cash
|
266
|
|
|
7,550
|
|
|
5,526
|
|
|
—
|
|
|
13,342
|
|
|||||
Cash, cash equivalents and restricted cash at beginning of period
|
131
|
|
|
16,645
|
|
|
19,573
|
|
|
—
|
|
|
36,349
|
|
|||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
397
|
|
|
$
|
24,195
|
|
|
$
|
25,099
|
|
|
$
|
—
|
|
|
$
|
49,691
|
|
Description
|
|
Balance at
Beginning
of Period
|
|
Charged to
Costs and
Expenses
|
|
|
Deductions
|
|
|
Balance at
End of
Period
|
||||||||
Allowance for doubtful accounts deducted from accounts receivable in the balance sheets
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2019
|
|
$
|
5,474
|
|
|
$
|
32
|
|
|
|
$
|
(513
|
)
|
(1)
|
|
$
|
6,019
|
|
December 31, 2018
|
|
5,388
|
|
|
86
|
|
|
|
—
|
|
|
|
5,474
|
|
||||
December 31, 2017
|
|
5,383
|
|
|
863
|
|
|
|
858
|
|
(1)
|
|
5,388
|
|
||||
Allowance for obsolete and slow moving inventory deducted from inventories in the balance sheets
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2019
|
|
$
|
10,046
|
|
|
$
|
1,680
|
|
|
|
$
|
1,639
|
|
(2)
|
|
$
|
10,087
|
|
December 31, 2018
|
|
10,351
|
|
|
87
|
|
|
|
392
|
|
(2)
|
|
10,046
|
|
||||
December 31, 2017
|
|
12,877
|
|
|
1,276
|
|
|
|
3,802
|
|
(2)
|
|
10,351
|
|
||||
Allowance for deferred tax assets not expected to be realized
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2019
|
|
$
|
200,105
|
|
|
$
|
23,560
|
|
|
|
$
|
10,631
|
|
(3)
|
|
$
|
213,034
|
|
December 31, 2018
|
|
222,049
|
|
|
12,648
|
|
|
|
34,592
|
|
(3)
|
|
200,105
|
|
||||
December 31, 2017
|
|
276,230
|
|
|
4,343
|
|
|
|
58,524
|
|
(3)
|
|
222,049
|
|
|
(1)
|
Uncollectible accounts written off, net of recoveries.
|
(2)
|
Obsolete inventory written off at cost, net of value received.
|
(3)
|
Reflects expected realization of deferred tax assets and amounts credited to other accounts for stock-based compensation excess tax benefits, expiring net operating losses, changes in tax rates and changes in currency exchange rates.
|
•
|
general business conditions;
|
•
|
industry practice;
|
•
|
our financial condition and performance;
|
•
|
our future prospects;
|
•
|
our cash needs and capital investment plans;
|
•
|
our obligations to holders of any preferred stock we may issue;
|
•
|
income tax consequences; and
|
•
|
the restrictions applicable laws and our credit arrangements then impose.
|
•
|
Any breach of the director’s duty of loyalty to our Company or our shareholders.
|
•
|
Any act or omission not in good faith or which involved intentional misconduct or a knowing violation of law.
|
•
|
Unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL.
|
•
|
Any transaction from which the director derived an improper personal benefit.
|
•
|
Before that person became an interested shareholder, the board of directors of the corporation approved the transaction in which that person became an interested shareholder or approved the business combination;
|
•
|
On completion of the transaction that resulted in that person’s becoming an interested shareholder, that person owned at least 85 percent of the voting stock of the corporation outstanding at the time the transaction commenced, other than stock held by (1) directors who are also officers of the corporation or (2) any employee stock plan that does not provide employees with the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
Following the transaction in which that person became an interested shareholder, both the board of directors of the corporation and the holders of at least two-thirds of the outstanding voting stock of the corporation not owned by that person approve the business combination.
