Revenue from contracts with customers

6 Months Ended

Jun. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue from contracts with customers

Revenue from contracts with customers

Revenue is recognized when a performance obligation is satisfied by transferring control over a product or service to a customer. Revenue is measured based on consideration specified in a contract with a customer and excludes any sales incentives and amounts collected on behalf of third parties. The Company is considered an agent for certain taxes collected from customers. As such, the Company presents revenues net of these taxes at the time of sale to be remitted to governmental authorities, including sales and use taxes.

Disaggregation

In the following tables, revenue is disaggregated by the type of customer or service provided. The Company believes this level of disaggregation best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The table also includes a reconciliation of the disaggregated revenue by reportable segments. For more information on the Company's business segments, see Note 16.

Three Months Ended June 30, 2020	Electric		Natural gas distribution		Pipeline		Construction materials and contracting		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	27,954	$	78,653	$	—	$	—	$	—	$	—	$	106,607
Commercial utility sales	29,877		41,027		—		—		—		—		70,904
Industrial utility sales	8,072		5,658		—		—		—		—		13,730
Other utility sales	1,591		—		—		—		—		—		1,591
Natural gas transportation	—		10,350		27,965		—		—		—		38,315
Natural gas gathering	—		—		1,181		—		—		—		1,181
Natural gas storage	—		—		3,104		—		—		—		3,104
Contracting services	—		—		—		303,356		—		—		303,356
Construction materials	—		—		—		482,498		—		—		482,498
Intrasegment eliminations	—		—		—		(164,719)		—		—		(164,719)
Inside specialty contracting	—		—		—		—		324,921		—		324,921
Outside specialty contracting	—		—		—		—		160,696		—		160,696
Other	7,717		2,711		3,363		—		412		2,861		17,064
Intersegment eliminations	(196)		(185)		(7,999)		(90)		(779)		(2,973)		(12,222)
Revenues from contracts with customers	75,015		138,214		27,614		621,045		485,250		(112)		1,347,026
Revenues out of scope	1,423		3,280		44		—		11,155		—		15,902
Total external operating revenues	$	76,438	$	141,494	$	27,658	$	621,045	$	496,405	$	(112)	$	1,362,928

Three Months Ended June 30, 2019	Electric		Natural gas distribution		Pipeline		Construction materials and contracting		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	26,437	$	71,010	$	—	$	—	$	—	$	—	$	97,447
Commercial utility sales	33,231		41,250		—		—		—		—		74,481
Industrial utility sales	9,344		5,577		—		—		—		—		14,921
Other utility sales	1,879		—		—		—		—		—		1,879
Natural gas transportation	—		10,706		24,804		—		—		—		35,510
Natural gas gathering	—		—		2,396		—		—		—		2,396
Natural gas storage	—		—		2,623		—		—		—		2,623
Contracting services	—		—		—		297,124		—		—		297,124
Construction materials	—		—		—		444,768		—		—		444,768
Intrasegment eliminations	—		—		—		(145,925)		—		—		(145,925)
Inside specialty contracting	—		—		—		—		319,276		—		319,276
Outside specialty contracting	—		—		—		—		133,288		—		133,288
Other	8,417		2,923		6,293		—		9		2,903		20,545
Intersegment eliminations	—		—		(7,513)		(168)		(721)		(2,879)		(11,281)
Revenues from contracts with customers	79,308		131,466		28,603		595,799		451,852		24		1,287,052
Revenues out of scope	1,703		2,401		77		—		12,340		—		16,521
Total external operating revenues	$	81,011	$	133,867	$	28,680	$	595,799	$	464,192	$	24	$	1,303,573

Six Months Ended June 30, 2020	Electric		Natural gas distribution		Pipeline		Construction materials and contracting		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	60,303	$	265,354	$	—	$	—	$	—	$	—	$	325,657
Commercial utility sales	63,464		156,023		—		—		—		—		219,487
Industrial utility sales	18,439		14,179		—		—		—		—		32,618
Other utility sales	3,239		—		—		—		—		—		3,239
Natural gas transportation	—		22,148		55,397		—		—		—		77,545
Natural gas gathering	—		—		3,271		—		—		—		3,271
Natural gas storage	—		—		6,150		—		—		—		6,150
Contracting services	—		—		—		401,757		—		—		401,757
Construction materials	—		—		—		690,408		—		—		690,408
Intrasegment eliminations	—		—		—		(208,823)		—		—		(208,823)
Inside specialty contracting	—		—		—		—		697,130		—		697,130
Outside specialty contracting	—		—		—		—		290,846		—		290,846
Other	16,167		5,209		6,604		—		763		5,852		34,595
Intersegment eliminations	(391)		(370)		(33,198)		(152)		(3,249)		(5,946)		(43,306)
Revenues from contracts with customers	161,221		462,543		38,224		883,190		985,490		(94)		2,530,574
Revenues out of scope	1,125		5,394		89		—		23,120		—		29,728
Total external operating revenues	$	162,346	$	467,937	$	38,313	$	883,190	$	1,008,610	$	(94)	$	2,560,302

