MYR GROUP INC. 10-K

Item 8. Financial Statements and Supplementary Data INDEX TO FINANCIAL STATEMENTS Management’s Report on Internal Control Over Financial Reporting 46 Report of Independent Registered Public Accounting Firm (1) 47 Consolidated Balance Sheets as of December 31, 2024 and 2023 49 Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2024 , 2023 and 2022 50 Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2024 , 2023 and 2022 51 Consolidated Statements of Cash Flows for the years ended December 31, 2024 , 2023 and 2022 52 Notes to Financial Statements 53 ___________________________ (1) The report of MYR Group’s independent registered public accounting firm (PCAOB ID: 173 ) with respect to the above-referenced financial statements and their report on internal control over financial reporting are included in Item 8 of this Form 10-K at the page number referenced above. 45 TABLE OF CONTENTS Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our Financial Statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we have conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this evaluation, our management has concluded that our internal control over financial reporting was effective as of December 31, 2024 in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with GAAP. Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable assurances and may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate. Crowe LLP, the independent registered public accounting firm that audited and reported on the 2024 Financial Statements included in this Annual Report on Form 10-K, has audited the effectiveness of MYR Group’s internal control over financial reporting as of December 31, 2024 and has issued an attestation report on MYR Group’s internal control over financial reporting which appears herein. February 26, 2025 46 TABLE OF CONTENTS Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of MYR Group Inc. Thornton, CO Opinions on the Financial Statements and Internal Control Over Financial Reporting We have audited the accompanying consolidated balance sheets of MYR Group Inc. (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework: (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework: (2013) issued by COSO. Basis for Opinions The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 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 47 TABLE OF CONTENTS communication of the critical audit matter does not alter in any way our opinion on the 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. Evaluation of estimated costs to complete and variable consideration for fixed price construction contracts, including changes to estimates As described in Note 1 of the Company’s consolidated financial statements, Organization, Business, and Significant Accounting Policies, and Note 12, Revenue Recognition, the Company recognizes revenue on fixed price construction projects over time using the cost-to-cost method, which measures the progress as the ratio of actual contract costs incurred to date to the estimated costs at completion. The amount of contract revenues and gross profit recognized on fixed price construction contracts is dependent on the contract price, the actual contract costs incurred, and the forecasted contract revenues and contract costs for construction projects. The recognition of revenue on fixed price construction contracts involves significant estimates due to the unique complexities of each construction project, uncertainty about estimates of costs to complete which can include unforeseen delays or construction complications, and uncertainty in the outcome of discussions with customers on the valuation of change orders and claims. The Company recognizes revenue related to change orders only when it is probable that the change order will result in an addition to contract value and can be reliably estimated. The Company evaluates change orders and claims based on historical experience with the customer, similar contracts, and on an individual basis, which involves significant judgment. The Company recognizes these estimated amounts of variable consideration in transaction price to the extent that it is probable there will not be a significant reversal of revenue. The Company reviews and revises, as needed, the estimated costs to complete and variable consideration for fixed price construction contacts while contracts are in process and through the date of contract completion. We identified auditing management’s estimates of variable consideration for change orders and claims, management’s estimates of costs to complete, and management’s assessment of changes to estimates of costs to complete on select fixed price construction contracts to be a critical audit matter. The critical audit matter relates to select fixed price construction contracts based on the magnitude of estimated costs to complete, the magnitude of variable consideration for change orders and claims, the stage of completion of