| Business Segment Information |
16. Business Segment Information The Company’s operations are organized and reviewed by management along its product lines or end markets that the segment serves and are presented in three reportable segments. Segment profit is reviewed quarterly by the chief operating decision maker ("CODM"), which is the Company's Chief Executive Officer, for the purposes of allocating resources, including personnel, capital, and financial resources, and assessing performance, including the monitoring of budget versus actual results. During the fourth quarter of 2025, management updated the definition of the segment profit measure used by the CODM. The presentation of prior period segment information has been recast to conform to this updated measure. During the second quarter of 2026, the Thermal Solutions segment was created following the acquisition of Thermon. Asset information by segment is not reported internally or otherwise regularly reviewed by the CODM.
The Company’s reportable segments are organized as groups of similar products and services, as described as follows: Engineered Systems: The Company's Engineered Systems segment serves the power generation, hydrocarbon processing,
water/wastewater treatment, oily water separation and treatment, marine and naval vessels, and midstream oil and gas sectors. The Company seeks to address the global demand for environmental and equipment protection solutions with its highly engineered platforms including emissions management, fluid bed cyclones, thermal acoustics, separation and filtration, and dampers and expansion joints. Industrial Process Solutions: The Company's Industrial Process Solutions segment serves the broad industrial sector with
solutions for air pollution and contamination control, fluid handling, and process filtration in applications such as aluminum beverage can production, automobile production, food and beverage processing, semiconductor fabrication, electronics production, steel and aluminum mill processing, wood manufacturing, desalination, and aquaculture markets. The Company assists customers in maintaining clean and safe operations for employees, reducing energy consumption, minimizing waste for customers, and meeting regulatory standards for toxic emissions, fumes, volatile organic compounds, and odor elimination through its platforms including duct fabrication and installation, industrial air, and fluid handling. Thermal Solutions: The Company's Thermal Solutions segment serves the general industrial, chemical and petrochemical, oil, gas, power generation, commercial, food and beverage processing, and rail and transit sectors. The Company, through this segment, offers a full suite of products including heating units, electrode and gas-fired boilers, heating cables, industrial heating blankets and related products, temporary power solutions and tubing bundles, engineering, installation and maintenance services, and software design optimization and wireless and network control systems. A reconciliation of total segment sales to total consolidated sales, as well as total segment profit from operations to total consolidated net loss before taxes is as follows for the three months ended June 30, 2026:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Thermal Solutions |
|
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Total |
|
Net sales |
|
$ |
49,606 |
|
|
$ |
173,673 |
|
|
$ |
61,682 |
|
|
$ |
284,961 |
|
Direct cost of sales |
|
|
38,088 |
|
|
|
110,257 |
|
|
|
42,124 |
|
|
|
|
Shop burden |
|
|
599 |
|
|
|
4,515 |
|
|
|
2,910 |
|
|
|
|
Selling expense |
|
|
3,762 |
|
|
|
8,467 |
|
|
|
3,075 |
|
|
|
|
Project engineering expense |
|
|
850 |
|
|
|
4,483 |
|
|
|
2,453 |
|
|
|
|
General and administrative expense |
|
|
4,794 |
|
|
|
9,951 |
|
|
|
2,210 |
|
|
|
|
Segment profit |
|
|
1,512 |
|
|
|
36,000 |
|
|
|
8,910 |
|
|
|
46,423 |
|
Share-based compensation |
|
|
|
|
|
|
|
|
|
|
|
12,408 |
|
Amortization of intangible assets |
|
|
|
|
|
|
|
|
|
|
|
7,789 |
|
Other corporate expenses(1) |
|
|
|
|
|
|
|
|
|
|
|
59,409 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
9,102 |
|
Other profit or loss(2) |
|
|
|
|
|
|
|
|
|
|
|
2,293 |
|
Total consolidated loss before income taxes |
|
|
|
|
|
|
|
|
|
|
$ |
(44,578 |
) |
(1) Includes corporate compensation, professional services and information technology expenses, and other general and administrative corporate expenses.
