Revenue from contracts with customers

6 Months Ended

Jun. 30, 2023

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 18.

Three Months Ended June 30, 2023	Electric		Natural gas distribution		Pipeline		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	30,825	$	120,967	$	—	$	—	$	—	$	151,792
Commercial utility sales	38,262		71,196		—		—		—		109,458
Industrial utility sales	10,370		9,183		—		—		—		19,553
Other utility sales	1,710		—		—		—		—		1,710
Natural gas transportation	—		11,671		34,394		—		—		46,065
Natural gas storage	—		—		3,758		—		—		3,758
Electrical & mechanical specialty contracting	—		—		—		568,307		—		568,307
Transmission & distribution specialty contracting	—		—		—		167,485		—		167,485
Other	11,531		3,272		3,937		177		3,151		22,068
Intersegment eliminations	(27)		(69)		(7,918)		—		(3,151)		(11,165)
Revenues from contracts with customers	92,671		216,220		34,171		735,969		—		1,079,031
Revenues out of scope	(1,682)		2,775		38		10,964		—		12,095
Total external operating revenues	$	90,989	$	218,995	$	34,209	$	746,933	$	—	$	1,091,126

Three Months Ended June 30, 2022	Electric		Natural gas distribution		Pipeline		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	29,363	$	116,749	$	—	$	—	$	—	$	146,112
Commercial utility sales	34,015		72,354		—		—		—		106,369
Industrial utility sales	10,923		9,009		—		—		—		19,932
Other utility sales	1,880		—		—		—		—		1,880
Natural gas transportation	—		11,456		31,967		—		—		43,423
Natural gas storage	—		—		2,896		—		—		2,896
Electrical & mechanical specialty contracting	—		—		—		507,233		—		507,233
Transmission & distribution specialty contracting	—		—		—		166,174		—		166,174
Other	10,216		3,751		2,676		109		1,456		18,208
Intersegment eliminations	(34)		(71)		(7,787)		(1,527)		(1,456)		(10,875)
Revenues from contracts with customers	86,363		213,248		29,752		671,989		—		1,001,352
Revenues out of scope	(812)		(2,738)		66		11,881		—		8,397
Total external operating revenues	$	85,551	$	210,510	$	29,818	$	683,870	$	—	$	1,009,749

Six Months Ended June 30, 2023	Electric		Natural gas distribution		Pipeline		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	68,650	$	448,617	$	—	$	—	$	—	$	517,267
Commercial utility sales	74,609		276,122		—		—		—		350,731
Industrial utility sales	21,133		26,021		—		—		—		47,154
Other utility sales	3,484		—		—		—		—		3,484
Natural gas transportation	—		25,175		69,378		—		—		94,553
Natural gas storage	—		—		7,620		—		—		7,620
Electrical & mechanical specialty contracting	—		—		—		1,158,570		—		1,158,570
Transmission & distribution specialty contracting	—		—		—		319,507		—		319,507
Other	23,410		7,993		5,797		209		4,723		42,132
Intersegment eliminations	(55)		(139)		(34,188)		—		(4,723)		(39,105)
Revenues from contracts with customers	191,231		783,789		48,607		1,478,286		—		2,501,913
Revenues out of scope	(4,545)		801		76		22,979		—		19,311
Total external operating revenues	$	186,686	$	784,590	$	48,683	$	1,501,265	$	—	$	2,521,224

Six Months Ended June 30, 2022	Electric		Natural gas distribution		Pipeline		Construction services		Other		Total
	(In thousands)
Residential utility sales	$	66,667	$	375,565	$	—	$	—	$	—	$	442,232
Commercial utility sales	69,615		235,963		—		—		—		305,578
Industrial utility sales	21,229		22,033		—		—		—		43,262
Other utility sales	3,630		—		—		—		—		3,630
Natural gas transportation	—		23,837		63,541		—		—		87,378
Natural gas storage	—		—		6,615		—		—		6,615
Electrical & mechanical specialty contracting	—		—		—		900,041		—		900,041
Transmission & distribution specialty contracting	—		—		—		314,640		—		314,640
Other	22,969		6,360		4,387		156		2,896		36,768
Intersegment eliminations	(68)		(137)		(33,729)		(2,353)		(2,896)		(39,183)
Revenues from contracts with customers	184,042		663,621		40,814		1,212,484		—		2,100,961
Revenues out of scope	(4,807)		(2,623)		124		23,209		—		15,903
Total external operating revenues	$	179,235	$	660,998	$	40,938	$	1,235,693	$	—	$	2,116,864

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 construction work 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, 2023		December 31, 2022		Change		Location on Consolidated Balance Sheets
	(In thousands)
Contract assets	$	179,282	$	154,144	$	25,138	Receivables, net
Contract liabilities - current	(166,268)		(168,361)		2,093		Accounts payable
Contract liabilities - noncurrent	(438)		(6)		(432)		Noncurrent liabilities - other
Net contract assets (liabilities)	$	12,576	$	(14,223)	$	26,799

The Company recognized $23.4 million and $157.9 million in revenue for the three and six months ended June 30, 2023, respectively, which was previously included in contract liabilities at December 31, 2022. The Company recognized $8.6 million

and $110.4 million in revenue for the three and six months ended June 30, 2022, respectively, which was previously included in contract liabilities at December 31, 2021.

The Company recognized a net increase in revenues of $23.1 million and $31.8 million for the three and six months ended June 30, 2023, respectively, from performance obligations satisfied in prior periods. The Company recognized a net increase in revenues of $24.3 million and $33.2 million for the three and six months ended June 30, 2022, respectively, from performance obligations satisfied in prior periods.

Remaining performance obligations

The remaining performance obligations, also referred to as backlog, at the construction services segment includes 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 majority of the Company's contracting services contracts have an original duration of less than two years.

The remaining performance obligations at the pipeline segment include firm transportation and storage contracts with fixed pricing and fixed volumes. The Company has applied the practical expedient, which does not require additional disclosures for contracts with an original duration of less than 12 months, to certain firm transportation and non-regulated contracts. The Company's firm transportation and firm storage contracts included in the remaining performance obligations have weighted average remaining durations of approximately less than five years and two years, respectively.

At June 30, 2023, the Company's remaining performance obligations were $2.5 billion. The Company expects to recognize the following revenue amounts in future periods related to these remaining performance obligations: $1.6 billion within the next 12 months or less; $384.0 million within the next 13 to 24 months; and $544.0 million in 25 months or more.