What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-26 compared with 2024-02-28 · 241 added, 283 removed, 1326 unchanged (28% of the section changed)

14 unchanged sentences

Property, plant, and equipment, net 207,489 179,378

179,378 157,819

Operating lease right-of-use assets 316,128 310,498

5 unchanged sentences

Current liabilities:

Current maturities of long-term debt and finance lease liabilities $ 2,465 $ 15,567

Accounts payable $ 937,087 $ 935,967

4 unchanged sentences

Total current liabilities 4,153,863 3,518,355

Long-term debt and finance lease liabilities 2,838 231,625

Operating lease liabilities, long-term 261,575 259,430

28 unchanged sentences

Operating income 1,344,863 875,756 564,877

Net periodic pension (cost) income ( 1,119 ) 4,311 3,625

Net periodic pension income (cost) 894 ( 1,119 ) 4,311

Interest expense ( 3,779 ) ( 17,199 ) ( 13,199 )

22 unchanged sentences

Other comprehensive income (loss) 177 7,747 ( 9,889 )

7,747 ( 9,889 ) 25,671

Comprehensive income 1,007,322 641,076 396,233

19 unchanged sentences

Gain on sale or disposal of property, plant, and equipment ( 1,012 ) ( 2,057 ) ( 6,393 )

( 2,057 ) ( 6,393 ) ( 782 )

Excess tax benefits from share-based compensation ( 3,978 ) ( 1,719 ) ( 1,654 )

Equity (income) loss from unconsolidated entities ( 1,660 ) ( 391 ) 1,170

Equity income from unconsolidated entities

( 98 ) ( 1,660 ) ( 391 )

Non-cash expense for amortization of debt issuance costs 822 960 960

5 unchanged sentences

Increase in accounts receivable ( 311,504 ) ( 626,494 ) ( 340,091 )

Decrease (increase) in inventories

17,982 ( 23,442 ) ( 31,541 )

Increase in inventories ( 23,442 ) ( 31,541 ) ( 116 )

Decrease (increase) in contract assets

(Increase) decrease in contract assets

( 13,318 ) 5,733 ( 44,725 )

Increase in accounts payable

(Decrease) increase in accounts payable

( 15,362 ) 82,192 111,488

1 unchanged sentence

Increase (decrease) in accrued payroll and benefits and other accrued expenses and liabilities 148,490 189,268 ( 30,025 )

189,268 ( 30,025 ) 46,573

Changes in other assets and liabilities, net ( 193 ) 24,868 ( 4,109 )

3 unchanged sentences

Proceeds from sale or disposal of property, plant, and equipment 3,839 13,604 7,145

13,604 7,145 2,754

Purchases of property, plant, and equipment ( 74,950 ) ( 78,404 ) ( 49,289 )

( 78,404 ) ( 49,289 ) ( 36,192 )

Investments in and advances to unconsolidated entities — — ( 1,595 )

Distributions from unconsolidated entities — — 196

Net cash used in investing activities ( 299,284 ) ( 161,291 ) ( 140,800 )

9 unchanged sentences

Payments for contingent consideration arrangements ( 4,852 ) ( 5,839 ) ( 5,534 )

Distributions to noncontrolling interests — — ( 43 )

Net cash used in financing activities ( 555,365 ) ( 412,054 ) ( 710,118 )

1 unchanged sentence

Increase (decrease) in cash, cash equivalents, and restricted cash 550,645 332,682 ( 365,500 )

332,682 ( 365,500 ) ( 80,994 )

Cash, cash equivalents, and restricted cash at beginning of year (1)

16 unchanged sentences

Balance, December 31, 2021 $ 2,253,089 $ 607 $ 61,874 $ ( 83,562 ) $ 2,835,504 $ ( 562,036 ) $ 702

$ 2,053,244 $ 606 $ 47,464 $ ( 109,233 ) $ 2,480,321 $ ( 366,490 ) $ 576

Net income including noncontrolling interests 406,122 — — — 406,122 — —

Other comprehensive income

25,671 — — 25,671 — — —

Other comprehensive loss ( 9,889 ) — — ( 9,889 ) — — —

Common stock issued under share-based compensation plans 2 2 — — — — —

3 unchanged sentences

Repurchases of common stock ( 660,609 ) — — — — ( 660,609 ) —

Distributions to noncontrolling interests ( 43 ) — — — — — ( 43 )

Share-based compensation expense 12,125 — 12,125 — — — —

Balance, December 31, 2022 $ 1,974,291 $ 609 $ 74,795 $ ( 93,451 ) $ 3,214,281 $ ( 1,222,645 ) $ 702

$ 2,253,089 $ 607 $ 61,874 $ ( 83,562 ) $ 2,835,504 $ ( 562,036 ) $ 702

Net income including noncontrolling interests 633,329 — — — 632,994 — 335

Other comprehensive loss

( 9,889 ) — — ( 9,889 ) — — —

Other comprehensive income 7,747 — — 7,747 — — —

Common stock issued under share-based compensation plans — 2 ( 2 ) — — — —

5 unchanged sentences

Balance, December 31, 2023 $ 2,470,815 $ 611 $ 91,813 $ ( 85,704 ) $ 3,814,439 $ ( 1,351,381 ) $ 1,037

$ 1,974,291 $ 609 $ 74,795 $ ( 93,451 ) $ 3,214,281 $ ( 1,222,645 ) $ 702

Net income including noncontrolling interests 1,007,145 — — — 1,007,145 — —

Other comprehensive income 177 — — 177 — — —

7,747 — — 7,747 — — —

Common stock issued under share-based compensation plans — 1 ( 1 ) — — — —

6 unchanged sentences

_________________

(1) Represents cumulative foreign currency translation and post-retirement liability adjustments of $( 4.7 ) million and $( 80.8 ) million, respectively, as of December 31, 2024, $( 1.8 ) million and $( 83.9 ) million, respectively, as of December 31, 2023, and $( 8.3 ) million and $( 85.2 ) million, respectively, as of December 31, 2022.

18 unchanged sentences

Actual results could materially differ from those estimates.

Our reportable segments and related disclosures reflect certain reclassifications of prior year amounts from our United States mechanical construction and facilities services segment to our United States building services segment due to changes in our internal reporting structure aimed at realigning our service offerings.

Revenue Recognition

25 unchanged sentences

Balance at December 31, 2024

The increase in our allowance for credit losses was primarily due to a reserve taken in the first quarter of 2024 for a specific customer bankruptcy within the commercial site-based services division of our United States building services segment.

Inventories are stated at the lower of cost or net realizable value.

32 unchanged sentences

The liabilities are derived from known facts, historical trends, and industry averages, utilizing the assistance of an independent third-party actuary to determine the best estimate for the majority of these obligations.

To the extent that the amount required to settle claims covered by insurance continues to increase, the cost of our insurance coverage, including premiums and deductibles, is likely to increase.

As of December 31, 2024 and 2023, the estimated current portion of such undiscounted insurance liabilities, included in “Other accrued expenses and liabilities” in the accompanying Consolidated Balance Sheets, were $ 50.8 million and $ 51.0 million, respectively.

16 unchanged sentences

We had no unrecognized income tax benefits as of December 31, 2024 and 2023.

Valuation of Share-Based Compensation

Our share-based compensation plans and programs are administered by our Board of Directors or its Compensation and Personnel Committee.

See Note 13 - Share-Based Compensation Plans of the notes to consolidated financial statements for additional information regarding these share-based compensation plans and programs.

EMCOR Group, Inc.

2 unchanged sentences

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Valuation of Share-Based Compensation

Our share-based compensation plans and programs are administered by our Board of Directors or its Compensation and Personnel Committee.

See Note 13 - Share-Based Compensation Plans of the notes to consolidated financial statements for additional information regarding these share-based compensation plans and programs.

We recognize expense for all share-based payments issued to acquire goods or services based on the fair value of such payments.

2 unchanged sentences

New Accounting Pronouncements

The Financial Accounting Standards Board (the “FASB”) has issued an Accounting Standards Update (“ASU”), which provides temporary optional expedients and exceptions to existing U.S.

This guidance is aimed at easing the financial reporting burdens related to reference rate reform, including the market transition from the London interbank offered rate (“LIBOR”), or other interbank offered rates, to alternative reference rates.

Such accounting pronouncement, as amended, allows entities to account for and present certain contract modifications, which occur before December 31, 2024 and result from the transition to an alternative reference rate, as an event that does not require remeasurement at the modification date or reassessment of a previous accounting determination.

In order to utilize such guidance, an entity must first conclude that the modified terms directly replace or have the potential to replace an eligible reference rate due to reference rate reform, and that any contemporaneous changes to other terms that change, or have the potential to change, the amount or timing of contractual cash flows are related to the replacement of a reference rate.

