Operations by Business Segment

9 Months Ended

Sep. 27, 2025

Segment Reporting [Abstract]

Operations by business segment [Text Block]

Operations by Business Segment

We provide a wide range of arboricultural, horticultural, environmental and consulting services to residential, utility, commercial and government entities throughout the United States and Canada. We have two reportable operating segments organized by type or class of customer: Residential and Commercial, and Utility.

Residential and Commercial--Residential and Commercial provides services to our residential and commercial customers including: the treatment, preservation, maintenance, removal and planting of trees, shrubs and other plant life; the practice of landscaping, grounds maintenance, tree surgery, tree feeding and tree spraying; the application of fertilizer, herbicides and insecticides; and natural resource management and consulting, forestry research and development, and environmental planning.

Utility--Utility is principally engaged in providing services to our utility customers--investor-owned, municipal utilities, and rural electric cooperatives--including: the practice of line-clearing and vegetation management around power lines and rights-of-way and chemical brush control, natural resource management and consulting, forestry research and development, and environmental planning.

All other operating activities, including research, technical support and laboratory diagnostic facilities, are included in “All Other,” which does not meet the definition of a reportable segment.

Measurement of Segment Profit and Loss and Segment Assets--Our Chief Operating Decision Maker (“CODM”) is our Chief Executive Officer, Patrick M. Covey. The CODM evaluates performance and allocates resources based primarily on revenue and income from operations, which includes reviews of year-over-year changes in both revenues and operating income as well as changes from internal forecasts and budgets for each segment. Since our revenue is primarily dependent on people and equipment, the CODM reviews significant cost components for each segment such as payroll expense, equipment and fuel expense, and subcontractor expense. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies except that (a) we compute and recognize depreciation expense for our segments only by the straight-line method, and (b) state income taxes are allocated to the segments. Corporate expenses are substantially allocated among the operating segments, but the nature of expenses allocated may differ from year-to-year. There are no intersegment revenues. Segment assets are those generated or directly used by each segment, and include accounts receivable, operating supplies, and property and equipment.

Segment information reconciled to the condensed consolidated financial statements was as follows:

	Utility Services		Residential Commercial Services		Total Reportable Segments		All Other			Consolidated
Three Months Ended September 27, 2025
Revenues	$	270,141	$	229,749	$	499,890	$	776		$	500,666
Less:
Payroll expense	113,514		97,403
Equipment and fuel expense	19,599		14,711
Subcontractor expense	27,504		15,749
Other segment expenses (a)	89,719		75,131				6,103
Income (loss) from operations, reportable segments	$	19,805	$	26,755	$	46,560	$	(5,327)		$	41,233
Unallocated costs (b)										(3,715)
Income from operations										37,518
Interest expense										(5,066)
Interest income										568
Other income (expense), net										(2,041)
Income before income taxes										$	30,979
Segment assets, total	$	387,651	$	439,205	$	826,856	$	661,228	(c)	$	1,488,084

	Utility Services		Residential Commercial Services		Total Reportable Segments		All Other			Consolidated
Three Months Ended September 28, 2024
Revenues	$	258,222	$	218,925	$	477,147	$	2,293		$	479,440
Less:
Payroll expense	112,115		92,435
Equipment and fuel expense	17,059		14,088
Subcontractor expense	19,860		14,311
Other segment expenses (a)	86,134		69,779				7,007
Income (loss) from operations, reportable segments	$	23,054	$	28,312	$	51,366	$	(4,714)		$	46,652
Unallocated costs (b)										(5,692)
Income from operations										40,960
Interest expense										(5,319)
Interest income										970
Other income (expense), net										(1,111)
Income before income taxes										$	35,500
Segment assets, total	$	390,632	$	376,607	$	767,239	$	632,041	(c)	$	1,399,280
Nine Months Ended September 27, 2025
Revenues	$	792,144	$	653,803	$	1,445,947	$	2,000		$	1,447,947
Less:
Payroll expense	334,379		266,132
Equipment and fuel expense	55,230		44,125
Subcontractor expense	79,487		54,215
Other segment expenses (a)	262,435		230,133				23,891
Income (loss) from operations, reportable segments	$	60,613	$	59,198	$	119,811	$	(21,891)		$	97,920
Unallocated costs (b)										(12,852)
Income from operations										85,068
Interest expense										(14,428)
Interest income										1,876
Other income (expense), net										(3,333)
Income before income taxes										$	69,183
Segment assets, total	$	387,651	$	439,205	$	826,856	$	661,228	(c)	$	1,488,084

	Utility Services		Residential Commercial Services		Total Reportable Segments		All Other			Consolidated
Nine Months Ended September 28, 2024
Revenues	$	753,418	$	608,291	$	1,361,709	$	4,194		$	1,365,903
Less:
Payroll expense	324,779		248,475
Equipment and fuel expense	50,776		41,446
Subcontractor expense	67,010		45,279
Other segment expenses (a)	253,320		210,626				23,231
Income (loss) from operations, reportable segments	$	57,533	$	62,465	$	119,998	$	(19,037)		$	100,961
Unallocated costs (b)										(13,289)
Income from operations										87,672
Interest expense										(14,608)
Interest income										2,494
Other income (expense), net										(4,644)
Income before income taxes										$	70,914
Segment assets, total	$	390,632	$	376,607	$	767,239	$	632,041	(c)	$	1,399,280

Reconciling adjustments from segment reporting to condensed consolidated external financial reporting includes unallocated corporate items:

(a)Other segment expenses include occupancy costs, travel, insurance, depreciation and amortization, selling expenses and all other operating expenses.

(b)Unallocated costs include unallocated corporate expenses.

(c)Corporate assets include cash, prepaid expenses, corporate facilities, enterprise-wide information systems and other nonoperating assets.