UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

x	Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the fiscal year ended December 31, 2018

or

¨	Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from to

Commission file number: 1-7525

The Goldfield Corporation

(Exact name of registrant as specified in its charter)

Delaware	88-0031580
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1684 W. Hibiscus Boulevard

Melbourne, Florida 32901

(Address of principal executive offices, including zip code)

(321) 724-1700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock	NYSE AMERICAN
par value $0.10 per share

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No   x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:    Yes  x   No  ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x   No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨	Smaller reporting company	x
		Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was approximately $98.6 million as of June 29, 2018 (the last business day of the registrant’s most recently completed second fiscal quarter), computed by reference to the price at which such common equity was last sold on such date.

The number of shares of the registrant’s common stock, $0.10 par value per share, outstanding as of March 7, 2019 was 24,522,534.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of The Goldfield Corporation’s definitive proxy statement for its 2019 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of the year covered by this Form 10-K Report are incorporated by reference into Part III of this report.

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

ANNUAL REPORT ON FORM 10-K

FOR THE YEAR ENDED DECEMBER 31, 2018

TABLE OF CONTENTS

	Page
PART I	1
Item 1. Business.	1
Item 1A. Risk Factors.	4
Item 1B. Unresolved Staff Comments.	13
Item 2. Properties.	13
Item 3. Legal Proceedings.	14
Item 4. Mine Safety Disclosures.	14
PART II	14
Item  5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.	14
Item 6. Selected Financial Data.	15
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.	16
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.	25
Item 8. Financial Statements and Supplementary Data.	26
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.	48
Item 9A. Controls and Procedures.	48
Item 9B. Other Information.	50
PART III	50
Item 10. Directors, Executive Officers and Corporate Governance.	50
Item 11. Executive Compensation.	50
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.	51
Item 13. Certain Relationships and Related Transactions, and Director Independence.	51
Item 14. Principal Accounting Fees and Services.	51
PART IV	51
Item 15. Exhibits, Financial Statement Schedules.	51
Item 16. Form 10-K Summary.	54
SIGNATURES	55

PART I

Item 1.    Business.

General

The Goldfield Corporation, incorporated in Wyoming in 1906 and subsequently reincorporated in Delaware in 1968, is engaged in both the construction of electrical infrastructure for the utility industry and industrial customers and to a considerably lesser extent real estate development. Real estate development represented 1% of our total revenue in 2018. The principal market for the electrical construction operation is primarily in the Southeast, mid-Atlantic and Texas-Southwest regions of the United States. The primary focus of the real estate operations is on the development of residential properties on the east coast of Central Florida. Unless the context otherwise requires, the terms “Goldfield,” the “Company,” “we,” “our” and “us” as used herein mean The Goldfield Corporation and its consolidated subsidiaries.

Our Internet website address is www.goldfieldcorp.com. Within the “Investor Relations” section, under the “Investors” tab of our website, we make available, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the U.S. Securities and Exchange Commission (“SEC”). The information on our website is not incorporated by reference into this Annual Report on Form 10-K. You may also access our reports, proxy statement, and other information regarding us at the SEC’s website at www.sec.gov. You may also read and copy any document we file with the SEC at the SEC’s public reference facilities located at 100 F Street, NE, Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference facilities.

Financial Information About Geographic Areas

During the years ended December 31, 2018 and 2017, our operations were exclusively in the United States.

Employees

As of March 3, 2019, we had a total of 487 employees, which included 480 full-time and seven part-time employees. These employees included 108 unionized employees at our subsidiary, C and C Power Line, Inc. (“C&C”). The total number of employees includes 427 hourly-rate employees. The number of hourly-rate employees fluctuates depending upon the number and size of projects under construction at any particular time. We believe that our relationship with our employees is good.

Electrical Construction Operations

Through our subsidiaries, Power Corporation of America (“PCA”), Southeast Power Corporation (“Southeast Power”), C&C and Precision Foundations, Inc. (“PFI”) we are engaged in the construction of electrical infrastructure for the utility industry and industrial customers. Southeast Power, C&C and PFI operate under PCA, headquartered in Port Orange, Florida. Southeast Power is headquartered in Titusville, Florida, and has additional offices in Bastrop, Texas and Spartanburg, South Carolina. C&C, headquartered in Jacksonville, Florida, is a full-service electrical contractor that provides similar services as Southeast Power with a unionized work force. PFI, headquartered in Port Orange, Florida, constructs drilled pier foundations and installs concrete poles, direct embeds and vibratory casings.

Our electrical construction business includes the construction of transmission lines, distribution systems, substations, drilled pier foundations and other electrical services.

Representative customers include:

Santee Cooper (South Carolina Public Service Authority)	Central Electric Power Cooperative, Inc.
Florida Power & Light Company	Duke Energy Corporation
CPS Energy	Orlando Utilities Commission
Lower Colorado River Authority	Union Power Cooperative
Oncor Electric Delivery Company LLC	Dominion Energy

Historically, a significant portion of our revenue has come from several different customers each year. Our largest customers may change from year to year. For the year ended December 31, 2018, our top three customers accounted for approximately 57.2% of our consolidated revenue. Since the contribution of a customer may vary from year to year, we cannot predict the future effect of the loss of any given customer.

It is our policy to commit ourselves only to the amount of work we believe we can properly supervise, equip and complete to the customer’s satisfaction and timetable. As a result of this policy and the magnitude of some of the construction projects

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undertaken by us, a substantial portion of our annual revenue is derived from a relatively small number of customers. See note 11 to the consolidated financial statements for detail on sales to major customers that exceed 10% of total sales.

Construction is customarily performed pursuant to plans and specifications of customers. We generally supply the management, labor, equipment and tools, while customers generally supply most of the required materials, however we generally supply most of the required materials for the construction of concrete foundations. We are not presently experiencing, nor do we anticipate experiencing, any difficulties in procuring an adequate supply of materials.

Revenue and results of operations in our electrical construction business can be subject to seasonal variations. These variations are influenced by weather, customer spending patterns and system loads. Project duration varies based on project type, complexity, applicable environmental regulations and customer requirements.

We enter into contracts on the basis of either competitive bidding, direct negotiations or pursuant to master service agreements (“MSAs”). Competitively bid contracts and MSAs account for a majority of our electrical construction revenue. Although there is considerable variation in the terms of the contracts undertaken, such contracts are typically lump sum (fixed-price) contracts, time plus equipment contracts, or unit price contracts. Most of our contracts do not require our clients to purchase a minimum amount of services, and some of our contracts are cancelable on short notice.

In certain circumstances, we are required to provide performance and payment bonds issued by a surety to secure our contractual commitments. These bonds provide a guarantee to the customer that we will perform under the terms of a contract and that we will pay subcontractors and vendors. If we fail to perform under a contract or to pay subcontractors and vendors, the customer may demand the surety to make payments or provide services under the bond. No bond issued for us has ever been called by a customer. Under current circumstances we believe that we will not need to fund any claims written by our surety in the foreseeable future. At present, we have adequate bonding availability for our operations. As of December 31, 2018, outstanding performance bonds issued on behalf of our electrical construction subsidiaries amounted to $46.4 million.

Contracts may include retention provisions. From 5% to 10% is withheld by the customer from progress payments as retainage until the contract work has been completed and approved.

Backlog

Our backlog represents future services to be performed under existing project-specific fixed-price and maintenance contracts and the estimated value of future services that we expect to provide under our existing MSAs.

The following table presents our total backlog as of December 31, 2018 and 2017 along with an estimate of the backlog amounts expected to be realized within 12 months and during the life of each of the MSAs. When awarded, our MSA initial terms range from one to seven years. Most of the MSAs have remaining renewals ranging from one to three years at the option of the customer. The calculation assumes exercise of the renewal options by the customer. Revenue from assumed exercise of renewal options represents $45.8 million (26.9%) of our total estimated MSA backlog as of December 31, 2018.

	Backlog as of				Backlog as of
	December 31, 2018				December 31, 2017
Electrical Construction Operations	12-Month		Total		12-Month		Total
Project-Specific Firm Contracts (1)	$	44,373,384	$	44,373,384	$	27,110,793	$	27,110,793
Estimated MSAs	57,464,231		170,097,919		83,124,471		187,047,802
Total	$	101,837,615	$	214,471,303	$	110,235,264	$	214,158,595
_________________________
(1)Amount includes firm contract awards under MSA agreements.

Our total backlog as of December 31, 2018, increased$313,000, or 0.1%, to $214.5 million, compared to $214.2 million as of December 31, 2017. The increase in total backlog is primarily due to the increase in MSA firm projects, which includes the addition of four new MSA customers for 2018, offset by existing MSA backlog run-off and adjustments to existing MSA backlog estimates.

Our 12-month backlog as of December 31, 2018, decreased$8.4 million, or 7.6%, to $101.8 million, mainly due to MSA backlog run-off and adjustments to existing MSA backlog estimates.

Of our total backlog as of December 31, 2018, we expect approximately $101.8 million, or 47.5%, to be completed during 2019.

Backlog is estimated at a particular point in time and is not determinative of total revenue in any particular period. It does not reflect future revenue from a significant number of short-term projects undertaken and completed between the estimated dates. Our electrical construction revenue in 2018 exceeded our 12-month backlog as of December 31, 2017 by 23.9%.

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The estimated amount of backlog for work under MSAs is calculated by using recurring historical trends inherent in current MSAs and projected customer needs based upon ongoing communications with the customer. Our estimated backlog also assumes exercise of existing customer renewal options. Certain MSAs are not exclusive to the Company and, therefore, the size and amount of projects we may be awarded cannot be determined with certainty. Accordingly, the amount of future revenue from MSA contracts may vary substantially from reported backlog. Even if we realize all of the revenue from the projects in our backlog, there is no guarantee of profit from the projects awarded under MSAs.

As of December 31, 2018 and 2017, MSAs accounted for approximately 79.3% and 87.3% of total backlog, respectively. We plan to continue our efforts to grow MSA business. MSA contracts are generally multi-year and should provide improved operating efficiencies.

Backlog is not a term recognized under U.S. generally accepted accounting principles, but is a common measurement used in our industry. While we believe that our methodology of calculation is appropriate, such methodology may not be comparable to that employed by other companies. Given the duration of our contracts and MSAs and our method of calculating backlog, our backlog at any point in time may not accurately represent the revenue that we expect to realize during any period, and our backlog as of the end of the year may not be indicative of the revenue we expect to earn in the following year and should not be viewed or relied upon as a stand-alone indicator. Consequently, we cannot provide assurance as to our customers’ requirements or our estimates of backlog.

Reconciliation of Backlog to our Remaining Unsatisfied Performance Obligation

The following table presents a reconciliation of our total backlog as of December 31, 2018 to our remaining unsatisfied performance obligation as defined under U.S. generally accepted accounting principles:

	December 31, 2018
Total Backlog	$	214,471,303
Estimated MSAs	(170,097,919		)
Estimated Firm(1)	(7,933,373		)
Total Unsatisfied Performance Obligation	$	36,440,011
_________________________
(1) Projects awarded, however backlog contract value was estimated as of December 31, 2018.

The amount of total backlog differs from the amount of our remaining unsatisfied performance obligation as of December 31, 2018 and as described in note 14 to the consolidated financial statements, primarily due to the inclusion of estimates of future revenue under MSA and other service agreements within our backlog estimates, as described above.

Revenue estimates included in our backlog may be subject to change as a result of project accelerations, additions, cancellations or delays due to various factors, including but not limited to: commercial issues, material deficiencies, permitting, regulatory requirements and adverse weather. Our customers are not contractually committed to a specific level of services under our MSAs (other than project-specific firm contracts under MSAs). While we did not experience any material cancellations during the current period, most of our contracts may be terminated, even if we are not in default under the contract.

For further information regarding the factors that affect the realizability of profits from our business backlog, please refer to the information set forth in “Item 1A. Risk Factors.”

Competition and Regulation

The electrical construction business is highly competitive. We compete with other independent contractors, including larger regional and national firms that may have financial, operational, technical and marketing resources that exceed our own. Competitive factors include: level of technical expertise and experience, industry reputation, quality of work, price, geographic presence, dependability, availability of skilled personnel, worker safety and financial stability. Our management believes that we compete favorably with our competitors on the basis of these factors. There can be no assurance that our competitors will not develop the expertise, experience and resources to provide services that are superior in both price and quality to our services, or that we will be able to maintain or enhance our competitive position.

We are subject to various federal, state and local statutes and rules regarding, among other things, contractor licensing, electrical codes, worker safety and environmental protection. We believe that we are in substantial compliance with all applicable regulatory requirements.

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Properties

The Company and its subsidiaries operate with owned or leased offices and facilities located in Florida, South Carolina and Texas. Individually, none of the properties are financially significant to the Company. We believe that such properties are currently in good condition and properly maintained. See note 8 to the consolidated financial statements for additional detail on properties.

Real Estate Development

Through our subsidiary Bayswater Development Corporation and its various subsidiaries (“Bayswater”) we are engaged in the acquisition, development, management and disposition of land and improved properties. The primary focus of our real estate operations has been the development of residential properties along the east coast of Central Florida.

When we use either of the terms “homes” or “units,” we mean our residential properties, which include detached single-family homes, townhomes and condominiums. References to our homebuilding revenues and similar references refer to revenues derived from the sales of our residential properties, in each case unless otherwise expressly stated or the context otherwise requires.

Our customers generally are pre-retirement, retirement or second home buyers seeking higher quality, low maintenance residences.

We generally purchase land and pay for architectural, engineering and various other costs with cash reserves. Construction costs are generally paid with cash reserves or in some cases financed, as specified in note 7 to the consolidated financial statements.

We acquire land for development only after feasibility and environmental testing has been performed. Architectural, engineering, structural and other plans for the projects are outsourced. In an effort to limit risk on condominium projects, our policy is to obtain a substantial number of contracts for purchase prior to commencing construction, backed by customers’ non-refundable earnest money deposits which are generally 20% of the purchase price. We do not offer financing arrangements to purchasers of our homes. As of December 31, 2018, we had two projects with a total of twenty units under construction in Brevard County, Florida. One project consists of an ocean front five-story building containing fourteen luxury ocean-view condominium units, of which thirteen units were under contract as of December 31, 2018. The second project consists of a six-unit townhome complex with three and four bedroom townhome units, of which three units were under contract as of December 31, 2018. Both projects are expected be completed during 2019.

As of December 31, 2018, we owned nine vacant parcels of land, eight of which are for future development projects and one is for sale.

Our historical financial performance in real estate construction is not necessarily a meaningful indicator of future results and, in particular, we expect financial results to vary from project to project and from quarter-to-quarter. Our revenue may therefore fluctuate significantly on a quarterly basis, and we believe that quarter-to-quarter comparisons of our results should not be relied upon as an indication of future performance.

The real estate industry is highly competitive and fragmented. The Company competes with other real estate developers on the basis of a number of interrelated factors, including: quality, location, design, perceived value, price and reputation in the marketplace. We believe that we have certain competitive advantages including desirable locations, attractive designs and higher quality features not generally offered by other developers in the markets in which we compete.

We are subject to federal, state and local statutes, ordinances, rules and regulations regarding, among other things, zoning, building permits, environmental standards, building moratoriums and building codes. Permits and approvals mandated by regulation for development of any magnitude are often numerous, significantly time-consuming and onerous to obtain, and not guaranteed. We believe that our real estate operations are in substantial compliance with all applicable regulations.

The real estate division administrative offices are located within the Company’s corporate offices in Melbourne, Florida.

Item 1A.    Risk Factors.

Our business involves various risks associated with the operations of our Company. To provide a framework to understand our operating environment, we are providing a brief explanation of the significant risks associated with our business. Although we have tried to identify and discuss key risk factors, others could emerge in the future. Each of the following risks could affect our performance.

We derive a significant portion of our revenue from a small group of customers. The loss of one or more of these customers could negatively impact our revenue and results of operations.

Our electrical construction customer base is highly concentrated. For the year ended December 31, 2018, our top three customers accounted for approximately 57.2% of our consolidated revenue, as discussed in note 11 to our consolidated

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financial statements herein. Our revenue could materially decline if one or more of our significant customers terminated our business relationship. Revenue under our contracts with significant customers may vary substantially from period-to-period. Reduced demand for our services or the loss of one or more of these customers, if not replaced by other business, would result in a decrease in revenue and profits, and could have a material impact on our results of operations.

The electrical construction industry is highly competitive.

The electrical construction business is highly competitive. We compete with other independent contractors, including larger regional and national firms that may have financial, operational, technical and marketing resources that exceed our own. We also face competition from existing and prospective customers establishing or augmenting in-house service and organizations that employ personnel who perform some of the same types of services as those provided by us. Some of our competitors may have lower cost structures and may, therefore, be able to provide their services at lower rates than we can provide. Many of our current and potential competitors, especially our competitors with national scope, also may have significantly greater financial, technical and marketing resources than we do. If we fail to compete favorably with new or existing competitors, our results of operations and financial condition could be adversely affected.

Our business is affected by the spending patterns of our customers, exposing us to variable quarterly results.

Our revenues are primarily driven by the spending patterns of our customers, which can vary significantly from period-to-period, as well as seasonal variations. These variations are influenced by available system outages, bidding seasons, customers’ budgetary constraints, holidays, weather and hours of daylight, which can have a significant impact on our gross margins.

An adverse change in economic conditions in the electric utility industry might reduce the demand for our services.

Because a substantial portion of our electrical construction work is performed for customers in the electric utility industry, an adverse change in economic conditions in the electric utility industry could impair the financial condition of many of our customers, which may cause them to reduce their capital expenditures and demand for our services.

Skilled labor shortages and increased labor costs may negatively affect our ability to compete for new projects.

In our electrical construction business, we have from time to time experienced shortages of certain types of qualified personnel. The commencement of new, large-scale infrastructure projects, increased demand for infrastructure improvements, departure of workers to storm affected locations and the aging utility workforce reduce the pool of skilled labor available to us, even if we are not awarded such projects. As a result of these factors, the supply of experienced linemen and supervisors may not be sufficient to meet our expected demand and we may not be able to allocate or hire a sufficient number of project managers for new electrical construction projects. We may also spend considerable resources training employees who may then be hired by our competitors, forcing us to spend additional funds to attract personnel to fill those positions. If we were unable to retain sufficient qualified personnel at a reasonable cost, or at all, we would be unable to staff new and existing projects, which would reduce our revenue and profits.

Our revenue recognition accounting policies may result in a reduction or elimination of previously reported profits.

As discussed in Critical Accounting Estimates and in the notes to our consolidated financial statements included herein, a significant portion of our revenue in our electrical construction operations is recognized using the cost-to-cost method, which is standard for fixed-price contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenue is recorded proportionally as costs are incurred. 

Due to the nature of the work required to be performed on many of the performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. We estimate variable consideration at the most likely amount we expect to receive. We include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of all information (historical, current and forecasted) that is reasonably available to us.

The earnings or losses recognized on individual contracts are based on these estimates of contract revenue, costs and profitability. The cost of labor and materials, however, may vary from the costs we originally estimated. These variations, along with other risks inherent in performing fixed-price contracts, may cause actual revenue and gross profit for a project to differ from those we originally estimated and may result in reduced profitability or losses on projects. Depending upon the size of a particular project, variations from the estimated contract costs may have a significant impact on our operating results for any quarter or year.