During the second quarter of 2023, we amended our then existing credit agreement to change the reference rate from LIBOR to an interest rate based on the secured overnight financing rate, as administered by the Federal Reserve Bank of New York (“SOFR”).

As such amendment was within the scope of the aforementioned guidance, we adopted this accounting pronouncement and utilized the optional expedients referenced above.

We are not exposed to any other material contracts that reference LIBOR.

The adoption of this accounting pronouncement did not have a material impact on our financial position and/or results of operations.

In November 2023, the FASB issued an ASU, which expands the required disclosure for reportable segments.

In November 2023, the Financial Accounting Standards Board (the “FASB”) issued an Accounting Standards Update (“ASU”), which expands the required disclosure for reportable segments.

This guidance requires entities to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all segment disclosures which are currently required annually.

This ASU additionally requires entities to disclose the title and position of the individual or the name of the group or committee identified as its chief operating decision-maker.

Such guidance, which is required to be applied retrospectively, is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, although early adoption is permitted.

While the adoption of this ASU will not have an impact on our financial position and/or results of operations, we are currently evaluating the impact to our segment disclosures.

While the adoption of this ASU did not have an impact on our financial position and/or results of operations, we have provided the additional required disclosures within Note 18 - Segment Information of the notes to consolidated financial statements.

In December 2023, the FASB issued an ASU intended to enhance the transparency and decision-usefulness of income tax disclosures.

3 unchanged sentences

While the adoption of this ASU will not have an impact on our financial position and/or results of operations, we are currently evaluating the impact on our income tax disclosures, including the processes and controls around the collection of this information.

In November 2024, the FASB issued an ASU, which requires disaggregated disclosures, in the notes to the financial statements, about certain income statement expense line items on an interim and annual basis.

This guidance requires entities to provide more detailed information about purchases of inventory, employee compensation, depreciation expense, intangible asset amortization, and selling expenses.

Such guidance, which is required to be applied prospectively, is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, although early adoption and retrospective application is permitted.

While the adoption of this ASU will not have an impact on our financial position and/or results of operations, we are currently evaluating the impact on our financial statement disclosures, including the processes and controls around the collection of this information.

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS

86 unchanged sentences

When the current estimate of total costs for a performance obligation indicates a loss, a provision for the entire estimated loss on the unsatisfied performance obligation is made in the period in which the loss becomes evident.

Based on an evaluation of individual projects that had revisions to total estimated costs, or anticipated contract value, which resulted in a reduction of profitability in excess of $ 1.0 million, our operating results were negatively impacted during the years ended December 31, 2023, 2022, and 2021, as summarized in the following table (in thousands):

2023 2022 2021

Based on an evaluation of individual projects that were substantially complete in prior periods but had revisions to total estimated costs or anticipated contract value (inclusive of the settlement of previously outstanding change orders and claims) that resulted in an increase to profitability in excess of $ 1.0 million, we recognized revenue during the years ended December 31, 2024 and 2023, as summarized in the following table (in thousands):

United States electrical construction and facilities services $ 14,006 $ 3,350

$ 12,535 $ 33,463 $ 4,627

United States mechanical construction and facilities services 10,551 13,114

10,864 13,679 2,264

United States building services

5,658 1,261 —

$ 29,057 $ 48,403 $ 6,891

During the year ended December 31, 2023, we recognized revenue of approximately $ 16.5 million on individual projects that were substantially complete in prior periods but had revisions to total estimated cost or anticipated contract value, which resulted in an increase to profitability in excess of $ 1.0 million.

Of this amount, approximately $ 3.4 million was reported within our United States electrical construction and facilities services segment and approximately $ 13.1 million was reported within our United States mechanical construction and facilities services segment.

There were no significant amounts of revenue recognized during the years ended December 31, 2022 or 2021 related to performance obligations satisfied in prior periods.

Total impact $ 24,557 $ 16,464

There were no significant amounts of revenue recognized during the year ended December 31, 2022 related to performance obligations satisfied in prior periods.

Included in our results for the year ended December 31, 2024 was $ 12.3 million of gross profit, recognized in the second quarter of the year, on two contracts, which are currently in process, as a result of favorable developments on certain claims.

Of this amount, $ 8.4 million was reported within our United States electrical construction and facilities services segment and $ 3.9 million was reported within our United States mechanical construction and facilities services segment.

EMCOR Group, Inc.

2 unchanged sentences

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Based on an evaluation of individual projects that had revisions to total estimated costs or anticipated contract value that resulted in a reduction of profitability in excess of $ 1.0 million, our operating results were negatively impacted during the years ended December 31, 2024, 2023, and 2022, as summarized in the following table (in thousands):

2024 2023 2022

United States electrical construction and facilities services $ 27,977 $ 12,535 $ 33,463

United States mechanical construction and facilities services 38,342 10,864 13,679

United States building services — 5,658 1,261

Total impact $ 66,319 $ 29,057 $ 48,403

Disaggregation of Revenues

3 unchanged sentences

Refer to Note 18 - Segment Information of the notes to consolidated financial statements for additional information on how we disaggregate our revenues by reportable segment.

Due to continued growth in certain of our end markets, during 2023, we have expanded the market sectors included in the disclosure for each of our United States construction segments, as shown below.

All prior period disclosures have been adjusted to additionally reflect these changes.

Total 2023 % of

2 unchanged sentences

Network and communications market sector $ 1,442,877 43 % $ 934,455 34 % $ 801,052 33 %

$ 934,455 34 % $ 801,052 33 % $ 621,139 30 %

Commercial market sector 310,730 9 % 402,886 14 % 414,539 17 %

Manufacturing and industrial market sector 439,450 13 % 394,804 14 % 301,606 12 %

394,804 14 % 301,606 12 % 230,894 11 %

Healthcare market sector 242,458 7 % 242,931 9 % 178,348 7 %

High-tech manufacturing market sector 190,992 6 % 140,471 5 % 88,544 4 %

140,471 5 % 88,544 4 % 35,196 2 %

Institutional market sector 174,073 5 % 147,375 5 % 154,077 6 %

2 unchanged sentences

Hospitality and entertainment market sector 66,982 2 % 81,815 3 % 33,818 1 %

81,815 3 % 33,818 1 % 23,257 1 %

Short duration projects (1)

4 unchanged sentences

Total segment revenues $ 3,342,927 $ 2,783,723 $ 2,433,114

_________________

(1) Represents those projects which generally are completed within three months or less.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Total 2023 % of

2 unchanged sentences

Network and communications market sector $ 818,991 13 % $ 410,397 8 % $ 295,261 7 %

$ 410,397 8 % $ 295,261 7 % $ 279,953 7 %

Commercial market sector 989,012 15 % 1,115,993 22 % 1,079,872 25 %

Manufacturing and industrial market sector 736,775 12 % 698,993 14 % 632,332 15 %

698,993 14 % 632,332 15 % 579,176 15 %

Healthcare market sector 580,676 9 % 489,485 10 % 479,937 11 %

High-tech manufacturing market sector 1,453,384 23 % 845,251 16 % 320,597 7 %

845,251 16 % 320,597 7 % 173,302 4 %

Institutional market sector 455,940 7 % 316,255 6 % 331,727 8 %

2 unchanged sentences

Hospitality and entertainment market sector 70,707 1 % 52,919 1 % 44,615 1 %

52,919 1 % 44,615 1 % 66,059 2 %

Short duration projects (1)

6 unchanged sentences

(1) Represents those projects which generally are completed within three months or less.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Total 2023 % of

2 unchanged sentences

Mechanical services $ 2,260,607 73 % $ 2,042,244 65 % $ 1,748,455 64 %

$ 2,042,244 65 % $ 1,748,455 64 % $ 1,590,506 65 %

Commercial site-based services 669,584 21 % 865,232 28 % 810,210 29 %

14 unchanged sentences

Total segment revenues $ 425,525 $ 436,423 $ 477,078

Total operations $ 12,582,873 $ 11,076,120 $ 9,903,580

Consolidated revenues

$ 14,566,116 $ 12,582,873 $ 11,076,120

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Contract Assets and Contract Liabilities

7 unchanged sentences

As of December 31, 2024 and 2023, contract assets included unbilled revenues for unapproved change orders of approximately $ 25.1 million and $ 29.8 million, respectively.

Contract assets as of December 31, 2023 and 2022 additionally included $ 6.7 million and $ 3.8 million, respectively, associated with claims.

There were $ 15.4 million of claims included within accounts receivable as of December 31, 2023.

There were no claims included within accounts receivable as of December 31, 2022.

There were no claim amounts included in contract assets as of December 31, 2024;

however, contract assets as of December 31, 2023 included $ 6.7 million associated with claims.

There were $ 6.9 million and $ 15.4 million of claims included within accounts receivable as of December 31, 2024 and 2023, respectively.

