Revenue from Contracts with Customers Revenue from Contracts with Customers (Tables)

6 Months Ended

Jun. 30, 2018

Revenue from Contract with Customer [Abstract]

The following tables provide further disaggregation of our revenues by categories we use to evaluate our financial performance within each of our reportable segments (in thousands):



	For the three months ended June 30, 2018			% of Total		For the six months ended June 30, 2018			% of Total
United States electrical construction and facilities services:
Commercial market sector	$	199,283		41	%	$	383,665		41	%
Institutional market sector	31,060			6	%	59,068			6	%
Hospitality market sector	7,289			2	%	12,805			1	%
Manufacturing market sector	94,018			20	%	179,812			19	%
Healthcare market sector	36,679			8	%	75,186			8	%
Transportation market sector	72,511			15	%	143,775			16	%
Water and wastewater market sector	6,140			1	%	10,753			1	%
Short duration projects ⁽¹⁾	25,195			5	%	54,725			6	%
Service work	8,836			2	%	17,004			2	%
	481,011					936,793
Less intersegment revenues	(1,469		)			(2,499		)
Total segment revenues	$	479,542				$	934,294



United States mechanical construction and facilities services:
Commercial market sector	$	263,660		35	%	$	495,511		34	%
Institutional market sector	78,079			11	%	143,706			10	%
Hospitality market sector	21,191			3	%	47,718			3	%
Manufacturing market sector	99,047			13	%	198,923			14	%
Healthcare market sector	60,006			8	%	126,120			9	%
Transportation market sector	4,724			1	%	9,930			1	%
Water and wastewater market sector	42,519			6	%	79,270			5	%
Short duration projects ⁽¹⁾	76,114			10	%	160,009			11	%
Service work	98,301			13	%	184,526			13	%
	743,641					1,445,713
Less intersegment revenues	(2,984		)			(6,209		)
Total segment revenues	$	740,657				$	1,439,504

________


(1)	Represents those projects which generally are completed within three months or less.



United States building services:
Commercial site-based services	$	119,043	26	%	$	265,804	29	%
Government site-based services	55,147		12	%	110,556		12	%
Mechanical services	260,249		56	%	487,591		53	%
Energy services	26,594		6	%	51,834		6	%
Total segment revenues	$	461,033			$	915,785



	For the three months ended June 30, 2018		% of Total		For the six months ended June 30, 2018		% of Total
United States industrial services:
Field services	$	125,527	75	%	$	273,617	78	%
Shop services	41,620		25	%	78,677		22	%
Total segment revenues	$	167,147			$	352,294

Total United States operations	$	1,848,379			$	3,641,877



United Kingdom building services:
Service work	$	54,998	52	%	$	110,273	52	%
Projects & extras	50,509		48	%	102,124		48	%
Total segment revenues	$	105,507			$	212,397

Total worldwide operations	$	1,953,886			$	3,854,274

Contract Assets and Contract Liabilities

Net contract liabilities consisted of the following (in thousands):



	June 30, 2018			December 31, 2017
Contract assets, current	$	156,134		$	122,621
Contract assets, non-current	—			—
Contract liabilities, current	(551,614		)	(524,156		)
Contract liabilities, non-current	(3,327		)	—
Deferred revenue ⁽¹⁾	—			(47,328		)
Net contract liabilities	$	(398,807	)	$	(448,863	)

________


(1)	Represents deferred revenue on service contracts, which was included in “Accrued expenses and other” and “Other long-term liabilities” in the Condensed Consolidated Balance Sheet as of December 31 2017. For the periods after December 31, 2017, these amounts are included within “Contract liabilities.”