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We possess a significant amount of accounts receivable and costs and estimated earnings in excess of billings assets.

We extend credit to our customers as a result of performing work under contract prior to billing our customers for that work. These customers mainly include electric utilities. As of December 31, 2018, we had net accounts receivable of $22.2 million and costs and estimated earnings in excess of billings of $12.0 million. We periodically assess the credit risk of our customers and continuously monitor the timeliness of payments. Slowdowns in the industries we serve may impair the financial condition of one or more of our customers and hinder their ability to pay us on a timely basis or at all. The failure or delay in payment by our customers may reduce our cash flows and adversely impact our liquidity and profitability.

Amounts included in our backlog may not result in revenue or translate into profits.

Backlog for our electrical construction operations as of December 31, 2018 was $214.5 million, which represents the estimated amount of revenue that we expect to realize from work to be performed on uncompleted contracts, including new contractual agreements on which work has not begun. Of the total backlog, $170.1 million is attributable to MSAs (other than project-specific firm contracts under MSAs). We determine the estimated amount of backlog for work under MSAs by using recurring historical trends in current MSAs and projected customer needs based upon ongoing communications with the customer. These service agreements do not require our customers to award a minimum amount of contracts and are cancelable on short notice. To the extent that our customers cancel their contracts with us or reduce their requirements during a particular period for any reason, we will not realize revenue or profit from the associated backlog. Furthermore, contracts included in our backlog may not be profitable. We may experience variances in the realization of backlog revenue because of project delays or cancellations, external market factors and economic factors beyond our control. Even if we realize all of the revenue from the projects in our backlog, there is no guarantee of profit from the projects awarded under MSAs. Given these factors and our method of calculating backlog, our backlog at any point in time may not accurately represent the revenue that we expect to realize during any period, and our backlog as of the end of the year may not be indicative of the revenue we expect to earn in the following year and should not be viewed or relied upon as a stand-alone indicator. Consequently, we cannot provide assurance as to our customers’ requirements or our estimates of backlog and should we receive less revenue than expected, our results of operations and financial condition may be adversely affected. For further discussion on how we calculate backlog for our business, please refer to the information set forth in “Item 1. Business” under the caption “Backlog.”

Our projects are subject to numerous hazards. If we do not maintain an adequate safety record, we may be ineligible to bid on certain projects, may be terminated from existing projects and may have difficulty procuring adequate insurance.

Hazards experienced as a result of our electrical construction operations include electrocutions, fires, mechanical failure and transportation accidents. These hazards can cause and have caused personal injury and loss of life, severe damage to or destruction of property and equipment, and other consequential damages, including blackouts, and may result in suspension of our operations on a project, large damage claims, and, in extreme cases, criminal liability. At any given time, we are subject to workers’ compensation claims and claims by employees, customers and third parties for property damage, loss of life and personal injuries resulting from such hazards or other workplace accidents. Further, regulatory changes implemented by the Occupational Safety and Health Administration may impose additional costs on us. Notwithstanding our investment of substantial resources in occupational health and safety programs, our industry involves a high degree of operational risk and we may be unable to avoid accidents resulting from the hazards described above and the associated liability exposure, which may be significant. Furthermore, if serious accidents or fatalities were to occur or if our safety record were to deteriorate, we may become ineligible to bid on certain projects and may be terminated from existing projects, our reputation and our prospects for future projects may be negatively affected, and we may be required to expend additional resources on health and safety programs. In addition, if our safety record were to significantly deteriorate, it would become more difficult and expensive for us to procure adequate insurance.

An inability to obtain bonding would have a negative impact on our operations and results.

On many of our projects we are required to provide performance bonds to secure our contractual commitments.We have not experienced difficulty in obtaining bonding. However, if we were unable to obtain surety bonds in the future, or were required to post collateral in order to obtain surety bonds, our ability to obtain new contracts would be adversely affected. This may have a material adverse effect on our results of operations and financial condition.

Our capital expenditures may fluctuate as a result of changes in business requirements.

Our anticipated capital expenditure requirements, primarily for property and equipment for our electrical construction operation, may vary from time to time as a result of the level of our electrical construction operations. Increased capital expenditures will use cash flow and may increase our borrowing costs if cash for capital expenditures is not available from operations.

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We may be unable to secure sufficient independent subcontractors to fulfill our obligations, or our independent subcontractors may fail to satisfy their obligations.

We utilize independent subcontractors to complete work on a portion of our projects. If we are unable to secure independent subcontractors at a reasonable cost or at all, we may be delayed in completing work under a contract or the cost of completing the work may increase. In addition, we may have disputes with these independent subcontractors arising from, among other things, the quality and timeliness of the work they performed. Any of these factors may adversely affect the quality of our service, our ability to perform under certain contracts and the relationship with our customers, which could have an adverse effect on our results of operations, cash flows and liquidity.

Our failure to properly manage projects, or project delays, may result in additional costs or claims, which could have a material adverse effect on our operating results, cash flows and liquidity.

Certain of our engagements involve large-scale, complex projects. The quality of our performance on such a project depends in large part upon our ability to manage our client relationship and the project itself and to timely deploy appropriate resources, including third-party contractors and our own personnel. Our results of operations, cash flows and liquidity could be adversely affected if we miscalculate the resources or time needed to complete a project with capped or fixed fees, or the resources or time needed to meet contractual milestones. Additionally, delays on a particular project, including permitting, material and weather delays, may cause us to incur costs for standby pay, and may lead to personnel shortages on other projects scheduled to commence at a later date. In addition, some of our agreements require that we share in cost overages or pay liquidated damages if we do not meet project deadlines; therefore, any failure to properly estimate or manage costs, or delays in completion of projects, could subject us to penalties, which could adversely affect our results of operations, cash flows and liquidity. Further, any defects or errors, or failures to meet our customers’ expectations could result in large damage claims against us, and because of the substantial cost of, and potentially long lead-times necessary to acquire certain of the materials and equipment used in our more complex projects, damage claims may substantially exceed the amount we can charge for our associated services.

Our business may be affected by difficult work sites and environments, which could cause delays and increase our costs.

We perform work under a variety of conditions, including, but not limited to, difficult and hard to reach terrain and difficult site conditions. Weather changes can materially change work site conditions after initial inspection and bid submittal. Performing work under such conditions can result in project delays or cancellations, potentially causing us to incur additional unanticipated costs, reductions in revenues or the payment of liquidated damages. In addition, most of our contracts require that we assume the risk should actual site conditions vary from those expected.

Our unionized workforce and related obligations could adversely affect our operations.

Certain of our employees are represented by labor unions and collective bargaining agreements. Although all such collective bargaining agreements prohibit strikes and work stoppages, we cannot be certain that strikes or work stoppages will not occur despite the terms of these agreements. Strikes or work stoppages would adversely impact relationships with our customers and could cause us to lose business and decrease our revenue. Additionally, as current agreements expire, the labor unions may not be able to negotiate extensions or replacements on terms favorable to their members, or at all, or avoid strikes, lockouts or other labor actions from time to time that may affect their members. Therefore, it cannot be assured that new agreements will be reached with employee labor unions as existing contracts expire, or on terms that we find desirable. Any labor action against us relating to failure to reach an agreement with employee labor unions could have a material adverse effect on our liquidity, cash flows and results of operations.

We may be required to contribute cash to meet our underfunded obligations in certain multi-employer pension plans.

Our collective bargaining agreements generally require us to participate with other companies in multi-employer pension plans. To the extent those plans are underfunded, the Employee Retirement Income Security Act of 1974, as amended by the Multi-Employer Pension Plan Amendments Act of 1980, may subject us to substantial liabilities under those plans if we withdraw from them or they are terminated or experience a mass withdrawal.

In addition, the Pension Protection Act of 2006 added special funding and operational rules generally applicable to plan years beginning after 2007 for multi-employer plans that are classified as “endangered,” “seriously endangered,” or “critical” status. Plans in these classifications must adopt measures to improve their funded status through a funding improvement or rehabilitation plan, which may require additional contributions from employers (which may take the form of a surcharge on benefit contributions) and/or modifications to retiree benefits. A number of multi-employer plans to which we contribute or may contribute in the future could have “endangered,” “seriously endangered” or “critical” status. The amount of additional funds we may be obligated to contribute to these plans in the future cannot be estimated, as such amounts will likely be based on future work that requires the specific use of union employees covered by these plans, and the amount of that future work and the number of employees that may be affected cannot reasonably be estimated. Our performance of a significant amount of future services in areas that require us to utilize unionized employees covered by these affected plans, or a deterioration in the

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funding status of any of the plans to which our operating units contribute, could require significant additional contributions, which could detrimentally affect our results of operations, financial condition or cash flows if we are not able to adequately mitigate these costs.

Adverse weather conditions and climate change risk expose us to variable quarterly results.

Most of our work is performed outdoors and as a result, our results of operations can be adversely impacted by extended periods of inclement weather. Any weather related delays in the completion of, or which increase the cost of, our projects could adversely affect our revenue and results of operations in any one or more of our reporting periods. We cannot predict with certainty whether climate change is occurring and, if so, at what rate. However, the physical effects of climate change could have a material adverse effect on our properties, operations and business. The potential physical impacts of climate change on our operations are highly uncertain. Climate change may result in, among other things, changing rainfall patterns, changing storm patterns and intensities and changing temperature levels. Because our operating results are significantly influenced by weather, substantial changes in historical weather patterns could significantly impact our future operating results. For example, if climate change results in a greater amount of rainfall, snow, ice, flooding or other less accommodating weather over a greater period of time in a given period, we could experience reduced productivity, which could negatively impact our revenue and gross margins.

Environmental risks.

We are subject to numerous federal, state, local and environmental laws and regulations governing our operations, including the handling, transportation and disposal of non-hazardous and hazardous substances and wastes, as well as emissions and discharges into the environment, including discharges to air, surface water and groundwater and soil. We also are subject to laws and regulations that impose liability and cleanup responsibility for releases of hazardous substances into the environment. Under some of these laws and regulations, such liabilities can be imposed for cleanup of previously operated properties regardless of whether we directly caused the contamination or violated any law at the time. The presence of any contamination from substances or wastes could interfere with ongoing operations. In addition, we could be held liable for significant penalties and damages under certain environmental laws and regulations and also could be subject to a revocation of our permits, which could materially and adversely affect our business and results of operations.

From time to time, we may incur costs and obligations for correcting environmental noncompliance matters and for remediation at or relating to our operations. We believe that we are currently in compliance with our environmental obligations and that any such obligations should not have a material adverse effect on our business or financial performance.

Climate change issues may result in the adoption of new environmental regulations that may unfavorably impact us, our suppliers, our customers, and subsequently effect how we conduct our businesses. This could also cause us to incur additional direct costs in complying with any new environmental regulations, as well as increased indirect costs resulting from our customers, suppliers, or both, incurring additional compliance costs that are passed on to us. These costs may adversely impact our operations and financial condition. In addition, developments in federal and state legislation and regulation on climate change could result in increased capital expenditures to improve the energy efficiency of our existing properties, equipment and our processes without a corresponding increase in revenue.

Our operating results may vary significantly from period-to-period.

Our periodic results may be materially and adversely affected by:

•the timing and volume of work under contract;

•changes in national, regional, local and general economic conditions;

•the budgetary spending patterns of customers;

•variations in margins of projects performed during any particular quarter;

•a change in the demand for our services;

•increased costs of performance of our services caused by severe weather conditions;

•increases in design and construction costs that we are unable to pass through to our customers;

•the termination of existing agreements;

•losses experienced in our operations that are not covered by insurance;

•a change in the mix of our customers, contracts and business;

•availability of qualified labor hired for specific projects; and

•changes in bonding requirements applicable to existing and new agreements.

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Our actual costs may be greater than expected in performing our fixed-price and unit-price contracts.

We currently generate, and expect to continue to generate, a significant portion of our revenues and profits under fixed-price and unit-price contracts. We must estimate the costs of completing a particular project when we bid for these types of contracts or when they are awarded under our current MSAs. The actual cost of labor and equipment, however, may vary from the costs we originally estimated and we may not be successful in recouping additional costs from our customers. These variations, along with other risks inherent in performing fixed-price and unit-price contracts, may cause actual revenue and gross profits for a project to differ from those we originally estimated and could result in reduced profitability or losses on projects due to changes in a variety of factors such as:

•failure to properly estimate costs of engineering, material, equipment or labor;

• unanticipated technical problems with the materials or services being supplied by us, which may require us to incur additional costs to remedy the problem;

•project modifications that create unanticipated costs;

•changes in costs of equipment, materials, labor or subcontractors;

•the failure of our suppliers or subcontractors to perform;

•difficulties in our customers obtaining required governmental permits or approvals;

•site conditions that differ from those assumed in the original bid (to the extent contract remedies are unavailable);

•the availability and skill level of workers in the geographic location of the project;

•an increase in the cost of fuel or other resources;

•changes in local laws and regulations;

•delays caused by local weather conditions, third parties or customers; and

•quality issues requiring rework.

We could be adversely affected by the loss of key management personnel.

Our future success depends, to a significant degree, on the efforts of our executive officers and senior management, including those of our subsidiaries. Other than with respect to our Chief Executive Officer, we do not have employment agreements with any of our employees. We believe that key members of our senior management possess valuable industry knowledge, relationships and experience that are important to the successful operation of our business. The relationships between our executive officers and senior management and our customers are important to our being retained as a service provider. We are also dependent upon our project managers and field supervisors who are responsible for managing and drawing employees to our projects. There can be no assurance that any individual will continue in his or her capacity for any particular period of time. Industry-wide competition for managerial talent in electrical construction has increased and the loss of one or more of our key employees could negatively impact our ability to manage our business and relationships with our customers. The loss of any of our executive officers or senior management could adversely affect our financial condition and results of operations.

We engage in real estate activities which are speculative and involve a high degree of risk.

The real estate industry is highly cyclical by nature and future market conditions are uncertain. Factors which adversely affect the real estate and homebuilding industries, many of which are beyond our control, include:

•the availability and cost of financing;

• unfavorable interest rates and increases in inflation;

•overbuilding or decreases in demand;

•changes in national, regional and local economic conditions;

•cost overruns, inclement weather, and labor and material shortages;

•the impact of present or future environmental legislation, zoning laws and other regulations;

• availability, delays and costs associated with obtaining permits, approvals or licenses necessary to develop property; and

•increases in real estate taxes and other local government fees.

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Changes in national and regional economic conditions, as well as local economic conditions where we conduct our real estate development operations and where prospective purchasers of our homes live, can have a negative impact on our business. Adverse changes in employment levels, job growth, consumer confidence, interest rates and population growth may reduce demand and depress prices for our homes. This, in turn, can reduce our earnings.

The homebuilding industry is cyclical and is significantly affected by changes in general and local economic conditions, such as employment levels; availability of financing for homebuyers; interest rates; consumer confidence; levels of new and existing homes for sale; demographic trends and housing demand. If any adverse conditions affect our markets, they could have a proportionately greater or lesser impact on us versus other homebuilding companies. An excess supply of housing, including homes held for sale by investors, banks and other lending institutions, can also lower new residential property prices and reduce our gross margins on new home sales.

As a result of the foregoing, potential customers may be less willing or able to buy our homes, or we may take longer or incur more costs to build them. We may not be able to recapture increased costs by raising prices in many cases because of market conditions or because we fix our prices in advance of delivery by signing residential property sales contracts. We may be unable to change the affordability of our residential properties to maintain our margins or satisfactorily address changing market conditions in other ways. In addition, cancellations of residential property sales contracts from time to time may increase if homebuyers’ sentiment changes and they may fail to honor their contracts.

The residential real estate development industry is highly competitive and, if others are more successful, our business could decline.

We operate in a very competitive environment, which is characterized by competition from a number of other real estate developers. We compete with large national and regional development companies and with smaller local firms for land, financing, raw materials and skilled management and labor resources. We also compete with the resale, or “previously owned” market. Increased competition could cause us to increase our selling incentives and/or reduce our prices. Increased competition could also result in an oversupply of new homes or other housing alternatives available, which could depress the prices at which we can sell our homes, and increase the length of time it takes us to sell them. If a failure to compete effectively resulted in our selling fewer homes at lower prices, our results of operations and financial condition would be adversely affected. Due to various contingencies, like delayed construction and buyer defaults, we may receive less cash than we expected, which could affect our financial condition and results of operations.

If land is not available at reasonable prices, our sales and earnings could decrease.

Our real estate development operations depend on our ability to obtain land at reasonable prices for our developments. Changes in the general availability of land, competition for available land, availability of financing to acquire land, zoning regulations that limit housing density and other market conditions may hurt our ability to obtain land for new residential developments. If the supply of land appropriate for development becomes more limited because of these factors, or for any other reason, the cost of land could increase, which could reduce the profitability of our real estate development operations if we are unable to recover these costs in the sales prices of our homes, and the number of homes that we build and sell could be reduced, which would reduce our revenue.

If the market value of our land and developments drops significantly, our profits could decrease.

The market value of our land and home inventories of our real estate development operations depends on market conditions. We acquire land for replacement of land inventory and expansion within our current market. If housing demand decreases below what we anticipated when we acquired our inventory, we may not be able to make profits similar to what we have made in the past, may experience less than anticipated profits and may not be able to recover our costs when we sell our property or finished product. In the face of adverse market conditions, we may have substantial inventory carrying costs or may have to sell land or completed units at a loss, which would have an adverse effect on our results of operations and financial condition. Also, if there is a decrease in demand for homes such that the market value of a home is less than purchase price reduced by the deposit made by a buyer, the buyer may elect to forfeit their deposit to us and have no further obligation to purchase the home, resulting in a loss of revenue, operating income and a possible write-down of homes in inventory.

Government regulations and legal challenges may delay the start or completion of our developments, increase our expenses or limit our building activities, which could have a negative impact on our operations.

We must obtain the approval of numerous governmental authorities in connection with our real estate development operations, and these governmental authorities often have broad discretion in exercising their approval authority. We incur substantial costs related to compliance with legal and regulatory requirements. Any increase in legal and regulatory requirements may cause us to incur substantial additional costs, as discussed below. Various local, state and federal statutes, ordinances, rules and regulations concerning building, zoning, sales and similar matters apply to and/or affect the homebuilding industry. Municipalities may restrict or place moratoriums on the availability of utilities, such as water and sewer taps. In some areas, municipalities may enact growth control initiatives, which will restrict the number of building permits available in a given year.

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This governmental regulation affects construction activities as well as sales activities, mortgage lending activities and other dealings with consumers. The industry also has experienced an increase in state and local legislation and regulations which limit the availability or use of land. We may be required to apply for additional approvals or modify our existing approvals because of changes in local circumstances or applicable law. Further, we may experience delays and increased expenses as a result of legal challenges to our proposed developments, whether brought by governmental authorities or private parties.

Increases in taxes or government fees could increase our costs, and adverse changes in tax laws could reduce customer demand for our homes.

