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Revenue Recognition
6 Months Ended
Mar. 31, 2020
Revenue From Contract With Customer [Abstract]  
Revenue Recognition

3) Revenue Recognition

The following disaggregates our revenue by major sources for the three and six months ended March 31, 2020 and March 31, 2019:

 

Three Months

Ended March 31,

 

 

Six Months

Ended March 31,

 

(in thousands)

2020

 

 

2019

 

 

2020

 

 

2019

 

Petroleum Products:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home heating oil and propane

$

413,466

 

 

$

554,364

 

 

$

756,812

 

 

$

918,566

 

Other petroleum products

 

67,809

 

 

 

83,036

 

 

 

157,151

 

 

 

177,541

 

   Total petroleum products

 

481,275

 

 

 

637,400

 

 

 

913,963

 

 

 

1,096,107

 

Installations and Services:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equipment installations

 

20,158

 

 

 

20,384

 

 

 

50,723

 

 

 

50,367

 

Equipment maintenance service contracts

 

27,764

 

 

 

26,678

 

 

 

55,672

 

 

 

54,997

 

Billable call services

 

13,866

 

 

 

15,120

 

 

 

31,650

 

 

 

33,138

 

   Total installations and services

 

61,788

 

 

 

62,182

 

 

 

138,045

 

 

 

138,502

 

   Total Sales

$

543,063

 

 

$

699,582

 

 

$

1,052,008

 

 

$

1,234,609

 

 

Deferred Contract Costs 

We recognize an asset for incremental commission expenses paid to sales personnel in conjunction with obtaining new residential customer product and equipment maintenance service contracts. We defer these costs only when we have determined the commissions are, in fact, incremental and would not have been incurred absent the customer contract. Costs to obtain a contract are amortized and recorded ratably as delivery and branch expenses over the period representing the transfer of goods or services to which the assets relate.  Costs to obtain new residential product and equipment maintenance service contracts are amortized as expense over the estimated customer relationship period of approximately five years.  Deferred contract costs are classified as current or non-current within “Prepaid expenses and other current assets” and “Deferred charges and other assets, net,” respectively.  At March 31, 2020 the amount of deferred contract costs included in “Prepaid expenses and other current assets” and “Deferred charges and other assets, net” was $3.5 million and $6.3 million, respectively.  At September 30, 2019 the amount of deferred contract costs included in “Prepaid expenses and other current assets” and “Deferred charges and other assets, net” was $3.4 million and $5.9 million, respectively.  During the six months ended March 31, 2020 and 2019 we recognized expense of $1.9 million each period associated with the amortization of deferred contract costs within “Delivery and branch expenses” in the Condensed Consolidated Statement of Operations. 

 

Contract Liability Balances

The Company has contract liabilities for advanced payments received from customers for future oil deliveries (primarily amounts received from customers on “smart pay” budget payment plans in advance of oil deliveries) and obligations to service customers with equipment maintenance service contracts.  Contract liabilities are recognized straight-line over the service contract period, generally one year or less.  As of March 31, 2020 and September 30, 2019 the Company had contract liabilities of $97.2 million and $127.0 million, respectively.  During the six months ended March 31, 2020 the Company recognized $95.7 million of revenue that was included in the September 30, 2019 contract liability balance.  During the six months ended March 31, 2019 the Company recognized $90.3 million of revenue that was included in the September 30, 2018 contract liability balance.