Basis of Presentation and Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2015

Basis of Presentation and Summary of Significant Accounting Policies

Summary of net income (loss) attributable to Exterran common stockholders used in the calculation of basic and diluted income (loss) per common share

The following table summarizes net income (loss) attributable to Exterran common stockholders used in the calculation of basic and diluted income (loss) per common share (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Income (loss) from continuing operations attributable to Exterran stockholders	$	(1,643	)	$	(5,392	)	$	11,786		$	8,477
Income from discontinued operations, net of tax	254			17,769			18,967			36,496
Less: Net income attributable to participating securities	(126		)	(122		)	(505		)	(803		)

Net income (loss) attributable to Exterran common stockholders	$	(1,515	)	$	12,255		$	30,248		$	44,170

Schedule of potential shares of common stock that were included in computing diluted income attributable to Exterran common stockholders per common share

The following table shows the potential shares of common stock that were included in computing diluted income (loss) attributable to Exterran common stockholders per common share (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
Weighted average common shares outstanding including participating securities	69,503		66,826		69,339		66,579
Less: Weighted average participating securities outstanding	(989	)	(936	)	(958	)	(1,004	)

Weighted average common shares outstanding — used in basic income (loss) per common share	68,514		65,890		68,381		65,575

Net dilutive potential common shares issuable:
On exercise of options and vesting of restricted stock units	*		*		286		556
On settlement of employee stock purchase plan shares	*		*		—		1
On exercise of warrants	**		*		—		2,640
On conversion of 4.25% convertible senior notes due 2014	**		*		**		*

Weighted average common shares outstanding — used in diluted income (loss) per common share	68,514		65,890		68,667		68,772

*Excluded from diluted income (loss) per common share as their inclusion would have been anti-dilutive.

**Not applicable as these instruments were not outstanding during the period.

Schedule of potential shares of common stock issuable, excluded from computation of diluted income (loss), attributable to Exterran common stockholders per common share

The following table shows the potential shares of common stock issuable that were excluded from computing diluted income (loss) attributable to Exterran common stockholders per common share as their inclusion would have been anti-dilutive (in thousands):

	Three Months Ended June 30,		Six Months Ended June 30,
	2015	2014	2015	2014
Net dilutive potential common shares issuable:
On exercise of options where exercise price is greater than average market value for the period	374	497	471	541
On exercise of options and vesting of restricted stock units	290	497	—	—
On settlement of employee stock purchase plan shares	1	—	—	—
On exercise of warrants	*	12,426	—	—
On conversion of 4.25% convertible senior notes due 2014	*	12,900	*	14,146

Net dilutive potential common shares issuable	665	26,320	471	14,687

Not applicable as these instruments were not outstanding during the period.

Schedule of changes in accumulated other comprehensive income (loss) by component, net of tax, excluding noncontrolling interest

The following table presents the changes in accumulated other comprehensive income (loss) by component, net of tax, and excluding noncontrolling interest, during the six months ended June 30, 2014 and 2015 (in thousands):

	Derivatives Cash Flow Hedges			Foreign Currency Translation Adjustment			Total
Accumulated other comprehensive income (loss), January 1, 2014	$	(1,346	)	$	31,424		$	30,078
Loss recognized in other comprehensive income (loss), net of tax	(639		)(1)	(269		)(3)	(908		)
Loss reclassified from accumulated other comprehensive income (loss), net of tax	823		(2)	—			823

Other comprehensive income (loss) attributable to Exterran stockholders	184			(269		)	(85		)

Accumulated other comprehensive income (loss), June 30, 2014	$	(1,162	)	$	31,155		$	29,993


Accumulated other comprehensive income (loss), January 1, 2015	$	(911	)	$	16,776		$	15,865
Loss recognized in other comprehensive income (loss), net of tax	(1,943		)(4)	(6,703		)(6)	(8,646		)
Loss reclassified from accumulated other comprehensive income (loss), net of tax	1,030		(5)	—			1,030

Other comprehensive income (loss) attributable to Exterran stockholders	(913		)	(6,703		)	(7,616		)

Accumulated other comprehensive income (loss), June 30, 2015	$	(1,824	)	$	10,073		$	8,249

(1)

During the three months ended June 30, 2014, we recognized a loss of $0.6 million and a tax benefit of $0.3 million, in other comprehensive income (loss), net of tax, related to changes in the fair value of derivative financial instruments. During the six months ended June 30, 2014, we recognized a loss of $1.0 million and a tax benefit of $0.4 million, in other comprehensive income (loss), net of tax, related to changes in the fair value of derivative financial instruments.

(2)

During the three months ended June 30, 2014, we reclassified a $0.6 million loss to interest expense and a tax benefit of $0.2 million to provision for income taxes in our condensed consolidated statements of operations from accumulated other comprehensive income (loss). During the six months ended June 30, 2014, we reclassified a $1.2 million loss to interest expense and a tax benefit of $0.4 million to provision for income taxes in our condensed consolidated statements of operations from accumulated other comprehensive income (loss).

(3)

During the three and six months ended June 30, 2014, we recognized a loss of $1.4 million and $0.3 million, respectively, in other comprehensive income (loss), net of tax, related to changes in foreign currency translation adjustment.

(4)

During the three months ended June 30, 2015, we recognized a loss of $0.6 million and a tax benefit of $0.2 million, in other comprehensive income (loss), net of tax, related to changes in the fair value of derivative financial instruments. During the six months ended June 30, 2015, we recognized a loss of $2.9 million and a tax benefit of $1.0 million, in other comprehensive income (loss), net of tax, related to changes in the fair value of derivative financial instruments.

(5)

During the three months ended June 30, 2015, we reclassified a $0.9 million loss to interest expense and a tax benefit of $0.4 million to provision for income taxes in our condensed consolidated statements of operations from accumulated other comprehensive income (loss). During the six months ended June 30, 2015, we reclassified a $1.6 million loss to interest expense and a tax benefit of $0.6 million to provision for income taxes in our condensed consolidated statements of operations from accumulated other comprehensive income (loss).

(6)

During the three and six months ended June 30, 2015, we recognized a gain of $3.7 million and a loss of $6.7 million, respectively, in other comprehensive income (loss), net of tax, related to changes in foreign currency translation adjustment.

Summary of carrying amount and fair value of debt

The following table summarizes the carrying amount and fair value of our debt as of June 30, 2015 and December 31, 2014 (in thousands):

	June 30, 2015				December 31, 2014
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Fixed rate debt	$	1,041,762	$	1,043,000	$	1,041,402	$	960,000
Floating rate debt	1,048,000		1,049,000		985,500		986,000

Total debt	$	2,089,762	$	2,092,000	$	2,026,902	$	1,946,000