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Description of the Business and Basis of Presentation
12 Months Ended
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of the Business and Basis of Presentation

1. DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION

Description of the Business—Montrose Environmental Group, Inc. (“Montrose” or the “Company”) is a corporation formed on November 2013, under the laws of the State of Delaware. The Company has approximately 115 offices across the United States, Canada, Australia and Europe and approximately 3,100 employees as of December 31, 2023.

Montrose is an environmental services company serving the recurring environmental needs of a diverse client base, including Fortune 500 companies and federal, state and local governments through the following three segments:

Assessment, Permitting and Response—Through its Assessment, Permitting and Response segment, Montrose primarily provides scientific advisory and consulting services to support environmental assessments, environmental emergency response, and environmental audits and permits for current operations, facility upgrades, new projects, decommissioning projects and development projects. The Company’s technical advisory and consulting offerings include regulatory compliance support and planning, environmental, ecosystem and toxicological assessments and support during responses to environmental disruption. Montrose helps clients navigate regulations at the local, state, provincial and federal levels.

Measurement and Analysis—Through its Measurement and Analysis segment, Montrose’s teams test and analyze air, water and soil to determine concentrations of contaminants, as well as the toxicological impact of contaminants on flora, fauna and human health. Montrose’s offerings include source and ambient air testing and monitoring, leak detection and repair and advanced analytical laboratory services such as air, storm water, wastewater and drinking water analysis.

Remediation and Reuse—Through its Remediation and Reuse segment, Montrose provides clients with engineering, design, and implementation services, primarily to treat contaminated water, remove contaminants from soil or create biogas from waste. The Company does not own the properties or facilities at which it implements these projects or the underlying liabilities, nor does it own material amounts of the equipment used in projects; instead, the Company assists clients in designing solutions, managing projects and mitigating their environmental risks and liabilities at their locations.

Follow-on Offering—On October 1, 2021, the Company completed a follow-on offering of common stock, in which it sold 2,875,000 shares, including 375,000 shares issued pursuant to the underwriters full exercise on October 5, 2021 of the underwriters’ option to purchase additional shares, at a price to the public of $62.00 per share, resulting in net proceeds to the Company of approximately $169.8 million after deducting underwriting discounts of $8.5 million. Additionally, the Company offset $0.6 million of deferred follow-on offering costs against follow-on proceeds recorded to additional paid in capital. These deferred follow-on offering costs were directly attributable to the follow-on offering in accordance with Staff Accounting Bulletin Topic 5: Miscellaneous Accounting.

Basis of Presentation—The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Intercompany balances and transactions are eliminated.

Reclassifications—Certain reclassifications have been made to prior period amounts in the audited consolidated financial statements to conform to the current period presentation. For the year ended December 31, 2022 and 2021, proprietary software development and other software costs, as well as proceeds from the sale of property and equipment were presented within purchases of property and equipment in the statements of cash flows. As of December 31, 2023, these amounts were reclassified to the proprietary software development and other software costs and proceeds from the sale of property and equipment financial statement line items within the statements of cash flow. These reclassifications did not have a material impact on previously reported amounts.