We are a global leader in infrastructure protection and maintenance, providing
proprietary technologies and services to: (i) protect against the corrosion
of industrial pipelines; (ii) rehabilitate and strengthen water, wastewater,
energy and mining piping systems and buildings, bridges, tunnels and waterfront
structures; and (iii) utilize integrated professional services in engineering,
procurement, construction, maintenance, and turnaround services for a broad
range of energy related industries. Our business activities include manufacturing,
distribution, maintenance, construction, installation, coating and insulation,
cathodic protection, research and development and licensing. Our 2013 acquisition
of Brinderson, L.P. and related entities (“Brinderson”) opened new
markets for us through the maintenance, engineering and construction services
for downstream and upstream facilities in the North American oil and gas market.
Our products and services are currently utilized and performed in more than
80 countries across six continents. We believe that the depth and breadth of
our products and services platform make us a leading “one-stop”
provider for the world’s infrastructure rehabilitation and protection
needs.
Our Company is primarily built on the premise that it is possible to use technology
to extend the structural design life and maintain, if not improve, the performance
of infrastructure, mostly pipe. We are proving that this expertise can be applied
in a variety of markets to protect pipelines in oil, gas, mining, wastewater
and water applications and extending this to the rehabilitation and maintenance
of commercial structures and the provision of professional services in energy-related
industries. Many types of infrastructure must be protected from the corrosive
and abrasive materials that pass through or near them. Our expertise in non-disruptive
corrosion engineering and abrasion protection is now wide-ranging, opening new
markets for growth. We have a long history of product development and intellectual
property management. We manufacture most of the engineered solutions we create
as well as the specialized equipment required to install them. Finally, decades
of experience give us an advantage in understanding municipal, energy, mining,
industrial and commercial customers. Strong customer relationships and brand
recognition allow us to support the expansion of existing and innovative technologies
into new high growth end markets.
We originally incorporated in Delaware in 1980 to act as the exclusive United
States licensee of the Insituform® cured-in-place pipe (“CIPP”)
process, which Insituform’s founder invented in 1971. The Insituform®
CIPP process served as the first trenchless technology for rehabilitating sewer
pipelines and has enabled municipalities and private industry to avoid the extraordinary
expense and extreme disruption that can result from conventional “dig-and-replace”
methods. For the past 40 years we have maintained our leadership position in
the CIPP market from manufacturing to technological innovations and market share.
In order to strengthen our ability to service the emerging demands of the infrastructure
protection market and to better position our Company for sustainable growth,
we embarked on a diversification strategy in 2009 to expand our product and
service portfolio and our geographical reach. Through a series of strategic
initiatives and key acquisitions, we now possess a broad portfolio of cost-effective
solutions for rehabilitating and maintaining aging or deteriorating infrastructure,
protecting new infrastructure from corrosion worldwide and providing integrated
professional services in engineering, procurement, construction, maintenance,
and turnaround services for upstream and downstream oil companies.
Recognizing that the breadth of our offerings expanded beyond our flagship Insituform®
brand, which constituted less than half of our revenue in 2011, we reorganized
Insituform Technologies, Inc. (“Insituform”), our parent company
at the time, into a new holding company structure in October 2011. Aegion became
the new parent company and Insituform became a wholly owned subsidiary of Aegion.
Aegion reflects our mission of extending our leadership capabilities to furnish
products and services to provide long-term protection for water and wastewater
pipes, oil and gas pipelines and infrastructure as well as commercial and governmental
structures and transportation infrastructure.
On October 6, 2014, our board of directors approved a realignment and restructuring
plan (the “2014 Restructuring Plan”) which is intended to exit low-return
businesses and reduce the size and cost of our overhead structure to improve
gross margins and profitability in the long term (see Note 3 to the consolidated
financial statements contained in this report).
We regularly review and evaluate our operating segments, which are the same
as our reportable segments. During the fourth quarter of 2014, as part of our
2014 Restructuring Plan, we realigned our reportable and operating segments
to be better aligned with our end markets by: (i) combining our former Water
and Wastewater and Commercial and Structural businesses to form the Infrastructure
Solutions segment; (ii) forming the Energy Services segment, which currently
consists solely of our Brinderson operations; and (iii) creating the Corrosion
Protection segment with the remaining businesses from our previous Energy and
Mining segment. Each segment is led by a unique leadership team, which has an
operating president who reports to the chief operating decision manager (“CODM”).
