Discontinued Operations

9 Months Ended

Sep. 30, 2022

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

At September 30, 2022, the Company determined that it would exit its Brazil Operations as the Company desires to focus its resources and management on the core LNG business. The Company expects that the exit will be in the form of a sale for cash or a combination of cash and a note receivable. The Company expects the sale will close within the next year.

Impairment of Brazil Operations

The Company reviews its long-lived assets whenever events or changes in circumstances indicate that a particular asset or group of asset's carrying value may not be recoverable. The Company determined that the decision to exit the Brazil Operations is such an event and recorded an impairment charge of $1.3 million measured as the estimated fair value of $0.9 million (calculated as the estimated net proceeds that would be received in an orderly and timely sale of the operations) less the carrying value of the Brazil net assets at September 30, 2022. The impairment charge is included within income (loss) from discontinued operations, net of tax as reported in the Consolidated Condensed Statements of Operations for the three and nine months ended September 30, 2022.

Classification as Discontinued Operations

The Company believes that the decision to exit the Brazil Operations at September 30, 2022 meets the criteria for discontinued operations presentation within the Condensed Consolidated Financial Statements as the decision to exit these operations represents a strategic shift of the future operations of the Company with separately reported financial information available as the Brazil Operations represent substantially all of the revenue and expenses of the Company's previously reported Power Delivery segment.

Accordingly, such assets and liabilities at September 30, 2022, results of operations for the three and nine months ended and cash flows for the nine months ended September 30, 2022 have been classified as discontinued operations on our Condensed Consolidated Balance Sheet, Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Cash Flows, respectively. The classification of these assets, liabilities, results of operations and cash flows as discontinued operations requires retrospective application to financial information for all prior periods presented. Accordingly, the Condensed Consolidated Financial Statements and related notes have been updated to separately state the assets and liabilities, revenues and expenses and cash flows between its continuing operations and the discontinued operations as of and for all periods presented.

Corporate allocations of $0.1 million and $0.6 million previously reported within the Company's Power Delivery Segment have been reclassified to continuing operations for the three and nine months ended September 30, 2022. Included within the Company's accumulated other comprehensive income (loss) at September 30, 2022 is $1.0 million of cumulative translation losses which will be removed upon sale.

The following table summarizes the components of income from discontinued operations (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenue	$	3,202	$	1,925	$	8,602	$	5,129
Costs and expenses	3,082		1,987		8,392		5,247
Impairment	1,310		—		1,310		—
Other income and interest expense, net	(45)		22		(80)		117
Loss from discontinued operations before income taxes	$	(1,235)	$	(40)	$	(1,180)	$	(1)
Income tax expense	66		4		261		127
Loss from discontinued operations net of income taxes	$	(1,301)	$	(44)	$	(1,441)	$	(128)

The following table summarizes the assets and liabilities of discontinued operations (in thousands):


	September 30, 2022		December 31, 2021
Assets
Cash and cash equivalents	$	478	$	1,149
Accounts receivable, net	1,222		926
Contract assets and other current assets	1,967		1,371
Total current assets of discontinued operations	3,667		3,446



Property, plant and equipment, net	—		522
Goodwill	—		138
Other noncurrent assets	—		172
Total assets of discontinued operations	$	3,667	$	4,278


	September 30, 2022		December 31, 2021
Liabilities
Accounts payable	$	498	$	492
Accrued liabilities	1,956		1,213
Current portion of notes payable	158		108
Current portion of finance and operating lease obligations	205		118
Total current liabilities of discontinued operations	2,817		1,931
Long-term notes payable, net of current portion and other noncurrent liabilities	—		288
Total liabilities of discontinued operations	$	2,817	$	2,219

Segment Reporting

As a result of the classification of the Brazil Operations as discontinued operations, the Company believes that it only has one reporting segment.