the contract, and the significance of any changes to estimates of costs to complete. Estimates of variable consideration for change orders and claims and estimated costs to complete, including changes to estimates, require management to make assumptions about future events and, as a result, a high degree of auditor judgment is involved in auditing these estimates. Due to the factors above, auditing management’s estimates of costs to complete, variable consideration, and changes to estimates of costs to complete required extensive audit effort. Our audit procedures to address the critical audit matter included the following: – Tested the design, implementation, and operating effectiveness of controls that are designed to address the reasonableness of estimates of costs to complete contracts, estimates of variable consideration recognized on contracts, and changes to estimated costs to complete; – Evaluated the reasonableness of management’s estimates of cost to complete for a sample of fixed price construction contracts through testing the key components of the estimated costs to complete, including materials, labor, and subcontractor costs; – Agreed a sample of contract costs incurred to supporting documentation; – Performed inquiries of management and project personnel regarding facts and circumstances relevant to the accounting for such contracts; – Recalculated revenue recognition based on the percentage of completion of projects; – Evaluated variable consideration recognized related to construction projects by comparing estimates made by management to subsequent actual data, evaluating the contracts and other documents that support estimates made by management, and obtaining legal opinions from internal and external counsel; – Performed retrospective review procedures to assess management’s historical ability to accurately estimate the transaction price and cost to complete of construction contracts; and – Obtained and evaluated evidence that changes to estimates of costs to complete contracts were recorded in the appropriate period. /s/ Crowe LLP We have served as the Company’s auditor since 2017. Oakbrook Terrace, Illinois February 26, 2025 48 TABLE OF CONTENTS MYR GROUP INC. CONSOLIDATED BALANCE SHEETS December 31, (in thousands, except share and per share data) 2024 2023 ASSETS Current assets Cash and cash equivalents $ 3,464 $ 24,899 Accounts receivable, net of allowances of $ 1,129 and $ 1,987 , respectively 653,069 521,893 Contract assets, net of allowances of $ 422 and $ 610 , respectively 301,942 420,616 Current portion of receivable for insurance claims in excess of deductibles 9,081 8,267 Refundable income taxes 4,638 4,034 Prepaid expenses and other current assets 42,468 46,535 Total current assets 1,014,662 1,026,244 Property and equipment, net of accumulated depreciation of $ 387,223 and $ 380,465 , respectively 278,226 268,978 Operating lease right-of-use assets 42,648 35,012 Goodwill 112,983 116,953 Intangible assets, net of accumulated amortization of $ 34,573 and $ 30,534 , respectively 75,691 83,516 Receivable for insurance claims in excess of deductibles 34,553 33,739 Deferred income taxes 5,734 — Investment in joint venture 3,730 8,707 Other assets 5,832 5,597 Total assets $ 1,574,059 $ 1,578,746 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Current portion of long-term debt $ 4,363 $ 7,053 Current portion of operating lease obligations 12,141 9,237 Current portion of finance lease obligations 1,046 2,039 Accounts payable 295,476 359,363 Contract liabilities 321,958 240,411 Current portion of accrued self-insurance 25,883 28,269 Accrued income taxes 196 237 Other current liabilities 87,837 100,593 Total current liabilities 748,900 747,202 Deferred income tax liabilities 52,498 48,230 Long-term debt 70,018 29,188 Accrued self-insurance 53,600 51,796 Operating lease obligations, net of current maturities 30,496 25,775 Finance lease obligations, net of current maturities 1,930 314 Other liabilities 16,257 25,039 Total liabilities 973,699 927,544 Commitments and contingencies Shareholders’ equity Preferred stock – $ 0.01 par value per share; 4,000,000 authorized shares; none issued and outstanding at December 31, 2024 and December 31, 2023 — — Common stock – $ 0.01 par value per share; 100,000,000 authorized shares; 16,121,901 and 16,684,492 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively 161 167 Additional paid-in capital 159,133 162,386 Accumulated other comprehensive loss ( 12,651 ) ( 3,880 ) Retained earnings 453,717 492,529 Total shareholders’ equity 600,360 651,202 Total liabilities and shareholders’ equity $ 1,574,059 $ 1,578,746 The accompanying notes are an integral part of these Financial Statements. 