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REVENUE, CONTRACT ASSETS AND LIABILITIES AND OTHER CONTRACT MATTERS | 12 Months Ended
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Dec. 31, 2024
Revenue from Contract with Customer [Abstract] |
REVENUE, CONTRACT ASSETS AND LIABILITIES AND OTHER CONTRACT MATTERS | 2. REVENUE, CONTRACT ASSETS AND LIABILITIES AND OTHER CONTRACT MATTERS As discussed in Note 1, we recognize revenue for our contracts in accordance with Topic 606. Summarized below are required disclosures under Topic 606 and other relevant guidance. Disaggregation of Revenue The following tables summarize revenue for each of our operating segments, disaggregated by contract type and duration, for 2024 and 2023 (in thousands):
|  | Year ended December 31, 2024 |
|  | Services |  |  | Fabrication |  |  | Shipyard |  |  | Eliminations |  |  | Total |
Fixed-price and unit-rate |  | $ | 937 |  |  | $ | 51,313 |  |  | $ | 1,061 |  |  | $ | (6 | ) |  | $ | 53,305 |
T&M and cost-reimbursable |  |  | 83,542 |  |  |  | 20,360 |  |  |  | — |  |  |  | — |  |  |  | 103,902 |
Other |  |  | 2,891 |  |  |  | — |  |  |  | — |  |  |  | (899 | ) |  |  | 1,992 |
Total |  | $ | 87,370 |  |  | $ | 71,673 |  |  | $ | 1,061 |  |  | $ | (905 | ) |  | $ | 159,199 |
Long-term |  | $ | 937 |  |  | $ | 67,240 |  |  | $ | 1,061 |  |  | $ | (6 | ) |  | $ | 69,232 |
Short-term |  |  | 86,433 |  |  |  | 4,433 |  |  |  | — |  |  |  | (899 | ) |  |  | 89,967 |
Total |  | $ | 87,370 |  |  | $ | 71,673 |  |  | $ | 1,061 |  |  | $ | (905 | ) |  | $ | 159,199 |
|  | Year ended December 31, 2023 |
|  | Services |  |  | Fabrication |  |  | Shipyard |  |  | Eliminations |  |  | Total |
Fixed-price and unit-rate |  | $ | 1,618 |  |  | $ | 51,015 |  |  | $ | (30,417 | ) |  | $ | (33 | ) |  | $ | 22,183 |
T&M and cost-reimbursable |  |  | 87,914 |  |  |  | 38,031 |  |  |  | — |  |  |  | — |  |  |  | 125,945 |
Other |  |  | 4,016 |  |  |  | — |  |  |  | — |  |  |  | (1,077 | ) |  |  | 2,939 |
Total |  | $ | 93,548 |  |  | $ | 89,046 |  |  | $ | (30,417 | ) |  | $ | (1,110 | ) |  | $ | 151,067 |
Long-term |  | $ | 1,618 |  |  | $ | 82,535 |  |  | $ | (30,417 | ) |  | $ | (33 | ) |  | $ | 53,703 |
Short-term |  |  | 91,930 |  |  |  | 6,511 |  |  |  | — |  |  |  | (1,077 | ) |  |  | 97,364 |
Total |  | $ | 93,548 |  |  | $ | 89,046 |  |  | $ | (30,417 | ) |  | $ | (1,110 | ) |  | $ | 151,067 |
Future Performance Obligations The following table summarizes remaining performance obligations for each of our operating segments, disaggregated by contract type, at December 31, 2024 (in thousands):
| December 31, 2024 |
| Services |  |  | Fabrication |  |  | Shipyard |  |  | Total |
Fixed-price and unit-rate | $ | 52 |  |  | $ | 5,450 |  |  | $ | — |  |  | $ | 5,502 |
T&M and cost-reimbursable |  | — |  |  |  | 10,049 |  |  |  | — |  |  |  | 10,049 |
Total (1) | $ | 52 |  |  | $ | 15,499 |  |  | $ | — |  |  | $ | 15,551 |
(1) We expect all of our performance obligations at December 31, 2024, to be recognized as revenue during 2025. C ertain factors and circumstances could result in changes in the timing of recognition of our performance obligations as revenue and the amounts ultimately recognized. Contracts Assets and Liabilities The timing of customer invoicing and recognition of revenue using the POC method may occur at different times. Customer invoicing is generally dependent upon contractual billing terms, which could provide for customer payments in advance of performing the work, milestone billings based on the completion of certain phases of the work, or billings when services are provided. Revenue recognized in excess of amounts billed is reflected as contract assets on our Balance Sheet, or to the extent we have an unconditional right to the consideration, is reflected as contract receivables on our Balance Sheet. Amounts billed in excess of revenue recognized, and accrued contract losses, are reflected as contract liabilities on our Balance Sheet. Information with respect to contracts that were incomplete at December 31, 2024 and 2023, is as follows (in thousands):
|  | December 31, |
|  | 2024 |  |  | 2023 |
Costs incurred to date |  | $ | 49,003 |  |  | $ | 117,274 |
Estimated profit (loss) incurred to date |  |  | 7,942 |  |  |  | (12,735 | )
Sub-total |  |  | 56,945 |  |  |  | 104,539 |
Billings to date |  |  | (49,612 | ) |  |  | (107,270 | )
Total |  | $ | 7,333 |  |  | $ | (2,731 | )
The above amounts are included within the following captions on our Balance Sheet at December 31, 2024 and 2023 (in thousands):
|  | December 31, |
|  | 2024 |  |  | 2023 |
Contract assets (1), (2) |  | $ | 8,611 |  |  | $ | 2,739 |
Contract liabilities (3), (4), (5) |  |  | (1,278 | ) |  |  | (5,470 | )
Total |  | $ | 7,333 |  |  | $ | (2,731 | )
(1) The increase in contract assets from December 31, 2023 to December 31, 2024, was primarily due to higher unbilled positions on various projects for our Fabrication Division. (2) Contract assets at December 31, 2024 and 2023, excluded $4.6 million and $6.0 million, respectively, associated with revenue recognized in excess of amounts billed for which we have an unconditional right to the consideration. Such amounts are reflected within contract receivables. The decrease from December 31, 2023 to December 31, 2024, was primarily due to lower unbilled positions on various projects for our Services Division. (3) The decrease in contract liabilities from December 31, 2023 to December 31, 2024, was primarily due to lower advance billings on various projects for our Fabrication Division. (4) Revenue recognized during 2024 and 2023, related to amounts included in our contract liabilities balance at December 31, 2023 and 2022, was $4.9 million and $6.6 million, respectively. (5) Contract liabilities at December 31, 2023, included accrued contract losses of $0.4 million, primarily related to projects for our Shipyard Division. Significant Customers The following table summarizes revenue for customers that accounted for 10% or more of our consolidated revenue for 2024 and 2023 (in thousands):
