Quarterly report pursuant to Section 13 or 15(d)

Reporting Segments

v3.22.2
Reporting Segments
6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
Reporting Segments Reporting Segments
As of June 30, 2022, the Company’s revenues, income before income taxes and identifiable assets are primarily attributable to four reportable segments. The Company principally provides electric infrastructure services to private utilities, public investor-owned utilities and co-operative utilities and services in connection with on-shore drilling of oil and natural gas wells for small to large domestic independent oil and natural gas producers.

The Company’s Chief Executive Officer and Chief Financial Officer comprise the Company’s Chief Operating Decision Maker function (“CODM”). Segment information is prepared on the same basis that the CODM manages the segments, evaluates the segment financial statements and makes key operating and resource utilization decisions. Segment evaluation is determined on a quantitative basis based on a function of operating loss less impairment expense, as well as a qualitative basis, such as nature of the product and service offerings and types of customers.

As of June 30, 2022, the Company’s four reportable segments include infrastructure services (“Infrastructure”), well completion services (“Well Completion”), natural sand proppant services (“Sand”) and drilling services (“Drilling”). Prior to the year ended December 31, 2021, the Company included Aquawolf in its “All Other” reconciling column. Based on its assessment of FASB ASC 280, Segment Reporting, guidance at December 31, 2021, the Company changed its presentation in 2021 to move Aquawolf to the Infrastructure segment. The results for the three and six months ended June 30, 2021 have been retroactively adjusted to reflect this change.

The Infrastructure segment provides electric utility infrastructure services to government-funded utilities, private utilities, public investor-owned utilities and co-operative utilities in the northeastern, southwestern, midwestern and western portions of the United States. The Well Completion segment provides hydraulic fracturing and water transfer services primarily in the Utica Shale of Eastern Ohio, Marcellus Shale in Pennsylvania and the mid-continent region. The Sand segment mines, processes and sells sand for use in hydraulic fracturing. The Sand segment primarily services the Utica Shale, Permian Basin, SCOOP, STACK and Montney Shale in British Columbia and Alberta, Canada. During certain of the periods presented, the Drilling segment provided contract land and directional drilling services primarily in the Permian Basin and mid-continent region.

During certain of the periods presented, the Company also provided aviation services, coil tubing services, equipment rental services, crude oil hauling services, remote accommodation and equipment manufacturing. The businesses that provide these services are distinct operating segments, which the CODM reviews independently when making key operating and resource utilization decisions. None of these operating segments meet the quantitative thresholds of a reporting segment and do not meet the aggregation criteria set forth in ASC 280 Segment Reporting. Therefore, results for these operating segments are included in the column titled “All Other” in the tables below. Additionally, assets for corporate activities, which primarily include cash and cash equivalents, inter-segment accounts receivable, prepaid insurance and certain property and equipment, are included in the All Other column. Although Mammoth Energy Partners LLC, which holds these corporate assets, meets one of the quantitative thresholds of a reporting segment, it does not engage in business activities from which it may earn revenues and its results are not regularly reviewed by the Company’s CODM when making key operating and resource utilization decisions. Therefore, the Company does not include it as a reportable segment.