Remaining Performance Obligations

The following table presents the transaction price allocated to remaining unsatisfied performance obligations (“remaining performance obligations”) for each of our reportable segments and their respective percentages of total remaining performance obligations (in thousands, except for percentages):



	June 30, 2018		% of Total
Remaining performance obligations:
United States electrical construction and facilities services	$	1,037,796	28	%
United States mechanical construction and facilities services	1,970,393		54	%
United States building services	451,960		12	%
United States industrial services	82,640		2	%
Total United States operations	3,542,789		96	%
United Kingdom building services	130,342		4	%
Total worldwide operations	$	3,673,131	100	%

Remaining Performance Obligations, Expected Timing of Satisfaction

Refer to the table below for additional information regarding our remaining performance obligations, including an estimate of when we expect to recognize such remaining performance obligations as revenue (in thousands):



	Within one year		Greater than one year
Remaining performance obligations:
United States electrical construction and facilities services	$	910,676	$	127,120
United States mechanical construction and facilities services	1,453,161		517,232
United States building services	436,102		15,858
United States industrial services	82,640		—
Total United States operations	2,882,579		660,210
United Kingdom building services	78,659		51,683
Total worldwide operations	$	2,961,238	$	711,893

Schedule of Changes in Accounting Principles

The following tables compare the differences between our reported and pro forma results under previous revenue guidance for each financial statement line item within our reported Condensed Consolidated Balance Sheet and Condensed Consolidated Statement of Operations, as of and for the three and six months ended June 30, 2018 (in thousands):



	As reported		Pro forma
	June 30, 2018 (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	306,624	$	306,624
Accounts receivable	1,635,289		1,631,976
Contract assets	156,134		158,341
Inventories	43,665		49,060
Prepaid expenses and other	48,511		45,314
Total current assets	2,190,223		2,191,315
Investments, notes and other long-term receivables	4,180		4,180
Property, plant and equipment, net	124,993		124,993
Goodwill	978,303		978,303
Identifiable intangible assets, net	481,577		481,577
Other assets	90,125		90,125
Total assets	$	3,869,401	$	3,870,493
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt and capital lease obligations	$	15,625	$	15,625
Accounts payable	505,379		505,379
Contract liabilities	551,614		503,811
Accrued payroll and benefits	282,159		282,159
Other accrued expenses and liabilities	150,153		198,789
Total current liabilities	1,504,930		1,505,763
Borrowings under revolving credit facility	25,000		25,000
Long-term debt and capital lease obligations	262,492		262,492
Other long-term obligations	341,846		342,037
Total liabilities	2,134,268		2,135,292
Total equity	1,735,133		1,735,201
Total liabilities and equity	$	3,869,401	$	3,870,493



	As reported			Pro forma			As reported			Pro forma
	For the three months ended June 30, 2018 (Unaudited)						For the six months ended June 30, 2018 (Unaudited)
Revenues	$	1,953,886		$	1,955,456		$	3,854,274		$	3,854,946
Cost of sales	1,663,042			1,664,330			3,294,311			3,296,062
Gross profit	290,844			291,126			559,963			558,884
Selling, general and administrative expenses	189,907			189,907			380,932			380,932
Restructuring expenses	374			374			464			464
Impairment loss on identifiable intangible assets	907			907			907			907
Operating income	99,656			99,938			177,660			176,581
Net periodic pension (cost) income	717			717			1,454			1,454
Interest expense	(3,457		)	(3,457		)	(6,453		)	(6,453		)
Interest income	634			634			1,178			1,178
Income from continuing operations before income taxes	97,550			97,832			173,839			172,760
Income tax provision	26,529			26,604			47,162			46,869
Income from continuing operations	71,021			71,228			126,677			125,891
Loss from discontinued operation, net of income taxes	(205		)	(205		)	(487		)	(487		)
Net income including noncontrolling interests	70,816			71,023			126,190			125,404
Less: Net income attributable to noncontrolling interests	—			—			—			—
Net income attributable to EMCOR Group, Inc.	$	70,816		$	71,023		$	126,190		$	125,404

Basic earnings per common share:
From continuing operations attributable to EMCOR Group, Inc. common stockholders	$	1.22		$	1.22		$	2.16		$	2.15
Diluted earnings per common share:
From continuing operations attributable to EMCOR Group, Inc. common stockholders	$	1.21		$	1.21		$	2.15		$	2.14