Revenue Recognition | Revenues The Company recognizes revenues to depict the transfer of promised services and products to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services and products. Service revenues include CE and the service components of HE and Rail. Product revenues include portions of HE and Rail. A summary of the Company's revenues by primary geographical markets as well as by key product and service groups is as follows: Three Months Ended June 30, 2024 (In thousands) Harsco Environmental Segment Clean Earth Segment Harsco Rail Segment Consolidated Totals Primary Geographical Markets (a) : North America $ 84,027 $ 236,105 $ 53,044 $ 373,176 Western Europe 109,620 — 18,652 128,272 Latin America (b) 41,280 — 1,918 43,198 Asia-Pacific 28,345 — 7,345 35,690 Middle East and Africa 25,182 — — 25,182 Eastern Europe 4,475 — — 4,475 Total Revenues $ 292,929 $ 236,105 $ 80,959 $ 609,993 Key Product and Service Groups: Environmental services related to resource recovery for metals manufacturing and related logistical services $ 253,685 $ — $ — $ 253,685 Ecoproducts 34,263 — — 34,263 Environmental systems for aluminum dross and scrap processing 4,981 — — 4,981 Railway track maintenance equipment — — 30,517 30,517 After market parts and services; safety and diagnostic technology — — 35,131 35,131 Railway contracting services — — 15,311 15,311 Hazardous waste processing solutions — 194,874 — 194,874 Soil and dredged materials processing and reuse solutions — 41,231 — 41,231 Total Revenues $ 292,929 $ 236,105 $ 80,959 $ 609,993 Three Months Ended June 30, 2023 (In thousands) Harsco Environmental Segment Clean Earth Harsco Rail Segment Consolidated Totals Primary Geographical Markets (a) : North America $ 81,616 $ 230,575 $ 69,450 $ 381,641 Western Europe 107,318 — 11,377 118,695 Latin America (b) 42,180 — 561 42,741 Asia-Pacific 32,339 — 7,460 39,799 Middle East and Africa 21,117 — — 21,117 Eastern Europe 5,023 — — 5,023 Total Revenues $ 289,593 $ 230,575 $ 88,848 $ 609,016 Key Product and Service Groups: Environmental services related to resource recovery for metals manufacturing and related logistical services $ 242,638 $ — $ — $ 242,638 Ecoproducts 40,504 — — 40,504 Environmental systems for aluminum dross and scrap processing 6,451 — — 6,451 Railway track maintenance equipment — — 44,796 44,796 After market parts and services; safety and diagnostic technology — — 34,530 34,530 Railway contracting services — — 9,522 9,522 Hazardous waste processing solutions — 197,506 — 197,506 Soil and dredged materials processing and reuse solutions — 33,069 — 33,069 Total Revenues $ 289,593 $ 230,575 $ 88,848 $ 609,016 Six Months Ended June 30, 2024 (In thousands) Harsco Environmental Segment Clean Earth Harsco Rail Segment Consolidated Totals Primary Geographical Markets (a) : North America $ 168,237 $ 462,135 $ 97,475 $ 727,847 Western Europe 219,895 — 40,024 259,919 Latin America (b) 84,201 — 2,958 87,159 Asia-Pacific 57,260 — 15,670 72,930 Middle East and Africa 53,531 — — 53,531 Eastern Europe 8,924 — — 8,924 Total Revenues $ 592,048 $ 462,135 $ 156,127 $ 1,210,310 Key Product and Service Groups: Environmental services related to resource recovery for metals manufacturing and related logistical services $ 511,813 $ — $ — $ 511,813 Ecoproducts 70,527 — — 70,527 Environmental systems for aluminum dross and scrap processing 9,708 — — 9,708 Railway track maintenance equipment — — 60,436 60,436 After-market parts and services; safety and diagnostic technology — — 66,007 66,007 Railway contracting services — — 29,684 29,684 Hazardous waste processing solutions — 386,784 — 386,784 Soil and dredged materials processing and reuse solutions — 75,351 — 75,351 Total Revenues $ 592,048 $ 462,135 $ 156,127 $ 1,210,310 Six Months Ended June 30, 2023 (In thousands) Harsco Environmental Segment Clean Earth Segment Harsco Rail Segment Consolidated Totals Primary Geographical Markets (a) : North America $ 160,089 $ 453,039 $ 113,612 $ 726,740 Western Europe 208,704 — 24,564 233,268 Latin America (b) 83,135 — 1,165 84,300 Asia-Pacific 61,300 — 14,559 75,859 Middle East and Africa 39,522 — — 39,522 Eastern Europe 10,032 — — 10,032 Total Revenues $ 562,782 $ 453,039 $ 153,900 $ 1,169,721 Key Product and Service Groups: Environmental services related to resource recovery for metals manufacturing and related logistical services $ 471,999 $ — $ — $ 471,999 Ecoproducts 78,906 — — 78,906 Environmental systems for aluminum dross and scrap processing 11,877 — — 11,877 Railway track maintenance equipment — — 74,240 74,240 After-market parts and services; safety and diagnostic technology — — 62,323 62,323 Railway contracting services — — 17,337 17,337 Hazardous waste processing solutions — 383,618 — 383,618 Soil and dredged materials processing and reuse solutions — 69,421 — 69,421 Total Revenues $ 562,782 $ 453,039 $ 153,900 $ 1,169,721 (a) Revenues are attributed to individual countries based on the location of the facility generating the revenue. (b) Includes Mexico. The Company may receive payments in advance of earning revenue (advances on contracts), which are included in Current portion of advances on contracts and Other liabilities on the Condensed Consolidated Balance Sheets. The Company may recognize revenue in advance of being able to contractually invoice the customer (contract assets), which is included in Current portion of contract