The operating results and financial information reported by each of the new
segments are evaluated separately, regularly reviewed and used by the CODM to
evaluate segment performance, allocate resources and determine management incentive
compensation. The realignment did not change the composition of our reporting
units for goodwill impairment testing purposes. The current and all future SEC
filings will reflect these new reportable segments, unless and until such time
as there is a subsequent change in our reportable segments.
Our long-term strategy consists of:
Infrastructure Solutions – Aging urban infrastructure will require increasing
rehabilitation and maintenance over the long term. While the pace of growth
is often based on government funding, the market need results in a long term
stable growth opportunity for Aegion and its market leading brands, Fyfe and
Insituform. We will optimize our municipal rehabilitation and commercial infrastructure
operations by: (i) focusing on operational excellence; (ii) utilizing business
development personnel to identify the need for new products and technologies
across the platform; (iii) adding new, innovative technologies and services
through licensing or selective acquisitions; (iv) enhancing returns through
backward integrating into product manufacturing; and (v) addressing the need
in international markets with alternative business models, including licensing
and tube sales.
Corrosion Protection – Investment in North America’s pipeline infrastructure
is required to transport non-conventional oil and gas fields, like the oil sands,
the Gulf of Mexico deep-water reserves and the oil and gas shale reserves, to
end markets in a safe and environmentally correct manner. Corrosion Protection
has a unique portfolio of technologies to address the requirement for many of
the aspects of pipeline protection including cathodic protection, linings and
coatings. The business development effort provides solutions to customers to
enhance the safety, environmental integrity and reliability of our customers’
pipelines in the oil and gas market. We license or acquire new technologies
based on the needs of our customers, those of which would benefit from our market-leading
presence and distribution channel.
Energy Services – With the continued development of conventional oil and
gas reserves, North America will have competitive prices for refinery and petrochemical
feedstocks. Energy Services has a unique value proposition based on its world
class safety and labor productivity program that results in cost effective maintenance
services at our customers’ refineries and petrochemical facilities. Our
market position is expanded through organic growth, targeted acquisitions or
alliances to bring additional product or service offerings to current customers,
broaden our geographic footprint to additional markets, and increased penetration
in end-markets such as petro-chemical and natural gas.
Today our diverse portfolio of full service solutions includes:
Rehabilitation of Water and Wastewater Pipelines: Through our Insituform®
family of companies, we offer the manufacture and installation of cost-effective
solutions to remediate operational, health, regulatory and environmental problems
resulting from aging and defective water and wastewater pipelines. Our Insituform®
CIPP product is a trenchless, jointless, seamless pipe-within-a-pipe solution
to rehabilitate pipes in various diameters. Our Insituform® CIPP process
provides a more affordable alternative to dig-and-replace methods and is a less
disruptive and more environmentally friendly method for pipe repairs. As mentioned
above, we have maintained our leadership position in the CIPP market through
our ISO 9001:2008 certified manufacturing to technological innovations and market
share for the past 40 years. Our Insituform® portfolio of products and services
are utilized worldwide.
Fiber Reinforced Polymer Systems for Rehabilitation and Strengthening: Through
our subsidiaries, Fyfe Co. LLC, Fibrwrap Construction Services, Inc. and other
affiliated companies, we offer the manufacture and installation of fiber reinforced
polymer ("FRP") systems for strengthening, repair and restoration
of masonry, concrete, steel and wooden infrastructures applicable worldwide.
Our infrastructure markets include large diameter pipelines, buildings, bridges,
tunnels, industrial developments and waterfront structures, of which the pipeline
market currently makes up the largest share. One of the key features of the
Tyfo Fibrwrap® technology is its capability to withstand seismic and force
loads, providing a unique advantage over conventional rehabilitation methods.
Fibrwrap® systems consist of the proprietary (or patented) and specialized
Tyfo® carbon, glass, aramid and hybrid lightweight and low profile woven
fabrics combined with the proprietary Tyfo® resin and epoxy polymers which,
in unique combination, create the tested, proven and certified Fibrwrap®
advanced composite systems. Fibrwrap® systems are specifically engineered,
manufactured and installed to solve a host of structural deficiencies or demands
in existing structures. We offer personalized technical support to our customers
through a highly trained structural engineering team that assists in all phases
of a potential project, from the initial design to implementation and installation.
