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.