Quarterly report pursuant to Section 13 or 15(d)

Operating Segments

v3.20.2
Operating Segments
6 Months Ended
Jun. 30, 2020
Segment Reporting [Abstract]  
Operating Segments
Operating Segments
The Company determined its operating segments on the same basis that it assesses performance and makes operating decisions. The Company manages and measures the performance of its business in two distinct operating segments: Construction and Service. These segments are reflective of how the Company’s Chief Operating Decision Maker (“CODM”) reviews operating results for the purposes of allocating resources and assessing performance. The Company's CODM is comprised of its Chief Executive Officer, Chief Financial Officer and Chief Operating Officer.
The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The CODM evaluates performance based on income from operations of the respective segments after the allocation of Corporate office operating expenses. In accordance with ASC Topic 280 – Segment Reporting, the Company has elected to aggregate all of the construction branches into one Construction reportable segment and all of the service branches into one Service reportable segment. All transactions between segments are eliminated in consolidation. Our Corporate department provides general and administrative support services to our two operating segments. The CODM allocates costs between segments for selling, general and administrative expenses and depreciation expense.
All of the Company’s identifiable assets are located in the United States, which is where the Company is domiciled. The Company does not have sales outside the United States. The Company does not identify capital expenditures and total assets by segment in its internal financial reports due in part to the shared use of a centralized fleet of vehicles and specialized equipment. Interest expense is not allocated to segments because of the corporate management of debt service including interest.
Condensed consolidated segment information for the periods presented is as follows:
 
Three months ended June 30,
 
2020
 
2019
(in thousands)
 
 
(As Recast)

Statement of Operations Data:
 

 
 

Revenue:
 

 
 

Construction
$
105,937

 
$
104,759

Service
29,248

 
27,844

Total revenue
135,185

 
132,603

 
 
 
 
Gross profit:
 
 
 
Construction
12,213

 
10,683

Service
8,122

 
7,012

Total gross profit
20,335

 
17,695

 
 
 
 
Selling, general and administrative expenses:(1)
 
 
 
Construction
8,024

 
11,229

Service
5,588

 
5,335

Corporate
140

 
515

Total selling, general and administrative expenses
13,752

 
17,079

Amortization of intangibles
274

 
175

Operating income
$
6,309

 
$
441

 
 
 
 
Operating income for reportable segments
$
6,309

 
$
441

Less unallocated amounts:
 
 
 
Interest expense, net
(2,137
)
 
(1,597
)
Gain (loss) on sale of property and equipment
(13
)
 
9

Loss on debt extinguishment

 
(513
)
Gain on change in fair value of warrant liability
(102
)
 
(103
)
Total unallocated amounts
(2,252
)
 
(2,204
)
Total consolidated income (loss) before income taxes
$
4,057

 
$
(1,763
)
 
 
 
 
Other Data:
 
 
 
Depreciation and amortization:
 
 
 
Construction
$
1,032

 
$
1,003

Service
330

 
282

Corporate
274

 
175

Total other data
$
1,636

 
$
1,460


 
Six months ended June 30,

 
 
2020
 
2019
(in thousands)
 
 
(As Recast)

Statement of Operations Data:
 

 
 

Revenue:
 

 
 

Construction
$
215,423

 
$
209,219

Service
58,534

 
57,131

Total revenue
273,957

 
266,350

 
 
 
 
Gross profit:
 
 
 
Construction
23,195

 
23,599

Service
15,364

 
13,720

Total gross profit
38,559

 
37,319

 
 
 
 
Selling, general and administrative expenses:(1)
 
 
 
Construction
18,200

 
21,681

Service
11,917

 
10,561

Corporate
435

 
882

Total selling, general and administrative expenses
30,552

 
33,124

Amortization of intangibles
417

 
350

Operating income
$
7,590

 
$
3,845

 
 
 
 
Operating income for reportable segments
$
7,590

 
$
3,845

Less unallocated amounts:
 
 
 
Interest expense, net
(4,295
)
 
(2,430
)
Gain on sale of property and equipment
17

 
21

Loss on debt extinguishment

 
(513
)
Gain on change in fair value of warrant liability
59

 
(103
)
Total unallocated amounts
(4,219
)
 
(3,025
)
Total consolidated income (loss) before income taxes
$
3,371

 
$
820

 
 
 
 
Other Data:
 
 
 
Depreciation and amortization:
 
 
 
Construction
$
2,062

 
$
1,976

Service
661

 
547

Corporate
417

 
350

Total other data
$
3,140

 
$
2,873


(1)
Starting January 1, 2020, we changed the methodology in which we present our corporate selling, general and administrative expenses to our CODM to better reflect the way the business is managed. Under this new methodology, all corporate expenses except for stock-based compensation are allocated to our Construction and Service segments. For comparability purposes, we reclassified our selling, general and administrative expense segment amounts for the three and six months ended June 30, 2019 to align with this updated allocation methodology.