There were contractually billed amounts and retention related to contracts with unapproved change orders and claims of approximately $ 172.4 million and $ 157.7 million as of December 31, 2024 and 2023, respectively.

For contracts in claim status, contractually billed amounts will generally not be paid by the customer to us until final resolution of the related claims.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Contract liabilities from our construction contracts arise when amounts invoiced to our customers exceed revenues recognized under the cost-to-cost measure of progress.

16 unchanged sentences

$ ( 1,690,994 ) $ ( 1,261,056 )

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Contract assets and contract liabilities increased by approximately $ 2.3 million and $ 24.3 million, respectively, as a result of acquisitions made by us in 2024.

Excluding the impact of acquisitions, net contract liabilities increased by approximately $ 497.9 million for the year ended December 31, 2023, predominantly due to an increase in net contract liabilities on our uncompleted construction projects, partially as a result of the timing of invoicing to our customers, which included customer deposits and advanced billings on several large projects in the earlier stages of completion, resulting in amounts invoiced exceeding the revenue recognized for such projects.

Excluding the impact of acquisitions, net contract liabilities increased by approximately $ 415.2 million for the year ended December 31, 2024, primarily due to an increase in net contract liabilities on our uncompleted construction projects, partially as a result of the timing of invoicing to our customers as we continue to effectively manage our working capital.

There was no significant impairment of contract assets recognized during the periods presented.

6 unchanged sentences

We estimate that approximately 89 % of the retainage outstanding as of December 31, 2024 will be paid during 2025.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Transaction Price Allocated to Remaining Unsatisfied Performance Obligations

9 unchanged sentences

Total operations $ 10,102,199 100 %

Our remaining performance obligations at December 31, 2023 were $ 8.85 billion.

Our remaining performance obligations at December 31, 2024 were approximately $ 10.10 billion.

Remaining performance obligations increase with awards of new contracts and decrease as we perform work and recognize revenue on existing contracts.

6 unchanged sentences

However, to the extent a service contract includes a cancellation clause which allows for the termination of such contract by either party without a substantive penalty, the remaining contract term, and therefore, the amount of unrecognized revenues included within remaining performance obligations, is limited to the notice period required for the termination.

Our remaining performance obligations are comprised of:

(a) original contract amounts, (b) change orders for which we have received written confirmations from our customers, (c) pending change orders for which we expect to receive confirmations in the ordinary course of business, (d) claim amounts that we have made against customers for which we have determined we have a legal basis under existing contractual arrangements and as to which the variable consideration constraint does not apply, and (e) other forms of variable consideration to the extent that such variable consideration has been included within the transaction price of our contracts.

Such claim and other variable consideration amounts were immaterial for all periods presented.

EMCOR Group, Inc.

2 unchanged sentences

NOTE 3 - REVENUE FROM CONTRACTS WITH CUSTOMERS (Continued)

Our remaining performance obligations are comprised of:

Such claim and other variable consideration amounts were immaterial for all periods presented.

Refer to the table below for additional information regarding our remaining performance obligations, including an estimate of when we expect to recognize such remaining performance obligations as revenue (in thousands):

10 unchanged sentences

Acquisitions are accounted for utilizing the acquisition method of accounting and the prices paid for them are allocated to their respective assets and liabilities based upon the estimated fair value of such assets and liabilities at the dates of their respective acquisition by us.

During 2024, we acquired seven companies for upfront consideration of $ 231.1 million, inclusive of customary working capital adjustments.

These acquisitions are comprised of:

(a) an electrical contractor in the Southeast region of the United States, that has been included in our United States electrical construction and facilities services segment, (b) two companies that have been included within our United States mechanical construction and facilities services segment, including:

(i) a leading plumbing services provider in the Southeast region of the United States and (ii) a full service provider of mechanical construction and maintenance services in Central Texas, (c) three companies that have been included in our United States building services segment, including:

(i) a provider of building automation and controls solutions in the Northeast region of the United States, (ii) a mechanical services company in the Western region of the United States, and (iii) a mechanical services company in the Eastern region of the United States, and (d) an instrumentation and electrical contractor, that has been included in our United States industrial services segment, which provides electrical, automation, digital integration, and fabrication services to various energy sector and process equipment customers.

In connection with these acquisitions, we acquired working capital of $ 29.0 million and other net assets of $ 1.1 million, and have preliminarily ascribed $ 61.9 million to goodwill and $ 139.1 million to identifiable intangible assets.

We expect that all of the goodwill and identifiable intangible assets acquired in connection with these 2024 acquisitions will be deductible for tax purposes.

During 2023, we acquired eight companies for total consideration of $ 99.6 million.

2 unchanged sentences

(i) three companies that have been included within our United States mechanical construction and facilities services segment, one of which provides mechanical and pipe fabrication services in the Midwestern region of the United States, and two of which add capabilities to our national fire protection services, and (ii) four mechanical services companies in the Western and Midwestern regions of the United States that have been included within our United States building services segment and enhance our presence in geographies where we have existing operations.

In connection with these acquisitions, we acquired working capital of $ 9.1 million and other net liabilities of $ 6.1 million, including certain deferred tax liabilities, and have preliminarily ascribed $ 37.4 million to goodwill and $ 59.2 million to identifiable intangible assets.

In connection with these acquisitions, we acquired working capital of $ 9.1 million and other net liabilities of $ 6.1 million, including certain deferred tax liabilities, and have ascribed $ 37.4 million to goodwill and $ 59.2 million to identifiable intangible assets.

We expect that $ 29.6 million of the goodwill and identifiable intangible assets acquired in connection with these 2023 acquisitions will be deductible for tax purposes.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - ACQUISITIONS OF BUSINESSES (Continued)

During 2022, we acquired six companies for total consideration of $ 100.8 million.

4 unchanged sentences

We expect that all of the goodwill and identifiable intangible assets acquired in connection with these 2022 acquisitions will be deductible for tax purposes.

During 2021, we acquired eight companies for total consideration of $ 131.2 million.

Such acquisitions include:

(a) two companies, the results of operations of which have been included within our United States mechanical construction and facilities services segment, consisting of:

(i) a company that provides mechanical services within the Southern region of the United States and (ii) a company that provides fire protection services in the Midwestern region of the United States, (b) two companies that provide electrical construction services for a broad array of customers in the Midwestern region of the United States, the results of operations of which have been included in our United States electrical construction and facilities services segment, and (c) four companies, the results of operations of which have been included within our United States building services segment, consisting of:

(i) a company that provides mechanical services across North Texas and (ii) three companies that enhance our presence in geographies where we have existing operations and provide either mechanical services or building

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 - ACQUISITIONS OF BUSINESSES (Continued)

automation and controls solutions.

In connection with these acquisitions, we acquired working capital of $ 22.9 million and other net liabilities of $ 0.6 million, including certain deferred tax liabilities, and have ascribed $ 38.3 million to goodwill and $ 70.6 million to identifiable intangible assets.

We expect that $ 90.5 million of the goodwill and identifiable intangible assets acquired in connection with these 2021 acquisitions will be deductible for tax purposes.

The purchase price allocation for one of the businesses acquired in 2023 is preliminary and subject to change during its measurement period.

As we finalize such purchase price allocation, adjustments may be recorded relating to finalization of intangible asset valuations, tax matters, or other items.

The purchase price allocations for the businesses acquired in 2024 are preliminary and subject to change during their respective measurement periods.

As we finalize such purchase price allocations, adjustments may be recorded relating to finalization of intangible asset valuations, tax matters, or other items.

Although not expected to be significant, such adjustments may result in changes in the valuation of assets and liabilities acquired.

The purchase price allocations for the other businesses acquired in 2023 as well as the businesses acquired in 2022 and 2021 have been finalized during their respective measurement periods with an insignificant impact.

The purchase price allocations for the businesses acquired in 2023 and 2022 have been finalized during their respective measurement periods with an insignificant impact.

NOTE 5 - EARNINGS PER SHARE

16 unchanged sentences

Inventories $ 95,667 $ 110,774

The increase in inventories as of December 31, 2023, compared to December 31, 2022, was a result of:

(a) advanced purchases of materials and equipment for use on specific construction projects, in an effort to mitigate the impact of increased lead times, which have resulted from supply chain disruptions, (b) an increase in raw materials on hand to support our fabrication facilities given the growth in demand for our fire protection services, and (c) higher levels of work in process inventory within our United States industrial services segment given greater new build heat exchanger orders.

EMCOR Group, Inc.

9 unchanged sentences

Land, buildings, and leasehold improvements 162,336 142,114

142,114 130,358

Construction in progress 13,059 13,514

28 unchanged sentences

NOTE 8 - GOODWILL, IDENTIFIABLE INTANGIBLE ASSETS, AND OTHER LONG-LIVED ASSETS (Continued)

For the years ended December 31, 2022 and 2021, no impairment of our goodwill was recognized.