Increases in real estate taxes and other local government fees, such as fees imposed on developers to fund schools, open space, road improvements, or to provide low or moderate income housing, could increase our costs and have an adverse effect on our real estate development operations if we are unable to recover these costs in the sales prices of our homes. In addition, increases in local real estate taxes could adversely affect our potential customers who may consider those costs in determining whether to make a new home purchase and decide, as a result, not to purchase one of our homes. In addition, any changes in the income tax laws that would reduce or eliminate tax deductions or incentives to homeowners could make housing less affordable or otherwise reduce the demand for housing, which in turn could reduce our sales and adversely affect our revenues. Specifically, the enactment of the Tax Cuts and Jobs Act (the “Tax Act”), which was enacted in December 2017, establishes new limits on the federal tax deductions individual taxpayers may take on mortgage loan interest payments and on state and local taxes, including property taxes. These changes could reduce the actual or perceived affordability of homeownership, which could adversely affect demand for and sales prices of new homes.

Our real estate business is concentrated in Florida, which increases our exposure to local adverse events.

In our real estate development operations, we currently develop and sell homes only on the east coast of Central Florida. As a consequence, our exposure to local adverse events, such as natural disasters or changes in economic conditions, is increased. In particular, Florida is affected by tropical storms and hurricanes, which can damage or destroy buildings. The occurrence of such a storm or other natural disaster could result in delays in construction and shortages and increased costs of labor and building materials. Any such delays or additional costs could adversely affect the profitability of our real estate development operations.

Additionally, the inability of property owners to obtain cost-effective insurance could have an adverse effect on demand for property in our markets, which could reduce our revenue. Furthermore, there are periods of time during which insurance companies will not write policies because of the presence of a named storm that may pass over the areas in which we sell homes. During these periods, home closings in areas that could be affected by such a storm will be delayed until the risk of the storm has passed and the required insurance can be obtained.

Adverse weather conditions and conditions in nature beyond our control could significantly impact our revenue and profitability.

In our real estate development operations, adverse weather conditions and natural disasters, such as, but not limited to, hurricanes, tornadoes, floods and fires, can have serious effects on our ability to perform work. We also may be affected by unforeseen engineering, environmental or geological problems. Any of these adverse events or circumstances could cause delays in the completion of, or increase the cost of, our projects and, as a result, could adversely affect our sales, earnings and profitability.

In addition, approaching storms require that sales, development and construction operations be suspended in favor of storm preparation activities such as securing construction materials and equipment. After a storm has passed, construction-related resources such as sub-contracted labor and building materials are likely to be redeployed to hurricane recovery efforts around the State of Florida.

Governmental permitting and inspection activities may similarly be focused primarily on returning displaced residents to homes damaged by the storms, rather than on new construction activity. Depending on the severity of the damage caused by the storms, disruptions such as these could last for several months.

If we experience shortages of labor and supplies or other circumstances beyond our control, there could be delays or increased costs in developing our homes, which could adversely affect our operating results.

Our ability to develop land and construct homes may be affected by circumstances beyond our control, including: work stoppages, labor disputes and shortages of qualified trades people, such as carpenters, roofers, electricians and plumbers; lack of availability of adequate utility infrastructure and services; our need to rely on local subcontractors who may not be adequately capitalized or insured; and shortages, or delays in availability, or fluctuations in prices of, building materials. Any of these circumstances could give rise to delays in the start or completion of, or increase the cost of, one or more of our developments. If we are not able to recover these increased costs by raising the prices of our homes we might decide to postpone or cancel the development of projects on which we have not yet begun construction. If that happens, our operating

11

results could be harmed. Additionally, we may be limited in the amount we can raise sales prices by our customers’ unwillingness to pay higher prices.

Product liability litigation and warranty claims that arise in the ordinary course of business may be costly, which could adversely affect our business.

As a real estate developer, we are subject to construction defect and home warranty claims arising in the ordinary course of business. These claims, which can include bodily injury claims and mold-related property damage claims among others, are common in the homebuilding industry and can be costly. In addition, the costs of insuring against construction defect and product liability claims are high, and the amount of coverage offered by insurance companies is currently limited. There can be no assurance that this coverage will not be further restricted and become more costly. If we are not able to obtain adequate insurance against these claims, we may experience losses that could have an adverse affect on our results of operations and financial condition, which could be material.

If we are not able to obtain suitable financing, our business may decline.

Our real estate development operations depend substantially on our ability to obtain financing for the development of our projects. If we are not able to obtain suitable financing, our costs would increase and our revenue would decrease, or we could be precluded from continuing our operations at current levels. Increases in interest rates can make it more difficult and expensive for us to obtain the funds we need to operate our business, which would have an adverse affect on our profitability.

If our potential customers are not able to obtain suitable financing, our business may decline.

Our real estate development operations also depend on the ability of our potential customers to obtain mortgages for the purchase of our homes. An increase in default rates, fewer loan products and stricter loan qualification standards may make it more difficult for some borrowers to finance the purchase of our homes. Increases in the cost of home mortgage financing could prevent our potential customers from purchasing our homes. In addition, where our potential customers must sell their existing homes in order to buy a new home from us, increases in mortgage costs could prevent the buyers of our customers’ existing homes from obtaining the mortgages they need to complete the purchase, which could result in our potential customers’ inability to buy a home from us. Furthermore, changes in government sponsored entities involved in the residential mortgage market such as Fannie Mae and FHA could affect mortgage rates, down payment requirements and our customers’ ability to obtain affordable financing, which could subsequently affect our customers’ ability to purchase our products. If our potential customers or the buyers of our customers’ current homes are not able to obtain suitable financing, our sales and revenue could decline.

We depend upon the availability and skill of subcontractors.

Substantially all our construction work is done by subcontractors. Accordingly, the timing and quality of our construction depends on the availability and skill of those subcontractors. We do not have long-term contractual commitments with any particular subcontractors or suppliers. Although we believe that our relationships with our subcontractors and suppliers are good, we cannot assure you that skilled subcontractors will continue to be available to us at reasonable rates. The inability to contract with skilled subcontractors at reasonable costs on a timely basis could limit our ability to build and deliver homes and could have a material adverse effect on the operating results of our real estate development operations. Additionally, if there is an impairment, bankruptcy or default by subcontractors or suppliers our production, revenue and operating income may be adversely affected.

We rely on outside professionals whose errors could increase our costs.

We often collaborate with numerous professionals such as architects and engineers in the development of our real estate projects. In the course of our business, we rely on the work of these professionals to help design and permit the homes that we develop, and errors in their work can create significant increases in cost and delays in construction.

Our revenue and operating results have fluctuated in the past and may continue to do so in the future.

Our revenue and operating results from real estate development operations are subject to fluctuations. Because we typically do not have more than one or two projects under development at any time, factors such as the timing of the start of construction of new projects, the timing of receipt of regulatory approvals for development and construction and others can cause our revenue and operating results to vary from period to period and from year to year. Accordingly, the historical financial performance of our real estate development operations is not necessarily a meaningful indicator of future results for any particular period, and quarter-to-quarter comparisons should not be relied upon as an indicator of future performance.

We may be subject to environmental liabilities that could adversely affect our results of operations or the value of our properties.

The development and sale of real property creates a potential for environmental liability on our part as owner and developer, for our own acts as well as the acts of prior owners, current owners or past owners of adjacent parcels. If hazardous substances are

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discovered on or emanating from any of our properties, we may be held liable for costs and liabilities relating to those hazardous substances. Should a substantial environmental hazard be found on any of our properties, our results of operations and the value of the contaminated property could be adversely affected.

Increased insurance risk could negatively affect our business.

Insurance and surety companies may take actions that could negatively affect our business, including increasing insurance premiums, requiring higher self-insured retentions and deductibles, requiring additional collateral or covenants on surety bonds, reducing limits, restricting coverages, imposing exclusions, and refusing to underwrite certain risks and classes of business. Any of these actions may adversely affect our ability to obtain appropriate insurance coverage at reasonable costs, which could have a material adverse effect on our business.

Changes in tax laws.

Changes in tax laws or tax rates may have a material impact on our future cash expended for taxes, effective tax rate or deferred tax assets and liabilities. These conditions are beyond our control and may have a significant impact on our business, results of operations, liquidity, and financial position. See “Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations” and note 3 to the consolidated financial statements for additional information on the impact of the Tax Act.

Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly.

Borrowings under our credit facility are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even though the amount borrowed remains the same, and net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.

We could be adversely affected by environmental liabilities associated with our former mining business.

The Company was previously engaged in mining activities and disposed of our last mining property over 15 years ago. Although we are not aware of any current environmental investigations relating to previously owned sites, we could still be liable for previous activities at such sites. For example, in 2015 we completed remediation activities at a mining site which we sold over 50 years ago, as discussed in note 4 to the consolidated financial statements.

The violation of our debt covenants imposed by our credit facility could impact our access to that credit facility and therefore our cash flows.

Our debt arrangements contain various financial and other covenants including, but not limited to: minimum tangible net worth, outside debt limitation, maximum debt to tangible net worth ratio and fixed charge coverage ratio. Our loans also have cross-default provisions whereby any default under any loans of the Company (or its subsidiaries) with the lender will constitute a default under all of the other loans of the Company (and its subsidiaries) with the lender. Although we are in compliance with all covenants, if we were to experience substantial losses, absent a modification of the loan agreement or a waiver, this could result in a violation of the financial covenants. A violation of our financial covenants will give the right to our lender to accelerate our loans. Under these circumstances, there can be no assurance that we could obtain a modification or waiver. The acceleration of all of our loans would adversely affect our cash flows and consequently our results of operations.

Failure to protect critical data and technology systems adequately could materially affect our operations.

We use our own information technology systems as well as those of business partners to manage our operations and other business processes and to protect sensitive information maintained in the normal course of business. Third-party security breaches, employee error, malfeasance or other irregularities may compromise our measures to protect these systems and may result in persons obtaining unauthorized access to our or our customers’ data or accounts. The occurrence of any such event could have a material adverse effect on our business.

Item 1B.    Unresolved Staff Comments.

None.

Item 2.    Properties.

For information with respect to the principal properties utilized in the Company’s operations, see “Item 1. Business - Properties.”

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Item 3.    Legal Proceedings.

The Company is not currently involved in any material legal proceedings, having substantially completed the Environmental Protection Agency remediation matter described in note 4 to the consolidated financial statements in this Form 10-K.

The Company is involved in various legal claims arising in the ordinary course of business. The Company has concluded that the ultimate disposition of these matters should not have a material adverse effect on the Company’s consolidated financial position, results of operations, or liquidity.

Item 4.    Mine Safety Disclosures.

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Our Common Stock is listed on the NYSE American under the symbol GV. Our Common Stock is the longest traded security on the NYSE American and its predecessor exchanges, having commenced trading in 1906. The following table shows the reported high and low sales price at which our Common Stock was traded in 2018 and 2017:

	2018				2017
	High		Low		High		Low
First Quarter	$	5.35	$	3.60	$	8.65	$	5.00
Second Quarter	4.63		3.70		6.08		4.00
Third Quarter	4.96		4.11		6.30		4.00
Fourth Quarter	4.32		1.98		6.38		4.05

As of March 7, 2019, there were 5,286 holders of record of our Common Stock.

We have paid no cash dividends on our Common Stock since 1933, and it is not expected that we will pay any cash dividends on our Common Stock in the immediate future.

We have had a stock repurchase plan since September 17, 2002, that was last amended by the Board of Directors on March 7, 2019. Through December 31, 2018, we have repurchased 3,206,171 shares of our Common Stock at a cost of $3,260,098 (average cost of $1.02 per share). We may repurchase our shares either in the open market or through private transactions. The volume of the shares to be repurchased is contingent upon market conditions and other factors. We currently hold the repurchased stock as Treasury Stock, reported at cost. Also included as Treasury Stock are 17,358 shares purchased prior to the current stock repurchase plan at a cost of $18,720.

Issuer Purchases of Equity Securities (1)
Period	(a) Total number of shares (or units) purchased	(b) Average price paid per share (or unit)		(c) Total number of shares (or units) purchased as part of publicly announced plans or programs	(d) Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs
December 1, 2018 to December 31, 2018	861,111	$	2.29	861,111	293,829
Total	861,111	$	2.29	861,111	293,829 (1)
(1) The stock repurchase plan became effective on September 17, 2002, and was last amended by the Board of Directors on March 7, 2019. The Company resumed the repurchase of its shares under the plan on December 10, 2018. The March 7, 2019 amendment expanded the original purchase amount of 3,500,000 shares by an additional 2,500,000 shares. There is currently available for purchase through September 30, 2020, a maximum of 2,726,120 shares.

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Item 6.    Selected Financial Data.

The following table sets forth summary consolidated financial information for each of the years in the five-year period ended December 31, 2018:

	Year Ended December 31,
	2018		2017			2016			2015			2014
	(In thousands except per share and share amounts)
Continuing operations
Revenue
Electrical construction	$	136,527	$	109,154		$	125,771		$	119,617		$	94,827
Real estate development	1,622		4,799			4,652			955			3,537
Total revenue	$	138,149	$	113,954		$	130,423		$	120,571		$	98,363
Income before taxes from continuing operations	$	6,825	$	9,609		$	20,918		$	8,204		$	778
Income tax provision	1,797		1,036			7,810			3,378			653
Income from continuing operations	5,028		8,573			13,108			4,826			125
Discontinued operations (1)
Loss from operations, net of tax	—		(276		)	(108		)	(333		)	(444		)
Net income (loss)	$	5,028	$	8,298		$	13,000		$	4,493		$	(319	)
Earnings (loss) per share — basic and diluted
Continuing operations	$	0.20	$	0.34		$	0.52		$	0.19		$	—
Discontinued operations	—		(0.01		)	—			(0.01		)	(0.02		)
Net income (loss)	$	0.20	$	0.33		$	0.51		$	0.18		$	(0.01	)
Weighted average shares outstanding — basic and diluted	25,411,623		25,451,354			25,451,354			25,451,354			25,451,354
Balance sheet data
Total assets(2)	$	112,548	$	93,632		$	91,302		$	81,164		$	79,910
Long term debt including current portion, net (2)	29,191		22,251			22,333			26,472			26,284
Stockholders’ equity	59,605		56,548			48,251			35,251			30,758
Working capital	33,078		35,995			32,993			25,498			19,674

The total of the above categories may differ from the sum of the components due to rounding.

 ___________________

(1) For information as to Discontinued Operations, see note 4 to the consolidated financial statements.

(2) Reflects the presentation of debt issuance costs in accordance with the adoption of Accounting Standard Update No. 2015-03 and 2015-15, which resulted in a reduction of total assets and long term debt of $60,000 as of December 31, 2014.

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Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

We make “forward-looking statements” within the meaning of the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995 throughout this document. You can identify these statements by forward-looking words such as “may,” “will,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” and “continue” or similar words. We have based these statements on our current expectations about future events. Although we believe that our expectations reflected in or suggested by our forward-looking statements are reasonable, we cannot assure you that these expectations will be achieved. Our actual results may differ materially from what we currently expect. Factors that may affect the results of our operations include, among others: the level of construction activities by public utilities; the concentration of revenue from a limited number of utility customers; the loss of one or more significant customers; the timing and duration of construction projects for which we are engaged; our ability to estimate accurately with respect to fixed-price construction contracts; and heightened competition in the electrical construction field, including intensification of price competition. Other factors that may affect the results of our operations include, among others: adverse weather; natural disasters; effects of climate changes; changes in generally accepted accounting principles; ability to obtain necessary permits from regulatory agencies; our ability to maintain or increase historical revenue and profit margins; general economic conditions, both nationally and in our region; adverse legislation or regulations; availability of skilled construction labor and materials and material increases in labor and material costs; and our ability to obtain additional and/or renew financing. Other important factors which could cause our actual results to differ materially from the forward-looking statements in this document include, but are not limited to, those discussed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Risk Factors” sections and should be considered while evaluating our business, financial condition, results of operations and prospects.

You should read this report in its entirety and with the understanding that our actual future results may be materially different from what we expect. We may not update these forward-looking statements, even in the event that our situation changes in the future, except as required by law. All forward-looking statements attributable to us are expressly qualified by these cautionary statements.

Overview

We are a provider of electrical construction services for the utility industry and industrial customers primarily in the Southeast, mid-Atlantic and Texas-Southwest regions of the United States. To a considerably lesser extent we are a developer of real estate residential properties on the east coast of Central Florida. We report our results under two reportable segments, electrical construction and real estate development. For the year ended December 31, 2018, our total consolidated revenue grew21.2% to $138.1 million from $114.0 million in 2017.

Through our subsidiaries, Power Corporation of America (“PCA”), Southeast Power Corporation (“Southeast Power”), C and C Power Line, Inc. (“C&C”) and Precision Foundations, Inc. (“PFI”), we are engaged in the construction of electrical infrastructure for the utility industry and industrial customers. Southeast Power performs electrical contracting services including the construction of transmission lines, distribution systems, substations, and other electrical services. Southeast Power is headquartered in Titusville, Florida and has additional offices in Bastrop, Texas and Spartanburg, South Carolina. C&C, headquartered in Jacksonville, Florida, is a full-service electrical contractor that provides similar services as Southeast Power with a unionized workforce. PFI, headquartered in Port Orange, Florida, acquired its operating assets from Southeast Power in August 2018 and constructs drilled pier foundations and installs concrete poles, direct embeds and vibratory casings.

The electrical construction business is highly competitive and fragmented. We compete with other independent contractors, including larger regional and national firms that may have financial, operational, technical and marketing resources that exceed our own. We also face competition from existing and prospective customers establishing or augmenting in-house services and organizations that employ personnel who perform similar services as those provided by us. In addition, a significant portion of our electrical construction revenue is derived from a small group of customers that account for a substantial portion of our revenue in any given year. The revenue contribution by any single customer or group of customers may significantly fluctuate from period-to-period. For example, for the years ended December 31, 2018 and 2017, three of our customers accounted for approximately 57.2% and 58.7% of our consolidated revenue, respectively. The loss of, or decrease in current demand from one or more customers, if not replaced, may result in a material decrease in revenue, margin and profit.

Through our subsidiary Bayswater Development Corporation and its various subsidiaries (“Bayswater”), we are engaged in the acquisition, development, management and disposition of land and improved properties along the east coast of Central Florida. Bayswater is headquartered in Melbourne, Florida. Our customers are generally pre-retirement, retirement or second home buyers seeking higher quality, low maintenance residences.

When we use either of the terms “homes” or “units,” we mean our residential properties, which include detached single-family homes, townhomes and condominiums. References to our homebuilding revenues and similar references refer to revenues

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derived from the sales of our residential properties, in each case unless otherwise expressly stated or the context otherwise requires.

Critical Accounting Estimates

This discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenue and expense, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, particularly those related to electrical construction contracts. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable, under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities, that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our management has discussed the selection and development of our critical accounting policies, estimates, and related disclosures with the Audit Committee of the Board of Directors.

Revenue Recognition

Our significant accounting policies are detailed in note 1 to the consolidated financial statements. Changes to our accounting policies as a result of adopting Accounting Standards Codification (“ASC”) Topic 606 Revenue from Contracts with Customers and all the related amendments (“new revenue standard”) are discussed in note 1, note 2 and note 14 to the consolidated financial statements.