While the majority of our Fibrwrap business is in North America, where we believe
there is a growing addressable market, there is a growing acceptance of our
products and services internationally, specifically in the Asia-Pacific region.
Cathodic Protection for Corrosion Engineering Control and Infrastructure Rehabilitation:
Through our subsidiary, Corrpro Companies, Inc. and its affiliated companies
(“Corrpro”), we offer corrosion protection solutions, most notably
through cathodic protection, a time tested pipeline corrosion mitigation technology
that is mandated by regulatory rules in many types of pipeline systems. We provide
engineering and inspection services by National Association of Corrosion Engineers
International (NACE) trained and certified inspectors (one of the largest independent
consulting corrosion engineering organizations in the world), project management,
training, research, testing and design, consultation and installation services
to the following markets: pipeline, refinery, above and underground storage
tanks, water/wastewater structures, concrete infrastructure and offshore and
marine structures. Corrpro also offers a full line of superior quality corrosion
control and cathodic protection materials, which are ANSI/NSF 61 classified
for drinking water system components. Through our acquisition of Hockway Middle
East FZE in 2011, formation of a joint venture in Saudi Arabia in 2011 and formation
of a branch office in Abu Dhabi in 2014, we have expanded our cathodic protection
capabilities in the Middle East. Hockway offers a complete cathodic protection
package from initial investigative survey through engineering design, manufacture
of equipment, site installation and commissioning of systems with subsequent
planned operational inspection and maintenance.
Pipe Coatings for Corrosion Control and Prevention: Through our subsidiary,
The Bayou Companies, LLC and its related entities (“Bayou”), we
provide products and services to protect pipes primarily for the oil and gas
industries from corrosion and to provide flow assurance. We accomplish this
through external and internal coatings utilizing fusion bonded epoxy (“FBE”),
concrete for buoyancy reduction, extruded polyethylene for additional protection,
insulation coating for thermal control and field joint coating for corrosion
protection of fittings, valves and other primary sources for metal corrosion.
Bayou also provides custom coating services on pipe bends, fittings, fabricated
spools, valves and short runs of straight pipe for oil, gas and potable water
services, as well as onshore or offshore fabrication and welding services. We
also offer a proprietary robotic pipe coating and inspection technology for
internal and external welded pipe field joints and rebar coating through our
subsidiary CRTS, Inc. (“CRTS”) and CCSI, Inc. (“CCSI”).
Our cathodic protection and coatings products are applicable worldwide, with
a focus on the Gulf of Mexico, the Canada Oil Sands, North America shale plays,
the Middle East and Asia Pacific.
HDPE Pipe Lining for Corrosion Control, Abrasion Protection and Pipeline Rehabilitation:
Through our subsidiary United Pipeline Systems, Inc. and its affiliated companies
(“United Pipeline Systems”), we provide polyethylene pipe lining
solutions to the oil and gas, mining and chemical industrial pipeline markets.
United Pipeline Systems proprietary high-density polyethylene (“HDPE”)
Tite Liner® installation system provides chemical, corrosion and erosion
resistance for numerous pipeline applications. Our HDPE system can rehabilitate
pipelines for a fraction of the cost and time associated with industrial pipeline
replacement and has application in the rehabilitation of pressure pipes in the
municipal marketplace. We offer our HDPE lining protection products and services
worldwide, with a strategic focus of expanding our presence in key end markets
with sustainable capital spend on oil, gas and mining activities.
Construction and Maintenance of Upstream and Downstream Facilities: Through
Brinderson we are a leading integrated service provider of maintenance, construction,
engineering and turnaround activities for the upstream and downstream oil and
gas markets. Primarily focused on serving large oil and gas customers in California,
Brinderson’s competitive advantages include its industry-leading safety
record, a strong reputation for reliability and quality and comprehensive solutions
needed for major refinery maintenance, repairs and retrofits. These core competencies
position Brinderson to meet the growing demand for non-discretionary operating
and maintenance expenditures.