Quarterly report pursuant to Section 13 or 15(d)

SEGMENT INFORMATION

v3.22.2.2
SEGMENT INFORMATION
9 Months Ended
Sep. 30, 2022
Segment Reporting [Abstract]  
SEGMENT INFORMATION SEGMENT INFORMATION
The Company’s products and operations are managed and reported in two operating segments: Fire Safety and Specialty Products, formerly Oil Additives.
The Fire Safety segment manufactures and sells fire retardant and firefighting foam products, as well as specialized equipment and services typically offered in conjunction with these retardant and foam products.
In June 2022, the Oil Additives segment, which produces and sells P2S5 was renamed the Specialty Products segment to better reflect the current and expanding applications for P2S5 in several end markets and applications, including lubricant additives, various agricultural applications, various mining applications, and emerging electric battery technologies. Within the lubricant additive end market, currently the Company’s largest end market application, P2S5 is primarily used in the production of a family of compounds called ZDDP, which is considered an essential component in the formulation of engine oils with its main function to provide anti-wear protection to engine components.
Interest income, interest expense, other income (expense) and certain corporate operating expenses are neither allocated to the segments nor included in the measure of segment performance reviewed by the chief operating decision-maker (“CODM”). The corporate category includes unallocated costs related to the Company’s corporate headquarter activities, including selling, general and administrative costs, which do not meet the requirements for being classified as an operating segment. The CODM is the Company's CEO.
The Company’s CODM uses the segment net sales and segment Adjusted EBITDA to assess the ongoing performance of the Company’s business segments and to allocate resources. The Company defines segment Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, as adjusted on a consistent basis for certain non-recurring or unusual items in a balanced manner and on a segment basis. These non-recurring or unusual items may include acquisition and integration related costs, management fees and other non-recurring items.
Information related to net sales and Adjusted EBITDA for the Company’s operations are summarized below (in thousands):
Successor Predecessor Successor Predecessor
Three Months Ended
September 30, 2022
Three Months Ended
September 30, 2021
Nine Months Ended
September 30, 2022
Nine Months Ended
September 30, 2021
Net sales:
Fire safety $ 121,963  $ 172,445  $ 207,010  $ 237,256 
Specialty products 38,546  22,969  112,222  79,204 
Total $ 160,509  $ 195,414  $ 319,232  $ 316,460 
Adjusted EBITDA:
Fire safety $ 60,363  $ 97,854  $ 81,248  $ 116,680 
Specialty products 15,264  2,496  42,038  17,919 
Total segment Adjusted EBITDA 75,627  100,350  123,286  134,599 
Less:
Depreciation and amortization 16,450  15,212  49,536  45,593 
Interest and financing expense 9,944  8,065  32,582  23,951 
Founders advisory fees - related party (73,713) —  (154,026) — 
Non-recurring expenses 1,168  3,855  4,788  12,805 
Share-based compensation expense 6,832  —  19,297  — 
Non-cash purchase accounting impact 658  —  27,973  — 
(Gain) loss on contingent earn-out (3,644) —  (13,042) 2,763 
Management fees —  313  —  937 
Contingent future payments —  625  —  1,875 
Unrealized foreign currency loss 4,705  1,634  8,741  3,892 
Income before income taxes $ 113,227  $ 70,646  $ 147,437  $ 42,783