For each of the years ended December 31, 2024, 2023 and 2022, no impairment of our goodwill was recognized.

Due to the inherent uncertainties involved in making estimates, our assumptions may change in future periods.

11 unchanged sentences

services segment United States

industrial services segment Total

United States

industrial services

Balance at December 31, 2022 $ 178,013 $ 315,329 $ 311,721 $ 114,088 $ 919,151

$ 159,512 $ 303,887 $ 312,781 $ 114,088 $ 890,268

17,601 6,942 4,340 — 28,883

Acquisitions — 4,524 32,874 — 37,398

Intersegment transfers — ( 1,500 ) 1,500 — —

Balance at December 31, 2023 178,013 318,353 346,095 114,088 956,549

178,013 315,329 311,721 114,088 919,151

— 4,524 32,874 — 37,398

Intersegment transfers — ( 1,500 ) 1,500 — —

Acquisitions 13,739 26,111 12,210 9,806 61,866

Balance at December 31, 2024 $ 191,752 $ 344,464 $ 358,305 $ 123,894 $ 1,018,415

$ 178,013 $ 318,353 $ 346,095 $ 114,088 $ 956,549

The aggregate goodwill balance as of December 31, 2021 included $ 493.6 million of accumulated impairment charges, which were comprised of $ 139.5 million within the United States building services segment and $ 354.1 million within the United States industrial services segment.

The aggregate goodwill balance as of December 31, 2022 included $ 493.6 million of accumulated impairment charges, which were comprised of $ 139.5 million within our United States building services segment and $ 354.1 million within our United States industrial services segment.

Identifiable Intangible Assets and Other Long-Lived Assets

7 unchanged sentences

If the carrying amount of the trade name is greater than the implied fair value of the trade name, an impairment in the amount of the excess is recognized and charged to operations.

For the years ended December 31, 2023, 2022, and 2021, no impairment of our indefinite-lived trade name intangible assets was recognized.

For each of the years ended December 31, 2024, 2023, and 2022, no impairment of our indefinite-lived trade name intangible assets was recognized.

EMCOR Group, Inc.

5 unchanged sentences

If the assets are impaired, the assets are written down to their fair values, generally determined based on their discounted estimated future cash flows.

During the quarter ended September 30, 2023, we identified facts and circumstances that indicated the carrying values of certain long-lived assets within our United States mechanical construction and facilities services segment may not be fully recoverable.

As a result, we determined that these assets were impaired, and, during the third quarter of 2023, recognized a $ 2.4 million impairment charge.

In 2023, we identified facts and circumstances that indicated the carrying values of certain long-lived assets within our United States mechanical construction and facilities services segment may not be fully recoverable.

As a result, we determined that these assets were impaired, and recognized a $ 2.4 million impairment charge.

For the years ended December 31, 2024, 2023, and 2022, there were no other indicators of impairment with respect to identifiable intangible assets that are being amortized as well as other long-lived assets.

22 unchanged sentences

The weighted average amortization periods for the unamortized balances remaining are, in the aggregate, approximately 7.75 years, which are comprised of the following:

7.25 years for customer relationships, 5.75 years for trade names, and 3.75 years for developed technology/vendor network.

8.25 years for customer relationships, 4.50 years for trade names, 2.75 years for developed technology/vendor network, and 0.75 years for contract backlog.

Amortization expense related to identifiable intangible assets with finite lives was $ 77.0 million, $ 67.1 million, and $ 61.3 million for the years ended December 31, 2024, 2023, and 2022, respectively.

8 unchanged sentences

In addition, estimates of weighted average costs of capital are developed with the assistance of an independent third-party valuation specialist.

These assumptions and estimates may change in future periods, especially in times of uncertain economic conditions and rising interest rates.

These assumptions and estimates may change in future periods.

Significant adverse changes to external market conditions or our internal forecasts, if any, could result in future impairment charges.

1 unchanged sentence

NOTE 9 - DEBT

Excluding finance lease liabilities, we had no outstanding debt as of December 31, 2023.

Excluding finance lease liabilities, we had no outstanding debt as of December 31, 2024 and 2023.

Refer to Note 16 - Leases of the notes to consolidated financial statements for additional information regarding our finance leases, including outstanding balances.

Debt in the accompanying Consolidated Balance Sheets consisted of the following amounts as of December 31, 2022 (in thousands):

December 31, 2022

Unamortized debt issuance costs ( 2,080 )

Finance lease liabilities 6,459

Total debt 247,192

current maturities 15,567

Total long-term debt $ 231,625

Credit Agreement

Until December 20, 2023, we had a credit agreement that was entered into on March 2, 2020 , which provided for a $ 1.3 billion revolving credit facility (the “2020 Revolving Credit Facility”) and a $ 300.0 million term loan (the “2020 Term Loan”).

On December 20, 2023 , we amended and restated such agreement (as amended and restated, the “2023 Credit Agreement”) to provide for a $ 1.3 billion revolving credit facility (the “2023 Revolving Credit Facility”) expiring December 20, 2028 .

We have a credit agreement dated December 20, 2023 (the “2023 Credit Agreement”), which provides for a $ 1.3 billion revolving credit facility (the “2023 Revolving Credit Facility”) expiring December 20, 2028 .

If additional lenders are identified and/or existing lenders are willing to increase their current commitments, we may increase the 2023 Revolving Credit Facility by an amount equal to the greater of:

1 unchanged sentence

We may allocate up to $ 600.0 million of available capacity under the 2023 Revolving Credit Facility to letters of credit for our account or for the account of any of our subsidiaries.

There were no direct borrowings outstanding under the 2023 Revolving Credit Facility as of December 31, 2023 or the 2020 Revolving Credit Facility as of December 31, 2022.

However, outstanding letters of credit reduce the available capacity under these facilities, and as of December 31, 2023 and 2022, we had $ 116.7 million and $ 71.3 million of letters of credit outstanding, respectively.

The balance of the 2020 Term Loan as of December 31, 2022 was $ 242.8 million.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 - DEBT (Continued)

There were no direct borrowings outstanding under the 2023 Revolving Credit Facility as of December 31, 2024 and 2023.

However, outstanding letters of credit reduce the available capacity under this facility and, as of December 31, 2024 and 2023, we had $ 71.2 million and $ 116.7 million of letters of credit outstanding, respectively.

At the Company’s election, borrowings under the 2023 Revolving Credit Facility bear interest at either:

2 unchanged sentences

(a) the prime commercial lending rate announced by Bank of Montreal from time to time, (b) the federal funds effective rate, plus ½ of 1.00%, (c) Adjusted Term SOFR for a one-month tenor, plus 1.00 %, or (d) 0.00 %.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 - DEBT (Continued)

A commitment fee is payable on the average daily unused amount of the 2023 Revolving Credit Facility, which ranges from 0.125 % to 0.25 %, depending on the Company’s Leverage Ratio.

The fee was 0.125 % of the unused amount as of December 31, 2023.

The fee was 0.125 % of the unused amount as of December 31, 2024 and 2023.

Fees for letters of credit issued under the 2023 Revolving Credit Facility range from 0.85 % to 1.875 % of the respective face amounts of outstanding letters of credit, depending on the nature of the letter of credit, and are computed depending on the Company’s Leverage Ratio.

We capitalized an additional $ 3.4 million of debt issuance costs associated with the 2023 Credit Agreement.

Debt issuance costs are amortized over the life of the agreement as part of interest expense.

Obligations under the 2023 Credit Agreement are guaranteed by most of our direct and indirect subsidiaries and are secured by substantially all of our assets.

The 2023 Credit Agreement contains customary covenants providing for, among other things, the maintenance of certain financial ratios and certain limitations on the payment of dividends, common stock repurchases, investments, acquisitions, indebtedness, and capital expenditures.

We were in compliance with all such covenants as of December 31, 2023.

We were in compliance with all such covenants as of December 31, 2024 and 2023.

NOTE 10 - FAIR VALUE MEASUREMENTS

14 unchanged sentences

61,242 — — 61,242

Restricted cash (3)

Total $ 1,401,637 $ — $ — $ 1,401,637

4 unchanged sentences

(2) Deferred compensation plan assets are classified as “Other assets” in the Consolidated Balance Sheets.

(3) Restricted cash is classified as “Prepaid expenses and other” in the Consolidated Balance Sheets.

Restricted cash represents cash held in account for use on customer contracts.

EMCOR Group, Inc.

8 unchanged sentences

47,315 — — 47,315

Restricted cash (3)

Total $ 837,065 $ — $ — $ 837,065

4 unchanged sentences

(2) Deferred compensation plan assets are classified as “Other assets” in the Consolidated Balance Sheets.