49 TABLE OF CONTENTS MYR GROUP INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Year ended December 31, (in thousands, except per share data) 2024 2023 2022 Contract revenues $ 3,362,290 $ 3,643,905 $ 3,008,542 Contract costs 3,071,971 3,279,508 2,664,580 Gross profit 290,319 364,397 343,962 Selling, general and administrative expenses 238,222 234,611 222,424 Amortization of intangible assets 4,869 4,907 9,009 Gain on sale of property and equipment ( 6,854 ) ( 4,214 ) ( 2,378 ) Income from operations 54,082 129,093 114,907 Other income (expense): Interest income 415 888 187 Interest expense ( 6,525 ) ( 4,939 ) ( 3,563 ) Other income (expense), net ( 1,479 ) ( 38 ) 2,673 Income before provision for income taxes 46,493 125,004 114,204 Income tax expense 16,230 34,014 30,823 Net income $ 30,263 $ 90,990 $ 83,381 Income per common share: – Basic $ 1.84 $ 5.45 $ 4.98 – Diluted $ 1.83 $ 5.40 $ 4.91 Weighted average number of common shares and potential common shares outstanding: – Basic 16,467 16,682 16,760 – Diluted 16,526 16,837 16,980 Net income $ 30,263 $ 90,990 $ 83,381 Other comprehensive income (loss): Foreign currency translation adjustment ( 8,771 ) 2,420 ( 6,473 ) Other comprehensive income (loss) ( 8,771 ) 2,420 ( 6,473 ) Total comprehensive income $ 21,492 $ 93,410 $ 76,908 The accompanying notes are an integral part of these Financial Statements. 50 TABLE OF CONTENTS MYR GROUP INC. CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Preferred Stock Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings Total (in thousands) Shares Amount Balance at December 31, 2021 $ — 16,871 $ 168 $ 163,754 $ 173 $ 355,007 $ 519,102 Net income — — — — — 83,381 83,381 Stock issued under compensation plans, net — 204 2 38 — — 40 Stock-based compensation expense — — — 7,922 — — 7,922 Shares repurchased related to tax withholding for stock-based compensation — ( 69 ) — ( 6,124 ) — ( 667 ) ( 6,791 ) Settlement of stock repurchase program — ( 442 ) ( 5 ) ( 4,163 ) — ( 32,813 ) ( 36,981 ) Other comprehensive loss — — — — ( 6,473 ) — ( 6,473 ) Balance at December 31, 2022 — 16,564 165 161,427 ( 6,300 ) 404,908 560,200 Net income — — — — — 90,990 90,990 Stock issued under compensation plans, net — 222 2 18 — — 20 Stock-based compensation expense — — — 8,376 — — 8,376 Shares repurchased related to tax withholding for stock-based compensation — ( 76 ) — ( 7,194 ) — ( 742 ) ( 7,936 ) Settlement of stock repurchase program — ( 26 ) — ( 241 ) — ( 2,627 ) ( 2,868 ) Other comprehensive income — — — — 2,420 — 2,420 Balance at December 31, 2023 — 16,684 167 162,386 ( 3,880 ) 492,529 651,202 Net income — — — — — 30,263 30,263 Stock issued under compensation plans, net — 117 1 ( 1 ) — — — Stock-based compensation expense — — — 8,532 — — 8,532 Shares repurchased related to tax withholding for stock-based compensation — ( 36 ) ( 1 ) ( 5,511 ) — ( 354 ) ( 5,866 ) Settlement of stock repurchase program — ( 643 ) ( 6 ) ( 6,273 ) — ( 68,721 ) ( 75,000 ) Other comprehensive loss — — — — ( 8,771 ) — ( 8,771 ) Balance at December 31, 2024 $ — 16,122 $ 161 $ 159,133 $ ( 12,651 ) $ 453,717 $ 600,360 The accompanying notes are an integral part of these Financial Statements. 51 TABLE OF CONTENTS MYR GROUP INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended December 31, (in thousands) 2024 2023 2022 Cash flows from operating activities: Net income $ 30,263 $ 90,990 $ 83,381 Adjustments to reconcile net income to net cash flows provided by operating activities: Depreciation and amortization of property and equipment 60,320 54,231 49,161 Amortization of intangible assets 4,869 4,907 9,009 Stock-based compensation expense 8,532 8,376 7,922 Deferred income taxes ( 400 ) 2,056 9,573 Gain on sale of property and equipment ( 6,854 ) ( 4,214 ) ( 2,378 ) Other non-cash items 1,459 96 2,294 Changes in operating assets and liabilities: Accounts receivable, net ( 134,476 ) ( 48,527 ) ( 86,939 ) Contract assets, net 114,776 ( 119,246 ) ( 64,421 ) Receivable for insurance claims in excess of deductibles ( 1,628 ) 1,529 ( 14 ) Prepaid expenses and other assets 10,270 560 1,640 Accounts payable ( 60,962 ) 37,250 109,008 Contract liabilities 82,557 13,151 58,001 Accrued self-insurance ( 548 ) 17 4,999 Other liabilities ( 21,063 ) 29,840 ( 13,752 ) Net cash flows provided by operating activities 87,115 71,016 167,484 Cash flows from investing activities: Proceeds from sale of property and equipment 8,726 5,608 1,990 Cash paid for acquisitions, net of cash acquired — — ( 110,660 ) Purchases of property and equipment ( 75,938 ) ( 84,736 ) ( 77,056 ) Net cash flows used in investing activities ( 67,212 ) ( 79,128 ) ( 185,726 ) Cash flows from financing activities: Borrowings under revolving lines of credit 822,491 562,901 198,697 Repayments under revolving lines of credit ( 777,297 ) ( 562,615 ) ( 185,782 ) Payment of principal obligations under equipment notes ( 7,054 ) ( 4,598 ) ( 1,047 ) Payment of principal obligations under finance leases ( 1,196 ) ( 1,143 ) ( 1,592 ) Borrowings under equipment notes — — 24,184 Proceeds from exercise of stock options — 20 40 Debt refinancing costs ( 33 ) ( 2,129 ) — Repurchase of common stock ( 75,000 ) ( 2,868 ) ( 36,981 ) Payments related to tax withholding for stock-based compensation ( 5,866 ) ( 7,936 ) ( 6,791 ) Other financing activities 3,998 — — Net cash flows used in financing activities ( 39,957 ) ( 18,368 ) ( 9,272 ) Effect of exchange rate changes on cash ( 1,381 ) 339 ( 3,538 ) Net decrease in cash and cash equivalents ( 21,435 ) ( 26,141 ) ( 31,052 ) Cash and cash equivalents: Beginning of period 24,899 51,040 82,092 End of period $ 3,464 $ 24,899 $ 51,040 Supplemental Cash Flow Information: Cash paid during the period for: Income taxes payments $ 15,075 $ 23,949 $ 20,462 Interest payments 5,767 4,145 2,736 Noncash investing activities: Acquisition of property and equipment for which payment is pending 3,373 8,474 2,218 The accompanying notes are an integral part of these Financial Statements. 