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Organization

Trecora Resources (the “Company”) was incorporated in the State of Delaware in 1967. The Company's principal business activities are the manufacturing of various specialty petrochemical products, specialty waxes and providing custom processing services.

The Company’s specialty petrochemicals operations are primarily conducted through its wholly-owned subsidiary, Texas Oil and Chemical Co. II, Inc. (“TOCCO”). TOCCO owns all of the capital stock of South Hampton Resources, Inc. (“SHR”) and Trecora Chemical, Inc. (“TC”). SHR owns all of the capital stock of Gulf State Pipe Line Company, Inc. (“GSPL”). SHR owns and operates a specialty petrochemicals product facility in Silsbee, Texas which manufactures high purity hydrocarbons used primarily in polyethylene, packaging, polypropylene, expandable polystyrene, poly-iso/urethane foams, Canadian tar sands, and in the catalyst support industry. TC owns and operates a facility located in Pasadena, Texas which manufactures specialty waxes and provides custom processing services. These specialty waxes are used in the production of coatings, hot melt adhesives and lubricants. GSPL owns and operates pipelines that connect the SHR facility to a natural gas line, to SHR’s truck and rail loading terminal and to a major petroleum pipeline owned by an unaffiliated third party.

The Company owns approximately 55% of the capital stock of a Nevada mining company, Pioche Ely Valley Mines, Inc. (“PEVM”), which does not conduct any substantial business activity but owns undeveloped properties in the United States.

The Company also previously owned 33% of a Saudi Arabian joint stock company, Al Masane Al Kobra Mining Company (“AMAK”). The final closing of the sale of our ownership interest in AMAK was completed on September 28, 2020. For more information, see Note 5.

For convenience in this report, the terms “Company”, “our”, “us”, “we” or “TREC” may be used to refer to Trecora Resources and its subsidiaries.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and, therefore, should be read in conjunction with the financial statements and related notes contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2020.

The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual financial statements and in management's opinion reflect all adjustments, including normal recurring adjustments, necessary to present fairly the Company's financial position, results of operations and cash flows for the interim periods presented. We have made estimates and judgments affecting the amounts reported in this document. The actual results that we experience may differ materially from our estimates. In the opinion of management, the disclosures included in these financial statements are adequate to make the information presented not misleading.

Operating results for the three months ended March 31, 2021 are not necessarily indicative of results for the year ending December 31, 2021.

We currently operate in two segments, Specialty Petrochemicals and Specialty Waxes. All revenue originates from sources in the United States, and all long-lived assets owned are located in the United States.

In addition, on September 28, 2020, we completed the final closing of the sale of our ownership interest in AMAK, a Saudi Arabian closed joint stock company, which owns, operates and is developing mining assets in Saudi Arabia. Our investment was classified as held-for-sale and the equity in earnings (losses) are recorded in discontinued operations. See Note 5 for additional discussion.

Recently Adopted Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the

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accounting for income taxes. This guidance was effective for us in the first quarter of 2021. The adoption of this guidance did not have a material impact on our consolidated financial statements.

Recent Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020–04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASU 2020-04), which provides guidance to alleviate the burden in accounting for reference rate reform by allowing certain expedients and exceptions in applying generally accepted accounting principles to contracts, hedging relationships, and other transactions impacted by reference rate reform. The provisions of ASU 2020-04 apply only to those transactions that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. This guidance is effective from March 12, 2020 through December 31, 2022 and adoption is optional. We are currently evaluating the impact of ASU 2020-04 on our consolidated financial statements.

Trade receivables, net consisted of the following:
						March 31, 2021						December 31, 2020
						(thousands of dollars)
Trade receivables						$	26,229					$	25,601
Less allowance for doubtful accounts						(300)						(300)
Total trade receivables, net						$	25,929					$	25,301

Trade receivables serve as collateral for our amended and restated credit agreement. See Note 11.

Inventories consisted of the following:
						March 31, 2021						December 31, 2020
						(thousands of dollars)
Raw material						$	1,592					$	2,580
Work in process						171						138
Finished products						9,976						10,227
Total inventories						$	11,739					$	12,945

Inventory serves as collateral for our amended and restated credit agreement. See Note 11.

Inventory included Specialty Petrochemicals products in transit valued at approximately $2.5 million and $3.6 million at March 31, 2021 and December 31, 2020, respectively.