(3) Restricted cash is classified as “Prepaid expenses and other” in the Consolidated Balance Sheets.

Restricted cash primarily represents cash held in account for use on customer contracts.

Nonrecurring Fair Value Measurements

6 unchanged sentences

We believe that the carrying values of our financial instruments, which include accounts receivable and other financing commitments, approximate their fair values due primarily to their short-term maturities and low risk of counterparty default.

Although there were no outstanding borrowings under our 2023 Credit Agreement as of December 31, 2023, the carrying value of any debt associated with this agreement would approximate its fair value due to the variable rate on such debt.

Although there were no outstanding direct borrowings under our 2023 Credit Agreement as of December 31, 2024 and 2023, the carrying value of any debt associated with this agreement would approximate its fair value due to the variable rate on such debt.

NOTE 11 - INCOME TAXES

14 unchanged sentences

$ 370,237 $ 239,524 $ 152,628

$ 239,524 $ 152,628 $ 145,602

EMCOR Group, Inc.

26 unchanged sentences

For tax years beginning after December 31, 2022, the Inflation Reduction Act creates a 15% corporate alternative minimum tax on profits of corporations whose average annual adjusted financial statement income exceeds $1.0 billion for any consecutive three-tax-year period preceding the then current tax year.

Based on our average annual income for the preceding three years, which was below the aforementioned $1.0 billion threshold, as well as the fact that our effective federal income tax rate is in excess of the 15% alternative minimum tax rate, this alternative minimum tax did not have an impact on our financial position and/or results of operations for the year ended December 31, 2023.

Legislation has been enacted in the United Kingdom to implement measures in concert with the Base Erosion and Profit Shifting Pillar Two framework for international taxation developed by the member countries of the Organization for Economic Co-operation and Development (the “Pillar Two Model Rules”).

23 unchanged sentences

Depreciation of property, plant, and equipment ( 33,284 ) ( 30,075 )

( 30,075 ) ( 28,435 )

Pension asset ( 6,082 ) ( 4,660 )

5 unchanged sentences

As of December 31, 2024 and 2023, the total valuation allowance on deferred income tax assets, related to state and local net operating losses, foreign net operating losses, and foreign income tax credit carryovers, was approximately $ 5.1 million and $ 4.4 million, respectively.

The increase in our valuation allowances at December 31, 2023 was a result of the recognition of additional deferred tax assets related to net operating loss carryovers and foreign income tax credit carryovers that we determined we would likely not be able to utilize.

The increase in our valuation allowances at December 31, 2024 was a result of the recognition of allowances for additional state net operating loss carryovers that we determined we would likely not be able to utilize.

Realization of our deferred income tax assets is dependent on our generating sufficient taxable income in the jurisdictions in which such deferred tax assets will reverse.

8 unchanged sentences

We currently pay a regular quarterly dividend of $ 0.25 per share.

Subsequent to December 31, 2023, our Board of Directors announced its intention to increase the regular quarterly dividend to $ 0.25 per share commencing with the dividend to be paid in April 2024.

In September 2011, the Board authorized a share repurchase program allowing us to begin repurchasing shares of our outstanding common stock.

In September 2011, our Board of Directors (the “Board”) authorized a share repurchase program allowing us to begin repurchasing shares of our outstanding common stock.

Subsequently, the Board has from time to time increased the amount authorized for repurchases under such program.

Since the inception of the repurchase program, the Board has authorized us to repurchase up to $ 2.15 billion of our outstanding common stock.

During the year ended December 31, 2023, we repurchased approximately 0.8 million shares of our common stock for approximately $ 128.7 million.

Since the inception of the repurchase program, through December 31, 2024, the Board has authorized us to repurchase up to $ 2.65 billion of our outstanding common stock.

During the year ended December 31, 2024, we repurchased approximately 1.3 million shares of our common stock for approximately $ 501.6 million, inclusive of the applicable excise tax.

Since the inception of the repurchase program through December 31, 2024, we have repurchased approximately 27.1 million shares of our common stock for approximately $ 2.39 billion.

2 unchanged sentences

We may repurchase our shares from time to time to the extent permitted by securities laws and other legal requirements, including provisions in our 2023 Credit Agreement placing limitations on such repurchases.

The Inflation Reduction Act, which was enacted into law on August 16, 2022, imposes a nondeductible excise tax of 1% on the fair value of net stock repurchases in excess of share issuances made by publicly traded U.S.

corporations, effective for repurchases after December 31, 2022.

The applicable excise tax for the year ended December 31, 2023 was approximately $ 1.0 million and has been included as a component of treasury stock as it represents a direct cost associated with the repurchase of our common stock.

NOTE 13 - SHARE-BASED COMPENSATION PLANS

23 unchanged sentences

An aggregate of 30,879 restricted stock units granted to current non-employee directors vested as of December 31, 2024, but, at the election of such directors, issuance has been deferred for up to 10 years from the date of vest.

In addition, an aggregate of 6,086 restricted stock units granted to former employees vested as of December 31, 2023 but, in accordance with plan documents, were issued in January 2024.

In addition, an aggregate of 13,087 restricted stock units granted to a former employee vested as of April 1, 2024 but, in accordance with plan documents, were not issued until January 2025.

We recognized approximately $ 20.0 million, $ 13.7 million, and $ 12.1 million of compensation expense for stock units awarded to non-employee directors and employees pursuant to our incentive plan for the years ended December 31, 2024, 2023, and 2022, respectively.

We have approximately $ 15.9 million of compensation expense, net of income taxes, which will be recognized over the remaining vesting periods of up to 3 years.

EMCOR Group, Inc.

2 unchanged sentences

NOTE 13 - SHARE-BASED COMPENSATION PLANS (Continued)

We recognized approximately $ 13.7 million, $ 12.1 million, and $ 11.1 million of compensation expense for stock units awarded to non-employee directors and employees pursuant to our incentive plan for the years ended December 31, 2023, 2022, and 2021, respectively.

We have approximately $ 11.4 million of compensation expense, net of income taxes, which will be recognized over the remaining vesting periods of up to 3 years.

The income tax benefit derived in 2024, 2023, and 2022 as a result of share-based compensation was approximately $ 5.7 million, $ 3.3 million, and $ 3.9 million, respectively, of which approximately $ 4.0 million, $ 1.7 million, and $ 1.7 million, respectively, represented excess tax benefits.

Through December 31, 2023, we sponsored an employee stock purchase plan, which generally allowed our corporate employees and non-union employees of our United States subsidiaries to purchase up to an aggregate of 3,000,000 of our shares.

This plan was terminated subsequent to December 31, 2023.

NOTE 14 - RETIREMENT PLANS

2 unchanged sentences

Gains and losses for the differences between actuarial assumptions and actual results are recognized through accumulated other comprehensive income (loss).

These amounts will be subsequently recognized as net periodic pension cost (income) within the Consolidated Statement of Operations, as described further below.

These amounts will be subsequently recognized as net periodic pension (income) cost within the Consolidated Statement of Operations, as described further below.

United Kingdom Retirement Plan

6 unchanged sentences

Interest cost 9,569 9,722

Actuarial loss (gain)

Actuarial (gain) loss

( 19,602 ) 651

4 unchanged sentences

Fair value of plan assets at beginning of year 223,077 210,284

Actual return (loss) on plan assets

Actual (loss) return on plan assets

( 5,240 ) 10,563

12 unchanged sentences

Discount rate 5.5 % 4.8 %

The components of net periodic pension cost (income) of the UK Plan for the years ended December 31, 2023, 2022, and 2021 were as follows (in thousands):

The components of net periodic pension (income) cost of the UK Plan for the years ended December 31, 2024, 2023, and 2022 were as follows (in thousands):

2024 2023 2022

2 unchanged sentences

Amortization of unrecognized loss 2,625 2,611 2,073

Net periodic pension cost (income) $ 916 $ ( 4,322 ) $ ( 3,758 )

The assumptions used to determine net periodic pension cost of the UK Plan for the years ended December 31, 2023, 2022, and 2021 were as follows:

Net periodic pension (income) cost

$ ( 816 ) $ 916 $ ( 4,322 )

The assumptions used to determine net periodic pension (income) cost of the UK Plan for the years ended December 31, 2024, 2023, and 2022 were as follows:

2024 2023 2022

Discount rate 4.8 % 5.0 % 1.8 %

2 unchanged sentences

This approach models the long term expected returns of the various asset classes held in the portfolio and takes into account the additional benefits of holding a diversified portfolio.

For measurement purposes of the liability, the annual rate of inflation of covered pension benefits assumed for both 2023 and 2022 was 2.8 %.

Amounts pertaining to the UK Plan not yet reflected in net periodic pension cost and included in accumulated other comprehensive loss were as follows (in thousands):

For measurement purposes of the liability, the annual rates of inflation of covered pension benefits assumed for 2024 and 2023 were 2.9 % and 2.8 %, respectively.