52 TABLE OF CONTENTS MYR GROUP INC. NOTES TO FINANCIAL STATEMENTS 1. Organization, Business and Significant Accounting Policies Organization and Business MYR Group Inc. (the “Company”) is a holding company of specialty electrical construction service providers conducting operations through wholly-owned subsidiaries. The Company performs construction services in two business segments: Transmission and Distribution (“T&D”) and Commercial and Industrial (“C&I”). T&D customers include investor-owned utilities, cooperatives, private developers, government-funded utilities, independent power producers, independent transmission companies, industrial facility owners and other contractors. T&D provides a broad range of services on electric transmission, distribution networks, substation facilities, clean energy projects and electric vehicle charging infrastructure. T&D services include design, engineering, procurement, construction, upgrade, maintenance and repair services. C&I customers include general contractors, commercial and industrial facility owners, government agencies and developers. C&I provides a broad range of services, which include design, installation, maintenance and repair of commercial and industrial wiring. Typical C&I contracts cover electrical contracting services for airports, hospitals, data centers, hotels, stadiums, commercial and industrial facilities, clean energy projects, manufacturing plants, processing facilities, water/waste-water treatment facilities, mining facilities, intelligent transportation systems, roadway lighting, signalization and electric vehicle charging infrastructure. Significant Accounting Policies Consolidation The accompanying Financial Statements include the results of operations of the Company and its subsidiaries. Significant intercompany transactions and balances have been eliminated. Certain reclassifications were made to prior year amounts to conform to the current year presentation. Revenue Recognition The Company recognizes revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services provided. Revenue associated with contracts with customers is recognized over time as the Company’s performance creates or enhances customer-controlled assets or creates or enhances an asset with no alternative use, for which the Company has an enforceable right to receive compensation as defined under the contract. To determine the amount of revenue to recognize over time, the Company estimates profit by determining the difference between total estimated revenue and total estimated cost of a contract. In addition, the Company estimates a cost accrual every quarter that represents unbilled invoicing activity for services performed by subcontractors and suppliers during the quarter, and estimates revenue from the contract cost portion of this accrual based on current gross margin rates to be consistent with its cost method of revenue recognition. The estimated value of unbilled amounts are determined using a regression analysis that estimates value based on the Company’s historical experience, and is adjusted for large individual projects. The profit and corresponding revenue is recognized over the contract term based on costs incurred under the cost-to-cost method. The Company utilizes the cost-to-cost method as it believes cost incurred best represents the amount of work completed and remaining on projects, and is the most common basis for computing percentage of completion in the industry. For purposes of recognizing revenue, the Company follows the five-step approach outlined in Accounting Standards Codification (“ASC”) 606. As the cost-to-cost method is driven by incurred cost, the Company calculates the percentage of completion by dividing costs incurred to date by the total estimated cost. The percentage of completion is then multiplied by estimated revenues to determine inception-to-date revenue. Revenue recognized for the period is the current inception-to-date recognized revenue less the prior period inception-to-date recognized revenue. If a contract is projected to result in a loss, the entire contract loss is recognized in the period when the loss was first determined and the amount of the loss is updated in subsequent reporting periods. Because the Company’s billings are based on contract terms and do not coincide with our progress in a project, revenue recognition also includes an amount related to a contract asset or contract liability. If the recognized revenue is greater than the amount billed to the customer, a contract asset is recorded. Additionally, the contract asset includes retainage billed to the customer that cannot be collected until the contract work has been completed and approved. Conversely, if the amount billed to the customer is greater than the recognized revenue, a contract liability is recorded. Additionally, the contract liability includes a liability for the excess of costs over revenues for all contracts that are in a loss position. 