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IMPAIRMENTS AND OTHER COSTS | 12 Months Ended
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Dec. 31, 2020
IMPAIRMENTS AND OTHER COSTS |
IMPAIRMENTS AND OTHER COSTS | NOTE 4—IMPAIRMENTS AND OTHER COSTS ​ Significant challenges that emerged during the year ended December 31, 2020, and that are expected to continue, have had and will likely continue to have a negative impact on our results of operations. The COVID-19 pandemic has caused a worldwide slowdown in economic activity, resulting in a sharp decline in global oil demand and therefore, lower oil and natural gas prices. Global oil demand is expected to remain challenged at least until the COVID-19 pandemic can be contained. In response to lower oil and gas prices, our E&P customers have cut capital spending, resulting in a sharp drop in the number of wells drilled and completed in all of our markets. Reduced demand for our services has had a material, negative impact on our financial results for the year ended December 31, 2020. While oil prices and U.S. unconventional completions activity have partially recovered from the recent lows, given the continued uncertainty around the COVID-19 pandemic and the associated impact on oil demand, we are unable to predict if, when, and by how much the demand for our services and therefore our financial performance will improve. ​ Because the magnitude and duration of the COVID-19 pandemic is unknown, we cannot forecast with reasonable certainty the impact of COVID-19 on our business, financial condition or near or longer-term financial or operational results. During the year ended December 31, 2020, we took actions to protect our balance sheet and maintain our liquidity, including significantly decreasing our operating expenses by reducing headcount, reducing salaries and director compensation, idling facilities, closing yard locations, reducing third-party expenses and streamlining operations, as well as reducing capital expenditures. We also deferred employer payroll tax payments, in accordance with the provisions of the CARES Act, and may take advantage of future legislation passed by the United States Congress in response to the COVID-19 pandemic. ​ As a result of the downturn in our business, we recorded impairment expenses in the first half of 2020 related to goodwill, property and equipment and other intangible assets. ​ A summary of impairments to goodwill and trademark for the years ended December 31, 2020, 2019 and 2018 is as follows: ​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year ended December 31,
​ |  | 2020 | ​ | 2019 |  | 2018
​ | ​ | (in thousands)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Impairment of goodwill and trademark | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Water Services | ​ | $ | 186,468 | ​ | $ | — | ​ | $ | —
Water Infrastructure | ​ | ​ | 80,466 | ​ | ​ | — | ​ | ​ | —
Oilfield Chemicals | ​ | ​ | 9,082 | ​ | ​ | — | ​ | ​ | 12,652
Other | ​ | ​ | — | ​ | ​ | 4,396 | ​ | ​ | 5,242
Total impairment of goodwill and trademark | ​ | $ | 276,016 | ​ | $ | 4,396 | ​ | $ | 17,894
​ For a discussion of the impairments to goodwill and trademark, See Note 9—Goodwill and Other Intangible Assets. ​ A summary of impairments to and abandonment of property and equipment for the years ended December 31, 2020, 2019 and 2018 is as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year ended December 31,
​ | ​ | 2020 | ​ | 2019 |  | 2018
​ | ​ | (in thousands)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Impairment and abandonment of property and equipment | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Water Services | ​ | $ | 3,894 | ​ | $ | 969 | ​ | $ | —
Water Infrastructure | ​ | ​ | 4,016 | ​ | ​ | 1,804 | ​ | ​ | 2,282
Other | ​ | ​ | — | ​ | ​ | 942 | ​ | ​ | 4,375
Total impairment and abandonment of property and equipment | ​ | $ | 7,910 | ​ | $ | 3,715 | ​ | $ | 6,657
​ For the year ended December 31, 2020, impairment and abandonment costs of $7.9 million were comprised of leasehold improvements related to abandoned facilities, abandonment of certain saltwater and freshwater wells and obsolete machinery and equipment. For the year ended December 31, 2019, the Company impaired $3.7 million of property and equipment as the carrying values were not deemed recoverable including $1.1 million of pipelines with low utilization, $1.0 million of layflat hose considered obsolete, $0.9 million related to divesting Canadian fixed assets, and $0.6 million related to an owned facility for sale. For the year ended December 31, 2018, the Company determined that long-lived assets with a carrying value of $2.3 million were no longer recoverable and were written down to their estimated fair value of zero. Additionally, the Company determined that $4.4 million of Canadian fixed assets were impaired due to an expectation of a loss on asset disposals. ​ A summary of severance, yard closure, and lease abandonment costs for the years ended December 31, 2020, 2019 and 2018 is as follows: ​ ​ ​ ​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year ended December 31,
​ | ​ | 2020 | ​ | 2019 |  | 2018
​ | ​ | (in thousands)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Severance | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Water Services | ​ | $ | 4,569 | ​ | $ | — | ​ | $ | 538
Water Infrastructure | ​ | ​ | 500 | ​ | ​ | — | ​ | ​ | —
Oilfield Chemicals | ​ | ​ | 813 | ​ | ​ | — | ​ | ​ | —
Other | ​ | ​ | 1,286 | ​ | ​ | 1,691 | ​ | ​ | 682
Total severance expense | ​ | $ | 7,168 | ​ | $ | 1,691 | ​ | $ | 1,220
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Yard closure costs | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Water Services | ​ | $ | 2,645 | ​ | $ | — | ​ | $ | —
Oilfield Chemicals | ​ | ​ | 316 | ​ | ​ | — | ​ | ​ | —
Total yard closure costs | ​ | $ | 2,961 | ​ | $ | — | ​ | $ | —
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Lease abandonment costs | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Water Services | ​ | $ | 4,321 | ​ | $ | 1,218 | ​ | $ | 2,150
Water Infrastructure | ​ | ​ | 51 | ​ | ​ | — | ​ | ​ | —
Oilfield Chemicals | ​ | ​ | 42 | ​ | ​ | 11 | ​ | ​ | 28
Other | ​ | ​ | (64) | ​ | ​ | 844 | ​ | ​ | 1,747
Total lease abandonment costs | ​ | $ | 4,350 | ​ | $ | 2,073 | ​ | $ | 3,925
​ During the year ended December 31, 2020, the Company recorded exit-disposal costs including $7.2 million of severance costs, with $0.6 million of accrued severance at December 31, 2020 recorded as accrued salary and benefits on the accompanying consolidated balance sheets, $3.0 million in yard closure costs recognized within costs of revenue on the accompanying consolidated statements of operations with $0.1 million accrued yard closure costs at December 31, 2020, recorded as accrued expenses and other current liabilities on the accompanying balance sheets, and $4.4 million of lease abandonment costs. Severance costs of $4.0 million and $3.2 million are recognized within costs of revenue and selling, general and administrative expenses, respectively, on the accompanying consolidated statements of operations. ​ During the year ended December 31, 2019, the Company recorded exit-disposal costs including $1.7 million of severance costs recognized within selling, general and administrative expenses on the accompanying consolidated statements of operations, and $2.1 million of lease abandonment costs, both of which primarily related to the Company’s divested service lines, the abandonment of two facilities and accretion of expenses for previously abandoned facilities. ​ During the year ended December 31, 2018, the Company recorded exit-disposal costs including $1.2 million of severance costs of which $0.7 million was recognized within selling, general and administrative expenses and $0.5 million was recognized as costs of revenue on the accompanying consolidated statements of operations. The severance costs were associated with the retirement of the Company’s former Chief Administrative Officer as well as the termination of employees assigned to the Company’s divested service lines. Additionally, the Company recorded $3.9 million of lease abandonment costs primarily due to excess facility capacity stemming from the Rockwater Merger and the Company’s divested services lines.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 + Details
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