SEGMENT AND GEOGRAPHICAL INFORMATION

6 Months Ended

Jul. 01, 2022

SEGMENT AND GEOGRAPHICAL INFORMATION

9. SEGMENT AND GEOGRAPHICAL INFORMATION

Segment Information

The Company’s two segments are Energy and Engineering and Consulting, and the Company’s chief operating decision maker, which continues to be its chief executive officer, receives and reviews financial information in this format.

There were no intersegment sales during the three and six months ended July 1, 2022 and July 2, 2021. The Company’s chief operating decision maker evaluates the performance of each segment based upon income or loss from operations before income taxes. Certain segment asset information including expenditures for long-lived assets has not been presented as it is not reported to or reviewed by the chief operating decision maker. In addition, enterprise-wide service line contract revenue is not included as it is impracticable to report this information for each group of similar services.

Financial information with respect to the reportable segments is as follows:


			Engineering		Unallocated				Consolidated
	Energy		& Consulting		Corporate		Intersegment		Total
	(in thousands)
Fiscal Three Months Ended July 1, 2022
Contract revenue	$	84,675	$	17,970	$	-	$	-	$	102,645
Depreciation and amortization		4,183		243		-		-		4,426
Interest expense, net		1		-		1,029		-		1,030
Segment profit (loss) before income tax expense		(6,357)		2,531		(2,173)		-		(5,999)
Income tax expense (benefit)		(1,891)		732		(514)		-		(1,673)
Net income (loss)		(4,467)		1,798		(1,657)		-		(4,326)
Segment assets ⁽¹⁾		323,070		23,293		58,650		(23,130)		381,883
Fiscal Three Months Ended July 2, 2021
Contract revenue	$	66,447	$	17,707	$	-	$	-	$	84,154
Depreciation and amortization		3,973		251		-		-		4,224
Interest expense, net		1		-		1,098		-		1,099
Segment profit (loss) before income tax expense		(4,913)		2,724		(6,075)		-		(8,264)
Income tax expense (benefit)		(2,151)		1,247		(2,759)		-		(3,663)
Net income (loss)		(2,762)		1,478		(3,317)		-		(4,601)
Segment assets ⁽¹⁾		322,255		22,952		58,410		(23,130)		380,487
Fiscal Six Months Ended July 1, 2022
Contract revenue	$	159,561	$	34,922	$	-	$	-	$	194,483
Depreciation and amortization		8,340		495		-		-		8,835
Interest expense, net		5		-		1,776		-		1,781
Segment profit (loss) before income tax expense		(10,710)		4,638		(6,089)		-		(12,161)
Income tax expense (benefit)		(3,578)		1,549		(2,033)		-		(4,062)
Net income (loss)		(7,132)		3,088		(4,055)		-		(8,099)
Segment assets ⁽¹⁾		323,070		23,293		58,650		(23,130)		381,883
Fiscal Six Months Ended July 2, 2021
Contract revenue	$	128,454	$	34,786	$	-	$	-	$	163,240
Depreciation and amortization		7,911		500		-		-		8,411
Interest expense, net		5		-		2,158		-		2,163
Segment profit (loss) before income tax expense		(7,745)		4,834		(10,577)		-		(13,488)
Income tax expense (benefit)		(2,941)		1,836		(4,016)		-		(5,121)
Net income (loss)		(4,804)		2,999		(6,562)		-		(8,367)
Segment assets ⁽¹⁾		322,255		22,952		58,410		(23,130)		380,487

(1)	Segment assets are presented net of intercompany receivables.

The following tables provide information about disaggregated revenue by contract type, client type and geographical region:


	Three months ended July 1, 2022
	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	7,587	$	13,340	$	20,927
Unit-based		42,544		3,755		46,299
Fixed price		34,545		874		35,419
Total⁽¹⁾	$	84,675	$	17,970	$	102,645

Client Type
Commercial	$	6,701	$	1,476	$	8,177
Government		29,861		16,338		46,199
Utilities⁽²⁾		48,114		156		48,270
Total⁽¹⁾	$	84,675	$	17,970	$	102,645