Fixed-Price Electrical Construction Contracts

We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. We generally recognize revenue over time as we perform because of continuous transfer of control to the customer.  Because of control transferring over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. We generally use the cost-to-cost measure of progress for our contracts because it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenue is recorded proportionally as costs are incurred. 

Due to the nature of the work required to be performed on many of our performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. We estimate variable consideration at the most likely amount which we expect to receive. We include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of all information (historical, current and forecasted) that is reasonably available to us.

Contracts are often modified to account for changes in contract specifications and requirements. We consider contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations. Most of our contract modifications are for goods or services that are not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as if they were part of that existing contract. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis.

We have a standard and disciplined quarterly estimated costs at completion process in which management reviews the progress and execution of our performance obligations. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the availability of materials, the length of time to complete the performance obligation (e.g., to estimate increases in wages and prices for materials and related support cost allocations), execution by our subcontractors, among other variables. Based on this analysis, any quarterly adjustments to net revenue, cost of electrical construction revenue and the related impact to operating income are recognized as necessary in the period they become known. 

The accuracy of our revenue and profit recognition in a given period is almost solely dependent on the accuracy of our estimates of the cost to complete each project. Our projects can be complex and in almost every case the profit margin estimates for a project will either increase or decrease from the amount that was originally estimated at the time of bid. If a current estimate of total costs exceeds the total estimate of revenue to be earned, on a performance obligation, the projected loss is recognized in full when determined. Accrued contract losses were $680,000 as of December 31, 2018 and $201,000 as

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of December 31, 2017. The accrued contract losses as of both December 31, 2018 and December 31, 2017 are mainly attributable to transmission projects experiencing unexpected construction issues.

The following table disaggregates our revenue for the years ended December 31 as indicated:

	2018		2017
Electrical construction operations (1)
Southeast	$	54,123,848	$	56,268,413
mid-Atlantic	41,071,994		29,289,385
Texas-Southwest	33,825,666		15,046,719
Other electrical construction (2)	7,505,003		8,549,959
Total	136,526,511		109,154,476
Real estate development	1,622,331		4,799,043
Total revenue	$	138,148,842	$	113,953,519
___________________________
(1) Principal electrical construction operations include revenue from transmission lines, distribution systems, substations and drilled pier foundations.
(2)Other electrical construction includes revenue from storm work, fiber optics and other miscellaneous electrical construction items.

We would have recognized $134,000 less revenue under legacy accounting practices for the year ended December 31, 2018 than we did under the new revenue standard. This was attributable to the assessment of variable consideration and performance obligations within our contractual arrangements.

The aggregate amount of the transaction price allocated to performance obligations that are unsatisfied as of December 31, 2018 was $36.4 million, all of which is expected to be satisfied within the next twelve months.

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RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2018 COMPARED TO YEAR ENDED DECEMBER 31, 2017

The following table presents a reconciliation of our operating income (loss) attributable to each of our reportable segments for the years ended December 31 as indicated:

	2018			2017
Electrical construction
Revenue	$	136,526,511		$	109,154,476
Operating expenses
Costs of goods sold	113,976,157			86,714,412
Selling, general and administrative	1,797,548			1,587,101
Depreciation and amortization	8,319,362			7,086,361
(Gain) loss on sale of property and equipment	(178,114		)	75,847
Total costs and expenses	123,914,953			95,463,721
Operating income	$	12,611,558		$	13,690,755
Real estate development
Revenue	$	1,622,331		$	4,799,043
Operating expenses
Costs of goods sold	1,012,098			3,147,791
Selling, general and administrative	890,951			1,014,560
Depreciation and amortization	21,279			15,207
Loss on sale of property and equipment	507			—
Total costs and expenses	1,924,835			4,177,558
Operating (loss) income	$	(302,504	)	$	621,485

Operating income (loss) equals total operating revenue less operating costs and expenses inclusive of depreciation and amortization, and selling, general and administrative expenses. Operating costs and expenses also include any gains or losses on the sale of property and equipment. Operating income (loss) excludes interest expense, interest income, other income, and income taxes.

Revenue

Total revenue for the year ended December 31, 2018, increased21.2% to $138.1 million, from $114.0 million in 2017, mainly due to the increase in electrical construction operations.

Electrical construction revenue increased$27.4 million, or 25.1%, to $136.5 million for the year ended December 31, 2018, from $109.2 million in 2017. The increase in electrical construction revenue was mainly attributable to increases in projects awarded and work completed in the Texas-Southwest and mid-Atlantic regions of $18.8 million and $11.8 million, respectively. This increase was primarily due to both master service agreement (“MSA”) and non-MSA customer project activity for the year ended December 31, 2018. This increase was partially offset by a decrease in Southeast operations revenue of $2.1 million, due to a decline in non-MSA customer projects attributable to competitive pressures and a decrease in our Other operations revenue of $1.0 million, primarily fiber splicing.

Revenue from real estate development decreased to $1.6 million for the year ended December 31, 2018, from $4.8 million in 2017, mainly due to the decline in the number of units sold and completed units available for sale.

Backlog

Our backlog represents future services to be performed under existing project-specific fixed-price and maintenance contracts and the estimated value of future services that we expect to provide under our existing MSAs.

The following table presents our total backlog as of December 31, 2018 and 2017 along with an estimate of the backlog amounts expected to be realized within 12 months and during the life of each of the MSAs. When awarded, our MSA initial terms range from one to seven years. Most of the MSAs have renewal options ranging from one to three years at the option of

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the customer. The calculation assumes exercise of the renewal options by the customer. Revenue from assumed exercise of renewal options represents $45.8 million, or 26.9%, of our total estimated MSA backlog as of December 31, 2018.

	Backlog as of				Backlog as of
	December 31, 2018				December 31, 2017
Electrical Construction Operations	12-Month		Total		12-Month		Total
Project-Specific Firm Contracts (1)	$	44,373,384	$	44,373,384	$	27,110,793	$	27,110,793
Estimated MSAs	57,464,231		170,097,919		83,124,471		187,047,802
Total	$	101,837,615	$	214,471,303	$	110,235,264	$	214,158,595
___________________________
(1)Amount includes firm contract awards under MSA agreements.

Our total backlog as of December 31, 2018, increased$313,000, or 0.1%, to $214.5 million, compared to $214.2 million as of December 31, 2017. The increase in total backlog is primarily due to the increase in MSA firm projects, which includes the addition of four new MSA customers, offset by existing MSA backlog run-off and adjustments to existing MSA backlog estimates.

Our 12-month backlog as of December 31, 2018decreased$8.4 million, or 7.6%, to $101.8 million, mainly due to MSA backlog run-off and adjustments to existing MSA backlog estimates.

Of our total backlog as of December 31, 2018, we expect approximately $101.8 million, or 47.5%, to be completed during 2019.

Backlog is estimated at a particular point in time and is not determinative of total revenue in any particular period. It does not reflect future revenue from a significant number of short-term projects undertaken and completed between the estimated dates. Our electrical construction revenue in 2018 exceeded our 12-month backlog as of December 31, 2017 by 23.9%.

The estimated amount of backlog for work under MSAs is calculated by using recurring historical trends inherent in current MSAs and projected customer needs based upon ongoing communications with the customer. Our estimated backlog also assumes exercise of existing customer renewal options. Certain MSAs are not exclusive to the Company and, therefore, the size and amount of projects we may be awarded cannot be determined with certainty. Accordingly, the amount of future revenue from MSA contracts may vary substantially from reported backlog. Even if we realize all the revenue from the projects in our backlog, there is no guarantee of profit from the projects awarded under MSAs.

As of December 31, 2018 and 2017, estimated MSAs (other than project-specific firm contracts under MSAs) accounted for approximately 79.3% and 87.3% of total backlog, respectively. We plan to continue to grow our MSA business. MSA contracts are generally multi-year and should provide improved operating efficiencies.

Backlog is not a term recognized under U.S. generally accepted accounting principles, but is a common measurement used in our industry. While we believe that our methodology of calculation is appropriate, such methodology may not be comparable to that employed by some other companies. Given the duration of our contracts and MSAs and our method of calculating backlog, our backlog at any point in time may not accurately represent the revenue that we expect to realize during any period and our backlog as of the end of a fiscal year may not be indicative of the revenue we expect to earn in the following fiscal year and should not be viewed or relied upon as a stand-alone indicator. Consequently, we cannot provide assurance as to our customers’ requirements or our estimates of backlog.

Reconciliation of Backlog to our Remaining Unsatisfied Performance Obligation

The following table presents a reconciliation of our total backlog as of December 31, 2018 to our remaining unsatisfied performance obligation as defined under U.S. generally accepted accounting principles:

	December 31, 2018
Total Backlog	$	214,471,303
Estimated MSAs	(170,097,919		)
Estimated Firm(1)	(7,933,373		)
Total Unsatisfied Performance Obligation	$	36,440,011
_________________________
(1) Projects awarded, however backlog contract value was estimated as of December 31, 2018.

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The amount of total backlog differs from the amount of our remaining unsatisfied performance obligation as of December 31, 2018 and as described in note 14 to the consolidated financial statements, primarily due to the inclusion of estimates of future revenue under MSA and other service agreements within our backlog estimates, as described above.

Revenue estimates included in our backlog may be subject to change as a result of project accelerations, additions, cancellations or delays due to various factors, including but not limited to: commercial issues, material deficiencies, permitting, regulatory requirements and adverse weather. Our customers are not contractually committed to a specific level of services under our MSAs (other than project-specific firm contracts under MSAs). While we did not experience any material cancellations during the current period, most of our contracts may be terminated, even if we are not in default under the contract.

For further Backlog information, please refer to the information set forth in “Item 1. Business” under the caption “Backlog,” and “Item 1A. Risk Factors.”

Operating Results

Total operating income decreased to $7.6 million for the year ended December 31, 2018, from $10.2 million in 2017, mainly due to an increase in depreciation expense, a decrease in real estate development margin and lower margins on electrical construction projects.

Electrical construction operating income decreased to $12.6 million for the year ended December 31, 2018, from $13.7 million in 2017. This decrease was primarily attributable to the change in electrical construction project mix to a higher level of lower margin work, mainly due to escalating costs, competitive pressures and expansion into lower margin service lines. Also contributing to the decline in operating income were higher depreciation and selling, general and administrative expenses.

Gross margin on electrical construction for the year ended December 31, 2018 was 16.5%, compared to 20.6% in 2017. Such gross margin represents electrical construction revenue less electrical construction costs and expenses (excluding depreciation and amortization, selling, general and administrative expenses, and (gain) loss on sale of property and equipment), divided by electrical construction revenue.

Real estate development operating results decreased to an operating loss of $303,000 for the year ended December 31, 2018, from operating income of $621,000 in 2017, mainly due to the decrease in units sold and available for sale during the year ended December 31, 2018, compared to the same prior year period.

Gross margin on real estate development for the year ended December 31, 2018 was 37.6%, compared to 34.4% in 2017. Such gross margin represents real estate revenue less real estate costs and expenses (excluding depreciation and amortization, selling, general and administrative expenses, and (gain) loss on sale of property and equipment), divided by real estate development revenue.

The following table provides a reconciliation of our net income to EBITDA (a non-GAAP financial measure) for the years ended December 31 as indicated:

	2018		2017
Net income (GAAP as reported)	$	5,027,751	$	8,297,751
Interest expense, net of amount capitalized	875,646		665,268
Provision for income taxes, net (1)	1,796,946		871,762
Depreciation and amortization (2)	8,436,972		7,217,901
EBITDA	$	16,137,315	$	17,052,682
___________________________
(1) Provision for income tax, net is equal to the total amount of tax provision, which includes the tax benefit for discontinued operations.
(2)Depreciation and amortization include depreciation on property, plant and equipment and amortization of finite-lived intangible assets.

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EBITDA, a non-GAAP performance measure used by management, is defined as net income plus: interest expense, provision (benefit) for income taxes and depreciation and amortization, as shown in the table above. EBITDA, a non-GAAP financial measure, does not purport to be an alternative to net income as a measure of operating performance or to net cash flows provided by operating activities as a measure of liquidity. Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly-titled measures of other companies. We use, and we believe investors benefit from the presentation of, EBITDA in evaluating our operating performance because it provides us and our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations. We believe that EBITDA is useful to investors and other external users of our financial statements in evaluating our operating performance because EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest expense, taxes, and depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired.

Using EBITDA as a performance measure has material limitations as compared to net income, or other financial measures as defined under GAAP as it excludes certain recurring items which may be meaningful to investors. EBITDA excludes interest expense; however, as we have borrowed money in order to finance transactions and operations, interest expense is an element of our cost structure and can affect our ability to generate revenue and returns for our stockholders. Further, EBITDA excludes depreciation and amortization; however, as we use capital and intangible assets to generate revenues, depreciation and amortization are a necessary element of our costs and ability to generate revenue. Finally, EBITDA excludes income taxes; however, as we are organized as a corporation, the payment of taxes is a necessary element of our operations. As a result of these exclusions from EBITDA, any measure that excludes interest expense, depreciation and amortization and income taxes has material limitations as compared to net income. When using EBITDA as a performance measure, management compensates for these limitations by comparing EBITDA and net income in each period, so as to allow for the comparison of the performance of the underlying core operations with the overall performance of the company on a full-cost, after-tax basis. Using both EBITDA and net income to evaluate the business allows management and investors to (a) assess our relative performance against our competitors and (b) monitor our capacity to generate returns for our stockholders. 

Costs and Expenses

Total costs and expenses increased by $26.8 million to $130.6 million for the year ended December 31, 2018, from $103.8 million in 2017, primarily attributable to the increase in costs associated with the increase in electrical construction revenue, as well as increases in depreciation and selling, general and administrative expenses. These increases were partially offset by the decrease in real estate development revenue related costs and expenses.

The following table sets forth selling, general and administrative (“SG&A”) expenses for the years ended December 31 as indicated:

	2018		2017
Electrical construction	$	1,797,548	$	1,587,101
Real estate development	890,951		1,014,560
Corporate	4,647,976		4,009,654
Total	$	7,336,475	$	6,611,315

SG&A expenses increased11.0% to $7.3 million for the year ended December 31, 2018, from $6.6 million for the year ended December 31, 2017. The increase in SG&A expenses was mainly attributable to higher salary and wage related expenses for 2018, when compared to 2017. As a percentage of revenue, SG&A expenses decreased to 5.3% for the year ended December 31, 2018, from 5.8% in 2017, due primarily to the aforementioned increase in revenue during 2018.

The following table sets forth depreciation and amortization expense for the years ended December 31 as indicated:

	2018		2017
Electrical construction	$	8,319,362	$	7,086,361
Real estate development	21,279		15,207
Corporate	96,331		116,333
Total	$	8,436,972	$	7,217,901

Depreciation and amortization expense, which includes $62,000 of amortization expense for acquired intangibles, increased to $8.4 million for the year ended December 31, 2018, from $7.2 million for the year ended December 31, 2017, as a result of an increase in capital expenditures.

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Income Taxes

The following table presents our provision for income tax and effective income tax rate from continuing operations for the years ended December 31 as indicated:

	2018			2017
Income tax provision	$	1,796,946		$	1,035,997
Effective income tax rate	26.3		%	10.8		%

Our effective tax rate for the year ending December 31, 2018 is 26.3%. Our effective tax rate differs from the federal statutory rate of 21% primarily due to state income taxes and nondeductible expenses. Our effective tax rate for the year ended December 31, 2017 was 10.8%. The effective tax rate differs from the federal statutory rate of 34% mainly due to the Tax Act, enacted on December 22, 2017, resulting in a one-time total net tax benefit of $2.5 million or 26% for the year ended December 31, 2017. This benefit is the result of the re-measurement of our deferred tax assets and liabilities to the lower enacted corporate tax rate of 21%, which offsets the effects of state income taxes and nondeductible expenses reduced by a significant domestic production activities deduction.

Liquidity and Capital Resources

Working Capital Analysis

Our primary cash needs have been for capital expenditures and working capital. Our primary sources of cash have been cash flow from operations and borrowings under our lines of credit and equipment financing. As of December 31, 2018, we had cash and cash equivalents of $11.4 million and working capital of $33.1 million, as compared to cash and cash equivalents of $18.5 million, and working capital of $36.0 million as of December 31, 2017.

In addition to cash flow from operations, we have an $18.0 million revolving line of credit, of which $12.4 million was available for borrowing as of December 31, 2018. This revolving line of credit is used as a Working Capital Loan, as discussed in note 7 to the consolidated financial statements. We anticipate that this cash on hand, our credit facilities and our future cash flows from operating activities will provide sufficient cash to enable us to meet our operating needs and debt requirements for the next twelve months.

Cash Flow Analysis

The following table presents our net cash flows for each of the years ended December 31 as indicated:

	2018			2017
Net cash provided by operating activities	$	6,819,485		$	8,132,463
Net cash used in investing activities	(18,577,571		)	(10,167,988		)
Net cash provided by (used in) financing activities	4,528,655			(105,380		)
Net decrease in cash, cash equivalents and restricted cash	$	(7,229,431	)	$	(2,140,905	)

Operating Activities

Cash flows from operating activities are comprised of net income, adjusted to reflect the timing of cash receipts and disbursements therefrom. Our cash flows are influenced by the level of operations, operating margins and the types of services we provide, as well as the stages of our electrical construction projects.

Cash provided by our operating activities totaled $6.8 million for the year ended December 31, 2018, compared to cash provided by operating activities of $8.1 million for 2017. The decrease in cash flows from operating activities was approximately $1.3 million and was primarily due to the changes reflected in our net income of $3.3 million, offset by the changes in our accounts receivable and accrued billings of $1.8 million. Operating cash flows normally fluctuate relative to the status of our electrical construction projects.

Days of Sales Outstanding Analysis

We evaluate fluctuations in our “accounts receivable and accrued billings” and “costs and estimated earnings in excess of billings on uncompleted contracts,” for our electrical construction operations, by comparing days of sales outstanding (“DSO”). We calculate DSO as of the end of any period by utilizing the respective quarter’s electrical construction revenue to determine sales per day. We then divide “accounts receivable and accrued billings, net of allowance for doubtful accounts” at the end of the period, by sales per day, to calculate DSO for accounts receivable. To calculate DSO for costs and estimated earnings in excess of billings, we divide “costs and estimated earnings in excess of billings on uncompleted contracts,” by sales per day.

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For the quarters ended December 31, 2018 and 2017, our DSO for accounts receivable and accrued billings were 56 and 73, respectively, and our DSO for costs and estimated earnings in excess of billings on uncompleted contracts were 30 and 20, respectively. The decrease in our DSO for accounts receivable and accrued billings and the increase in our costs and estimated earnings in excess of billings for the quarter ended December 31, 2018, when compared to the same quarterly period in 2017 was mainly due to the timing of project billings and cash collections, as well as the aforementioned decrease in revenue. As of March 8, 2019, we have received approximately 99.9% of our December 31, 2018 outstanding trade accounts receivable and have billed 68.7% of our costs and estimated earnings in excess of billings balance.

Income Taxes Paid

Income tax payments decreased to a little over $1.0 million for the year ended December 31, 2018 from $4.5 million for the year ended December 31, 2017. Taxes paid for the year ended December 31, 2018 included approximately $35,000, mainly for the 2017 tax liability, and the remaining $1.0 million for the estimated 2018 income tax liability. Taxes paid for the year ended December 31, 2017 included $500,000 for the 2016 income tax liability and the remaining $4.0 million for the estimated 2017 income tax liability.

