Severance and Other Charges, net

6 Months Ended

Jun. 30, 2020

Restructuring and Related Activities [Abstract]

We recognize severance and other charges for costs associated with workforce reductions, facility closures, exiting or reducing our footprint in certain countries, asset impairments and the retirement of excess machinery and equipment based on economic utility. As a result of the downturn in the industry and its impact on our business outlook, we continue to take actions to adjust our operations and cost structure to reflect current and expected activity levels. Depending on future market conditions, further actions may be necessary to adjust our operations, which may result in additional charges.

Our severance and other charges, net are summarized below (in thousands):


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Severance and other costs	$	4,794	$	593	$	5,332	$	982
Fixed asset impairments and retirements	—		—		15,479		66
Inventory write-offs	368		222		368		222
Intangible asset impairments	—		—		4,708		—
	$	5,162	$	815	$	25,887	$	1,270

Severance and other costs: We incurred costs due to a continued effort to adjust our cost base, including reducing our workforce to meet the depressed demand in the industry. At June 30, 2020, our outstanding liability associated with our current program was approximately $4.0 million and included severance payments and other employee-related separation costs.

Below is a reconciliation of our employee separation liability balance (in thousands):


	Tubular Running Services		Tubulars		Cementing Equipment		Corporate		Total
Balance at December 31, 2019	$	2,000	$	19	$	1,632	$	2,186	$	5,837
Additions for costs expensed	3,456		15		675		1,186		5,332
Severance and other payments	(4,078)		(13)		(1,383)		(1,375)		(6,849)
Other adjustments	(8)		—		22		(348)		(334)
Balance at June 30, 2020	$	1,370	$	21	$	946	$	1,649	$	3,986

Fixed asset impairments and retirements: During the six months ended June 30, 2019, we recognized $0.1 million of impairment related to assets held for sale. During the six months ended June 30, 2020, we recorded fixed asset impairment charges of $15.5 million primarily associated with construction in progress in our Cementing Equipment segment. Please see Note 5—Property, Plant and Equipment for additional details.

Inventory write-offs: During the six months ended June 30, 2020, certain inventories in our Cementing Equipment segment were determined to have costs that exceeded their net realizable values, resulting in a charge of $0.4 million.

Intangible asset impairments: During the six months ended June 30, 2020, we identified certain intangible assets where the carrying value exceeded the fair value in the Cementing Equipment segment, resulting in an impairment charge of $4.7 million. Please see Note 6—Goodwill and Intangible Assets for additional details.