|  | Years Ended December 31, |
|  | 2024 |  |  | 2023 |
Customer A |  | $ | 63,633 |  |  | $ | 70,497 |
Customer B |  |  | 18,036 |  |  | * |
Customer C |  | * |  |  |  | 26,956 |
Customer D (1) |  | * |  |  |  | 16,498 |
Customer E (1) |  | * |  |  |  | 15,481 |
(*) The customer revenue was less than 10% of consolidated revenue for the year. (1) For 2023, these customers accounted for 10% or more of our consolidated revenue due to lower revenue for the period associated with a charge of $32.5 million for our Shipyard Division, resulting from the resolution of our previous MPSV Litigation. See “Changes in Project Estimates” below and Note 7 for further discussion of the resolution of our MPSV Litigation. Allowance for Doubtful Accounts and Credit Losses Our provision for bad debts and credit losses is included in other (income) expense, net on our Statement of Operations. Revisions to our allowance for doubtful accounts and credit losses for 2024 were not significant, and for 2023, we recognized income of $0.4 million. Our allowance for doubtful accounts and credit losses at December 31, 2024 and 2023, was $0.2 million and $0.2 million, respectively. We had no significant write-offs or recoveries of previously recorded bad debts during 2024 or 2023. See Note 1 for further discussion of our adoption of ASU 2016-13. Variable Consideration For 2024 and 2023, we had no material amounts in revenue related to unapproved change orders, claims or incentives, other than amounts for 2023 related to the resolution of our MPSV Litigation discussed further below. However, at December 31, 2023, certain projects for our Shipyard Division reflected a reduction to our estimated contract price for liquidated damages of $1.4 million. Changes in Project Estimates We determine the impact of changes in estimated margins on projects for a given period by calculating the amount of revenue recognized in the period that would have been recognized in a prior period had such estimated margins been forecasted in the prior period. The total impact of changes in estimated margins for a project as disclosed on a quarterly basis may be different from the applicable year-to-date impact due to the application of the POC method and the changing progress of the project at each period end. Such impacts may also be different when a project is commenced and completed within the applicable year-to-date period but spans multiple quarters. Changes in Estimates for 2024 – During 2024, significant changes in estimated margins on projects positively impacted operating results for our Shipyard Division by $1.1 million. The status of our Shipyard Division projects at December 31, 2024, which have previously experienced material changes in estimates, including the changes in estimates for 2024, is as follows: • Seventy-Vehicle Ferry Project – As of December 31, 2023, we had completed, delivered and received final customer acceptance of our seventy-vehicle ferry, and the warranty period for the vessel expired in the third quarter 2024. During 2024, our operating results were positively impacted by $1.1 million from changes in estimates on the project, associated primarily with reduced materials and subcontracted services costs and reductions in contingency. The impacts were primarily due to the favorable resolution of a vendor claim and less than forecasted warranty costs. • Forty-Vehicle Ferry Projects – As of December 31, 2023, we had completed, delivered and received final customer acceptance of the first of two forty-vehicle ferries, and had substantially completed and delivered our second forty-vehicle ferry. During the first quarter 2024, we received final customer acceptance of the second ferry. The warranty period for the first vessel expired in the second quarter 2024 and the warranty period for the second vessel expires in March 2025. As a result of customer design deficiencies, prior to 2024, we experienced rework, construction and commissioning challenges on the two ferries, resulting in previous cost increases and liquidated damages, and the previous need to fabricate a new hull for one of the vessels. Accordingly, during 2021, we submitted claims to our customer to recover the cost impacts of the design deficiencies. In accordance with contract requirements and North Carolina state law, in July 2024, we submitted our finalized claim to the customer for these cost and schedule impacts. In October 2024, the customer denied our claim, which cleared the way for us to litigate our claim. Accordingly, we have filed a lawsuit in North Carolina state court to have our claim decided before a judge, and that case is pending in Superior Court for Wake County, bearing docket number 24CV022792-910. In December 2024, the customer responded to our claim denying liability and asserting a counterclaim in an unspecified amount relating to alleged defective workmanship in our