On September 28, 2020, the Company completed the final closing of the previously disclosed sale of its ownership interest in AMAK (the “Share Sale”) to AMAK and certain existing shareholders of AMAK and their assignees (collectively, the “Purchasers”). The Share Sale was completed in multiple closings pursuant to a Share Sale and Purchase Agreement, dated September 22, 2019 (which we refer to herein as the “Purchase Agreement”), among the Company, AMAK, and other Purchasers and resulted in aggregate gross proceeds to the Company of Saudi Riyals (“SAR”) 265 million (approximately $70 million) (before taxes and expenses).

As a condition to the effectiveness of the Purchase Agreement, the Purchasers advanced 5% of the purchase price (or approximately $3.5 million) in the form of a non-refundable deposit. Pursuant to the Purchase Agreement, (i) with respect to any Purchaser that completed the purchase of all or a portion of the ordinary shares allotted to it under the Purchase Agreement on or before March 31, 2020, the non-refundable deposit paid by such Purchaser (or a portion of such deposit for a partial closing) was credited toward the purchase price of the ordinary shares being purchased and (ii) with respect to any Purchasers that completed the purchase of all or a portion of their allotted ordinary shares after March 31, 2020 but on or before September 28, 2020, an amount equal to 50% of the non-refundable deposit paid by such Purchasers was forfeited to the Company as liquidated damages and such amount was not applied to the purchase price paid by the applicable Purchaser.

On March 26, 2020, the Company and one Purchaser completed the first closing of the Share Sale (the “First Closing”). In connection with the First Closing, the Company sold 4,000,000 ordinary shares for aggregate gross proceeds (before taxes and transaction expenses) of SAR 40 million (or approximately $10.7 million) (inclusive of the full amount of the

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Purchaser’s non-refundable deposit previously paid of $0.5 million). The Company recorded a foreign tax payable of approximately $0.3 million related to the First Closing.

During the third quarter of 2020, the Company completed additional closings of the Share Sale with respect to its remaining ownership interest in AMAK. In connection with these closings, the Company sold a total of 22,467,422 ordinary shares for aggregate gross proceeds (before taxes and transaction expenses) of SAR 224 million (or approximately $59.9 million) (inclusive of $1.5 million which constituted 50% of the non-refundable deposits previously paid by certain Purchasers). As none of the third quarter 2020 closings were completed prior to March 31, 2020, the remaining portion of the initial deposits (approximately $1.5 million) were forfeited to the Company as liquidated damages and were not applied to the purchase price. These amounts are included in income from discontinued operations, net of tax. The Company recorded a foreign tax payable of approximately $1.1 million related to the third quarter 2020 closings.

In connection with the completion of the Share Sale, the Company and AMAK entered into an agreement whereby AMAK agreed to withhold approximately $2.1 million of the purchase price to pay the Company’s estimated tax obligations in Saudi Arabia. The Company is in the process of finalizing the necessary tax returns in the Kingdom of Saudi Arabia. All foreign taxes paid will create foreign tax credit to offset U.S. taxes. As of March 31, 2021, approximately $1.3 million of foreign taxes has been paid. The remaining funds of approximately $0.8 million withheld by AMAK are included in prepaid expenses and other assets on the Company’s consolidated balance sheets as of March 31, 2021.

As previously disclosed, and as a result of the Company’s investment in AMAK, the Company was required to execute a limited guarantee on October 24, 2010 (the “Guarantee”) of up to 41% of a loan (the “Loan”) by the Saudi Industrial Development Fund (“SIDF”) to AMAK to fund the construction of the AMAK facilities and to provide working capital needs. The provision of personal or corporate guarantees, as applicable, by each shareholder of AMAK was a condition to SIDF providing the Loan. Pursuant to the Purchase Agreement, the Purchasers (other than AMAK) agreed, upon the completion of the Share Sale, to assume the Company’s obligation under the Guarantee (proportionately based upon such Purchaser’s percentage acquisition of ordinary shares in the Share Sale). While a formal written release of the Company from the Guarantee was not obtained from SIDF prior to closing, the Company believes that the Purchasers’ assumption of the Company’s obligation under the Guarantee effectively eliminates the Company’s liability arising under the Guarantee.