assets and Other assets on the Condensed Consolidated Balance Sheets. Contract assets are transferred to Trade accounts receivable, net, when the right to payment becomes unconditional. Contract assets and advances on contracts are reported as a net position, on a contract-by-contract basis, at the end of each reporting period. These instances are primarily related to Rail. The Company had contract assets totaling $99.4 million and $86.9 million at June 30, 2024 and December 31, 2023, respectively. The Company had advances on contracts totaling $30.5 million and $38.6 million at June 30, 2024 and December 31, 2023, respectively. During the three and six months ended June 30, 2024, the Company recognized $9.8 million and $20.5 million of revenue related to amounts previously included in advances on contracts. During the three and six months ended June 30, 2023, the Company recognized revenues of $10.9 million and $22.5 million, respectively, related to amounts previously included in advances on contracts. At June 30, 2024, HE had remaining, fixed, unsatisfied performance obligations where the expected contract duration exceeds one year totaling $77.0 million. Of this amount, $21.6 million is expected to be fulfilled by June 30, 2025, $18.9 million by June 30, 2026, $14.5 million by June 30, 2027, $11.6 million by June 30, 2028 and the remainder thereafter. These amounts exclude any variable fees, fixed fees subject to indexation and any performance obligations expected to be satisfied within one year. At June 30, 2024, Rail had remaining, fixed, unsatisfied performance obligations where the expected contract duration exceeds one year totaling $128.7 million. Of this amount, $60.7 million is expected to be fulfilled by June 30, 2025, $34.2 million by June 30, 2026, $21.8 million by June 30, 2027, $8.0 million by June 30, 2028 and the remainder thereafter. These amounts exclude any variable fees, fixed fees subject to indexation and any performance obligations expected to be satisfied within one year. Rail is currently manufacturing highly-engineered equipment under large long-term fixed-price contracts with SBB, Network Rail, and Deutsche Bahn. As previously disclosed, the Company recognized estimated forward loss provisions in 2021, 2022 and 2023 related to these contracts due to several factors, such as material and labor cost inflation, supply chain delays, the bankruptcy of a key vendor and increased engineering efforts. For the Network Rail contract, the Company recorded an additional loss provision of $2.0 million in the second quarter of 2024, primarily related to costs for redesign and increased manufacturing costs. During the second quarter of 2023, the Company reversed a portion of its previous estimated loss provision adjustment in the amount of $23.6 million. The favorable adjustment was the result of an amendment to the contract with Network Rail which extended the delivery schedule for the machines and reduced the estimate of liquidated damages. The majority of the reduction in liquidated damages was recorded as an increase to revenue and contract assets. Partially offsetting this were higher estimated material, engineering and labor costs due to additional experience gained during the manufacturing process. For the Deutsche Bahn contract, the Company recorded an additional loss provision of $7.2 million in the second quarter of 2024, related to supplier price increases, challenges with supplier quality on key components and increased engineering efforts that exceeded previous estimates. During the second quarter of 2023, the Company recorded an additional forward loss provision of $8.4 million. This loss provision was due to increased costs related to a critical supplier that had filed for bankruptcy in 2022 and ceased operations during the second quarter of 2023, as well as an increase in estimated component costs and engineering costs. For the SBB contract, a $0.2 million provision was recognized in the six months ended June 30, 2024. In the second quarter of 2023, the company recorded an additional forward loss provision of $6.1 million, due to increased costs related to increased estimates for material, engineering and commissioning costs for the remaining vehicles. The estimated forward loss provisions represent the Company's best estimate based on currently available information. It is possible that the Company's overall estimate of liquidated damages, penalties and costs to complete these contracts may change, which could result in an additional estimated forward loss provision at such time that could be material. The Company will continue to update its estimates to complete these contracts, which will include the effect of negotiations with the customers regarding price increases, change orders and extensions to delivery schedules. As of June 30, 2024, the contracts with Network Rail, Deutsche Bahn and SBB are 62%, 44% and 89% complete, respectively, based on costs incurred. The Company provides assurance type warranties primarily for product sales at Rail. These warranties are typically not priced or negotiated separately (there is no option to separately purchase the warranty) or the warranty does not provide customers with a service in addition to the assurance that the product complies with agreed-upon specifications. Accordingly, such warranties do not represent separate performance obligations. |