|
(i)
|
the commission by the Executive of an act of fraud, embezzlement or willful breach of a fiduciary duty to the Company or an affiliate (including the unauthorized disclosure of confidential or proprietary material information of the Company or an affiliate);
|
(ii)
|
a conviction of the Executive for (or a plea of nolo contendere to) a felony or a crime involving fraud, dishonesty or moral turpitude;
|
(iii)
|
willful failure of the Executive to follow the written directions the Board of Directors of the Company (the “Board”);
|
(iv)
|
willful failure of the Executive to render services to the Company or an affiliate in accordance with the Executive’s employment arrangement, which failure amounts to a material neglect of the Executive’s duties to the Company or an affiliate;
|
(v)
|
material violation of the Company’s Code of Conduct; or
|
(vi)
|
the Executive’s use of alcohol or illicit drugs in the workplace or otherwise in a manner that has or may reasonably be expected to have a detrimental effect on the Executive’s performance, the Executive’s duties to the Company, or the reputation of the Company or any affiliate thereof.
|
(i)
|
a material diminution in the Executive’s duties or responsibilities;
|
(ii)
|
a material reduction in the Executive’s then current base salary;
|
(iii)
|
a material reduction in the Executive’s then current annual target short-term incentive as a percentage of base salary;
|
(iv)
|
a material reduction in the Executive’s employee benefits (without regard to bonus compensation, if any) if such reduction results in the Executive receiving benefits which are, in the aggregate, materially less than the benefits received by other comparable executives of the Company generally;
|
(v)
|
Executive’s being required to be based at any of other office or location of employment more than fifty (50) miles from the Executives primary office or location of employment as of the Effective Date; or
|
(vi)
|
willful failure by the Company to pay any compensation to the Executive when due;
|
(i)
|
Severance Payment. The Company shall pay the Executive a lump-sum amount equal to the Severance Payment on the sixtieth (60th) day after the Separation Date. The “Severance Payment” shall be an amount equal to the sum of:
|
(ii)
|
Incentive Awards.
|
(i)
|
engage in any managerial, administrative, advisory, consulting, operational or sales activities in a Restricted Business anywhere in the Restricted Area, including, without limitation, as a director or partner of such Restricted Business, or
|
(ii)
|
organize, establish, operate, own, manage, control or have a direct or indirect investment or ownership interest in a Restricted Business or in any corporation, partnership (limited or general), limited liability company, enterprise or other business entity that engages in a Restricted Business anywhere in the Restricted Area.
|
(iii)
|
For purposes of this Section 4(d):
|
|
Exterran Corporation
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
Executive
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
AGREED TO AND ACCEPTED
|
||
|
|
|
this day of _______, 20__:
|
||
|
|
|
|
|
|
Name:
|
|
|
Title:
|
|
|
(i)
|
Payments pursuant to this Agreement are intended to comply with or be exempt from Code Section 409A and accompanying Department of Treasury regulations and other interpretive guidance promulgated thereunder (collectively, “Section 409A”) and, to the extent applicable, the provisions of this Agreement will be administered, interpreted and construed accordingly. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be or become subject to Section 409A, the Company may unilaterally adopt such amendments to this Agreement and/or to adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 3(g) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
|
(ii)
|
Executive shall have no right to specify the calendar year during which any payment hereunder shall be made. All reimbursements and in-kind benefits provided pursuant to this Agreement shall be made in accordance with Treasury Regulation Section 1.409A-3(i)(1)(iv) such that any reimbursements or in-kind benefits will be deemed payable at a specified time or on a fixed schedule relative to a permissible payment event. Specifically, (A) the amounts reimbursed and in-kind benefits under this Agreement during Executive’s taxable year may not affect the amounts reimbursed or in-kind benefits provided in any other taxable year, (B) the reimbursement of an eligible expense shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense was incurred, and (C) the right to reimbursement or an in-kind benefit is not subject to liquidation or exchange for another benefit.
|
(iii)
|
Notwithstanding any provision of this Agreement to the contrary, the Company and Executive agree that no benefit or benefits under this Agreement, including, without limitation, any severance payments or benefits payable under Section 3 hereof, shall be paid to Executive during the six (6)-month period following the Separation Date if paying such amounts at the time or times indicated in this Agreement would constitute a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence,
|
(i)
|
engage in any managerial, administrative, advisory, consulting, operational or sales activities in a Restricted Business anywhere in the Restricted Area, including, without limitation, as a director or partner of such Restricted Business, or
|
(ii)
|
organize, establish, operate, own, manage, control or have a direct or indirect investment or ownership interest in a Restricted Business or in any corporation, partnership (limited or general), limited liability company, enterprise or other business entity that engages in a Restricted Business anywhere in the Restricted Area.