Included in discontinued operations are the following:

						Three Months Ended March 31,
						2021						2020
						(thousands of dollars)
Saudi administration and transaction expenses						$	—					$	17
Equity in losses of AMAK						—						(532)
Gain on sale of equity interest						—						6,663
Income from discontinued operations before taxes						—						6,148
Tax expense						—						(1,291)
Income from discontinued operations, net of tax						$	—					$	4,857

AMAK's financial statements were prepared in the functional currency of AMAK which is the SAR. In June 1986, the SAR was officially pegged to the U. S. Dollar at a fixed exchange rate of 1 USD to 3.75 SAR.

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The summarized results of operations and financial position for AMAK are as follows:

Results of Operations

						Three Months Ended March 31,
						2021						2020
						(thousands of dollars)
Sales						$	—					$	17,937
Cost of sales						—						16,821
Gross profit						—						1,116
Selling, general, and administrative						—						2,680
Operating income (loss)						—						(1,564)
Other income						—						17
Finance and interest expense						—						(531)
Income (loss) before Zakat and income taxes						—						(2,078)
Zakat and income tax (benefit)						—						533
Net Income (Loss)						$	—					$	(2,611)

Financial Position

						March 31,						December 31,
						2021						2020
						(thousands of dollars)
Current assets						$	—					$	29,799
Noncurrent assets						—						209,814
Total assets						$	—					$	239,613
Current liabilities						$	—					$	40,919
Long term liabilities						—						79,122
Stockholders' equity						—						119,572
						$	—					$	239,613

The equity in the earnings (losses) of AMAK included in income (loss) from discontinued operations, net of tax, on the condensed consolidated statements of operations for the three months ended March 31, 2021 and 2020, is comprised of the following:

						Three Months Ended March 31,
						2021						2020
						(thousands of dollars)
AMAK Net Loss						—						(2,611)
Company's share of loss reported by AMAK						—						(869)			*
Amortization of difference between Company's investment in AMAK and Company's share of net assets of AMAK						—						337
Equity in losses of AMAK						—						(532)
* Percentage of Ownership varies during the period.

For additional information, see NOTE 6, “INVESTMENT IN AMAK AND DISCONTINUED OPERATIONS” to the consolidated financial statements set forth in our Annual Report on Form 10–K for the year ended December 31, 2020.

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Property, plant and equipment consisted of the following:
						March 31, 2021						December 31, 2020
						(thousands of dollars)
Platinum catalyst metal						$	1,580					$	1,580
Catalyst						4,298						4,325
Land						5,428						5,428
Plant, pipeline and equipment						271,960						270,149
Construction in progress						9,335						6,422
Total property, plant and equipment						$	292,601					$	287,904
Less accumulated depreciation						(104,678)						(100,800)
Total property, plant and equipment, net						$	187,923					$	187,104

Property, plant and equipment serve as collateral for our amended and restated credit agreement. See Note 11.

Labor capitalized for construction was approximately $0.3 million and $0.6 million for the three months ended March 31, 2021 and 2020, respectively.

Construction in progress during the first three months of 2021 included costs for rebuild and restoration of a distillation tower. Construction in progress during the first three months of 2020 included Advanced Reformer unit improvements and pipeline maintenance at SHR and equipment modifications at TC.

Amortization relating to the catalyst, which is included in cost of sales, was approximately $0.3 million and $0.2 million for the three months ended March 31, 2021 and 2020, respectively.

The Company leases certain rail cars, rail equipment, office space and office equipment. The Company determines if a contract is a lease at the inception of the arrangement. The Company reviews all options to extend, terminate, or purchase its right-of-use assets at the inception of the lease and accounts for these options when they are reasonably certain of being exercised.

Leases with an initial term of 12 months or less are not recorded on the condensed consolidated balance sheets. Lease expense for these leases is recognized on a straight-line basis over the lease term.

The Company has no finance leases.

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The components of lease expense were as follows:
($ in thousands)			Classification in the Condensed Consolidated Statements of Income			Three Months Ended March 31,
						2021						2020
Operating lease cost (a)			Cost of sales, exclusive of depreciation and amortization			$	1,049					$	920
Operating lease cost (a)			Selling, general and administrative			34						48
Total lease cost						$	1,083					$	968

(a) Short-term lease costs were approximately $0.2 million and $0.1 million for the three months ended March 31, 2021 and 2020, respectively.

The Company had no variable lease expense, as defined by ASC 842, during the periods.