(2) Includes foreign exchange (gain) loss. A reconciliation of total segment sales to total consolidated sales, as well as total segment profit from operations to total consolidated net loss before taxes is as follows for the six months ended June 30, 2026:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Thermal Solutions |
|
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Total |
|
Net sales |
|
$ |
49,606 |
|
|
$ |
324,209 |
|
|
$ |
117,065 |
|
|
$ |
490,880 |
|
Direct cost of sales |
|
|
38,088 |
|
|
|
205,964 |
|
|
|
80,686 |
|
|
|
|
Shop burden |
|
|
599 |
|
|
|
8,995 |
|
|
|
6,160 |
|
|
|
|
Selling expense |
|
|
3,762 |
|
|
|
16,586 |
|
|
|
6,007 |
|
|
|
|
Project engineering expense |
|
|
850 |
|
|
|
8,310 |
|
|
|
4,703 |
|
|
|
|
General and administrative expense |
|
|
4,794 |
|
|
|
18,534 |
|
|
|
4,154 |
|
|
|
|
Segment profit |
|
|
1,512 |
|
|
|
65,822 |
|
|
|
15,356 |
|
|
|
82,690 |
|
Share-based compensation |
|
|
|
|
|
|
|
|
|
|
|
12,848 |
|
Amortization of intangible assets |
|
|
|
|
|
|
|
|
|
|
|
11,792 |
|
Other corporate expenses(1) |
|
|
|
|
|
|
|
|
|
|
|
89,363 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
13,332 |
|
Other profit or loss(2) |
|
|
|
|
|
|
|
|
|
|
|
3,680 |
|
Total consolidated loss before income taxes |
|
|
|
|
|
|
|
|
|
|
$ |
(48,325 |
) |
(1) Includes corporate compensation, professional services and information technology expenses, and other general and administrative corporate expenses.
(2) Includes foreign exchange (gain) loss. Other segment information is as follows for the three and six months ended June 30, 2026:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2026 |
|
|
(in thousands) |
|
Thermal Solutions |
|
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Property and equipment additions |
|
$ |
1,756 |
|
|
$ |
1,165 |
|
|
$ |
128 |
|
|
Depreciation and amortization(1) |
|
|
4,328 |
|
|
|
3,835 |
|
|
|
2,317 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30, 2026 |
|
|
(in thousands) |
|
Thermal Solutions |
|
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Property and equipment additions |
|
$ |
1,756 |
|
|
$ |
1,825 |
|
|
$ |
314 |
|
|
Depreciation and amortization(1) |
|
|
4,328 |
|
|
|
6,750 |
|
|
|
4,432 |
|
|
(1) The amounts of depreciation and amortization disclosed by reportable segment are included within other segment expense captions, such as shop burden or general and administrative expense. A reconciliation of total segment sales to total consolidated sales, as well as total segment profit to total consolidated net income before taxes is as follows for the three months ended June 30, 2025:
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Total |
|
Net sales |
|
$ |
128,460 |
|
|
$ |
56,931 |
|
|
$ |
185,391 |
|
Direct cost of sales |
|
|
76,638 |
|
|
|
36,078 |
|
|
|
|
Shop burden |
|
|
3,338 |
|
|
|
2,230 |
|
|
|
|
Selling expense |
|
|
7,933 |
|
|
|
2,857 |
|
|
|
|
Project engineering expense |
|
|
4,729 |
|
|
|
2,803 |
|
|
|
|
General and administrative expense |
|
|
9,185 |
|
|
|
2,278 |
|
|
|
|
Gain on sale of Global Pump Solutions business |
|
|
— |
|
|
|
- |
|
|
|
|
Segment profit |
|
|
26,639 |
|
|
|
10,686 |
|
|
|
37,325 |
|
Share-based compensation |
|
|
|
|
|
|
|
|
2,878 |
|
Amortization of intangible assets |
|
|
|
|
|
|
|
|
6,033 |
|
Other corporate expenses(1) |
|
|
|
|
|
|
|
|
22,935 |
|
Interest expense |
|
|
|
|
|
|
|
|
4,898 |
|
Other profit or loss(2) |
|
|
|
|
|
|
|
|
(1,454 |
) |
Total consolidated income before income taxes |
|
|
|
|
|
|
|
$ |
14,617 |
|
(1) Includes corporate compensation, professional services and information technology expenses, and other general and administrative corporate expenses.