53 TABLE OF CONTENTS Contract costs incurred to date and expected total contract costs are continuously monitored during the term of the contract. Changes in the job performance, job conditions and final contract settlements are factors that influence management’s assessment of total contract value and the total estimated costs to complete those contracts, and therefore, profit and revenue recognition. Additionally, the Company estimates costs to complete on fixed price contracts which are determined on an individual contract basis by evaluating each project’s status as of the balance sheet date, and using our historical experience with the level of effort required to complete the underlying project. Claims and change orders are also measured based on our historical experience with individual customers and similar contracts, and are evaluated by management individually. A change order is a modification to a contract that changes the provisions of the contract, typically resulting from changes in scope, specifications, design, manner of performance, facilities, equipment, materials, sites, or period of completion of the work under the contract. A claim is an amount in excess of the agreed-upon contract price that the Company seeks to collect from its clients or others for client-caused delays, errors in specifications and designs, contract terminations, change orders that are either in dispute or are unapproved as to both scope and price, or other causes. The Company includes these estimated amounts of variable consideration to the extent that it is probable there will not be a significant reversal of revenue. As of December 31, 2024 and 2023, the Company recognized revenues related to significant variable consideration of $ 29.9 million and $ 76.5 million, respectively. Some of the Company’s contracts may have contract terms that include variable consideration such as safety or performance bonuses or liquidated damages. In accordance with ASC 606, the Company estimates the variable consideration using one of two methods. In contracts in which there is a binary outcome, the most likely amount method is used. In instances in which there is a range of possible outcomes, the expected value method is used. In accordance with ASC 606, the Company includes the estimated amount of variable consideration in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative recognized revenue will not occur when the final outcome of the variable consideration is determined. In contracts in which a significant reversal may occur, the Company uses constraint in recognizing revenue on variable consideration. The Company often enters into contracts that contain liquidated damage clauses. The Company does not include amounts associated with liquidated damage clauses until it is probable that liquidated damages will occur. These items are continually monitored by multiple levels of management throughout the reporting period. A portion of the work the Company performs requires financial assurances in the form of performance and payment bonds or letters of credit at the time of execution of the contract. Many of the Company’s contracts include retention provisions of up to 10 %, which are generally withheld from each progress payment as retainage until the contract work has been completed and approved. The Company provides warranties to customers on a basis customary to the industry; however, the warranty period does not typically exceed one year . Historically, warranty claims have not been material to the Company. Based on the Company’s estimates, as of December 31, 2024, the Company recorded warranty reserves of $ 3.4 million and as of December 31, 2023, warranty reserves were no t significant. Settlements on warranty claims during the years ended December 31, 2024, 2023 and 2022 were no t significant. Total revenues do not include sales tax as the Company considers itself a pass-through conduit for collecting and remitting sales taxes. Sales tax collected from customers is included in other current liabilities on the Company’s consolidated balance sheets. Joint Ventures and Noncontrolling Interests The Company accounts for investments in joint ventures using the proportionate consolidation method for income statement reporting and under the equity