Amounts pertaining to the UK Plan not yet reflected in net periodic pension (income) cost and included in accumulated other comprehensive loss were as follows (in thousands):

December 31, 2024 December 31, 2023

2 unchanged sentences

The amortization period for 2024 was 22 years.

The reclassification adjustment, net of income taxes, for the UK Plan from accumulated other comprehensive loss into net periodic pension cost was approximately $ 2.0 million for the year ended December 31, 2023, approximately $ 1.6 million for the year ended December 31, 2022, and approximately $ 2.9 million for the year ended December 31, 2021.

The estimated unrecognized loss for the UK Plan that will be amortized from accumulated other comprehensive loss into net periodic pension cost over the next year is approximately $ 2.0 million, net of income taxes.

The reclassification adjustment, net of income taxes, for the UK Plan from accumulated other comprehensive loss into net periodic pension (income) cost was approximately $ 2.0 million for each of the years ended December 31, 2024 and 2023, and approximately $ 1.6 million for the year ended December 31, 2022.

The estimated unrecognized loss for the UK Plan that will be amortized from accumulated other comprehensive loss into net periodic pension (income) cost over the next year is approximately $ 1.9 million, net of income taxes.

EMCOR Group, Inc.

4 unchanged sentences

In order to ensure that an appropriate investment strategy is in place, an analysis of the UK Plan’s assets and liabilities is completed periodically.

Target allocation percentages vary over time depending on the perceived risk and return potential of various asset classes and market conditions.

Target allocation percentages may vary over time depending on the perceived risk and return potential of various asset classes and market conditions.

The weighted average asset allocations and weighted average target allocations at December 31, 2024 and 2023 were as follows:

48 unchanged sentences

These investments are redeemable at NAV, which is generally determined on a quarterly basis, and have redemption notice periods of up to 180 days.

In addition, certain of these investments are subject to a lockup period of up to 24 months.

The methods described above may produce fair values that may not be indicative of net realizable value or reflective of future fair values.

16 unchanged sentences

The plan assets are predominantly invested in cash, equity securities, and equity and bond funds, which have quoted market prices in active markets, and as such are considered Level 1 assets within the fair value hierarchy.

The liability balances as of December 31, 2023 and 2022 are classified as “Other long-term obligations” in the accompanying Consolidated Balance Sheets.

The net liability associated with these plans as of December 31, 2024 and 2023 is classified as “Other long-term obligations” in the accompanying Consolidated Balance Sheets.

The measurement date for these plans is December 31 of each year.

The major assumptions used in the actuarial valuations to determine benefit obligations included discount rates of 4.75 % and 5.20 % as of December 31, 2023, and approximately 4.80 % as of December 31, 2022.

In addition, key assumptions included an expected rate of return of 7.00 % in order to determine net periodic pension cost for both 2023 and 2022.

The net periodic pension cost associated with the domestic plans, as well as the reclassification adjustment from accumulated other comprehensive loss to net periodic pension cost, were insignificant for all periods presented.

The major assumptions used in the actuarial valuations to determine benefit obligations included discount rates of 5.00 % as of December 31, 2024, and 4.75 % to 5.20 % as of December 31, 2023.

In addition, key assumptions included an expected rate of return of 7.00 % in order to determine net periodic pension (income) cost for both 2024 and 2023.

The net periodic pension (income) cost associated with the domestic plans, as well as the reclassification adjustment from accumulated other comprehensive loss to net periodic pension (income) cost, were insignificant for all periods presented.

EMCOR Group, Inc.

9 unchanged sentences

Our United Kingdom subsidiary also has defined contribution retirement plans.

The expenses recognized related to employer matching contributions for the years ended December 31, 2023, 2022, and 2021 were approximately $ 7.4 million, $ 7.3 million, and $ 8.3 million, respectively.

The expenses recognized related to employer matching contributions were approximately $ 7.4 million for each of the years ended December 31, 2024 and 2023, and $ 7.3 million for the year ended December 31, 2022.

Multiemployer Plans

24 unchanged sentences

date or range of expiration dates of CBA(s)

2024 2023 2024 2023 2022

National Automatic Sprinkler Industry Pension Fund 52-6054620 001 Green Green NA $ 30,719 $ 25,559 $ 21,583 Yes March 2025 to

National Electrical Benefit Fund 53-0181657 001 Green Green NA 18,128 15,192 12,310 Yes

February 2024 to November 2027

United Association National Pension Fund

52-6152779 001 Green Green NA 16,815 15,288 14,723 No

January 2024 to May 2029

Sheet Metal Workers National Pension Fund 52-6112463 001 Green Green

NA 10,797 9,505 10,307 No April 2024 to

Central Pension Fund of the IUOE & Participating Employers 36-6052390 001 Green Green NA 8,573 7,651 6,627 No January 2024 to December 2026

National Electrical Benefit Fund 53-0181657 001 Green Green NA 23,255 18,128 15,192 Yes April 2025 to August 2028

United Association National Pension Fund 52-6152779 001 Green Green NA 21,839 16,815 15,288 No February 2025 to May 2029

Sheet Metal Workers National Pension Fund 52-6112463 001 Green Green NA 12,795 10,797 9,505 No May 2025 to

Electrical Workers Local No.

26 Pension Trust Fund 52-6117919 001 Green Green NA 8,283 7,844 9,346 Yes May 2024 to September 2027

Pension, Hospitalization & Benefit Plan of the Electrical Industry-Pension Trust Account 13-6123601 001 Green Green NA 7,198 8,122 7,355 No January 2025 to

Plumbers Pipefitters & Mechanical Equipment Service Local Union 392 Pension Plan 31-0655223 001 Red Red Implemented 7,010 7,674 7,110 Yes May 2024 to May 2025

Electrical Workers Pension Plan Local 103 IBEW 04-6063734 001 Green Green NA 6,537 2,900 — Yes August 2028

Northern California Pipe Trades Pension Plan 94-3190386 001 Green Green NA 6,317 3,238 2,663 No June 2024 to July 2024

26 Pension Trust Fund 52-6117919 001 Green Green NA 12,472 8,283 7,844 Yes May 2025 to August 2028

Central Pension Fund of the IUOE & Participating Employers 36-6052390 001 Green Green NA 9,433 8,573 7,651 No March 2025 to December 2028

Edison Pension Plan 93-6061681 001 Green Green NA 7,982 5,840 5,325 Yes December 2026

Sheet Metal Workers Pension Plan of Northern California 51-6115939 001 Red Red Implemented 5,738 6,074 7,850 Yes

June 2024 to June 2026

Plumbers Pipefitters & Mechanical Equipment Service Local Union 392 Pension Plan 31-0655223 001 Yellow

7,728 7,010 7,674 Yes May 2025

San Diego Electrical Pension Plan 95-6101801 001 Green Green NA 7,039 5,511 4,258 Yes May 2028

Heating, Piping & Refrigeration Pension Fund 52-1058013 001 Green Green NA 5,315 4,625 5,591 Yes

July 2024 to July 2025

Pension, Hospitalization & Benefit Plan of the Electrical Industry-Pension Trust Account 13-6123601 001 Green Green NA 6,982 7,198 8,122 Yes

January 2025 to April 2025

Pipefitters Union Local 537 Pension Fund 51-6030859 001 Green Green NA 6,656 5,179 5,039 Yes August 2025

Southern California Pipe Trades Retirement Fund 51-6108443 001 Green Green NA 4,657 4,650 6,272 Yes

August 2024 to August 2026

Electrical Contractors Association of the City of Chicago Local Union 134, IBEW Joint Pension Trust of Chicago Pension Plan 2 51-6030753 002 Green Green NA 4,432 3,516 4,225 No June 2024 to December 2024

IBEW Local 701 Pension Fund 36-6455509 001 Green Green NA 3,989 2,625 1,276 No

May 2024 to September 2024

Eighth District Electrical Pension Fund 84-6100393 001 Green Green NA 3,844 3,339 3,298 Yes February 2024 to February 2027

Southern California IBEW-NECA Pension Trust Fund 95-6392774 001 Yellow Yellow Implemented 3,801 4,287 4,876 No May 2024 to

November 2026

Heating, Piping & Refrigeration Pension Fund 52-1058013 001 Green Green NA 5,710 5,315 4,625 Yes July 2025

Southern California Pipe Trades Retirement Fund 51-6108443 001 Green Green NA 5,447 4,657 4,650 Yes June 2026 to August 2026

Sheet Metal Workers Pension Plan of Northern California 51-6115939 001 Red Red Implemented 5,245 5,738 6,074 Yes May 2025 to June 2026

Electrical Workers Pension Plan Local 103 IBEW 04-6063734 001 Green Green NA 5,133 6,537 2,900 Yes August 2028

