Total revenues include sales of products and services to customers, net of any discounts or allowances, and freight revenues. Product revenues are recognized when control of the promised good is transferred to the customer, typically when finished products are shipped. Intersegment and interproduct revenues are eliminated in consolidation. Service revenues are derived from the paving business and recognized using the percentage-of-completion method under the revenue-cost approach. Freight revenues reflect delivery arranged by the Company using a third party on behalf of the customer and are recognized consistent with the timing of the product revenues.

Performance Obligations. Performance obligations are contractual promises to transfer or provide a distinct good or service for a stated price. The Company’s product sales agreements are single-performance obligations that are satisfied at a point in time. Performance obligations within paving service agreements are satisfied over time, primarily ranging from one day to 20 months. For product revenues and freight revenues, customer payment terms are generally 30 days from invoice date. Customer payments for the paving operations are based on a contractual billing schedule and are due 30 days from invoice date.

Future revenues from unsatisfied performance obligations at March 31, 2019 and 2018 were $149.4 million and $88.1 million, respectively, where the remaining periods to complete these obligations ranged from one month to 21 months and one month to 20 months, respectively.

Revenue by Category. The following table presents the Company’s total revenues by category for each reportable segment:

	Three Months Ended
	March 31, 2019
(Dollars in Thousands)	Products and Services		Freight		Total
Mid-America Group	$	230,308	$	18,505	$	248,813
Southeast Group		115,312		3,925		119,237
West Group		463,511		33,320		496,831
Total Building Materials Business		809,131		55,750		864,881
Magnesia Specialties		69,174		4,900		74,074
Total	$	878,305	$	60,650	$	938,955

	Three Months Ended
	March 31, 2018
(Dollars in Thousands)	Products and Services		Freight		Total
Mid-America Group	$	167,890	$	10,891	$	178,781
Southeast Group		77,563		2,676		80,239
West Group		442,983		30,739		473,722
Total Building Materials Business		688,436		44,306		732,742
Magnesia Specialties		64,869		4,393		69,262
Total	$	753,305	$	48,699	$	802,004

Service revenues, which include paving operations located in Colorado, were $9.9 million and $11.1 million for the three months ended March 31, 2019 and 2018, respectively.

Contract Balances. Costs in excess of billings relate to the conditional right to consideration for completed contractual performance and are contract assets on the consolidated balance sheets. Costs in excess of billings are reclassified to accounts receivable when the right to consideration becomes unconditional. Billings in excess of costs relate to customers invoiced in advance of contractual performance and are contract liabilities on the consolidated balance sheets. The following table presents information about the Company’s contract balances:

Revenues recognized from the beginning balance of contract liabilities for the three months ended March 31, 2019 and 2018 were $3.8 million and $4.2 million, respectively.

Retainage, which primarily relates to the paving services, represents amounts that have been billed to customers but payment withheld until final acceptance of the performance obligation by the customer. Included on the Company’s consolidated balance sheets, retainage was $5.4 million and $7.5 million at March 31, 2019 and December 31, 2018.

Warranties. The Company’s construction contracts generally contain warranty provisions typically for a period of nine months to one year after project completion and cover materials, design or workmanship defects. Historically, the Company has not experienced material costs for warranties. The ready mixed concrete product line carries longer warranty periods, for which the Company has accrued an estimate of warranty cost based on experience with the type of work and any known risks relative to the project. In total, warranty costs were not material to the Company’s consolidated results of operations for the three months ended March 31, 2019 and March 31, 2018.

Policy Elections. When the Company arranges third party freight to deliver products to customers, the Company has elected the delivery to be a fulfillment activity rather than a separate performance obligation. Further, the Company acts as a principal in the delivery arrangements and, as required by the accounting standard, the related revenues and costs are presented gross and are included in the consolidated statements of earnings.