construction of the ferries. The warranty claims asserted by the customer during the warranty periods for the vessels were not material and we are not aware of any other material claims regarding alleged defective workmanship for either vessel. At December 31, 2024, no amounts have been included in revenue related to potential recoveries from our claim and we can provide no assurances that we will be successful with our claim or recover any previously incurred costs. Changes in Estimates for 2023 – During 2023, we recorded a charge of $32.5 million for our Shipyard Division, reflected as a reduction to revenue, resulting from the resolution of our previous MPSV Litigation. See Note 7 for further discussion of the resolution of our MPSV Litigation. In addition, during 2023, significant changes in estimated margins on projects negatively impacted operating results for our Shipyard Division by $2.7 million, as follows: • Seventy-Vehicle Ferry Project – During 2023, our operating results were negatively impacted by $1.3 million from changes in estimates on our seventy-vehicle ferry project, associated primarily with increased materials and subcontracted services costs, duration related costs due to extensions of schedule and net reductions to contract price. The cost impacts were primarily due to delays in the receipt of certain equipment that required replacement and subcontractor delays. The contract price impacts were primarily due to a price reduction resulting from the required replacement of the vessel’s propeller blades (discussed further below), offset partially by price increases due to favorable resolution of customer change orders and the customer’s agreement to forego a portion of previously forecasted liquidated damages. In connection with the delivery and commissioning of the vessel during 2023, corrosion on the propeller blades was identified and the customer determined that replacement of the propeller blades would be required. The customer agreed to directly procure the new propeller blades and take responsibility for future installation of the blades once received. Further, the customer agreed to bear a portion of the cost of the new propeller blades, with the remainder borne by us through the aforementioned contract price reduction. • Forty-Vehicle Ferry Projects – During 2023, our operating results were negatively impacted by $1.4 million from changes in estimates on our forty-vehicle ferry projects, associated primarily with warranty costs, increased materials and subcontracted services costs, and duration related costs due to extensions of schedule, including forecast liquidated damages. The impacts were primarily due to delays in the receipt of certain equipment that required replacement and subcontractor delays. Other Operating and Project Matters During 2021, our operations were impacted by Hurricane Ida, which made landfall near Houma, Louisiana as a high-end Category 4 hurricane, causing debris and damage to our buildings and equipment at our Houma Facilities. Fabrication Division Impacts – As of December 31, 2023, we had finalized all claims associated with our property and equipment insurance coverages, and at December 31, 2023, we had total insurance receivables on our Balance Sheet of $2.0 million. During 2024 and 2023, we received insurance payments of $2.0 million and $2.2 million, respectively, from our insurance carriers associated with interruptions to our operations and damage to buildings and equipment. The classification of insurance proceeds within our Statement of Cash Flows is based on our use or intended use of the proceeds at the time of receipt. Proceeds that were used or intended to be used for repairs that were not deemed to be capital in nature, and proceeds associated with interruptions to our operations, are reflected within operating activities. Proceeds that were used or intended to be used for repairs that were deemed capital in nature, or proceeds in excess of repair costs, are reflected within investing activities. During 2023, we recorded gains of $2.0 million (including $0.6 million related to our business interruption coverage) related to the net impact of insurance recoveries and costs associated with damage previously caused by Hurricane Ida. The gains are included in other (income) expense, net on our Statement of Operations and are reflected within our Fabrication Division. Shipyard Division Impacts – In addition to damage to our Houma Facilities, the storm resulted in damage to one of our forty-vehicle ferry projects, the multi-purpose supply vessels (“MPSV(s)”) and associated equipment that were previously in our possession and subject to our previous MPSV Litigation, and certain bulkheads where the vessels were moored. During 2023, we recorded charges of $0.5 million related to costs associated with damage previously caused by Hurricane Ida. The charges are included in other (income) expense, net on our Statement of Operations and are reflected within our Shipyard Division. See Note 7 for further discussion of the resolution of our MPSV Litigation.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-9 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-10 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-15 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-13 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 606 -Publisher FASB -URI https://asc.fasb.org/606/tableOfContent + Details
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