|
|
Exterran Corporation
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
Executive
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
AGREED TO AND ACCEPTED
|
||
|
|
|
this day of _______, 20__:
|
||
|
|
|
|
|
|
Name:
|
|
|
Title:
|
|
|
(i)
|
Payments pursuant to this Agreement are intended to comply with or be exempt from Code Section 409A and accompanying Department of Treasury regulations and other interpretive guidance promulgated thereunder (collectively, “Section 409A”) and, to the extent applicable, the provisions of this Agreement will be administered, interpreted and construed accordingly. Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any compensation or benefits payable under this Agreement may be or become subject to Section 409A, the Company may unilaterally adopt such amendments to this Agreement and/or to adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to avoid the imposition of taxes under Section 409A, including without limitation, actions intended to (i) exempt the compensation and benefits payable under this Agreement from Section 409A, and/or (ii) comply with the requirements of Section 409A; provided, however, that this Section 3(g) shall not create an obligation on the part of the Company to adopt any such amendment, policy or procedure or take any such other action, nor shall the Company have any liability for failing to do so.
|
(ii)
|
Executive shall have no right to specify the calendar year during which any payment hereunder shall be made. All reimbursements and in-kind benefits provided pursuant to this Agreement shall be made in accordance with Treasury Regulation Section 1.409A-3(i)(1)(iv) such that any reimbursements or in-kind benefits will be deemed payable at a specified time or on a fixed schedule relative to a permissible payment event. Specifically, (A) the amounts reimbursed and in-kind benefits under this Agreement during Executive’s taxable year may not affect the amounts reimbursed or in-kind benefits provided in any other taxable year, (B) the reimbursement of an eligible expense shall be made on or before the last day of Executive’s taxable year following the taxable year in which the expense was incurred, and (C) the right to reimbursement or an in-kind benefit is not subject to liquidation or exchange for another benefit.
|
(iii)
|
Notwithstanding any provision of this Agreement to the contrary, the Company and Executive agree that no benefit or benefits under this Agreement, including, without limitation, any severance payments or benefits payable under Section 3 hereof, shall be paid to Executive during the six (6)-month period following the Separation Date if paying such amounts at the time or times indicated in this Agreement would constitute a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence,
|
(i)
|
engage in any managerial, administrative, advisory, consulting, operational or sales activities in a Restricted Business anywhere in the Restricted Area, including, without limitation, as a director or partner of such Restricted Business, or
|
(ii)
|
organize, establish, operate, own, manage, control or have a direct or indirect investment or ownership interest in a Restricted Business or in any corporation, partnership (limited or general), limited liability company, enterprise or other business entity that engages in a Restricted Business anywhere in the Restricted Area.
|
|
Exterran Corporation
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
Executive
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
Title:
|
AGREED TO AND ACCEPTED
|
||
|
|
|
this day of _______, 20__:
|
||
|
|
|
|
|
|
Name:
|
|
|
Title:
|
|
|
Company
|
|
Ownership
|
|
Incorporation
|
EES Finance Corp.
|
|
Wholly owned
|
|
United States
|
EESLP LP LLC
|
|
Wholly owned
|
|
United States
|
Enterra B.V.
|
|
Wholly owned
|
|
Netherlands
|
Enterra Compression Investment LLC
|
|
Wholly owned
|
|
United States
|
Excel Energy Services Limited
|
|
Wholly owned
|
|
Nigeria
|
EXH Cayman Ltd.
|
|
Wholly owned
|
|
Cayman Islands
|
Exterran (Beijing) Energy Equipment Company Ltd.
|
|
Wholly owned
|
|
China
|
Exterran (Thailand) Ltd.
|
|
Wholly owned
|
|
Thailand
|
Exterran 0039, Inc.
|
|
Wholly owned
|
|
United States
|
Exterran Argentina S.r.l.
|
|
Wholly owned
|
|
Argentina
|
Exterran Bahrain S.P.C.