Investing Activities

Cash used in investing activities for the year ended December 31, 2018, was $18.6 million, compared to cash used in investing activities of $10.2 million for 2017. The increase in cash used in our investing activities for the year ended December 31, 2018 is attributable to an increase in capital expenditures of $9.3 million when compared to 2017. Our capital expenditures are mainly for the purchases of equipment, primarily trucks and heavy machinery, used by our electrical construction operations for the upgrading and replacement of equipment. Our capital budget for 2019 is expected to total approximately $15.7 million, the majority of which is for continued upgrading and purchases of equipment, for our electrical construction operations, mainly due to favorable purchasing opportunities. We plan to fund these purchases through our cash on hand and equipment financing, consistent with past practices.

Financing Activities

Cash provided by financing activities for the year ended December 31, 2018, was $4.5 million, compared to cash used in financing activities of $105,000 for 2017. Our financing activities for the current year consisted mainly of borrowings totaling $18.3 million as follows: $10.5 million on our $27.49 Million Equipment Loan (previously $22.6 Million Equipment Loan) and borrowings of $7.8 million on our Working Capital Loan (as such loans are defined in note 7 to the consolidated financial statements). These borrowings were offset by repayments totaling $11.6 million, as follows: repayments of $6.1 million on our $27.49 Million Equipment Loan (previously $22.6 Million Equipment Loan), and repayments of $2.8 million on our Previous Working Capital Loan, repayments of $2.8 million on our current Working Capital Loan (as such loans are defined in note 7 to the consolidated financial statements) and repayments of $107,000 on our other long term debt (as described in note 7 to the consolidated statements). Our financing activities for the year ended December 31, 2018, also included the repurchase of 861,111 shares of common stock totaling $2.0 million, as discussed in note 10 to the consolidated financial statements. Our financing activities for the year ended December 31, 2017 consisted mainly of repayments totaling $22.7 million, as follows: $9.6 million on our $17.0 Million Equipment Loan, repayments of $7.6 million on our $10.0 Million Equipment Loan, repayments of $3.1 million on our $22.6 Million Equipment Loan, repayments of $1.3 million on our $2.0 Million Equipment Loan and repayments of $1.2 million on our Working Capital Loan(as such loans are defined in note 7 to the consolidated financial statements). These repayments were offset by net borrowings of $22.6 million on our $22.6 Million Equipment Loan (as defined in note 7 to the consolidated financial statements).

We have paid no cash dividends on our Common Stock since 1933, and it is not expected that we will pay any cash dividends on our Common Stock in the immediate future.

Debt Covenants

Our debt arrangements contain various financial and other covenants including cross-default provisions whereby any default under any loans of the Company (or its subsidiaries) with the lender will constitute a default under all of the other loans of the Company (and its subsidiaries) with the lender. The most significant of the covenants are: maximum debt to tangible net worth ratio and fixed charge coverage ratio. We must maintain: a tangible net worth of at least $20.0 million calculated quarterly; no more than $2.0 million in outside debt (with certain exceptions); a maximum debt to tangible net worth ratio of no greater than 2.5 : 1.0 and a fixed charge coverage ratio that is to equal or exceed 1.3 : 1.0. The fixed charge coverage ratio is calculated annually using EBITDAR (earnings before interest, taxes, depreciation, amortization and rental expense) divided by the sum of CPLTD (current portion of long term debt), interest expense and rental expense. We were in compliance with all of our covenants as of December 31, 2018.

24

The following are computations of these most restrictive financial covenants:

			Actual as of
Covenants Measured at Each Quarter End:	Covenant		December 31, 2018
Tangible net worth minimum	$	20,000,000	$	58,814,859
Outside debt not to exceed	$	2,000,000	$	297,599
Maximum debt/tangible net worth ratio not to exceed	2.5 : 1.0		0.90 : 1.00
Covenants Measured Only at Year End:
Earnings to fixed charge coverage ratio must equal or exceed	1.3 : 1.0		1.94 : 1.00

Forecast

We anticipate our cash on hand and cash flows from operations and credit facilities will provide sufficient cash to enable us to meet our working capital needs, debt service requirements and planned capital expenditures, for at least the next twelve months. The amount of our planned capital expenditures will depend, to some extent, on the results of our future performance. However, our revenue, results of operations and cash flows, as well as our ability to seek additional financing, may be negatively impacted by factors including, but not limited to: a decline in demand for electrical construction services, general economic conditions, heightened competition, availability of construction materials, increased interest rates, and adverse weather conditions.

Off-Balance Sheet Arrangements

We do not have any outstanding derivative financial instruments, off-balance sheet guarantees, interest rate swap transactions or foreign currency forward contracts. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit support to us or that engages in leasing, hedging or research and development services with us.

Contractual Obligations

The following table summarizes the Company’s future aggregate contractual obligations at December 31, 2018:

	Payments Due By Period
	Total		Less Than 1 Year		1-2 Years		3-5 Years		More Than 5 Years
Long term debt - principal (1)	$	29,217,599	$	7,289,855	$	19,535,744	$	2,392,000	$	—
Long term debt - interest (2)	2,240,708		1,134,249		1,084,981		21,478		—
Operating leases (3)	4,727,693		3,613,980		999,247		114,466		—
Purchase obligations (4)	3,813,623		3,813,623		—		—		—
Total	$	39,999,623	$	15,851,707	$	21,619,972	$	2,527,944	$	—

 ___________________

(1) Excludes interest, see footnote 2.

(2) Interest is at a rate per annum equal to one month LIBOR (as defined in the documentation related to each loan) plus 1.80% for notes payable and 5.85% fixed rate for the other long term debt.

(3) Operating leases with initial or remaining non-cancelable lease terms in excess of one year for office space and equipment, which is primarily used in our electrical construction operations.

(4) Purchase obligations include various contractual agreements that secure future rights to goods, services and other items to be used in the normal course of operations. These commitments include capital equipment purchases, sub-contractor services for the construction of residential properties and land purchases for the future construction of residential properties.

Item7A. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

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Item 8.    Financial Statements and Supplementary Data.

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

The Goldfield Corporation:

Opinion on the ConsolidatedFinancial Statements

We have audited the accompanying consolidated balance sheets of The Goldfield Corporation and subsidiaries (the “Company”) as of December 31, 2018 and 2017, the related consolidated statements of income, cash flows, and stockholders’ equity for the years then ended, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 12, 2019 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company has changed its method of accounting for revenue from contracts with customers in 2018 due to the adoption of Accounting Standards Codification 606, Revenue from Contracts with Customers.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ KPMG LLP

We have served as the Company’s auditor since 1963.

Orlando, Florida

March 12, 2019

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	December 31,
	2018			2017
ASSETS
Current assets
Cash and cash equivalents	$	11,376,373		$	18,529,757
Accounts receivable and accrued billings	22,236,071			21,566,842
Costs and estimated earnings in excess of billings on uncompleted contracts	12,030,000			6,074,346
Income taxes receivable	1,220,527			619,552
Residential properties under construction	8,244,995			2,412,202
Prepaid expenses	634,069			993,668
Other current assets	1,835,743			1,532,110
Total current assets	57,577,778			51,728,477
Property, buildings and equipment, at cost, net of accumulated depreciation of $43,060,083 in 2018 and $38,927,654 in 2017	48,927,055			36,072,300
Deferred charges and other assets
Land and land development costs	4,680,080			4,326,728
Cash surrender value of life insurance	547,009			550,335
Restricted cash	25,980			102,027
Goodwill	101,407			101,407
Intangibles, net of accumulated amortization of $324,634 in 2018 and $263,134 in 2017	689,166			750,666
Total deferred charges and other assets	6,043,642			5,831,163
Total assets	$	112,548,475		$	93,631,940
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	15,999,157		$	9,379,535
Billings in excess of costs and estimated earnings on uncompleted contracts	1,165,002			166,268
Current portion of other long-term debt	113,855			—
Current portion of notes payable, net	7,161,890			6,099,787
Accrued remediation costs	60,101			87,553
Total current liabilities	24,500,005			15,733,143
Deferred income taxes	6,061,042			4,698,720
Accrued remediation costs, less current portion	436,982			434,164
Other long-term debt, less current portion, net	183,744			—
Notes payable, less current portion, net	21,731,024			16,151,567
Other accrued liabilities	30,246			66,033
Total liabilities	52,943,043			37,083,627
Commitments and contingencies (notes 4 and 8)	—			—
Stockholders’ equity
Preferred stock, $1 par value, 5,000,000 shares authorized, none issued	—			—
Common stock, $.10 par value, 40,000,000 shares authorized; 27,813,772 shares issued 24,590,243 shares outstanding in 2018 and 25,451,354 shares outstanding in 2017	2,781,377			2,781,377
Additional paid-in capital	18,481,683			18,481,683
Retained earnings	41,621,191			36,593,440
Treasury stock, 3,223,529 shares in 2018 and 2,362,418 shares in 2017, at cost	(3,278,819		)	(1,308,187		)
Total stockholders’ equity	59,605,432			56,548,313
Total liabilities and stockholders’ equity	$	112,548,475		$	93,631,940

See accompanying notes to consolidated financial statements

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	Years Ended December 31,
	2018			2017
Revenue
Electrical construction	$	136,526,511		$	109,154,476
Real estate development	1,622,331			4,799,043
Total revenue	138,148,842			113,953,519
Costs and expenses
Electrical construction	113,976,157			86,714,412
Real estate development	1,012,098			3,147,791
Selling, general and administrative	7,336,475			6,611,315
Depreciation and amortization	8,436,972			7,217,901
(Gain) loss on sale of property and equipment	(176,564		)	76,810
Total costs and expenses	130,585,138			103,768,229
Total operating income	7,563,704			10,185,290
Other income (expense), net
Interest income	52,288			31,696
Interest expense, net of amount capitalized	(875,646		)	(665,268		)
Other income, net	84,351			57,654
Total other expense, net	(739,007		)	(575,918		)
Income before income taxes	6,824,697			9,609,372
Income tax provision	1,796,946			1,035,997
Income from continuing operations	5,027,751			8,573,375
Loss from discontinued operations, net of income tax benefit of $0 and $164,235, respectively	—			(275,624		)
Net income	$	5,027,751		$	8,297,751
Net income per share of common stock — basic and diluted
Continuing operations	$	0.20		$	0.34
Discontinued operations	—			(0.01		)
Net income per share of common stock — basic and diluted	$	0.20		$	0.33
Weighted average shares outstanding — basic and diluted	25,411,623			25,451,354

See accompanying notes to consolidated financial statements

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2018			2017
Cash flows from operating activities
Net income	$	5,027,751		$	8,297,751
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	8,436,972			7,217,901
Amortization of debt issuance costs	34,873			23,506
Deferred income taxes	1,362,322			(3,505,604		)
(Gain) loss on sale of property and equipment	(176,564		)	76,810
Other losses	3,326			337
Changes in operating assets and liabilities
Accounts receivable and accrued billings	(669,229		)	(2,472,435		)
Costs and estimated earnings in excess of billings on uncompleted contracts	(5,955,654		)	1,238,753
Residential properties under construction	(5,832,793		)	(860,071		)
Income taxes receivable	(600,975		)	(85,715		)
Prepaid expenses and other assets	55,966			(130,307		)
Land and land development costs	(353,352		)	603,603
Accounts payable and accrued liabilities	4,512,742			(1,900,088		)
Billings in excess of costs and estimated earnings on uncompleted contracts	998,734			(678,789		)
Accrued remediation costs	(24,634		)	306,811
Net cash provided by operating activities	6,819,485			8,132,463
Cash flows from investing activities
Proceeds from disposal of property and equipment	1,031,674			133,733
Purchases of property, buildings and equipment	(19,609,245		)	(10,301,721		)
Net cash used in investing activities	(18,577,571		)	(10,167,988		)
Cash flows from financing activities
Purchase of treasury stock	(1,970,632		)	—
Proceeds from notes payable	18,275,451			22,600,000
Repayments on notes payable	(11,645,451		)	(22,697,255		)
Other long-term debt repayments	(107,400		)	—
Debt issuance costs	(23,313		)	(8,125		)
Net cash provided by (used in) financing activities	4,528,655			(105,380		)
Net decrease in cash, cash equivalents and restricted cash	(7,229,431		)	(2,140,905		)
Cash, cash equivalents and restricted cash at beginning of the year	18,631,784			20,772,689
Cash, cash equivalents and restricted cash at end of the year	$	11,402,353		$	18,631,784
Supplemental disclosure of cash flow information
Interest paid, net of amounts capitalized	$	805,756		$	621,797
Income taxes paid, net	$	1,035,599		$	4,463,081
Supplemental disclosure of non-cash investing
Liability for equipment acquired	$	2,235,772		$	57,279
Equipment funded by other long-term debt	$	297,599		$	—

See accompanying notes to consolidated financial statements

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

YEARS ENDED DECEMBER 31, 2018 AND 2017

	Common stock			Additional paid-in capital		Retained earnings		Treasury stock			Total stockholders’ equity
	Shares	Amount
Balance as of December 31, 2016	27,813,772	$	2,781,377	$	18,481,683	$	28,295,689	$	(1,308,187	)	$	48,250,562
Net income	—	—		—		8,297,751		—			8,297,751
Balance as of December 31, 2017	27,813,772	2,781,377		18,481,683		36,593,440		(1,308,187		)	56,548,313
Repurchase of stock								(1,970,632		)	(1,970,632		)
Net income	—	—		—		5,027,751		—			5,027,751
Balance as of December 31, 2018	27,813,772	$	2,781,377	$	18,481,683	$	41,621,191	$	(3,278,819	)	$	59,605,432

See accompanying notes to consolidated financial statements

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2018 AND 2017

Note 1 – Organization and Summary of Significant Accounting Policies

Overview

The Goldfield Corporation (the “Company”) was incorporated in Wyoming in 1906 and subsequently reincorporated in Delaware in 1968. The Company’s principal line of business is the construction of electrical infrastructure for the utility industry and industrial customers. The principal market for the Company’s electrical construction operation is primarily in the Southeast, mid-Atlantic and Texas-Southwest regions of the United States.

Basis of Financial Statement Presentation

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company adopted Accounting Standards Updates (“ASU”) ASU 2011-05 and ASU 2011-12, which require comprehensive income to be reported in either a single statement or in two consecutive statements reporting net income and other comprehensive income. The amendment eliminates the option to report other comprehensive income and its components in the statement of changes in stockholders’ equity. However, comprehensive income is equivalent to net income for the Company, and therefore, the Company’s accompanying financial statements do not include a Statement of Other Comprehensive Income.

Cash and Cash Equivalents

The Company considers highly liquid investments with maturities of three months or less when purchased to be cash equivalents.

Allowance for Doubtful Accounts

The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on customer specific information and historical write-off experience. The Company reviews its allowance for doubtful accounts quarterly. Account balances are charged off against the allowance after reasonable means of collection have been exhausted and the potential for recovery is considered remote. As of both December 31, 2018 and 2017, upon its review, management determined it was not necessary to record an allowance for doubtful accounts due to the majority of accounts receivable being generated by electrical utility customers who the Company considers creditworthy based on timely collection history and other considerations.

Property, Buildings, Equipment and Depreciation

Property, buildings and equipment are stated at cost. Depreciation on property, buildings and equipment is calculated on the straight-line method over the estimated useful lives of the assets. Leasehold improvements are depreciated on a straight-line basis over the shorter of the lease term, including renewals that are deemed to be reasonably assured, or the estimated useful life of the improvement.

In accordance with Accounting Standard Codification (“ASC”) ASC Topic 360-10-05, Accounting for the Impairment or Disposal of Long-Lived Assets, the Company assesses the need to record impairment losses on long-lived assets when events and circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when future estimated undiscounted cash flows expected to result from use of the asset are less than the asset’s carrying value. Any resulting loss would be measured at fair value based on discounted expected cash flows.

Electrical Construction Revenue

In May 2014, the FASB issued ASU 2014-09, ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”),which will replace most existing revenue recognition guidance in U.S. generally accepted accounting principles and is intended to improve and converge the financial reporting requirements for revenue from contracts with customers with International Financial Reporting Standards (“IFRS”). Subsequently Financial Accounting Standards Board (the “FASB”) issued various Accounting Standards Updates (“ASUs”) in relation to the new revenue recognition standard. The core principle of ASC 606 is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. ASC 606 also requires additional disclosures about the nature, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASC 606 allows for either retrospective or cumulative effect transition methods of adoption and is effective for periods beginning after December 15, 2017.

On January 1, 2018 the Company adopted the new accounting standard ASC 606 and all the related amendments (“new revenue standard”) to all applicable contracts using the modified retrospective method (cumulative effect method). Applicable

31

contracts did not include contracts considered substantially complete. Contracts that were modified before the beginning of the earliest period presented were not retrospectively restated. Instead, the Company reflected the aggregate effect of all modifications when identifying the satisfied and unsatisfied performance obligations, determining the transaction price and allocating the transaction price as of the date of adoption. Adoption of the new revenue standard did not result in significant changes to the Company’s accounting policies, business processes, systems or controls, or have a material impact on its financial position, results of operations and cash flows. In addition, the Company concluded that the cumulative effect of initially applying the new revenue standard was immaterial and consequently did not record an adjustment to the opening balance of retained earnings (less than $30,000 net of tax). The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company does not expect the adoption of the new revenue standard to have a material impact to its financial position, results of operations and cash flows on an ongoing basis.

The Company accepts contracts on a fixed-price, unit-price and service agreement basis. Under the new revenue standard, electrical construction fixed-price contracts previously accounted for under ASC 605-35 will be recognized over time as services are performed and the underlying obligations to customers are fulfilled. This resulted mainly in the use of input measures on a cost to cost basis similar to the practices previously in place for contracts accounted for under ASC 605-35. The Company concluded that under the new revenue standard the primary impact is on the timing of when contract modifications, variable consideration and change orders are recognized, mainly due to the application of the contract identification criteria. This resulted in timing differences on the recognition in revenue and margin when compared to prior practices.

Revenue from unit-price contracts is recognized over time as services are performed and the underlying obligations to customers are fulfilled. The Company has elected to apply the practical expedient within ASC 606-10-55-18 for contracts that are routinely billed based on established man hour and equipment rates and the amounts invoiced correspond directly with the value to the customer of the Company’s performance completed to date. These contracts will be treated as a series of distinct services transferred over time and will generally result in a similar revenue pattern when compared to the prior accounting policies.

Revenue from service agreements are recognized as services are performed. Revenue from service agreements are billed on either a man-hour or man-hour plus equipment basis. Terms of the Company’s service agreements may extend for periods beyond one year.

The Company’s contracts allow it to bill additional amounts for change orders and claims. The Company considers a claim to be for additional work performed outside the scope of the contract and contested by the customer. Historically, claims relating to electrical construction work have not been significant.

A change order is a modification to a contract that changes the provisions of the contract, typically resulting from changes in scope, specifications, design, manner of performance, facilities, equipment, materials, sites, or period of completion of the work under the contract. It is the Company’s policy to include revenue from change orders in contract value only when they can be reliably estimated and realization is considered probable.