($ in thousands)			Classification on the Condensed Consolidated Balance Sheets			March 31, 2021						December 31, 2020
Assets:
Operating			Operating lease assets			$	9,757					$	10,528
Total lease right-of-use assets, net						$	9,757					$	10,528
Liabilities:
Current:
Operating			Current portion of operating lease liabilities			$	3,219					$	3,195
Noncurrent:
Operating			Operating lease liabilities			6,538						7,333
Total lease liabilities						$	9,757					$	10,528

			Three Months Ended March 31,
($ in thousands)			2021						2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used for operating leases			$	903					$	947
Right-of-use assets obtained in exchange for lease obligations:
Operating leases			$	19					$	—

			March 31, 2021						March 31, 2020
Weighted-average remaining lease term (in years):
Operating leases			3.5						4.3
Weighted-average discount rate:
Operating leases			4.5		%				4.5		%

Most of the Company’s lease contracts do not provide a readily determinable implicit rate. For these contracts, the Company’s estimated incremental borrowing rate is based on information available at the inception of the lease.

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Intangible assets were recorded in relation to the acquisition of TC on October 1, 2014.

The following tables summarize the gross carrying amounts and accumulated amortization of intangible assets by major class:
						March 31, 2021
						Gross						Accumulated Amortization						Net
						(thousands of dollars)
Customer relationships						$	16,852					$	(7,302)					$	9,550
Non-compete agreements						94						(94)						—
Licenses and permits						1,471						(734)						737
Developed technology						6,131						(3,985)						2,146
Total						$	24,548					$	(12,115)					$	12,433

						December 31, 2020
						Gross						Accumulated Amortization						Net
						(thousands of dollars)
Customer relationships						$	16,852					$	(7,022)					$	9,830
Non-compete agreements						94						(94)						—
Licenses and permits						1,471						(707)						764
Developed technology						6,131						(3,832)						2,299
Total						$	24,548					$	(11,655)					$	12,893

Amortization expense for intangible assets included in cost of sales was approximately $0.5 million and $0.5 million for the three months ended March 31, 2021 and 2020, respectively.

Based on identified intangible assets that are subject to amortization as of March 31, 2021, we expect future amortization expenses for each period to be as follows:

						Total						Remainder of 2021						2022						2023						2024						2025						2026						Thereafter
						(thousands of dollars)
Customer relationships						$	9,550					$	843					$	1,123					$	1,123					1,123						1,123						1,123						$	3,092
Licenses and permits						737						74						86						86						86						86						86						233
Developed technology						2,146						460						613						613						460						—						—						—
Total future amortization expense						$	12,433					$	1,377					$	1,822					$	1,822					$	1,669					$	1,209					$	1,209					$	3,325

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Senior Secured Credit Facilities

As of March 31, 2021, the Company had no outstanding borrowings under the senior secured revolving credit facility (the “Revolving Facility”) and approximately $45.0 million in borrowings outstanding under the senior secured term loan facility (the “Term Loan Facility”) (and, together with the Revolving Facility, the “Credit Facilities”), in each case, under the Company's amended and restated credit agreement (as amended, the “ARC Agreement”). In addition, the Company had approximately $53 million of availability under our Revolving Facility at March 31, 2021. TOCCO’s ability to make additional borrowings under the Revolving Facility at March 31, 2021 was limited by, and in the future may be limited by, the Company's obligation to maintain compliance with the covenants contained in the ARC Agreement (including maintenance of a maximum Consolidated Leverage Ratio and minimum Consolidated Fixed Charge Coverage Ratio (each as defined in the ARC Agreement)).

On May 3, 2021, TOCCO, SHR, GSPL and TC (SHR, GSPL and TC collectively, the "Guarantors") entered into an Eighth Amendment to Amended and Restated Credit Agreement (the “Eighth Amendment”) which amended the definition of Consolidated EBITDA for any Measurement Period (as defined in the ARC Agreement) (including any Measurement Period containing the quarter ended March 31, 2021) to allow for certain add backs not to exceed $5.0 million in the aggregate for the 2021 fiscal year related to charges, expenses and losses arising from or related to the prolonged period of sub-freezing temperatures and snow across the State of Texas and the region in February 2021 (the “Texas freeze event”).