Six Months Ended June 30, 2019	Electric		Natural gas distribution		Pipeline		Construction materials and contracting		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	62,993	$	271,619	$	—	$	—	$	—	$	—	$	334,612
Commercial utility sales	68,902		163,043		—		—		—		—		231,945
Industrial utility sales	18,228		14,188		—		—		—		—		32,416
Other utility sales	3,678		—		—		—		—		—		3,678
Natural gas transportation	—		22,276		49,862		—		—		—		72,138
Natural gas gathering	—		—		4,517		—		—		—		4,517
Natural gas storage	—		—		5,269		—		—		—		5,269
Contracting services	—		—		—		380,164		—		—		380,164
Construction materials	—		—		—		624,077		—		—		624,077
Intrasegment eliminations	—		—		—		(181,066)		—		—		(181,066)
Inside specialty contracting	—		—		—		—		618,805		—		618,805
Outside specialty contracting	—		—		—		—		240,686		—		240,686
Other	17,538		6,836		8,989		—		26		10,747		44,136
Intersegment eliminations	—		—		(31,468)		(264)		(849)		(10,704)		(43,285)
Revenues from contracts with customers	171,339		477,962		37,169		822,911		858,668		43		2,368,092
Revenues out of scope	2,239		(1,948)		124		—		26,257		—		26,672
Total external operating revenues	$	173,578	$	476,014	$	37,293	$	822,911	$	884,925	$	43	$	2,394,764

Presented in the previous tables are intrasegment revenues within the construction materials and contracting segment to highlight the focus on vertical integration as this segment sells materials to both third parties and internal customers. Due to consolidation requirements, these revenues must be eliminated against construction materials to arrive at the external operating revenue total for the segment.

Contract balances

The timing of revenue recognition may differ from the timing of invoicing to customers. The timing of invoicing to customers does not necessarily correlate with the timing of revenues being recognized under the cost-to-cost method of accounting. Contracts from contracting services are billed as work progresses in accordance with agreed upon contractual terms. Generally, billing to the customer occurs contemporaneous to revenue recognition. A variance in timing of the billings may result in a contract asset or a contract liability. A contract asset occurs when revenues are recognized under the cost-to-cost measure of progress, which exceeds amounts billed on uncompleted contracts. Such amounts will be billed as standard contract terms allow, usually based on various measures of performance or achievement. A contract liability occurs when there are billings in excess of revenues recognized under the cost-to-cost measure of progress on uncompleted contracts. Contract liabilities decrease as revenue is recognized from the satisfaction of the related performance obligation.

The changes in contract assets and liabilities were as follows:

	June 30, 2020		December 31, 2019		Change		Location on Consolidated Balance Sheets
	(In thousands)
Contract assets	$	136,514	$	109,078	$	27,436	Receivables, net
Contract liabilities - current	(158,272)		(142,768)		(15,504)		Accounts payable
Contract liabilities - noncurrent	(72)		(19)		(53)		Noncurrent liabilities - other
Net contract liabilities	$	(21,830)	$	(33,709)	$	11,879

The Company recognized $32.3 million and $121.7 million in revenue for the three and six months ended June 30, 2020, respectively, which was previously included in contract liabilities at December 31, 2019. The Company recognized $22.6 million and $79.0 million in revenue for the three and six months ended June 30, 2019, respectively, which was previously included in contract liabilities at December 31, 2018.

The Company recognized a net increase in revenues of $31.9 million and $42.9 million for the three and six months ended June 30, 2020, respectively, from performance obligations satisfied in prior periods. The Company recognized a net increase in revenues of $20.6 million and $32.5 million for the three and six months ended June 30, 2019, respectively, from performance obligations satisfied in prior periods.

Remaining performance obligations

The remaining performance obligations, also referred to as backlog, at the construction materials and contracting and construction services segments include unrecognized revenues that the Company reasonably expects to be realized. These unrecognized revenues can include: projects that have a written award, a letter of intent, a notice to proceed, an agreed upon work order to perform work on mutually accepted terms and conditions and change orders or claims to the extent management believes additional contract revenues will be earned and are deemed probable of collection. Excluded from remaining performance obligations are potential orders under master service agreements. The remaining performance obligations at the pipeline segment include firm transportation and storage contracts with fixed pricing and fixed volumes.

At June 30, 2020, the Company's remaining performance obligations were $2.3 billion. The Company expects to recognize the following revenue amounts in future periods related to these remaining performance obligations: $1.8 billion within the next 12 months or less; $296.0 million within the next 13 to 24 months; and $239.6 million in 25 months or more.

The majority of the Company's construction contracts have an original duration of less than two years. The Company's firm transportation and firm storage contracts have weighted average remaining durations of approximately five and two years, respectively.