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Revenue Recognition
 9 Months Ended
May 31, 2021
Revenue From Contract With Customer [Abstract]  
Revenue Recognition

Note 2 – Revenue Recognition  

 

Contract balances

Contract assets primarily consist of unbilled receivables related to marine vessel construction and railcar repair services, for which the respective contracts do not yet permit billing at the reporting date. Contract liabilities primarily consist of customer prepayments for manufacturing, maintenance, and other management-type services, for which the Company has not yet satisfied the related performance obligations.

 

The contract balances are as follows:

 

(in thousands)

 

Balance sheet classification

 

May 31,

2021

 

 

August 31,

2020

 

 

$

change

 

Contract assets

 

Accounts receivable, net

 

$

18,999

 

 

$

430

 

 

$

18,569

 

Contract assets

 

Inventories

 

$

9,728

 

 

$

7,081

 

 

$

2,647

 

Contract liabilities 1

 

Deferred revenue

 

$

36,867

 

 

$

27,009

 

 

$

9,858

 

 

1

Contract liabilities balance includes deferred revenue within the scope of Topic 606.

 

For the nine months ended May 31, 2021, the Company recognized $5.9 million of revenue that was included in Contract liabilities as of August 31, 2020.

 

Performance obligations

 

As of May 31, 2021, the Company has entered into contracts with customers for which revenue has not yet been recognized. The following table outlines estimated revenue related to performance obligations wholly or partially unsatisfied, that the Company anticipates will be recognized in future periods.

 

(in millions)

 

May 31,

2021

 

Revenue type:

 

 

 

 

Manufacturing – Railcar sales

 

$

2,145.0

 

Manufacturing – Marine

 

$

39.4

 

Services

 

$

131.0

 

Other

 

$

68.1

 

 

 

 

 

 

Manufacturing – Railcars intended for syndication 1

 

$

253.0

 

 

1

Not a performance obligation as defined in Topic 606

 

 


 

Based on current production and delivery schedules and existing contracts, approximately $0.4 billion of Railcar sales are expected to be recognized in the remaining three months of 2021 while the remaining amount is expected to be recognized into 2024. The table above excludes estimated revenue to be recognized at the Company’s Brazilian manufacturing operations, as they are accounted for under the equity method.

 

Revenue amounts reflected in Railcars intended for syndication may be syndicated to third parties or held in the Company’s fleet depending on a variety of factors.

 

Marine revenue is expected to be recognized through 2022 as vessel construction is completed.

 

Services includes management and maintenance services of which approximately 47% are expected to be performed through 2025 and the remaining amount through 2037.