For each fiscal quarter after December 31, 2019, TOCCO must maintain a maximum Consolidated Leverage Ratio of 3.50 to 1.00 (subject to temporary increase following certain acquisitions). TOCCO's Consolidated Leverage Ratio was 1.62 and 1.65 as of March 31, 2021 and December 31, 2020, respectively. Additionally, TOCCO must maintain a minimum Consolidated Fixed Charge Coverage Ratio as of the end of any fiscal quarter of 1.15 to 1.00. TOCCO's Consolidated Fixed Charge Coverage Ratio was 2.13 and 1.80 as of March 31, 2021 and December 31, 2020, respectively.

The maturity date for the ARC Agreement is July 31, 2023. As of March 31, 2021, the year to date effective interest rate for the Credit Facilities was 1.88%. The ARC Agreement contains a number of customary affirmative and negative covenants and the Company was in compliance with those covenants as of March 31, 2021.

For a summary of additional terms of the Credit Facilities, see NOTE 13, “LONG-TERM DEBT AND LONG-TERM OBLIGATIONS” to the consolidated financial statements set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2020.

PPP Loans

On May 6, 2020, SHR and TC (collectively, the “Borrowers”) received loan proceeds from loans (the “PPP Loans”) under the United States Small Business Administration Paycheck Protection Program in an aggregate principal amount of approximately $6.1 million. The PPP Loans are evidenced by unsecured promissory notes each payable to Bank of America, N.A. The Borrowers fully utilized the PPP Loans to cover payroll and benefits costs in accordance with the relevant terms and conditions of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The PPP Loans mature on May 6, 2022, and bear interest at a stated rate of 1.0% per annum. The Company is currently working on the forgiveness applications and expects to receive full forgiveness of the PPP Loans in accordance with the provisions of the CARES Act.

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Debt Issuance Costs

Debt issuance costs of approximately $0.9 million were incurred in connection with the fourth amendment to the ARC Agreement in July 2018. Unamortized debt issuance costs of approximately $0.4 million and $0.5 million for the periods ended March 31, 2021 and December 31, 2020, have been netted against outstanding loan balances.

Long-term debt and long-term obligations are summarized as follows:
			March 31, 2021						December 31, 2020
			(thousands of dollars)
Revolving Facility			$	—					$	—
Term Loan Facility			45,469						46,563
Loan fees			(423)						(468)
Total long-term debt			45,046						46,095
Less current portion including loan fees			4,194						4,194
Total long-term debt, less current portion including loan fees			$	40,852					$	41,901

Litigation

The Company is periodically named in legal actions arising from normal business activities. We evaluate the merits of these actions and, if we determine that an unfavorable outcome is probable and can be reasonably estimated, we will establish the necessary reserves. We are not currently involved in legal proceedings that could reasonably be expected to have a material adverse effect on our business, prospects, financial condition or results of operations. We may become involved in material legal proceedings in the future.

Supplier Agreements

In accordance with our supplier agreements, on a recurring monthly basis, the Company commits to purchasing a determined volume of feedstock in anticipation of upcoming requirements. Feedstock purchases are invoiced and recorded when they are delivered. As of March 31, 2021 and December 31, 2020, the value of the remaining undelivered feedstock approximated $14.2 million and $9.2 million, respectively.

From time to time, we may incur shortfall fees due to feedstock purchases being below the minimum amounts prescribed by our agreements with our suppliers. Shortfall fee expenses were approximately $0.4 million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively.

Environmental Remediation

Amounts charged to expense for various activities related to environmental monitoring, compliance, and improvements were approximately $0.3 million and $0.2 million for the three months ended March 31, 2021 and 2020, respectively.

The Stock Option Plan for Key Employees, as well as, the Non-Employee Director Stock Option Plan (hereinafter collectively referred to as the “Stock Option Plans”), were approved by the Company’s stockholders in July 2008. The Stock Option Plans allot for the issuance of up to 1,000,000 shares.

The Trecora Resources Stock and Incentive Plan (the “Plan”) was approved by the Company’s stockholders in June 2012. As amended, the Plan allots for the issuance of up to 2.5 million shares in the form of stock options or restricted stock unit awards.

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The Company recognized stock-based compensation expense of approximately $0.6 million and $0.4 million for the three months ended March 31, 2021 and 2020, respectively.

Stock Options and Warrant Awards

Stock options and warrants granted under the provisions of the Stock Option Plans permit the purchase of our common stock at exercise prices equal to the closing price of Company common stock on the date the options were granted. The options have terms of 10 years and generally vest ratably over terms of 4 to 5 years. There were no stock options or warrant awards issued during the three months ended March 31, 2021 or 2020, respectively.