Sales from one segment to another are generally priced at estimated equivalent commercial selling prices. Total revenue and total cost of revenue amounts included in the Eliminations column in the following tables include inter-segment transactions conducted between segments. Receivables due for sales from one segment to another and for corporate allocations to each segment are included in the Eliminations column for total assets in the following tables. All
transactions conducted between segments are eliminated in consolidation. Transactions conducted by companies within the same reporting segment are eliminated within each reporting segment. The following tables set forth certain financial information with respect to the Company’s reportable segments (in thousands):
Three months ended June 30, 2022 Infrastructure Well Completion Sand Drilling All Other Eliminations Total
Revenue from external customers $ 25,587  $ 43,574  $ 13,841  $ 1,952  $ 4,724  $ —  $ 89,678 
Intersegment revenues —  243  1,618  19  306  (2,186) — 
Total revenue 25,587  43,817  15,459  1,971  5,030  (2,186) 89,678 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 21,808  31,486  9,707  2,034  3,751  —  68,786 
Intersegment cost of revenues 15  1,985  —  160  103  (2,263) — 
Total cost of revenue 21,823  33,471  9,707  2,194  3,854  (2,263) 68,786 
Selling, general and administrative 4,443  1,884  870  277  732  —  8,206 
Depreciation, depletion, amortization and accretion 4,211  6,747  2,058  1,651  2,809  —  17,476 
Operating income (loss) (4,890) 1,715  2,824  (2,151) (2,365) 77  (4,790)
Interest expense, net 1,755  422  178  121  183  —  2,659 
Other (income), net (10,925) (157) (19) —  (1,986) —  (13,087)
Income (loss) before income taxes $ 4,280  $ 1,450  $ 2,665  $ (2,272) $ (562) $ 77  $ 5,638 
Three months ended June 30, 2021 Infrastructure Well Completion Sand Drilling All Other Eliminations Total
Revenue from external customers $ 18,420  $ 17,337  $ 6,886  $ 1,130  $ 3,667  $ —  $ 47,440 
Intersegment revenues —  36  —  17  682  (735) — 
Total revenue 18,420  17,373  6,886  1,147  4,349  (735) 47,440 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 21,062  16,396  7,400  1,568  3,949  —  50,375 
Intersegment cost of revenues 50  666  —  —  19  (735) — 
Total cost of revenue 21,112  17,062  7,400  1,568  3,968  (735) 50,375 
Selling, general and administrative 5,620  1,893  991  395  961  —  9,860 
Depreciation, depletion, amortization and accretion 5,899  6,447  2,387  2,078  3,454  —  20,265 
Operating loss (14,211) (8,029) (3,892) (2,894) (4,034) —  (33,060)
Interest expense, net 664  219  90  58  138  —  1,169 
Other expense (income), net 18,035  (53) (126) (736) —  17,121 
Loss before income taxes $ (32,910) $ (8,249) $ (3,929) $ (2,826) $ (3,436) $ —  $ (51,350)
Six months ended June 30, 2022 Infrastructure Well Completion Sand Drilling All Other Eliminations Total
Revenue from external customers $ 48,596  $ 67,202  $ 22,189  $ 4,804  $ 9,185  $ —  $ 151,976 
Intersegment revenues —  489  2,450  22  576  (3,537) — 
Total revenue 48,596  67,691  24,639  4,826  9,761  (3,537) 151,976 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 40,695  53,325  17,495  4,406  7,345  —  123,266 
Intersegment cost of revenues 31  3,016  —  321  172  (3,540) — 
Total cost of revenue 40,726  56,341  17,495  4,727  7,517  (3,540) 123,266 
Selling, general and administrative 9,088  3,923  1,698  569  1,596  —  16,874 
Depreciation, depletion, amortization and accretion 8,525  13,191  3,852  3,331  5,744  —  34,643 
Operating income (loss) (9,743) (5,764) 1,594  (3,801) (5,096) (22,807)
Interest expense, net 3,298  793  340  225  352  —  5,008 
Other (income), net (20,512) (206) (98) —  (1,508) —  (22,324)
Income (loss) before income taxes $ 7,471  $ (6,351) $ 1,352  $ (4,026) $ (3,940) $ $ (5,491)
Six months ended June 30, 2021 Infrastructure Well Completion Sand Drilling All Other Eliminations Total
Revenue from external customers $ 48,619  $ 40,238  $ 15,592  $ 2,049  $ 7,746  $ —  $ 114,244 
Intersegment revenues —  90  —  31  1,322  (1,443) — 
Total revenue 48,619  40,328  15,592  2,080  9,068  (1,443) 114,244 
Cost of revenue, exclusive of depreciation, depletion, amortization and accretion 48,439  25,399  13,262  3,173  8,182  —  98,455 
Intersegment cost of revenues 95  1,060  —  —  288  (1,443) — 
Total cost of revenue 48,534  26,459  13,262  3,173  8,470  (1,443) 98,455 
Selling, general and administrative 9,359  12,505  3,040  817  2,163  —  27,884 
Depreciation, depletion, amortization and accretion 12,566  13,130  4,527  4,243  6,945  —  41,411 
Operating loss (21,840) (11,766) (5,237) (6,153) (8,510) —  (53,506)
Interest expense, net 1,333  473  183  121  284  —  2,394 
Other (income) expense, net 11,548  440  (847) (135) (493) —  10,513 
Loss before income taxes $ (34,721) $ (12,679) $ (4,573) $ (6,139) $ (8,301) $ —  $ (66,413)