Revenue Recognition

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

Disaggregation of Revenue

A majority of the Company’s revenues are earned through contracts with customers that normally provide for payment upon completion of specified work or units of work as identified in the contract. Although there is considerable variation in the terms of these contracts, they are primarily structured as fixed-price contracts, under which the Company agrees to perform a defined scope of a project for a fixed amount, or unit-price contracts, under which the Company agrees to do the work at a fixed price per unit of work as specified in the contract. The Company also enters into time-and-equipment and time-and-materials contracts under which the Company is paid for labor and equipment at negotiated hourly billing rates and for other expenses, including materials, as incurred at rates agreed to in the contract. Finally, the Company sometimes enters into cost-plus contracts, where the Company is paid for costs plus a negotiated margin. On occasion, time-and-equipment, time-and-materials and cost-plus contracts require the Company to include a guaranteed not-to-exceed maximum price.

Historically, fixed-price and unit-price contracts have had the highest potential margins; however, they have had a greater risk in terms of profitability because cost overruns may not be recoverable. Time-and-equipment, time-and-materials and cost-plus contracts have historically had less margin upside, but generally have had a lower risk of cost overruns. The Company also provides services under master service agreements (“MSAs”) and other variable-term service agreements. MSAs normally cover maintenance, upgrade and extension services, as well as new construction. Work performed under MSAs is typically billed on a unit-price, time-and-materials or time-and-equipment basis. MSAs are typically one to three years in duration; however, most of the Company’s contracts, including MSAs, may be terminated by the customer on short notice, typically 30 to 90 days, even if the Company is not in default under the contract. Under MSAs, customers generally agree to use the Company for certain services in a specified geographic region. Most MSAs include no obligation for the contract counterparty to assign specific volumes of work to the Company and do not require the counterparty to use the Company exclusively, although in some cases the MSA contract gives the Company a right of first refusal for certain work. Additional information related to the Company’s market types is provided in Note 10–Segment Information.

The components of the Company’s revenue by contract type for the three and nine months ended September 30, 2021 and 2020 were as follows:

	Three months ended September 30, 2021
	T&D				C&I				Total
(dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Fixed price	$	122,185	39.9	%	$	246,803	81.3	%	$	368,988	60.5	%
Unit price	83,200		27.1		21,567		7.1		104,767		17.2
T&E	101,161		33.0		35,266		11.6		136,427		22.3
	$	306,546	100.0	%	$	303,636	100.0	%	$	610,182	100.0	%

	Three months ended September 30, 2020
	T&D				C&I				Total
(dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Fixed price	$	126,588	42.2	%	$	248,577	80.7	%	$	375,165	61.7	%
Unit price	88,708		29.6		22,587		7.3		111,295		18.3
T&E	84,443		28.2		36,998		12.0		121,441		20.0
	$	299,739	100.0	%	$	308,162	100.0	%	$	607,901	100.0	%

The components of the Company’s revenue by contract type for the nine months ended September 30, 2021 and 2020 were as follows:

	Nine months ended September 30, 2021
	T&D				C&I				Total
(dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Fixed price	$	431,673	45.5	%	$	733,686	81.2	%	$	1,165,359	62.9	%
Unit price	258,489		27.3		58,477		6.5		316,966		17.1
T&E	258,123		27.2		111,793		12.3		369,916		20.0
	$	948,285	100.0	%	$	903,956	100.0	%	$	1,852,241	100.0	%

	Nine months ended September 30, 2020
	T&D				C&I				Total
(dollars in thousands)	Amount		Percent		Amount		Percent		Amount		Percent
Fixed price	$	374,065	44.8	%	$	654,815	81.5	%	$	1,028,880	62.8	%
Unit price	236,720		28.3		59,713		7.4		296,433		18.1
T&E	224,983		26.9		89,126		11.1		314,109		19.1
	$	835,768	100.0	%	$	803,654	100.0	%	$	1,639,422	100.0	%

The components of the Company’s revenue by market type for the three months ended September 30, 2021 and 2020 were as follows:

	Three months ended September 30, 2021					Three months ended September 30, 2020
(dollars in thousands)	Amount		Percent		Segment	Amount		Percent		Segment
Transmission	$	165,953	27.2	%	T&D	$	185,007	30.4	%	T&D
Distribution	140,593		23.0		T&D	114,732		18.9		T&D
Electrical construction	303,636		49.8		C&I	308,162		50.7		C&I
Total revenue	$	610,182	100.0	%		$	607,901	100.0	%

The components of the Company’s revenue by market type for the nine months ended September 30, 2021 and 2020 were as follows:

	Nine months ended September 30, 2021					Nine months ended September 30, 2020
(dollars in thousands)	Amount		Percent		Segment	Amount		Percent		Segment
Transmission	$	588,126	31.8	%	T&D	$	537,762	32.8	%	T&D
Distribution	360,159		19.4		T&D	298,006		18.2		T&D
Electrical construction	903,956		48.8		C&I	803,654		49.0		C&I
Total revenue	$	1,852,241	100.0	%		$	1,639,422	100.0	%

Remaining Performance Obligations

As of September 30, 2021, the Company had $1.51 billion of remaining performance obligations. The Company’s remaining performance obligations include projects that have a written award, a letter of intent, a notice to proceed or an agreed upon work order to perform work on mutually accepted terms and conditions.

The following table summarizes the amount of remaining performance obligations as of September 30, 2021 that the Company expects to be realized and the amount of the remaining performance obligations that the Company reasonably estimates will not be recognized within the next twelve months.

	Remaining Performance Obligations at September 30, 2021
(in thousands)	Total		Amount estimated to not be recognized within 12 months		Total at December 31, 2020
T&D	$	534,964	$	89,531	$	645,422
C&I	974,683		207,990		889,596
Total	$	1,509,647	$	297,521	$	1,535,018

The Company expects a vast majority of the remaining performance obligations to be recognized within twenty-four months, although the timing of the Company’s performance is not always under its control. Additionally, the difference between the remaining performance obligations and backlog is due to the exclusion of a portion of the Company’s MSAs under certain contract types from the Company’s remaining performance obligations as these contracts can be canceled for convenience at any time by the Company or the customer without considerable cost incurred by the customer. Additional information related to backlog is provided in Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”