Eighth District Electrical Pension Fund 84-6100393 001 Green Green NA 4,476 3,844 3,339 Yes May 2025 to August 2027

Electrical Contractors Association of the City of Chicago Local Union 134, IBEW Joint Pension Trust of Chicago Pension Plan 2 51-6030753 002 Green Green NA 4,341 4,432 3,516 Yes

Southern California IBEW-NECA Pension Trust Fund 95-6392774 001 Yellow Yellow Implemented 4,279 3,801 4,287 Yes

November 2025 to

Atlanta Plumbers and Steamfitters Pension Fund 58-1233396 001

4,133 1,691 1,434 Yes

January 2025 to August 2028

Arizona Pipe Trades Pension Trust Fund 86-6025734 001 Green Green NA 4,038 3,048 2,940 Yes June 2025 to June 2027

IBEW Local 701 Pension Fund 36-6455509 001 Green Green NA 3,849 3,989 2,625 Yes

June 2025 to August 2026

Sheet Metal Workers Pension Plan of Southern California, Arizona & Nevada 95-6052257 001 Green Green NA 3,783 3,399 2,921 No June 2026 to June 2029

Local 393 Pension Trust Fund Defined Benefit 94-6359772 002 Green Green NA 3,734 3,263 3,517 Yes May 2025 to June 2027

IBEW Local No.

82 Pension Plan 31-6127268 001 Green Green NA 3,325 3,701 2,549 Yes December 2026

Sheet Metal Workers Pension Plan of Southern California, Arizona & Nevada 95-6052257 001 Green Green

NA 3,399 2,921 3,322 No June 2024 to July 2028

Kern County Electrical Workers Pension Fund

001 Green Green NA 3,299 1,542 1,167 Yes

November 2027

Northern California Pipe Trades Pension Plan 94-3190386 001 Green Green NA 3,310 6,317 3,238 Yes

May 2025 to June 2027

EMCOR Group, Inc.

7 unchanged sentences

2024 2023 2024 2023 2022

Local 393 Pension Trust Fund Defined Benefit 94-6359772 002 Green Green NA 3,263 3,517 3,507 Yes

June 2024 to July 2024

Arizona Pipe Trades Pension Trust Fund 86-6025734 001 Green Green NA 3,048 2,940 2,020 Yes June 2024

Joint Pension Fund of Local Union No.

2,868 1,762 1,531 Yes

Plumbers & Steamfitters Local 486 Pension Fund

NECA-IBEW Pension Trust Fund 51-6029903 001 Green Green NA 3,242 2,228 3,034 No May 2025 to December 2025

Plumbers & Steamfitters Local 486 Pension Fund 52-6124449 001 Green Green NA 2,796 2,828 1,599 Yes December 2025

IBEW Local 456 Pension Plan

22-6238995 001

2,792 1,390 417 Yes

December 2025

Plumbers & Pipefitters Local No.

189 Pension Fund

189 Pension Plan

31-0894807 001 Green Green NA 2,744 2,557 1,272 Yes May 2025 to June 2025

Kern County Electrical Workers Pension Fund 95-6123049 001 Green Green NA 2,499 3,299 1,542 Yes November 2027

Plumbers Local 24 Pension Fund 22-6042823 001 Green Green NA 2,231 2,295 1,819 Yes April 2025

Building Trades United Pension Trust Fund Milwaukee and Vicinity 51-6049409 001

2,182 1,622 1,560 No

May 2025 to May 2026

IBEW Local No.

683 Pension Fund Pension Plan

34-1442087 001

2,146 905 893 Yes

May 2024 to June 2025

697 IBEW and Electrical Industry Pension Fund 51-6133048 001 Green Green NA 2,528 2,287 1,753 Yes May 2024

Plumbers Local 24 Pension Fund

June 2025 to May 2027

Pension and Retirement Plan of Plumbers and Pipefitters Union, Local No.

525 88-6003864 001

2,099 1,970 1,858 No

January 2025 to September 2028

Plumbers and Steamfitters Local No.

166 AFL - CIO Pension Plan 51-6132690 001

2,046 1,773 1,838 Yes

NECA-IBEW Pension Trust Fund 51-6029903 001 Green Green NA 2,228 3,034 2,491 No May 2024 to December 2024

IBEW 332 Pension Fund - Part A 94-2688032 004 Green Green NA 2,062 4,177 2,339 Yes

May 2024 to June 2024

IBEW Local No.

640 & Arizona Chapter NECA Defined Benefit Pension Plan 86-0323980 001

2,044 390 52 No

June 2025 to June 2027

Plumbers & Pipefitters Local 162 Pension Fund 31-6125999 001 Yellow Yellow Implemented 1,390 1,243 1,132 Yes May 2025 to May 2026

Steamfitters Local Union No.

420 Pension Plan 23-2004424 001 Red Red Implemented 1,227 1,018 677 No April 2026 to May 2026

Boilermaker-Blacksmith National Pension Trust 48-6168020 001 Red

1,140 6,434 3,479 Yes

April 2025 to

September 2026

Plumbing & Pipe Fitting Local 219 Pension Fund 34-6682376 001 Red Red Implemented 1,098 919 1,172 Yes May 2026

Boilermaker-Blacksmith National Pension Trust 48-6168020 001 Red Red Implemented 825 1,140 6,434 No

April 2025 to

Carpenters Pension Trust Fund for Northern California 94-6050970 001 Red Red Implemented 627 610 532 No June 2027

15 unchanged sentences

Our contributions to these plans were approximately $ 279.9 million, $ 243.5 million, and $ 213.7 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Acquisitions made by use since 2021 have resulted in incremental contributions to such other post retirement benefit plans of approximately $ 14.4 million.

Acquisitions made by us since 2022 have resulted in incremental contributions to such other post-retirement benefit plans of approximately $ 6.4 million.

The amount of contributions to these plans is also subject, for the most part, to the factors discussed above in conjunction with the MEPPs.

21 unchanged sentences

Collective Bargaining Agreements

At December 31, 2023, we employed approximately 38,300 people, approximately 60 % of whom are represented by various unions pursuant to nearly 450 collective bargaining agreements between our individual subsidiaries or trade associations and local unions, as well as two collective bargaining agreements that are national or regional in scope.

At December 31, 2024, we employed approximately 40,400 people, approximately 63 % of whom are represented by various unions pursuant to approximately 425 collective bargaining agreements between our individual subsidiaries or trade associations and local unions, as well as two collective bargaining agreements that are national or regional in scope.

We believe that our relations with our labor unions are generally positive.

4 unchanged sentences

Legal Proceedings

We are involved in several legal proceedings in which damages and claims have been asserted against us.

We believe that we have a number of valid defenses to such proceedings and claims and intend to vigorously defend ourselves.

We face potential exposure in several legal proceedings in which damages or claims (including, without limitation, indemnification claims by named defendants in legal proceedings in which we are not a party) have been asserted against us.

We believe that we have valid defenses to such proceedings and claims, but litigation is inherently uncertain.

We additionally maintain insurance coverage for certain of these matters, although these policies do not cover all possible claims and certain of the policies are subject to large deductibles and retentions.

We do not believe that any such matters will have a material adverse effect on our financial position, results of operations, or liquidity.

We record a loss contingency if the potential loss from a proceeding or claim is considered probable and the amount can be reasonably estimated or a range of loss can be determined.

We provide disclosure when it is reasonably possible that a loss will be incurred in excess of any recorded provision.

We record a loss contingency if we consider the potential loss from a proceeding or claim probable, and we are able to reasonably estimate the amount or can reasonably determine a range of loss.

We provide disclosure when we believe a loss in excess of any recorded provision is reasonably possible.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 15 - COMMITMENTS AND CONTINGENCIES (Continued)

Significant judgment is required in these determinations.

2 unchanged sentences

Litigation is subject to many uncertainties, and the outcome of litigation is not predictable with assurance.

It is possible that a litigation matter for which liabilities have not been recorded could be decided unfavorably to us, and that any such unfavorable decision could have a material adverse effect on our financial position, results of operations, or liquidity.

EMCOR Group, Inc.

and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A litigation matter for which liabilities have not been recorded could be decided unfavorably to us, and any such unfavorable decision could have a material adverse effect on our financial position, results of operations, or liquidity.

NOTE 16 - LEASES

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Operating Operating lease liabilities, current $ 81,247 $ 75,236

Finance Current maturities of long-term debt and finance lease liabilities 2,465 2,652

Finance Other accrued expenses and liabilities

Operating Operating lease liabilities, long-term 261,575 259,430

Finance Long-term debt and finance lease liabilities 2,838 3,807

Finance Other long-term obligations

Total lease liabilities $ 348,917 $ 339,969

58 unchanged sentences

Our services are provided to a broad range of commercial, technology, manufacturing, industrial, healthcare, utility, and institutional customers through approximately 100 operating subsidiaries.