The asset, “costs and estimated earnings in excess of billings on uncompleted contracts” represents revenue recognized in excess of amounts billed. The liability, “billings in excess of costs and estimated earnings on uncompleted contracts” represents billings in excess of revenue recognized.

Contract costs include all direct material, direct labor, subcontractor costs and indirect costs related to contract performance, such as supplies, tools and equipment maintenance. General and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, estimated profitability and final contract settlements may result in revisions to costs and income and are recognized in the period in which the revisions are determined.

Land and Land Development Costs and Residential Properties Under Construction

The costs of a land purchase and any development expenses up to the initial construction phase of any residential property development project are recorded under the asset “land and land development costs.” Once construction commences, both the land development costs and construction costs are recorded under the asset “residential properties under construction.” The assets “land and land development costs” and “residential properties under construction” relating to specific projects are recorded as current assets when the estimated project completion date is less than one year from the date of the consolidated financial statements, or as non-current assets when the estimated project completion date is one year or more from the date of the consolidated financial statements.

In accordance with ASC Topic 360-10, Accounting for the Impairment or Disposal of Long-lived Assets, land and residential properties under construction are reviewed by the Company for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the carrying amount or basis is not expected to be recovered, impairment losses are recorded and the related assets are adjusted to their estimated fair value. The fair value of an asset is the amount at which that asset could be bought or sold in a current transaction between willing parties, other than in a forced or

32

liquidation sale. The Company also complies with ASC Topic 820, Fair Value Measurement, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The Company did not record an impairment write-down to either of its land carrying value or residential properties under construction carrying value for either years ended December 31, 2018 or 2017.

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes, which establishes the recognition requirements. Deferred tax assets and liabilities are recognized for the future tax effects attributable to temporary differences and carryforwards between the financial statement carrying amounts of existing assets and liabilities and the respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.  Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as interest expense and other general and administrative expenses, respectively, and not as a component of income taxes.

Executive Long-term Incentive Plan

The Company has not issued shares pursuant to The Goldfield Corporation 2013 Long-term Incentive Plan (the “2013 Plan”) in either 2018 or 2017. Therefore, the Company has no compensation expense for shares pursuant to the 2013 Plan for either of the years ended December 31, 2018 or 2017.

Use of Estimates

Management of the Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with U.S. generally accepted accounting principles. Actual results could differ from those estimates. Management considers the most significant estimates in preparing these consolidated financial statements to be the estimated costs at completion of electrical construction contracts in progress.

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable and accrued billings, restricted cash collateral deposited with insurance carriers, cash surrender value of life insurance policies, accounts payable, notes payable, and other current liabilities.

Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value guidance establishes a valuation hierarchy, which requires maximizing the use of observable inputs when measuring fair value.

The three levels of inputs that may be used are:

Level 1 - Quoted market prices in active markets for identical assets or liabilities.

Level 2 - Observable market based inputs or other observable inputs.

Level 3 - Significant unobservable inputs that cannot be corroborated by observable market data. These values are generally determined using valuation models incorporating management’s estimates of market participant assumptions.

Fair values of financial instruments are estimated through the use of public market prices, quotes from financial institutions, and other available information. Management considers the carrying amounts reported on the consolidated balance sheets for cash and cash equivalents, accounts receivable and accrued billings, accounts payable and accrued liabilities, to approximate fair value due to the immediate or short-term maturity of these financial instruments. The Company has determined the fair value of its fixed rate other long-term debt to be $292,000 using an interest rate of 4.31% (Level 2 input), which is the Company's current interest rate on borrowings. The Company’s carrying value of long-term notes payable are estimated by management to approximate fair value since the interest rates prescribed by Branch Banking and Trust Company (the “Bank”) are variable market interest rates and are adjusted periodically, and as such, are classified as Level 2. Restricted cash is considered by management to approximate fair value due to the nature of the asset held in a secured interest bearing bank account. The carrying value of cash surrender value of life insurance is also considered by management to approximate fair value as the carrying value is based on the current settlement value under the contract, as provided by the carrier and as such, is classified as Level 2.

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Restricted Cash

The Company’s restricted cash includes cash deposited in a secured interest bearing bank account, as required by the Collateral Trust Agreement in connection with the Company’s previous workers’ compensation insurance policies, as described in note 12. Also, see note 12 for financial information regarding the immaterial impact of an ASU issued by the FASB specifically related to the disclosure of restricted cash.

Goodwill and Intangible Assets

Intangible assets with finite useful lives recorded in connection with a historical acquisition are amortized over the term of the related contract or useful life, as applicable. Intangible assets held by the Company with finite useful lives include customer relationships and trademarks. The Company reviews the values recorded for intangible assets and goodwill to assess recoverability from future operations annually or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. As of December 31, 2018, the Company assessed the recoverability of its long-lived assets and goodwill, by reviewing relevant events and circumstances to evaluate the qualitative factors in addition to the quantitative impairment test. As a result, there was no impairment of the carrying amounts of such assets.

Reclassifications

Certain amounts previously reflected in the prior year statement of cash flows have been reclassified to conform to the Company’s 2018 presentation. The reclassifications are associated with the adoption of ASU 2016-15 for restricted cash.

Recent Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, to increase transparency and comparability among organizations by recognizing all lease transactions (with terms in excess of 12 months) on the balance sheet as a lease liability and a right-of-use (“ROU”) asset (as defined). ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with earlier application permitted. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. The Company will use the effective date as our date of initial application. Consequently, financial information will not be updated and the disclosures required under the new standard will not be provided for dates and periods before January 1, 2019. The new standard provides a number of optional practical expedients in transition. We expect to elect the package of practical expedients, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We do not expect to elect the use-of-hindsight or the practical expedient pertaining to land easements; the latter not being applicable to us. The new standard also provides practical expedients for an entity’s ongoing accounting. We currently expect to elect the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. We also currently expect to elect the practical expedient to not separate lease and non-lease components for all of our leases. While we continue to assess all of the effects of adoption, we expect upon adoption to recognize additional operating liabilities ranging from $4 million to $5 million, with corresponding ROU assets of the same amount based on the present value of the remaining minimum rental payments under current leasing standards for existing operating leases. The Company expects the derecognition of existing deferred rent allowances to be immaterial. The Company is not anticipating material changes to either the consolidated statements of income or the consolidated statements of cash flows as a result of the adoption. The impact of this ASU is non-cash in nature, therefore the Company does not expect the adoption of this new guidance to have a material impact on the Company’s cash flows or liquidity.

In August 2016, the FASB issued ASU 2016-15, which provides clarification regarding how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. In addition, in November 2016, the FASB issued ASU 2016-18, which requires that amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Both updates are effective for annual and interim periods beginning after December 15, 2017, with early adoption permitted. The Company has adopted these updates and determined there is not a material impact on its consolidated financial statements due to the adoption. The consolidated statement of cash flows for the twelve months ended December 31, 2017, has been adjusted on the line item “Accounts receivable and accrued billings” to reflect an immaterial difference in the balance of cash, cash equivalents and restricted cash for the 2017 period. The Company did not make any other prior period adjustments due to the adoption of this ASU. Had the Company made the adjustment to its consolidated balance sheet as of December 31, 2017, restricted cash would have decreased by approximately $2,300 with a corresponding increase to other receivables. This adjustment is associated with the interest income earned on the amount deposited in a trust account for the restricted cash balance. See note 12 for additional restricted cash disclosure information.

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In October 2016, the FASB issued ASU 2016-16, which eliminates the requirement to defer the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. Under the new guidance, an entity should recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This update is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years; early adoption is permitted and is to be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings at the time of adoption. The adoption of ASU 2016-16 had no impact on the Company’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, which eliminates Step 2 of the current goodwill impairment test. A goodwill impairment loss will instead be measured at the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the recorded amount of goodwill allocated to that reporting unit. The provisions of this ASU are effective for years beginning after December 15, 2019, with early adoption permitted for any impairment test performed on testing dates after January 1, 2017. The Company is currently assessing the impact that adoption will have on its consolidated financial statements however, the Company does not expect this ASU to have a significant impact on its consolidated financial statements.

Note 2 – Contract Assets and Contract Liabilities

On January 1, 2018 the Company adopted the new accounting standard ASC 606 and all the related amendments (“new revenue standard”) to all applicable contracts using the modified retrospective method. Applicable contracts did not include contracts considered substantially complete. Contracts that were modified before the beginning of the earliest period presented were not retrospectively restated. Instead, the Company reflected the aggregate effect of all modifications when identifying the satisfied and unsatisfied performance obligations, determining the transaction price and allocating the transaction price as of the date of adoption. Adoption of this standard did not result in significant changes to the Company’s accounting policies, business processes, systems or controls, or have a material impact on its financial position, results of operations and cash flows.

The following table presents the net contract assets and liabilities for the electrical construction operations as of the dates indicated:

	December 31, 2018			December 31, 2017			$ Change
Contract assets (1)	$	12,030,000		$	6,074,346		$	5,955,654
Contract liabilities (2)	(1,845,049		)	(367,552		)	(1,477,497		)
Net contract assets	$	10,184,951		$	5,706,794		$	4,478,157
___________________________
(1) Contract assets consist of amounts under the caption “Costs and estimated earnings in excess of billings on uncompleted contracts.”
(2) Contract liabilities consist of the aggregate of amounts presented under the caption “Billings in excess of costs and estimated earnings on uncompleted contracts” and any contract loss accruals included in “Accounts payable and accrued liabilities.”

The amounts billed but not paid by customers pursuant to retention provisions of the electrical construction contracts were $2.2 million and $3.3 million as of December 31, 2018 and 2017, respectively, and are included in the accompanying consolidated balance sheets in accounts receivable and accrued billings. Retainage is expected to be collected within the next twelve months.

The following table presents the changes in the net contract assets and liabilities for the electrical construction operations for the twelve months ended December 31, 2018:

	$ Change
Cumulative adjustment due to changes in contract values (1)	$	1,877,219
Cumulative adjustment due to changes in estimated costs at completion	(1,556,467		)
Revenue recognized in the period	100,224,125
Amounts reclassified to receivables	(95,587,957		)
Impairment of contract assets (2)	(478,763		)
Total	$	4,478,157
(1) Amount attributable to contract modifications accounted for on a cumulative catch-up basis where the customer has approved a change in the scope or price of the contract, where the modification is treated as part of the existing contract and where the remaining goods and services are not distinct.
(2)Adjustment amounts due to changes in contract losses.

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For the year ended December 31, 2018, $166,000 of the total revenue recognized in the current period was attributable to the contract liability billings in excess of costs and estimated earnings on uncompleted contracts’ balance as of December 31, 2017.

Note 3 – Income Taxes

On December 22, 2017, the President signed into law the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revises the U.S. tax code by, among other items, reducing the federal corporate tax rate from its highest rate of 35% to a single rate of 21%.

Certain provisions in the Tax Act, such as providing for full expensing of certain depreciable property, the limitation on interest expense deductibility, the limitation on the deductibility of certain executive compensation and net operating loss carryforwards have had an impact on the Company and have been reflected in the consolidated financial statements for the year ended December 31, 2018.

The Company has evaluated the impact of the new revenue standard under ASC 606 for tax purposes. The impact has been reported in the financial statements as of December 31, 2018 and accounted for tax purposes under deferred tax liabilities as a Section 481(a) adjustment. It is a non-automatic change in accounting method based on current Internal Revenue Service (“IRS”) regulations at this time and is subject to review and approval by the IRS.

The following table presents the income tax provision from continuing operations for the years ended December 31 as indicated:

	2018			2017
Current
Federal	$	(153,610	)	$	3,863,151
State	597,909			558,993
	444,299			4,422,144
Deferred
Federal	1,779,574			(3,270,928		)
State	(426,927		)	(115,219		)
	1,352,647			(3,386,147		)
Total	$	1,796,946		$	1,035,997

The following table presents the total income tax provision for the years ended December 31 as indicated:

	2018		2017
Income tax provision	$	1,796,946	$	1,035,997
Discontinued operations	—		(164,235		)
Total	$	1,796,946	$	871,762

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The following table presents the temporary differences and carryforwards, which give rise to deferred tax assets and liabilities as of December 31 as indicated:

	2018			2017
Deferred tax assets
Accrued vacation	$	139,713		$	113,893
Acquisition costs capitalized	55,917			58,886
Accrued remediation costs	120,493			130,168
Net operating loss carryforwards	435,121			—
Sec 163(j) interest limitation	199,582			—
Federal depreciation in excess of state	635,202			—
Accrued payables	17,914			174,674
Percentage completed contract method for tax	1,557,437			276,413
Accrued workers’ compensation	205,150			159,237
Capitalized bidding costs	73,565			121,227
Inventory adjustments	263,680			139,565
Accrued lease expense	15,199			17,902
Accrued contract losses	164,843			50,220
Other	4,097			4,103
Total deferred tax assets	3,887,913			1,246,288
Deferred tax liabilities
481 (a) adjustment for deferred revenue	(24,602		)	—
Tax amortization in excess of financial statement amortization	(13,378		)	(10,850		)
Tax depreciation in excess of financial statement depreciation	(9,910,975		)	(5,934,158		)
Total deferred tax liabilities	(9,948,955		)	(5,945,008		)
Total net deferred tax liabilities	$	(6,061,042	)	$	(4,698,720	)

As of December 31, 2018, the Company had net operating loss (“NOL”) carryforwards of approximately $2.1 million available to offset future federal taxable income. The Tax Act allows for an indefinite carryforward of the NOL to use against future taxable income, subject to a limitation of 80 percent of taxable income each year.

As of December 31, 2018, the non-current deferred tax liabilities increased to $6.1 million from $4.7 million as of December 31, 2017 primarily due to additional tax depreciation in excess of book depreciation. The Tax Act provides for the full expensing of certain depreciable property for 2018 and through 2022 and partial expensing through 2026.

The carrying amounts of deferred tax assets are reduced by a valuation allowance, if based on the available evidence, it is more likely than not such assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the deferred tax assets are expected to be recovered or settled. In the assessment for a valuation allowance, appropriate consideration is given to positive and negative evidence related to the realization of the deferred tax assets. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability and tax planning alternatives. If the Company determines it will not be able to realize all or part of the deferred tax assets, a valuation allowance would be recorded to reduce deferred tax assets to the amount that is more likely than not to be realized.

Based on assumptions with respect to forecasts of future taxable income and tax planning, among others, the Company anticipates being able to generate sufficient taxable income to utilize the deferred tax assets. Therefore, the Company has not recorded a valuation allowance against deferred tax assets. The minimum amount of future taxable income required to be generated to fully realize the deferred tax assets as of December 31, 2018 is approximately $13.4 million.

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The following table presents the differences between the Company’s effective income tax rate and the federal statutory rate on income from continuing operations for the years ended December 31 as indicated:

	2018	2017
Federal statutory rate	21.0%	34.0%
State tax rate, net of federal tax	3.2	3.1
Nondeductible expenses	5.4	3.6
Domestic production activities deduction	—	(4.0)
Tax Act rate change	—	(26.0)
Other	(3.3)	0.1
Total	26.3%	10.8%

The Company had gross unrecognized tax benefits of $5,000 as of both December 31, 2018 and 2017. The Company believes that it is reasonably possible that the liability for unrecognized tax benefits related to certain state income tax matters may be settled within the next twelve months. The federal statute of limitation has expired for tax years prior to 2015 and relevant state statutes vary. The Company is currently not under any income tax audits or examinations and does not expect the assessment of any significant additional tax in excess of amounts provided.

The following table presents a reconciliation of the beginning and ending amounts of unrecognized tax benefits for the years as indicated:

	2018		2017
Balance as of January 1	$	4,723	$	4,723
Increase from current year tax positions	—		—
Decrease from settlements with taxing authority	—		—
Balance as of December 31	$	4,723	$	4,723

The Company accrues interest and penalties related to unrecognized tax benefits as interest expense and other general and administrative expenses, respectively, and not as a component of income taxes. Decreases in interest and penalties are due to settlements with taxing authorities and expiration of statutes of limitation. During the years ended December 31, 2018 and 2017, the Company recognized $1,000 each year in interest and penalties. The Company had accrued as a current liability $11,000 and $9,000 for the future payment of interest and penalties as of December 31, 2018 and 2017, respectively.

Note 4 – Commitments and Contingencies Related to Discontinued Operations

Discontinued operations represent former mining activities, the last of which ended in 2002. Pursuant to an agreement with the United States Environmental Protection Agency (the “EPA”), the Company performed certain remediation actions at a property sold over fifty years ago. This remediation work was completed by September 30, 2015. As of December 31, 2018 and 2017, the Company has established a contingency provision related to discontinued operations, which was $497,000 and $522,000, respectively. No change to the provision was required for either of the three or twelve month periods ended December 31, 2018. For the three and twelve month periods endedDecember 31, 2017, the Company increased the provision $275,000 and $440,000 ($172,000 and $276,000, net of tax benefit of $103,000 and $164,000, respectively). This increase resulted mainly from changes in the scope of the project as required by the EPA and the state of Washington.

The remaining balance of the accrued remediation costs as of December 31, 2018, mainly represents estimated future charges for EPA response costs and monitoring and provisions for potential future remediation efforts of the property as required by the state of Washington. The total costs to be incurred in future periods may vary from this estimate. The amounts recorded in the aforementioned contingency provision are not discounted. The provision will be reviewed periodically based upon facts and circumstances available at the time.

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Note 5 – Property, Buildings and Equipment

The following table presents the balances of major classes of properties as of December 31 as indicated:

	Estimated useful lives in years	2018		2017
Land	—	$	670,400	$	530,221
Land improvements	7 - 15	537,175		495,484
Buildings and improvements	5 - 40	2,767,603		2,588,053
Leasehold improvements	5 - 39	254,385		252,646
Machinery and equipment	2 - 10	87,734,262		70,892,181
Construction in progress	—	23,313		241,369
Total		91,987,138		74,999,954
Less accumulated depreciation		43,060,083		38,927,654
Net properties, buildings and equipment		$	48,927,055	$	36,072,300

Management reviews the net carrying value of all properties, buildings and equipment on a regular basis to assess and determine whether trigger events of impairment exist and the need for possible impairments. As a result of such review, no impairment write-down was considered necessary for the years ended December 31, 2018 and 2017.

Note 6 – 401(k) Employee Benefits Plan

Effective January 1, 1995, the Company adopted The Goldfield Corporation and Subsidiaries Employee Savings and Retirement Plan, a defined contribution plan that qualifies under Section 401(k) of the Internal Revenue Code. The plan provides retirement benefits to all employees who meet eligibility requirements and elect to participate. Under the plan, participating employees may defer up to 75% of their pre-tax compensation per calendar year subject to Internal Revenue Code limits. The Company’s contributions to the plan are discretionary and amounted to approximately $258,000 and $297,000 for the years ended December 31, 2018 and 2017, respectively.