Geography ⁽³⁾
Domestic	$	84,675	$	17,970	$	102,645

	Six months ended July 1, 2022
	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	16,405	$	26,341	$	42,746
Unit-based		85,501		6,739		92,240
Fixed price		57,655		1,842		59,497
Total⁽¹⁾	$	159,561	$	34,922	$	194,483

Client Type
Commercial	$	14,790	$	2,954	$	17,744
Government		48,220		31,791		80,011
Utilities⁽²⁾		96,551		177		96,728
Total⁽¹⁾	$	159,561	$	34,922	$	194,483

Geography ⁽³⁾
Domestic	$	159,561	$	34,922	$	194,483


	Three months ended July 2, 2021
	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	9,056	$	13,863	$	22,919
Unit-based		41,604		2,722		44,326
Fixed price		15,786		1,123		16,909
Total ⁽¹⁾	$	66,446	$	17,708	$	84,154

Client Type
Commercial	$	7,016	$	1,372	$	8,388
Government		13,675		16,281		29,956
Utilities ⁽²⁾		45,756		55		45,811
Total ⁽¹⁾	$	66,446	$	17,708	$	84,154

Geography ⁽³⁾
Domestic	$	66,446	$	17,708	$	84,154


	Six months ended July 2, 2021
	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	15,956	$	27,284	$	43,240
Unit-based		81,218		5,167		86,385
Fixed price		31,279		2,336		33,615
Total ⁽¹⁾	$	128,453	$	34,787	$	163,240

Client Type
Commercial	$	12,944	$	2,469	$	15,413
Government		27,229		32,210		59,439
Utilities ⁽²⁾		88,280		108		88,388
Total ⁽¹⁾	$	128,453	$	34,787	$	163,240

Geography ⁽³⁾
Domestic	$	128,453	$	34,787	$	163,240

(1)

Amounts may not add to the totals due to rounding.

(2)

Includes the portion of revenue related to small business programs paid by the end user/customer.

(3)

Revenue from the Company’s foreign operations were not material for the three and six months ended July 1, 2022 and July 2, 2021.

Geographical Information

Substantially all of the Company’s consolidated revenue was derived from its operations in the U.S. The Company operates through a network of offices spread across 23 U.S. states, the District of Columbia, and Canada. Revenues from the Company’s Canadian operations were not material for the three and six months ended July 1, 2022 nor the three and six months ended July 1, 2021.

Customer Concentration

For the three and six months ended July 1, 2022, the Company’s top 10 customers accounted for 55.4%, and 54.4%, respectively, of the Company’s consolidated contract revenue. For the three and six months ended July 2, 2021, the Company’s top 10 customers accounted for 48.4%, and 46.2%, respectively, of the Company’s consolidated contract revenue.

For the three and six months ended July 1, 2022, the Company had one customer, LADWP, that accounted for 14.6% and 15.8%, respectively, of its consolidated contract revenues. For the three and six months ended July 2, 2021, the Company did not have any individual customers that accounted for more than 10% of its consolidated contract revenues.

On a segment basis, the Company had individual customers that accounted for more than 10% of its segment contract revenues. For the three and six months ended July 1, 2022, the Company derived 17.6% and 19.2%, respectively, of its Energy segment revenues from one customer, LADWP. For the three and six months ended July 1, 2022, no single customer accounted for 10% or more of its Engineering and Consulting segment revenues. For the three and six months ended July 1, 2021, the Company derived 11.5% and 10.9%, respectively, of its Energy segment revenues from one customer, Consolidated Edison of New York, and it derived 13.9% and 15.8%, respectively, of its Engineering and Consulting segment revenues from one customer, the City of Elk Grove.

The Company’s largest clients are based in California and New York. For the three and six months ended July 1, 2022, services provided to clients in California accounted for 40.9% and 42.2%, respectively, of the Company’s

contract revenue and services provided to clients in New York accounted for 19.6% and 20.2%, respectively, of the Company’s contract revenue. For the three and six months ended July 2, 2021, services provided to clients in California accounted for 34.8% and 34.5%, respectively, of the Company’s contract revenue and services provided to clients in New York accounted for 21.6% and 21.8%, respectively, of the Company’s contract revenue.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
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-Section 50
-Paragraph 31
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+ Details