In March 2026, our Board approved the sale of Intrepid South, and the accounting criteria for classification as held for sale and discontinued operations were met. The sale closed on April 1, 2026. As a result, Intrepid South assets and liabilities are reported as held for sale as of December 31, 2025, and Intrepid South results of operations are reported as discontinued operations in the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2026, and 2025. The assets and liabilities held for sale were not measured at fair value as the expected selling price exceeded their net carrying value.


	December 31, 2025
Accounts receivable	$	1,797
Inventory	114
Prepaid expenses and other current assets	43
Property, plant, equipment, and mineral properties, net	36,017
Water rights	16,873
Other long term assets	4,310
Assets held for sale	$	59,154

Accounts payable	$	188
Accrued liabilities	140
Accrued employee compensation and benefits	170
Contract liability - current portion	753
Asset retirement obligations	389
Long term contract liability	1,730
Liabilities held for sale	$	3,370

The following table presents the results of discontinued operations for the three and six months ended June 30, 2026, and 2025 (amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Sales	$	—	$	3,936	$	2,366	$	7,169
Less: cost of goods sold	—		2,010		1,823		3,962
Gross Margin	—		1,926		543		3,207

Selling and administrative	—		48		—		48
Accretion of asset retirement obligation	—		8		9		16
Gain on sale of assets	—		(12)		(3)		(34)
Other operating income	—		—		—		(1)
Gain on sale of discontinued operations	(13,263)		—		(13,263)		—
Net income of discontinued operations before income tax	13,263		1,882		13,800		3,178
Income tax (expense) benefit	(81)		5		(81)		(113)
Net income of discontinued operations, net of tax	$	13,182	$	1,887	$	13,719	$	3,065

Contract Balances: Customers generally pay the total amount due under surface use agreements when the agreement is executed. Depending on the nature of the performance obligations in the various surface use agreements, revenue may be recognized at a point in time or over time. Our contract liabilities (sometimes referred to in practice as deferred revenue) represent the amount of cash we received from customers under surface use agreements at Intrepid South where the associated revenue is being recognized over time.

Under the terms of the Intrepid South sales agreement, we retained one-half of the $2.4 million contract liability balance as of March 31, 2026, and was included in the gain on the sale of Intrepid South, and the remaining one-half of the contract liability balance was included as an adjustment to the final sales price.

As of December 31, 2025, we had total contract liabilities of $2.5 million, of which $0.8 million was current and included in "Liabilities held for sale" on the Condensed Consolidated Balance Sheets.

Deferred revenue activity during the three and six months ended June 30, 2026, and 2025, and the ending contract liability balances at the end of each of those periods is shown below (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Beginning balance	$	2,377	$	2,427	$	2,483	$	2,431
Additions	—		496		123		872
Recognized as revenue during period	—		(333)		(229)		(713)
Liability extinguished upon sale of discontinued operations	(2,377)		—		(2,377)		—
Ending Balance	$	—	$	2,590	$	—	$	2,590