|
|
Wholly owned
|
|
Bahrain
|
Exterran Bolivia S.r.l.
|
|
Wholly owned
|
|
Bolivia
|
Exterran Capital Services International, C.V.
|
|
Wholly owned
|
|
Netherlands
|
Exterran Cayman GP Holdings LLC
|
|
Wholly owned
|
|
United States
|
Exterran Corporation
|
|
Parent
|
|
United States
|
Exterran Eastern Hemisphere F.Z.E.
|
|
Wholly owned
|
|
UAE Dubai
|
Exterran Eastern Hemisphere Holdings LLC
|
|
Wholly owned
|
|
United States
|
Exterran Egypt LLC
|
|
Wholly owned
|
|
Egypt
|
Exterran Egypt Oil & Gas Services LLC
|
|
Wholly owned
|
|
Egypt
|
Exterran Energy de Mexico, S. de R.L. de C.V.
|
|
Wholly owned
|
|
Mexico
|
Exterran Energy F.Z.E.
|
|
Wholly owned
|
|
UAE Sharjah
|
Exterran Energy Malaysia SDN. BHD.
|
|
Wholly owned
|
|
Malaysia
|
Exterran Energy Solutions Compania Limitada
|
|
Wholly owned
|
|
Chile
|
Exterran Energy Solutions India Private Limited
|
|
Wholly owned
|
|
India
|
Exterran Energy Solutions, L.P.
|
|
Wholly owned
|
|
United States
|
Exterran General Holdings LLC
|
|
Wholly owned
|
|
United States
|
Exterran Gulf Operations LLC
|
|
49% owned
|
|
UAE Sharjah
|
Exterran Holding Company NL B.V.
|
|
Wholly owned
|
|
Netherlands
|
Exterran International Holdings C.V.
|
|
Wholly owned
|
|
Netherlands
|
Exterran International Holdings GP LLC
|
|
Wholly owned
|
|
United States
|
Exterran International Holdings LLC
|
|
Wholly owned
|
|
United States
|
Exterran International SA
|
|
Wholly owned
|
|
Switzerland
|
Exterran Italy B.V.
|
|
Wholly owned
|
|
Netherlands
|
Exterran Italy Holdings B.V.
|
|
Wholly owned
|
|
Netherlands
|
Exterran Kazakhstan LLP
|
|
Wholly owned
|
|
Kazakhstan
|
Exterran Middle East LLC
|
|
Wholly owned
|
|
Oman
|
Exterran Nigeria Limited
|
|
Wholly owned
|
|
Nigeria
|
Exterran Offshore Pte. Ltd.
|
|
Wholly owned
|
|
Singapore
|
Exterran Oman Holdings LLC
|
|
Wholly owned
|
|
United States
|
Exterran Pakistan (Private) Limited
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Wholly owned
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Pakistan
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Exterran Peru S.R.L.
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Wholly owned
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Peru
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Exterran Services (UK) Ltd.
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Wholly owned
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United Kingdom
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Exterran Services B.V.
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Wholly owned
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Netherlands
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Exterran Servicos de Oleo e Gas Ltda.
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Wholly owned
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Brazil
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Exterran Trinidad LLC
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Wholly owned
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United States
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/s/ PricewaterhouseCoopers LLP
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Houston, Texas
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February 28, 2020
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(a)
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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By:
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/s/ ANDREW J. WAY
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|
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Name:
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Andrew J. Way
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|
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Title:
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President and Chief Executive Officer
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|
|
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(Principal Executive Officer)
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|
(a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
By:
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/s/ DAVID A. BARTA
|
|
|
|
Name:
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David A. Barta
|
|
|
Title:
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Senior Vice President and Chief Financial Officer
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|
|
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(Principal Financial Officer and Principal Accounting Officer)
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(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ ANDREW J. WAY
|
|
|
Name:
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Andrew J. Way
|
|
Title:
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President and Chief Executive Officer
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|
|
|
|
Date: February 28, 2020
|
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ DAVID A. BARTA
|
|
|
Name:
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David A. Barta
|
|
Title:
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Senior Vice President and Chief Financial Officer
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|
|
|
|
Date: February 28, 2020
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