Such operating subsidiaries are organized into the following reportable segments:

Such operating subsidiaries are organized into the following reportable segments, which additionally reflect the nature of the services offered and their geographical location:

• United States electrical construction and facilities services;

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• United Kingdom building services.

Our chief operating decision maker (“CODM”) is our Chairman, President, and Chief Executive Officer.

Our CODM is responsible for assessing performance of the Company and each of our reportable segments as well as allocating resources, including personnel and capital resources.

The measure of segment profit or loss utilized by our CODM is operating income.

Our CODM evaluates segment performance by comparing historical, actual, and forecasted operating income on a regular basis.

The accounting policies of our reportable segments are the same as those applied at the consolidated financial statement level as described in Note 2 - Summary of Significant Accounting Policies of the notes to consolidated financial statements.

EMCOR Group, Inc.

2 unchanged sentences

NOTE 18 - SEGMENT INFORMATION (Continued)

The following tables present financial information for each of our reportable segments for the years ended December 31, 2023, 2022, and 2021 (in thousands):

The following tables present the revenues and operating income for each of our reportable segments for the years ended December 31, 2024, 2023, and 2022 (in thousands):

2024 2023 2022

6 unchanged sentences

United Kingdom building services 425,525 436,423 477,078

Total operations $ 12,582,873 $ 11,076,120 $ 9,903,580

Consolidated revenues

$ 14,566,116 $ 12,582,873 $ 11,076,120

2024 2023 2022

Total revenues:

6 unchanged sentences

United Kingdom building services 425,525 436,423 477,078

Total operations $ 12,582,873 $ 11,076,120 $ 9,903,580

Consolidated revenues

$ 14,566,116 $ 12,582,873 $ 11,076,120

2024 2023 2022

Operating income (loss):

7 unchanged sentences

Impairment loss on long-lived assets — ( 2,350 ) —

Consolidated operating income

1,344,863 875,756 564,877

Total operations 875,756 564,877 530,800

Net periodic pension (cost) income ( 1,119 ) 4,311 3,625

Net periodic pension income (cost)

894 ( 1,119 ) 4,311

Interest expense ( 3,779 ) ( 17,199 ) ( 13,199 )

5 unchanged sentences

NOTE 18 - SEGMENT INFORMATION (Continued)

The following tables provide the significant expenses that are regularly provided to and reviewed by our CODM for each of our reportable segments for the years ended December 31, 2024, 2023, and 2022 (in thousands):

2024 2023 2022

Capital expenditures:

Cost of sales:

United States electrical construction and facilities services $ 2,673,491 $ 2,359,816 $ 2,129,405

4 unchanged sentences

United Kingdom building services 376,423 379,067 417,540

Corporate administration 1,672 107 386

Total operations $ 78,404 $ 49,289 $ 36,192

Consolidated cost of sales

$ 11,801,065 $ 10,493,534 9,472,526

Depreciation and amortization of property, plant, and equipment:

2024 2023 2022

Selling, general and administrative expenses:

United States electrical construction and facilities services $ 222,250 $ 193,267 $ 154,981

5 unchanged sentences

Corporate administration 144,354 127,229 110,440

Total operations $ 51,822 $ 47,296 $ 48,347

December 31, 2023 December 31, 2022 December 31, 2021

Contract assets:

Consolidated selling, general and administrative expenses

$ 1,420,188 $ 1,211,233 1,038,717

The following tables present other financial information for each of our reportable segments as of or for the years ended December 31, 2024, 2023, and 2022 (in thousands):

2024 2023 2022

Depreciation and amortization of property, plant, and equipment:

United States electrical construction and facilities services $ 7,928 $ 8,402 $ 7,543

4 unchanged sentences

United Kingdom building services 3,750 3,116 2,752

Total operations $ 269,885 $ 273,176 $ 230,143

December 31, 2023 December 31, 2022 December 31, 2021

Contract liabilities:

Corporate administration 886 983 1,657

Total depreciation and amortization of property, plant, and equipment

$ 56,678 $ 51,822 $ 47,296

2024 2023 2022

Amortization of identifiable intangible assets:

United States electrical construction and facilities services $ 6,773 $ 9,583 $ 7,298

4 unchanged sentences

United Kingdom building services — — —

Total operations $ 1,595,109 $ 1,098,263 $ 788,134

Total amortization of identifiable intangible assets

$ 77,002 $ 67,143 $ 61,315

EMCOR Group, Inc.

2 unchanged sentences

NOTE 18 - SEGMENT INFORMATION (Continued)

December 31, 2023 December 31, 2022 December 31, 2021

Long-lived assets:

2024 2023 2022

Capital expenditures:

United States electrical construction and facilities services $ 9,467 $ 6,929 $ 11,228

5 unchanged sentences

Corporate administration 1,128 1,672 107

Total operations $ 1,721,959 $ 1,670,945 $ 1,631,699

Total capital expenditures

$ 74,950 $ 78,404 49,289

December 31, 2024 December 31, 2023 December 31, 2022

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Corporate administration 1,455,718 891,793 596,591

Total operations $ 6,609,721 $ 5,524,607 $ 5,441,446

$ 7,716,473 $ 6,609,721 $ 5,524,607

The following table presents geographical information about certain tangible long-lived assets, including property, plant, and equipment and right-of-use lease assets as of December 31, 2024, 2023, and 2022 (in thousands):

December 31, 2024 December 31, 2023 December 31, 2022

Long-lived assets:

United States

$ 509,181 $ 476,595 $ 411,581

United Kingdom

14,436 13,281 14,301

Total long-lived assets

$ 523,617 $ 489,876 $ 425,882

NOTE 19 - SUBSEQUENT EVENTS

Subsequent to December 31, 2023, we entered into definitive agreements to acquire three companies for upfront consideration of approximately $ 137.0 million.

These transactions are expected to close in the second quarter of 2024, subject to customary closing conditions.

These acquisitions are comprised of:

(a) two companies that will be included within our United States mechanical construction and facilities services segment including:

(i) a leading plumbing services provider in the Southeast region of the United States and (ii) a full service provider of mechanical construction and maintenance services in Central Texas, and (b) a company which provides building automation and controls solutions in the Northeast region of the United States, that will be included in our United States building services segment.

On February 3, 2025, we completed the acquisition of Miller Electric Company (“Miller Electric”), a leading electrical contractor operating across the Southeastern United States, for $ 865 million in cash, subject to customary adjustments.

The results of operations of Miller Electric will be included as part of our United States electrical construction and facilities services segment.

On February 25, 2025, our Board of Directors authorized an additional $ 500 million for the repurchase of shares of the Company’s outstanding common stock under our existing share repurchase program.

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors of EMCOR Group, Inc.

and subsidiaries:

Opinion on the Financial Statements

15 unchanged sentences

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition from Construction Contracts

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In addition, we performed certain retrospective review procedures to assess management’s historical ability to accurately estimate the transaction price and costs to complete contracts as well as to identify any significant or unusual changes in project revenue and cost forecasts during the period.

Valuation of Goodwill

Description of the Matter At December 31, 2023, the Company’s goodwill was approximately $956.5 million.

As discussed in Note 8 to the consolidated financial statements, goodwill is tested for impairment at least annually.

Auditing management’s annual impairment tests was especially complex and subjective due to the significant estimation required in determining the fair value of the reporting units for goodwill.

In particular, the fair value estimates for goodwill were sensitive to significant assumptions inherent in the Company’s discounted estimated future cash flows such as the weighted average cost of capital, revenue growth rates, and operating margins.

The fair value estimates for goodwill are affected by expectations about future market or economic conditions relevant to each of the markets in which the Company operates.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s impairment review processes for goodwill.

For example, we tested management’s review controls over the valuation models and significant assumptions described above, including those developed by the Company's third-party valuation specialists.

To test the estimated fair value of the Company’s reporting units, with the support of a valuation specialist, we performed audit procedures that included, among others, assessing methodologies and testing the significant assumptions and completeness and accuracy of the underlying data used by the Company in its analyses.

For example, we compared the significant assumptions used by management to the historical financial results of the Company’s reporting units and to current industry and economic trends.

We assessed the historical accuracy of management’s estimates by comparing past projections to actual performance and performed sensitivity analyses of significant assumptions to evaluate the changes in fair value that would result from changes in the assumptions.

In addition, we reviewed the reconciliation of the aggregate fair value of the Company’s reporting units to the market capitalization of the Company.

/s/ Ernst & Young LLP

4 unchanged sentences

To the Stockholders and Board of Directors of EMCOR Group, Inc.

and subsidiaries:

Opinion on Internal Control Over Financial Reporting

26 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data