method for balance sheet reporting, unless the Company has a controlling interest causing the joint venture to be consolidated with equity owned by other joint venture partners recorded as noncontrolling interests. Under the proportionate consolidation method, joint venture activity is allocated to the appropriate line items found on the consolidated statements of operations in proportion to the percentage of participation the Company has in the joint venture. During the years ended December 31, 2024, 2023 and 2022, the Company recognized its proportionate share of joint venture revenues of $ 22.4 million, $ 33.0 million, and $ 11.3 million, respectively. Under the equity method the net investment in joint ventures is stated as a single item on the Company’s consolidated balance sheets. If an investment in a joint venture contains a recourse or unfunded commitment to provide additional equity, distributions and/or losses in excess of the investment a liability is recorded in other current liabilities on the Company’s consolidated balance sheets. 54 TABLE OF CONTENTS For joint ventures which the Company does not have a controlling interest, the Company’s share of any profits and assets and its share of any losses and liabilities are recognized based on the Company’s stated percentage partnership interest in the joint venture and are normally recorded by the Company one month in arrears. The investments in joint ventures are recorded at cost and the carrying amounts are adjusted to recognize the Company’s proportionate share of cumulative income or loss, additional contributions made and dividends and capital distributions received. The Company records the effect of any impairment or any other-than-temporary decrease in the value of the joint venture investment as incurred, which may or may not be one month in arrears, depending on when the Company obtains the joint venture activity information. Additionally, the Company continually assesses the fair value of its investment in unconsolidated joint ventures despite using information that is one month in arrears for regular reporting purposes. The Company includes only its percentage ownership of each joint venture in its backlog. Foreign Currency The functional currency for the Company’s Canadian operations is the Canadian dollar. Assets and liabilities denominated in Canadian dollars are translated into U.S. dollars at the end-of-period exchange rate. Revenues and expenses are translated using average exchange rates for the periods reported. Equity accounts are translated at historical rates. Cumulative translation adjustments are included as a separate component of accumulated other comprehensive income in shareholders’ equity. Foreign currency transaction gains and losses, arising primarily from changes in exchange rates on short-term monetary assets and liabilities, and intercompany loans that are not deemed long-term investment accounts are recorded in the “other income (expense), net” line on the Company’s consolidated statements of operations. Foreign currency losses recorded in other income (expense), net, for the years ended December 31, 2024, 2023 and 2022 were $ 1.4 million, $ 0.1 million and $ 0.2 million, respectively. Foreign currency translation gains and losses, arising from intercompany loans that are deemed long-term investment accounts, are recorded in the foreign currency translation adjustment line on the Company’s consolidated statements of comprehensive income. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the period reported. Actual results could differ from those estimates. The most significant estimates are related to estimates of costs to complete on contracts, variable consideration inclusive of pending change orders and claims, shared savings, insurance reserves, income tax reserves, estimates surrounding stock-based compensation, acquisition-related contingent earn-out consideration liabilities, the recoverability of goodwill and intangibles and allowance for doubtful accounts. The Company estimates a cost accrual every period that represents costs incurred but not invoiced for services performed or goods delivered during the period, and estimates revenue from the contract cost portion of these accruals based on current gross margin rates to be consistent with its cost method of revenue recognition. As of December 31, 2024 and 2023, the Company recognized revenues of $ 46.0 million and $ 76.5 million, respectively, related to significant change orders and/or claims that had been included as contract price adjustments on certain contracts, some of which are multi-year projects. These change orders and/or claims are in the process of being negotiated in the normal course of business, and a portion of these recognized revenues had been included in multiple periods. These aggregate amounts, which were included in “Contract assets” in the accompanying consolidated balance sheets, represent the Company’s estimates of additional contract revenues