Uncompleted Contracts (Notes)

9 Months Ended

Mar. 31, 2017

Disclosure Customer Contracts Additional Information [Abstract]

Contract terms of the Company’s construction contracts generally provide for progress billings based on project milestones. The excess of costs incurred and estimated earnings over amounts billed on uncompleted contracts is reported as a current asset. The excess of amounts billed over costs incurred and estimated earnings recognized on uncompleted contracts is reported as a current liability. Gross and net amounts on uncompleted contracts are as follows:



	March 31, 2017			June 30, 2016
	(in thousands)
Costs incurred and estimated earnings recognized on uncompleted contracts	$	1,266,388		$	1,875,014
Billings on uncompleted contracts	1,271,826			1,829,340
	$	(5,438	)	$	45,674
Shown in balance sheet as:
Costs and estimated earnings in excess of billings on uncompleted contracts	$	69,986		$	104,001
Billings on uncompleted contracts in excess of costs and estimated earnings	75,424			58,327
	$	(5,438	)	$	45,674

Progress billings in accounts receivable at March 31, 2017 and June 30, 2016 included retentions to be collected within one year of $55.0 million and $29.7 million, respectively. Contract retentions collectible beyond one year are included in other assets in the condensed consolidated balance sheet and totaled $0.3 million as of June 30, 2016. There were no retentions collectible beyond one year as of March 31, 2017.

Other

Our results were negatively impacted by an increased cost estimate related to a large project in the Electrical Infrastructure segment, which resulted in a decrease in gross profit. The financial impact of the project was a gross profit (loss) of ($18.9) million and ($13.7) million for the three and nine months ended March 31, 2017, respectively. The profit on future revenue related to this project will be recognized based on the current project forecast, which is at a greatly reduced gross profit margin. The change in cost estimate resulted from a deterioration in the financial forecast of the project during the third quarter and was caused by various factors that have delayed schedule progress and reduced productivity. The adjustment in the current period represents the Company’s estimate, based on the information currently available, of the impact of the increased forecasted cost to complete the project. The current forecast includes estimates for the expected outcome regarding reimbursement from the customer of additional costs incurred and expected to be incurred, as well as the receipt of schedule based incentive revenue currently included in the contract.

Work on the project continues to progress; however, critical work remains, which is at risk from continued impacts to project costs and schedule. Therefore, it is possible that future changes in contract estimates, including those related to project costs, project timeline, receipt of schedule based incentive revenue, and the estimated recovery of additional costs, could occur and have a material positive or negative impact to our results of operations and financial position in subsequent accounting periods.