A summary of the status of the Company’s stock option and warrant awards is as follows:

			Stock Options and Warrants						Weighted Average Exercise Price Per Share						Weighted Average Remaining Contractual Life						Intrinsic Value (in thousands)
Outstanding at January 1, 2020			487,000						10.87
Granted			—						—
Exercised			(20,000)						4.09
Forfeited			—						—
Outstanding at March 31, 2021			467,000						11.16						2.6						$	—
Expected to vest			—																		$	—
Exercisable at March 31, 2021			467,000						11.16						2.6						$	—

The aggregate intrinsic value of options was calculated as the difference between the exercise price of the underlying awards and the quoted price of our common stock. At March 31, 2021, options to purchase approximately 0.1 million shares of common stock were in-the-money.

Since no options were granted, the weighted average grant-date fair value per share of options granted during the three months ended March 31, 2021 and 2020, respectively, was zero.

The Company has no non-vested outstanding options as of March 31, 2021.

Restricted Stock Unit Awards

Generally, restricted stock unit awards are granted annually to officers and directors of the Company under the provisions of the Plan. Restricted stock units are also granted ad hoc to attract or retain key personnel, and the terms and conditions under which these restricted stock units vest vary by award. The fair market value of restricted stock units granted is equal to the Company’s closing stock price on the date of grant. Restricted stock units granted generally vest ratably over 3 years. Certain awards also include vesting provisions based on performance metrics measured over a 3 year period. Upon vesting, the restricted stock units are settled by issuing one share of Company common stock per unit.

A summary of the status of the Company's restricted stock units activity is as follows:
			Shares of Restricted Stock Units						Weighted Average Grant Date Price per Share
Outstanding at January 1, 2020			567,563						7.39
Granted			265,183						7.12
Forfeited			(74,280)						8.38
Vested			(80,318)						7.21
Outstanding at March 31, 2021			678,148						7.12
Expected to vest			678,148

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audit for the tax period ending December 31, 2017. We do not expect any material changes related to the federal or Texas audits. Our federal and Texas tax returns remain open for examination for the years 2016 through 2019. As of March 31, 2021 and December 31, 2020, respectively, we recognized no adjustments for uncertain tax positions or related interest and penalties.

The effective tax rate varies from the federal statutory rate of 21%, primarily as a result of state tax expense, stock based compensation, foreign taxes and a research and development credit for the three months ended March 31, 2021 and 2020. We continue to maintain a valuation allowance against certain deferred tax assets, specifically for mining claims for PEVM, where realization is not certain.

The CARES Act provided stimulus measures to companies impacted by the COVID-19 pandemic, which included the ability to defer payment for employer payroll taxes, utilize net operating loss (“NOL”) carrybacks, increased the limitation on the deductibility of interest expense, technical corrections to allow accelerated tax depreciation on qualified improvement property, as well as allowing qualified business to apply for loans and grants. We have filed carryback claims allowed under these provisions which are included in income tax receivable on the consolidated balance sheets.

In April 2021, we received approximately $2.5 million related to our second and final NOL carryback claims, including approximately $0.1 million of interest income.

We operate through business segments according to the nature and economic characteristics of our products as well as the manner in which the information is used internally by our key decision maker, who is our Chief Executive Officer. Segment data may include rounding differences.

Our Specialty Petrochemicals segment includes SHR and GSPL. Our Specialty Waxes segment is TC. We also separately identify our corporate overhead which includes administrative activities such as legal, accounting, consulting, investor relations, officer and director compensation, corporate insurance, and other administrative costs.

			Three Months Ended March 31, 2021
			Specialty Petrochemicals						Specialty Waxes						Corporate						Eliminations						Consolidated
			(in thousands)
Product sales			$	44,658					$	6,907					$	—					$	—					$	51,565
Processing fees			1,254						1,766						—						—						3,020
Total revenues			45,912						8,673						—						—						54,585
Operating income (loss) before depreciation and amortization			2,571						(481)						(3,023)						—						(933)
Operating loss			(231)						(1,957)						(3,025)						—						(5,213)
Loss from continuing operations before taxes			(297)						(1,954)						(3,154)						—						(5,405)
Depreciation and amortization			2,802						1,476						3						—						4,281
Capital expenditures			3,567						1,214						—						—						4,781

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March 31, 2021

Specialty Petrochemicals

Specialty Waxes

Corporate

Eliminations

Consolidated

(in thousands)