Note 7 – Notes Payable

The following table presents the balances of our notes payables as of December 31 as indicated:

Branch Banking and Trust Company	Maturity Date	2018		2017		Interest Rates
						2018		2017
Working Capital Loan	November 28, 2020	$	5,000,000	$	—	4.31	%	—	%
$27.49 Million Equipment Loan (previously $22.6 Million Equipment Loan)	May 1, 2022	23,920,000		19,540,000		4.31	%	3.25	%
Previous Working Capital Loan		—		2,750,000		—	%	3.38	%
Total notes payable		28,920,000		22,290,000
Less unamortized debt issuance costs		27,086		38,646
Total notes payable, net		28,892,914		22,251,354
Less current portion of notes payable, net		7,161,890		6,099,787
Notes payable net, less current portion		$	21,731,024	$	16,151,567

As of December 31, 2018, the Company, and the Company’s wholly owned subsidiaries Southeast Power, Pineapple House of Brevard, Inc. (“Pineapple House”), Bayswater Development Corporation (“Bayswater”), Power Corporation of America (“PCA”) Precision Foundations, Inc. (“PFI”) and C and C Power Line, Inc. (“C&C”), collectively (the “Debtors,”) were parties to a Master Loan Agreement, dated May 24, 2018 (the “2018 Master Loan Agreement”), with Branch Banking and Trust Company (the “Bank”). The 2018 Master Loan Agreement restates substantially the same terms and conditions as those set forth in the previous Master Loan Agreement (the “Previous Master Loan Agreement”) among the Debtors and the Bank, originally entered into on June 9, 2017, except for the update in the exhibit for the loan modification and the new Working Capital Loan described below and an increase in the permissible outside debt and leases amount from $500,000 in the Previous Master Loan Agreement to $2.0 million.

As of December 31, 2018, the Company had a promissory note and a series of related ancillary agreements with the Bank providing for a revolving line of credit loan for a maximum principal amount of $18.0 million, to be used as a “Working

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Capital Loan” (the “Working Capital Loan”). The Company entered into the Working Capital Loan on May 24, 2018, the Working Capital Loan restates and replaces all previous renewals and or modifications on the previous working capital loan entered into on August 26, 2005 (the “Previous Working Capital Loan”) on substantially the same terms and conditions as those set forth in the Previous Working Capital Loan. Borrowings of $2.78 million, outstanding as of May 24, 2018, from the Working Capital Loan were used to pay in full the outstanding amount of the Previous Working Capital Loan, plus accrued interest and loan closing costs.

As of December 31, 2018, borrowings under the Working Capital Loan were $5.0 million. As of December 31, 2018 and December 31, 2017, borrowings under the Previous Working Capital Loan were zero and $2.8 million, respectively.

As a credit guaranty to the Bank, the Company is contingently liable for the guaranty of a subsidiary obligation under an irrevocable letter of credit related to workers’ compensation. The amount of this letter of credit was $575,000 and $420,000 as of December 31, 2018 and December 31, 2017, respectively.

On January 1, 2018, the Company had a loan agreement with the Bank for a $22.6 Million equipment loan (the “$22.6 Million Equipment Loan”). The $22.6 Million Equipment Loan between the Company and the Bank was modified on May 24, 2018 increasing the principal amount to $27.49 Million (the “$27.49 Million Equipment Loan”). Borrowings of $16.99 million, outstanding as of May 24, 2018, plus accrued interest, under the $22.6 Million Equipment Loan were continued under the $27.49 Million Equipment Loan. The remaining portion of the $27.49 Million Equipment Loan balance was drawn by the Company for equipment purchases that were made after January 1, 2018.

As of December 31, 2018, the Company had a loan agreement with the Bank for the $27.49 Million Equipment Loan. Under the documentation related to the $27.49 Million Equipment Loan, principal payments in the amount of $510,000 plus accrued interest commenced on June 9, 2018 and continued monthly thereafter until and including the payment due on December 9, 2018. On December 31, 2018, the outstanding principal balance of the $27.49 Million Equipment Loan was amortized over a forty (40) month period. Equal monthly payments of principal in the amount of $598,000 plus accrued interest commenced on January 9, 2019 and will continue monthly on the same day of each month thereafter, with all outstanding principal, accrued interest, and all other amounts then due and owing to be payable on May 1, 2022, its maturity date.

As of December 31, 2018, the Debtors had a loan agreement with the Bank under the 2018 Master Loan Agreement for the $27.49 Million Equipment Loan (previously $22.6 Million Equipment Loan), and the Working Capital Loan, which are guaranteed by the Debtors and includes the grant of a continuing security interest in all now owned and after acquired and wherever located personal property of the Debtors.

The $27.49 Million Equipment Loan (previously $22.6 Million Equipment Loan) and the Working Capital Loan bear interest at a rate per annum equal to one month LIBOR (as defined in the documentation related to each loan) plus 1.80%, which will be adjusted monthly and subject to a maximum rate as described in the documentation related to each loan.

Subsequently, on March 7, 2019, the Company, the Debtors and the Bank entered into a First Amendment to the 2018 Master Loan Agreement (the “Amendment”). The Amendment provides an exhibit which lists new loans, or modifications of loans, which will be governed by the 2018 Master Loan Agreement and which were also entered into on March 7, 2019.

Also, on March 7, 2019, the Company, the Debtors and the Bank entered into a modification of the $27.49 Million Equipment Loan, increasing it to a $38.2 million equipment loan (as increased, the “$38.2 Million Equipment Loan”) and a new $4.5 million equipment promissory note (the “$4.5 Million Equipment Note”).

Borrowings of $22.7 million, outstanding as of March 7, 2019, plus accrued interest under the $27.49 Million Equipment Loan will continue under the $38.2 Million Equipment Loan. The $15.5 million balance remaining on the $38.2 Million Equipment Loan was drawn by the Company on March 8, 2019 for equipment purchases that were made on or after August 1, 2018.

Under the documentation related to the $38.2 Million Equipment Loan, principal payments of $598,000 plus accrued interest will commence on March 9, 2019 and continue monthly thereafter until and including the payment due on December 9, 2019. On January 9, 2020, equal monthly principal payments of $650,000, plus accrued interest, will commence and continue monthly thereafter on the same day of each month until the March 9, 2024 maturity date.

Under the documentation related to the $4.5 Million Equipment Note, borrowings will be made only for the purchase of equipment currently held by the Company under Master Lease Agreements and will not exceed the cost of the lease buy-out. Interest only payments on any amounts drawn will commence on April 7, 2019, and continue monthly on the same day through and including the payment due on March 7, 2020. Thereafter, principal payments of $93,750 plus accrued interest will commence on April 7, 2020, and continue monthly thereafter until and including the payment due on March 7, 2024.

The Company’s debt arrangements contain various financial and other covenants including, but not limited to: minimum tangible net worth, maximum debt to tangible net worth ratio and fixed charge coverage ratio. Other loan covenants prohibit, among other things, a change in legal form of the Company, and entering into a merger or consolidation. The loans also have

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cross-default provisions whereby any default under any loans of the Company (or its subsidiaries) with the Bank, will constitute a default under all of the other loans of the Company (and its subsidiaries) with the Bank.

The schedule of payments of the notes payable as of December 31, 2018 is as follows:

2019	$	7,176,000
2020	12,176,000
2021	7,176,000
2022	2,392,000
Total payments of notes payable	$	28,920,000

Other Long Term Debt

As of December 31, 2018, the Company had an equipment purchase loan agreement for a specialty piece of equipment to be used in the Company’s electrical construction operations in the amount of $405,000 plus interest and sales tax. The agreement requires monthly payments of $10,687 plus interest at a 5.85% fixed rate. The loan matures on June 14, 2021 and there are no early payment provisions.

The schedule of payments of the other long term debt as of December 31, 2018 is as follows:

2019	$	113,855
2020	120,697
2021	63,047
2022	—
Total payments of other long term debt	$	297,599

Note 8 – Commitments and Contingencies

Operating Leases

The Company leases its principal office space under a nine-year operating lease. Within the provisions of the office lease, there are escalations in payments over the base lease term, as well as renewal periods and cancellation provisions. The effects of the escalations have been reflected in rent expense on a straight-line basis over the expected lease term. In addition, the Company leases other office spaces as principal offices for our subsidiaries PCA, PFI and C&C. The Company also leases office equipment under operating leases that expire over the next four years. The Company’s leases require payments of property taxes, insurance and maintenance costs in addition to the lease payments. Additionally, the Company leases several off-site storage facilities, used to store equipment and materials, under a month to month lease arrangement. Lastly, the Company has several lease agreements to lease certain equipment from time to time over a 60-month term. The leased equipment is used in our electrical construction operations. The Company recognizes rent expense on a straight-line basis over the expected lease term.

Future minimum lease payments under operating leases having initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2018 are as follows:

2019	$	3,613,980
2020	910,778
2021	88,469
2022 and beyond	114,466
Total minimum operating lease payments	$	4,727,693

Total expense for the operating leases were $4.7 million and $4.7 million for the years ended December 31, 2018 and 2017, respectively.

Performance Bonds

In certain circumstances, the Company is required to provide performance bonds to secure its contractual commitments. Management is not aware of any performance bond issued for the Company that has ever been called by a customer. As of December 31, 2018, outstanding performance bonds issued on behalf of the Company’s electrical construction subsidiaries amounted to approximately $46.4 million.

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Collective Bargaining Agreements

C&C, one of the Company’s electrical construction subsidiaries, is party to collective bargaining agreements with unions representing workers performing field construction operations. The collective bargaining agreements expire at various times and have typically been renegotiated and renewed on terms similar to the ones contained in the expiring agreements. The agreements require the subsidiary to pay specified wages, provide certain benefits to their respective union employees and contribute certain amounts to multi-employer pension plans and employee benefit trusts. The subsidiary’s multi-employer pension plan contribution rates generally are specified in the collective bargaining agreements (usually on an annual basis), and contributions are made to the plans on a “pay-as-you-go” basis based on such subsidiary’s union employee payrolls, which cannot be determined for future periods because contributions depend on, among other things, the number of union employees that such subsidiary employs at any given time; the plans in which it may participate vary depending on the projects it has ongoing at any time; and the need for union resources in connection with those projects. If the subsidiary withdraws from, or otherwise terminates its participation in, one or more multi-employer pension plans, or if the plans were to otherwise become substantially underfunded, such subsidiary could be assessed liabilities for additional contributions related to the underfunding of these plans. The Company is not aware of any amounts of withdrawal liability that have been incurred as a result of a withdrawal by C&C from any multi-employer defined benefit pension plans.

Multi-employer Pension Plans 

The Company contributes to a multi-employer pension plan on behalf of employees covered by collective bargaining agreements. These plans are administered jointly by management and union representatives and cover substantially all full-time and certain part-time union employees who are not covered by other plans. The risks of participating in multi-employer plans are different from single-employer plans in the following aspects: (1) assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers, (2) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers, and (3) if the Company chooses to stop participating in a multi-employer plan, we could, under certain circumstances, be liable for unfunded vested benefits or other expenses of jointly administered union/management plans. At this time, we have not established any liabilities because withdrawal from these plans is not probable. For the years ended December 31, 2018 and 2017, the contributions to these plans were $227,000 and $180,000, respectively.

The Company’s participation in multi-employer pension plans is outlined in the table below. The EIN column provides the Employer Identification Number (“EIN”) of the plan. Unless otherwise noted, the most recent Pension Protection Act zone status available in 2018 and 2017 is for the plan’s year ended December 31, 2018, and 2017, respectively. The zone status is based on information that the Company received from the plan, and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65% funded, plans in the yellow zone are less than 80% funded, and plans in the green zone are at least 80% funded. The “FIP” column indicates plans for which a financial improvement plan (“FIP”) is either pending or has been implemented. The last column lists the expiration date(s) of the collective-bargaining agreement(s) to which the plans are subject. There have been no significant changes in the number of Company employees covered by the multi-employer plans or other significant events that would impact the comparability of contributions to the plans.

Information about the Plan is publicly available on Form 5500, Annual Return / Report of Employee Benefit Plan. The Plan year-end is December 31st and no single employer contributes 5% or more of total plan contributions.

		Certified Zone Status
Plan  Name:	EIN Number	Plan  Number	2018	2017	FIP Implemented	Surcharge Imposed	Expiration Date of Collective Bargaining Agreement
National Electrical Benefit Fund	53-0181657	001	Green	Green	Not applicable (green-zone plan)	Not applicable (green-zone plan)	August 31, 2019

Committed Expenditures 

The Company from time to time commits to various contractual agreements that secure future rights to goods, services and other items to be used in the normal course of operations. These commitments include capital equipment purchases, sub-contractor services for the construction of residential properties and land purchases for the future construction of residential properties. The Company’s committed expenditures as of December 31, 2018, totaled $3,813,623 all of which is expected to be completed in 2019.

Legal Proceedings 

The Company is involved in various legal claims arising in the ordinary course of business. The Company has concluded that the ultimate disposition of these matters should not have a material adverse effect on the Company’s consolidated financial position, results of operations, or liquidity.

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Note 9 – Income Per Share of Common Stock

Basic income per common share is computed by dividing net income by the weighted average number of common stock shares outstanding during the period. Diluted income per share reflects the potential dilution that could occur if common stock equivalents, such as stock options outstanding, were exercised into common stock that subsequently shared in the earnings of the Company.

As of December 31, 2018 and 2017, the Company had no common stock equivalents. The computation of the weighted average number of common stock shares outstanding excludes 3,223,529 and 2,362,418 shares of Treasury Stock for the years ended December 31, 2018 and 2017, respectively.

Note 10 – Common Stock Repurchase Plan

The Company has had a stock repurchase plan since September 17, 2002, when the Board of Directors approval was announced. As last amended by the Board of Directors on September 13, 2018, this plan permits the purchase of up to 3,500,000 shares. There is currently available for purchase through September 30, 2019, a maximum of 293,829 shares. The Company may repurchase its shares either in the open market or through private transactions. The volume of the shares to be repurchased is contingent upon market conditions and other factors. During the year ended December 31, 2018, 861,111 shares were purchased at a cost of $1,970,632 (average cost of $2.29 per share), no shares were repurchased during the year ended December 31, 2017. As of December 31, 2018, the total number of shares repurchased under the Repurchase Plan was 3,206,171 at a cost of $3,260,098 (average cost of $1.02 per share). The Company currently holds the repurchased stock as Treasury Stock, reported at cost. Prior to September 17, 2002, the Company had 17,358 shares of Treasury Stock that it had purchased at a cost of $18,720.

Subsequently, on March 7, 2019, the Company’s Board of Directors extended the Company’s Common Stock Repurchase plan from September 30, 2019 until September 30, 2020 and increased the number of shares available for purchase under the plan. The plan previously authorized the repurchase of up to 3,500,000 shares, of which 3,273,880 have been repurchased as of March 7, 2019. The revised plan will permit an additional 2,500,000 shares to be repurchased, increasing the amount available for repurchase to 2,726,120 shares as of March 7, 2019.

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Note 11 – Business Segment, Business Credit Risks and Concentration

Segment

The Company is currently involved in two segments, electrical construction and real estate development. There were no material amounts of sales or transfers between segments and no material amounts of foreign sales. Any inter-segment sales have been eliminated.

The following table sets forth certain segment information as of December 31 for the years indicated:

Continuing Operations	2018			2017
Revenue
Electrical construction	$	136,526,511		$	109,154,476
Real estate development	1,622,331			4,799,043
Total revenue	138,148,842			113,953,519
Operating expenses
Electrical construction	123,914,953			95,463,721
Real estate development	1,924,835			4,177,558
Corporate	4,745,350			4,126,950
Total operating expenses	130,585,138			103,768,229
Operating income (loss)
Electrical construction	12,611,558			13,690,755
Real estate development	(302,504		)	621,485
Corporate	(4,745,350		)	(4,126,950		)
Total operating income	7,563,704			10,185,290
Other income (expenses), net
Electrical construction	(761,117		)	(562,233		)
Real estate development	(56,010		)	(71,945		)
Corporate	78,120			58,260
Total other expenses, net	(739,007		)	(575,918		)
Net income (loss) before taxes
Electrical construction	11,850,441			13,128,522
Real estate development	(358,514		)	549,540
Corporate	(4,667,230		)	(4,068,690		)
Total net income before taxes	$	6,824,697		$	9,609,372
Identifiable Assets
Electrical construction	$	93,642,412		$	78,745,673
Real estate development	16,444,209			8,713,310
Corporate	2,461,854			6,172,957
Total	$	112,548,475		$	93,631,940
Capital Expenditures
Electrical construction	$	19,514,124		$	10,191,515
Real estate development	42,545			1,065
Corporate	52,576			109,141
Total	$	19,609,245		$	10,301,721
Depreciation and Amortization
Electrical construction	$	8,319,362		$	7,086,361
Real estate development	21,279			15,207
Corporate	96,331			116,333
Total	$	8,436,972		$	7,217,901

44

Credit Risks

Financial instruments, mainly within the electrical construction operations, which potentially subject the Company to concentrations of credit risk, consist principally of accounts receivable and accrued billings in the amounts of $22.2 million and $21.6 million as of December 31, 2018 and 2017, respectively, which management reviews to assess the need to establish an allowance for doubtful accounts.

Cash and Cash Equivalents

The Company holds cash on deposit in U.S. banks, in excess of Federal Deposit Insurance Corporation insurance limits. The Company has not experienced and does not anticipate any losses in any such accounts.The Company mitigates this risk by doing business with well capitalized, quality financial institutions.

Customer Concentration

Revenue (in thousands of dollars) to customers exceeding 10% of the Company’s total revenue for the years ended December 31 as indicated are as follows:

	2018			2017
	Amount		% of Total revenue	Amount		% of Total revenue
Electrical construction operations
Customer A	$	39,866	29	$	38,306	34
Customer B	22,085		16	16,912		15
Customer C	16,972		12	11,681		10

Revenue by service/product (in thousands of dollars) for the years ended December 31 as indicated are as follows:

	2018			2017
	Amount		% of Total revenue	Amount		% of Total revenue
Electrical construction
Principal electrical construction operations (1)	$	129,022	93	$	100,604	88
Other electrical construction (2)	7,505		6	8,550		8
Total	136,527		99	109,154		96
Real estate development	1,622		1	4,799		4
Total revenue	$	138,149	100	$	113,953	100
___________________________
(1) Principal electrical construction operations include revenue from transmission lines, distribution systems, substations and drilled pier foundations.
(2)Other electrical construction includes revenue from storm work, fiber optics and other miscellaneous electrical construction items as disclosed in the revenue disaggregation reported in note 14.

The total of the above categories may differ from the sum of the components due to rounding.

Note 12 – Restricted Cash

Restricted cash, reported under “Deferred charges and other assets” on the Company’s consolidated balance sheet, represents amounts deposited in a trust account to secure the Company’s obligations in connection with the Company’s previous workers’ compensation insurance policies.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same such amounts shown in the statement of cash flows as of the dates indicated:

	December 31, 2018		December 31, 2017
Cash and cash equivalents	$	11,376,373	$	18,529,757
Restricted cash	25,980		102,027
Cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows	$	11,402,353	$	18,631,784

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Note 13 – Goodwill and Other Intangible Assets Associated with the Acquisition of C&C

The Company performed an annual impairment assessment on its goodwill and intangible assets on December 31, 2018.  Based upon this analysis, the Company determined that there were no impairments.