(2) Includes foreign exchange (gain) loss. A reconciliation of total segment sales to total consolidated sales, as well as total segment profit to total consolidated net income before taxes is as follows for the six months ended June 30, 2025:
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Total |
|
Net sales |
|
$ |
248,894 |
|
|
$ |
113,195 |
|
|
$ |
362,088 |
|
Direct cost of sales |
|
|
149,703 |
|
|
|
71,717 |
|
|
|
|
Shop burden |
|
|
6,269 |
|
|
|
5,129 |
|
|
|
|
Selling expense |
|
|
15,765 |
|
|
|
6,587 |
|
|
|
|
Project engineering expense |
|
|
9,459 |
|
|
|
5,675 |
|
|
|
|
General and administrative expense |
|
|
18,225 |
|
|
|
6,547 |
|
|
|
|
Gain on sale of Global Pump Solutions business |
|
|
— |
|
|
|
(63,701 |
) |
|
|
|
Segment profit |
|
|
49,472 |
|
|
|
81,241 |
|
|
|
130,713 |
|
Share-based compensation |
|
|
|
|
|
|
|
|
6,234 |
|
Amortization of intangible assets |
|
|
|
|
|
|
|
|
6,033 |
|
Other corporate expenses(1) |
|
|
|
|
|
|
|
|
38,516 |
|
Interest expense |
|
|
|
|
|
|
|
|
11,115 |
|
Other profit or loss(2) |
|
|
|
|
|
|
|
|
(861 |
) |
Total consolidated income before income taxes |
|
|
|
|
|
|
|
$ |
69,676 |
|
(1) Includes corporate compensation, professional services and information technology expenses, and other general and administrative corporate expenses.
(2) Includes foreign exchange (gain) loss and pension expense. Other segment information is as follows for the three and six months ended June 30, 2025:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, 2025 |
|
|
Six months ended June 30, 2025 |
|
(in thousands) |
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
|
Engineered Systems |
|
|
Industrial Process Solutions |
|
Property and equipment additions |
|
$ |
512 |
|
|
$ |
328 |
|
|
$ |
1,206 |
|
|
$ |
961 |
|
Depreciation and amortization(1) |
|
|
2,113 |
|
|
|
1,864 |
|
|
|
4,098 |
|
|
|
4,188 |
|
(1) The amounts of depreciation and amortization disclosed by reportable segment are included within other segment expense captions, such as shop burden or general and administrative expense. Geographic Information Net sales by geographic area are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
(in thousands) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
United States |
|
$ |
180,619 |
|
|
$ |
120,204 |
|
|
$ |
317,165 |
|
|
$ |
230,875 |
|
Netherlands |
|
|
26,212 |
|
|
|
15,763 |
|
|
|
43,775 |
|
|
|
26,989 |
|
Canada |
|
|
18,815 |
|
|
|
5,390 |
|
|
|
23,080 |
|
|
|
10,747 |
|
China |
|
|
18,814 |
|
|
|
13,563 |
|
|
|
33,369 |
|
|
|
28,357 |
|
United Kingdom |
|
|
11,646 |
|
|
|
12,470 |
|
|
|
24,678 |
|
|
|
32,027 |
|
Other |
|
|
28,855 |
|
|
|
18,001 |
|
|
|
48,813 |
|
|
|
33,093 |
|
Total net sales |
|
$ |
284,961 |
|
|
$ |
185,391 |
|
|
$ |
490,880 |
|
|
$ |
362,088 |
|
The geographical area data for net sales is based upon the country location of the Company's business unit generating such sales. Long-lived assets by geographic area are as follows:
|
|
|
|
|
|
|
|
|
(in thousands) |
|
June 30, 2026 |
|
|
December 31, 2025 |
|
United States |
|
$ |
2,565,411 |
|
|
$ |
359,584 |
|
China |
|
|
41,056 |
|
|
|
39,205 |
|
United Kingdom |
|
|
24,807 |
|
|
|
27,761 |
|
Canada |
|
|
57,968 |
|
|
|
8,492 |
|
Other |
|
|
64,696 |
|
|
|
48,545 |
|
Total long-lived assets |
|
$ |
2,753,938 |
|
|
$ |
483,587 |
|
The geographical area data for long-lived assets is based upon physical location of such assets.
|