The following table presents the gross and net balances of our goodwill and intangible assets as of the dates indicated:

		December 31, 2018							December 31, 2017
	Useful Life (Years)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Goodwill	Indefinite	$	101,407	$	—		$	101,407	$	101,407	$	—		$	101,407
Trademarks/Names	15	$	640,000	$	(213,334	)	$	426,666	$	640,000	$	(170,670	)	$	469,330
Customer relationships	20	350,000		(87,500		)	262,500		350,000		(70,000		)	280,000
Non-competition agreement	5	10,000		(10,000		)	—		10,000		(8,664		)	1,336
Other	1	13,800		(13,800		)	—		13,800		(13,800		)	—
Total		$	1,013,800	$	(324,634	)	$	689,166	$	1,013,800	$	(263,134	)	$	750,666

Amortization of definite-lived intangible assets will be approximately $60,000 annually for 2019 through 2023.

Note 14 – ASC 606 Revenue Recognition and Significant Accounting Policies Disclosures

On January 1, 2018, the Company adopted the new revenue standard ASC 606 and all the related amendments (“new revenue standard”). Adoption of this standard did not result in significant changes to the Company’s accounting policies, business processes, systems or controls, or have a material impact on its financial position, results of operations and cash flows. The Company concluded that the cumulative effect of initially applying the new revenue standard was immaterial and consequently did not record an adjustment to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company does not expect the adoption of the new revenue standard to have a material impact to its financial position, results of operations and cash flows on an ongoing basis.

The Company’s significant accounting policies are detailed in note 1, changes to the Company’s accounting policies as a result of adopting the new revenue standard are discussed below.

To determine the proper revenue recognition method for contracts for electrical construction services, the Company evaluates whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. This evaluation requires significant judgment and the decision to combine a group of contracts or separate the combined or single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period. For most of the contracts, the Company provides a significant service of integrating a complex set of tasks and components into a single project or capability. Hence, the entire contract is accounted for as one performance obligation. However, less likely, if a contract is separated into more than one performance obligation, the Company allocates the total transaction price for each performance obligation in an amount based on the estimated relative stand-alone selling prices of the promised goods or services underlying each performance obligation.

The Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. The Company generally recognizes revenue over time as it performs because of continuous transfer of control to the customer. Because of control transferring over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The cost-to-cost measure of progress is generally used for its contracts because it best depicts the transfer of control to the customer which occurs as the Company incurs costs on the contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenue is recorded proportionally as costs are incurred. 

Due to the nature of the work required to be performed on many of the performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. The Company estimates variable consideration at the most likely amount which the Company expects to receive. The Company includes estimated

46

amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of all information (historical, current and forecasted) that is reasonably available to the Company.

Contracts are often modified to account for changes in contract specifications and requirements. The Company considers contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations. Most of the contract modifications are for goods or services that are not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as if they were part of that existing contract. The effect of a contract modification on the transaction price and our measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis.

The Company has a standard and disciplined quarterly estimated costs at completion process in which management reviews the progress and execution of our performance obligations. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the availability of materials, the length of time to complete the performance obligation (e.g., to estimate increases in wages and prices for materials and related support cost allocations), and execution by our subcontractors, among other variables. Based on this analysis, any quarterly adjustments to net revenue, cost of electrical construction revenue and the related impact to operating income are recognized as necessary in the period they become known. 

The following table disaggregates the Company’s revenue for the years ended December 31 as indicated:

	2018		2017
Electrical construction operations (1)
Southeast	$	54,123,848	$	56,268,413
mid-Atlantic	41,071,994		29,289,385
Texas-Southwest	33,825,666		15,046,719
Other electrical construction (2)	7,505,003		8,549,959
Total	136,526,511		109,154,476
Real estate development	1,622,331		4,799,043
Total revenue	$	138,148,842	$	113,953,519
___________________________
(1) Principal electrical construction operations include revenue from transmission lines, distribution systems, substations and drilled pier foundations.
(2) Other electrical construction includes revenue from storm work, fiber optics and other miscellaneous electrical construction items.

The Company would have recognized $134,000less revenue under legacy accounting practices for the year ended December 31, 2018, than it did under the new revenue standard. This was attributable to the assessment of variable consideration and performance obligations within our contractual arrangements.

The aggregate amount of the transaction price allocated to performance obligations that are unsatisfied as of December 31, 2018 was $36.4 million, all of which is expected to be satisfied within the next twelve months.

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Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A.    Controls and Procedures.

Evaluation of disclosure controls and procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management in a timely manner. An evaluation was performed under the supervision and with the participation of our management, including John H. Sottile, our Chief Executive Officer (“CEO”), and Stephen R. Wherry, our Chief Financial Officer (“CFO”), of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of December 31, 2018. Based upon this evaluation, our management, including our CEO and our CFO, concluded that our disclosure controls and procedures were effective, as of the end of the period covered by this Annual Report on Form 10-K, at the reasonable assurance level.

Management’s report on internal control over financial reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rule 13a-15(f), which consists of processes and procedures designed to provide reasonable assurance to our management and board of directors regarding the preparation and fair presentation of our published financial statements. Under the supervision and with the participation of our management, including our CEO and CFO, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2018, based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on our assessment, we believe that as of December 31, 2018, our internal control over financial reporting was effective based on those criteria.

KPMG LLP, the Company’s independent registered public accounting firm, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting.

Changes in internal control

No changes in our internal control over financial reporting occurred during the fourth quarter of 2018 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the effectiveness of controls

A control system, no matter how well conceived and operated, can provide only reasonable assurance, not absolute assurance, that the objectives of the control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that the design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies and procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

48

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

The Goldfield Corporation:

Opinion on Internal Control Over Financial Reporting

We have audited The Goldfield Corporation and subsidiaries’ (the “Company”) internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company as of December 31, 2018 and 2017, the related consolidated statements of income, cash flows, and stockholders’ equity for the years then ended, and the related notes (collectively, the “consolidated financial statements”), and our report dated March 12, 2019 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG LLP

Orlando, Florida

March 12, 2019

49

Item 9B.    Other Information.

None.

PART III

Item 10.    Directors, Executive Officers and Corporate Governance.

Information concerning the directors of the Company will be contained under the heading “Proposal 1. Election of Directors” and information concerning compliance with Section 16(a) of the Securities Exchange Act of 1934, as amended, will be contained under the heading “Section 16(a) Beneficial Ownership Reporting Compliance” in our 2019 Proxy Statement, which information is incorporated herein by reference.

Our executive officers are as follows:

Name and Title	Year in which service began as officer	Age(1)
John H. Sottile Chairman of the Board, President and Chief Executive Officer, Director	1983	71
Stephen R. Wherry Senior Vice President, Chief Financial Officer, Treasurer, and Assistant Secretary	1988	60
Jason M. Spivey President Power Corporation of America, Southeast Power Corporation and Precision Foundations, Inc.	2017	48

___________________

(1) As of February 28, 2019

Throughout the past five years, John H. Sottile and Stephen R. Wherry have been principally employed as executive officers of the Company, with responsibilities substantially consistent with those of their current positions.

John H. Sottile has served as Chairman of the Board of Directors since May 1998.

Jason M. Spivey joined Southeast Power Corporation as Project Manager in January 2015 and was promoted to Assistant Vice President in May 2016, prior to being appointed President in June of 2017. Prior to joining the Company, Mr. Spivey worked in the power line construction industry for over 25 years and held various leadership roles related to transmission and distribution line construction at Orlando Utilities Commission, a municipally-owned public utility company, including the position of Transmission Line Supervisor from February 2010 until January 2015.

The term of office of all directors is until the next annual meeting and the term of office of all officers is one year, and until their successors are elected and qualify.

Code of Ethics

In March 2003, our Board of Directors adopted a Code of Ethics (the “Code”) that is specifically applicable to our Chief Executive Officer and Senior Financial Officers, including our Chief Financial Officer (who is our Principal Financial and Accounting Officer). The Code incorporates guidelines designed to deter wrongdoing, to promote honest and ethical conduct, compliance with applicable laws and regulations, prompt internal reporting of Code violations and accountability for Code adherence. A copy of the Code was filed as an exhibit to our Annual Report on Form 10-K for the period ended December 31, 2003.

The Code is also available, free of charge, within the “Corporate Governance” section of our website, our website address is www.goldfieldcorp.com. We intend to disclose on our website any amendments to, or waivers from, our Code of Ethics that are required to be publicly disclosed pursuant to the rules of the Securities and Exchange Commission.

Audit Committee

Information concerning our Audit Committee including the Audit Committee Financial Expert will be contained under “Committees and Meetings of the Board of Directors” in our 2019 Proxy Statement, which information is incorporated herein by reference.

Item 11.    Executive Compensation.

Information concerning executive compensation and director compensation will be contained under “Executive Compensation” and “Director Compensation” in our 2019 Proxy Statement, which information is incorporated herein by reference.

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Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Information concerning the security ownership of certain beneficial owners and management will be contained under “Security Ownership of Certain Beneficial Owners and Management” and “Executive Compensation-Equity Compensation Plan Information” in our 2019 Proxy Statement, which information is incorporated herein by reference.

Item 13.    Certain Relationships and Related Transactions, and Director Independence.

Information concerning certain relationships and related transactions of the directors and officers of our Company and director independence will be contained under “Proposal 1. Election of Directors” and “Director Compensation-Transactions with Related Parties” in our 2019 Proxy Statement, which information is incorporated herein by reference.

Item 14.    Principal Accounting Fees and Services.

Information concerning the accounting services performed by our Independent Registered Public Accounting Firm, KPMG LLP, and their respective fees for such services will be contained under “Audit Committee Report and Fee Information” in our 2019 Proxy Statement, which information is incorporated herein by reference.

PART IV

Item 15. Exhibits, Financial Statement Schedules.

(a) The following documents are filed as part of this report:

(1) Financial Statements

	Page
Report of Independent Registered Public Accounting Firm	26
Consolidated Balance Sheets — December 31, 2018 and 2017	27
Consolidated Statements of Income — Years ended December 31, 2018 and 2017	28
Consolidated Statements of Cash Flows — Years ended December 31, 2018 and 2017	29
Consolidated Statements of Stockholders’ Equity — Years ended December 31, 2018 and 2017	30
Notes to Consolidated Financial Statements	31

(2) Financial Statement Schedules

No financial statement schedules are included as all applicable information is included in the notes to the consolidated financial statements.

(3) Exhibits

3-1 (p)	Restated Certificate of Incorporation of the Company, as amended, is hereby incorporated by reference to Exhibit 3-1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1987, heretofore filed with the Commission (file No. 1-7525).
3-2	Amended and Restated By-Laws of the Company are hereby incorporated by reference to Exhibit 3-1 of the Company’s Current Report on Form 8-K dated December 11, 2007, heretofore filed with the Commission (file No. 1-7525).
4-1 (p)	Specimen copy of Company’s Common Stock certificate is hereby incorporated by reference to Exhibit 4-5 of the Company’s Annual Report on Form 10-K for the year ended December 31, 1987, heretofore filed with the Commission (file No. 1-7525).
+10-1	Amended and Restated Employment Agreement dated November 1, 2001 between The Goldfield Corporation and John H. Sottile is hereby incorporated by reference to Exhibit 10-2(g) of the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2001, heretofore filed with the Commission (file No. 1-7525).
+10-1(a)	Amendment to John H. Sottile Employment Agreement, dated April 15, 2010, between John H. Sottile and The Goldfield Corporation, is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 8-K dated April 15, 2010, heretofore filed with the Commission (file No. 1-7525).
+10-1(b)	Letter dated March 15, 2012 from John H. Sottile to the Benefits and Compensation Committee of the Board of Directors of The Goldfield Corporation, is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 8-K dated March 15, 2012, heretofore filed with the Commission (file No. 1-7525).

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+10-1(c)	Partial Bonus Waiver Letter dated November 5, 2018 from John H. Sottile to the Benefits and Compensation Committee of the Board of Directors of The Goldfield Corporation, is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 10-Q dated November 5, 2018, hereto filed with the Commission (file No. 1-7525).
+10-2	Form of Indemnification Agreement is hereby incorporated by reference to Item 1.01 of the Company’s Current Report on Form 8-K dated December 7, 2017, heretofore filed with the Commission (file No. 1-7525).
+10-3	Amended and Restated Performance-Based Bonus Plan effective January 1, 2016 is hereby incorporated by reference to the Company’s 2016 Proxy Statement, heretofore filed with the Commission on April 27, 2016 (file No. 1-7525).
+10-4	The Goldfield Corporation 2013 Long-Term Incentive Plan is hereby incorporated by reference to the Company’s 2013 Proxy Statement, heretofore filed with the Commission on April 29, 2013 (file No. 1-7525).
10-5	Collateral Trust Agreement between The Goldfield Corporation, Valley Forge Insurance Company Branch Banking and Trust Company is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 8-K dated October 25, 2010, heretofore filed with the Commission (file No. 1-7525).
10-6	The Lease Agreement dated June 7, 2004 between Hibiscus Office Park, LLC and The Goldfield Corporation is hereby incorporated by reference to Exhibit 10-1 of the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2004, heretofore filed with the Commission (file No. 1-7525).
10-6(a)	The First Amendment to the Lease Agreement signed October 7, 2011, effective November 1, 2011 between Hibiscus Office Park, LLC and The Goldfield Corporation is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 8-K dated October 7, 2011, heretofore filed with the Commission (file No. 1-7525).
10-6(b)	The Second Amendment to the Lease Agreement signed July 29, 2013, effective November 1, 2013 between Hibiscus Office Park, LLC and The Goldfield Corporation is hereby incorporated by reference to Exhibit 10-1 of the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2013, heretofore filed with the Commission (file No. 1-7525).
10-7	Master Lease Agreement dated March 31, 2014, among Power Corporation of America and Terex Master Trust relating to (4) 60 month lease schedules for specific use of equipment totaling $6.4 million in the aggregate over the 60-month term is hereby incorporated by reference to Item 2.03 of the Company’s Current Report on Form 8-K dated April 3, 2014, heretofore filed with the Commission (file No. 1-7525).
10-8	Master Loan Agreement, dated May 24, 2018, among The Goldfield Corporation, Power Corporation of America, Southeast Power Corporation, C and C Power Line, Inc, Bayswater Development Corporation, Precision Foundations, Inc., Pineapple House of Brevard, Inc., and Branch Banking and Trust Company relating to all prior and new loans with Branch Banking and Trust Company as listed in Exhibit “A” of the loan document is hereby incorporated by reference to Exhibit 10-1 of the Company’s Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-9	Promissory Note of The Goldfield Corporation, dated June 9, 2017, relating to Loans of up to $22.6 million is hereby incorporated by reference to Exhibit 10-2 of the Company’s Current Report on Form 8-K dated June 9, 2017, heretofore filed with the Commission (file No. 1-7525).
10-9(a)	Addendum to Promissory Note dated June 9, 2017, among The Goldfield Corporation and Branch Banking and Trust Company relating to Loans of up to $22.6 million is hereby incorporated by reference to Exhibit 10-3 of the Company’s Current Report on Form 8-K dated June 9, 2017, heretofore filed with the Commission (file No. 1-7525).
10-9(b)	Modification Promissory Note, dated May 24, 2018, among The Goldfield Corporation and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $27.49 million is hereby incorporated by reference to Exhibit 10-2 of the Company's Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-9(c)	Addendum To Modification Promissory Note, dated May 24, 2018, among The Goldfield Corporation and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $27.49 million is hereby incorporated by reference to Exhibit 10-3 of the Company's Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-9(d)	Security Agreement, dated May 24, 2018, between Southeast Power Corporation, Power Corporation of America, Bayswater Development Corporation, Pineapple House of Brevard, Inc., C and C Power Line, Inc., Precision Foundations, Inc., and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $27.49 million is hereby incorporated by reference to Exhibit 10-4 of the Company's Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).

52

10-9(e)	Guaranty Agreement, dated May 24, 2018, between Southeast Power Corporation, Power Corporation of America, Bayswater Development Corporation, Pineapple House of Brevard, Inc., C and C Power Line, Inc., Precision Foundations, Inc., and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $27.49 million is hereby incorporated by reference to Exhibit 10-5 of the Company's Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-10	Promissory Note, dated May 24, 2018, among The Goldfield Corporation and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $18.0 million is hereby incorporated by reference to Exhibit 10-6 of the Company’s Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-10(a)	Addendum To Promissory Note, dated May 24, 2018, among The Goldfield Corporation and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $18.0 million is hereby incorporated by reference to Exhibit 10-7 of the Company’s Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-10(b)	Security Agreement, dated May 24, 2018, between Southeast Power Corporation, Power Corporation of America, Bayswater Development Corporation, Pineapple House of Brevard, Inc., C and C Power Line, Inc., Precision Foundations, Inc., and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $18.0 million is hereby incorporated by reference to Exhibit 10-8 of the Company’s Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
10-10(c)	Guaranty Agreement, dated May 24, 2018, between Southeast Power Corporation, Power Corporation of America, Bayswater Development Corporation, Pineapple House of Brevard, Inc., C and C Power Line, Inc., Precision Foundations, Inc., and Branch Banking and Trust Company relating to Loans to The Goldfield Corporation of up to $18.0 million is hereby incorporated by reference to Exhibit 10-9 of the Company’s Current Report on Form 8-K dated May 24, 2018, heretofore filed with the Commission (file No. 1-7525).
(p)	Filed as a paper exhibit with the U.S. Securities and Exchange Commission
11	For computation of per share earnings, see note 9 to the consolidated financial statements.
*21	Subsidiaries of Registrant
*23	Consent of Independent Registered Public Accounting Firm
*24	Powers of Attorney
*31-1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 15 U.S.C. Section 7241
*31-2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, 15 U.S.C. Section 7241
*32-1	**Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350
*32-2	**Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350
101.INS	XBRL Instance Document
101.SCH	XBRL Schema Document
101.CAL	XBRL Calculation Linkbase Document
101.DEF	XBRL Definition Linkbase Document
101.LAB	XBRL Label Linkbase Document
101.PRE	XBRL Presentation Linkbase Document

* Filed herewith.

**

These exhibits are furnished in accordance with Regulation S-K Item 601(b)(32) and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liability of that section. These exhibits shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the registrant specifically incorporates them by reference.

+

Management contract, compensatory plan or arrangement.

53

Item 16. Form 10-K Summary.

None.

54

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE GOLDFIELD CORPORATION

By:	/s/ JOHN H. SOTTILE
	(John H. Sottile)
	Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer)

Dated: March 12, 2019

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on March 12, 2019.

Signature	Title
/s/ JOHN H. SOTTILE	Chairman of the Board, President and Chief Executive Officer (Principal Executive Officer)
(John H. Sottile)
/s/ STEPHEN R. WHERRY	Senior Vice President, Chief Financial Officer, Treasurer and Assistant Secretary (Principal Financial and Accounting Officer)
(Stephen R. Wherry)
*	Director
(Stephen L. Appel)
*	Director
(David P. Bicks)
*	Director
(Harvey C. Eads, Jr.)
*	Director
(John P. Fazzini)
*	Director
(Danforth E. Leitner)

*By:	/s/ JOHN H. SOTTILE
	John H. Sottile
	Attorney-in-Fact

55