that were earned and probable of collection; however, the amount ultimately realized could be significantly higher or lower than the estimated amount. The cost-to-cost method of accounting requires the Company to make estimates about the expected revenue and gross profit on each of its contracts in process. During the year ended December 31, 2024, changes in estimates pertaining to certain projects decreased consolidated gross margin by 4.4 %, which resulted in decreases in operating income of $ 146.5 million, net income of $ 96.9 million and diluted earnings per common share of $ 5.86 . The estimates are reviewed and revised quarterly, as needed. Additional discussion on the impact of these estimate changes can be found in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” During the year ended December 31, 2023, changes in estimates pertaining to certain projects decreased consolidated gross margin by 1.7 %, which resulted in decreases in operating income of $ 62.2 million, net income of $ 43.6 million and diluted earnings per common share of $ 2.59 . During the year ended December 31, 2022, changes in estimates pertaining to certain projects decreased consolidated gross margin by 0.4 %, which resulted in decreases in operating income of $ 9.8 million, net income of $ 6.9 million and diluted earnings per common share of $ 0.41 . 55 TABLE OF CONTENTS Advertising Advertising costs are expensed when incurred. Advertising costs, included in selling, general and administrative expenses, were $ 2.0 million, $ 1.8 million and $ 1.2 million for the years ended December 31, 2024, 2023 and 2022, respectively. Income Taxes The Company follows the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recorded for future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the underlying assets or liabilities are recovered or settled. The Company also evaluates whether the recorded deferred tax assets and valuation allowances can be realized and, when necessary, reduces the amounts to what is expected to be realized. Interest and penalties related to uncertain income tax positions are included in income tax expense on the Company’s consolidated statements of operations. Interest and penalties actually incurred are charged to the interest expense and the “other income (expense), net” line, respectively. Stock-Based Compensation The Company determines compensation expense for stock-based awards based on the estimated fair values at the grant date and recognizes the related compensation expense over the vesting period. The Company uses the straight-line amortization method to recognize compensation expense related to stock-based awards, such as restricted stock units, that have only service conditions. This method recognizes stock compensation expense on a straight-line basis over the requisite service period for the entire award. The Company recognizes compensation expense related to performance awards that vest based on internal performance metrics and service conditions on a straight-line basis over the service period, but adjusts inception-to-date expense based upon our determination of the potential achievement of the performance target at each reporting date. The Company recognizes compensation expense related to performance awards with market-based performance metrics on a straight-line basis over the requisite service period. The Company recognizes forfeitures as they occur. Shares issued under the Company’s stock-based compensation program are taken out of authorized but unissued shares. Earnings Per Share The Company computes earnings per share using the treasury stock method. Under the treasury stock method, basic earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the period plus all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of December 31, 2024 and 2023, the Company held its cash in checking accounts or in highly liquid money market accounts. The Company’s banking arrangements allow the Company to fund outstanding checks when presented to financial institutions for payment. The Company funds all intraday bank balance overdrafts during the same business day. Checks issued and outstanding in excess of bank balances are recorded in accounts payable on the Company’s consolidated balance sheets and are reflected as a financing activity on the Company’s Consolidated Statements of Cash Flows. Accounts Receivable and Allowance for Doubtful Accounts The Company does not charge interest to its customers and carries its customer receivables at their face amounts, net of contract retainage, less an allowance for doubtful accounts. Based on the Company’s experience in recent years, the majority of customer balances at each balance sheet date are collected within twelve months. As is common practice in the industry, the Company classifies all accounts receivable as current assets. The Company grants trade credit, on a non-collateralized basis (with the exception of lien rights against the property in certain cases), to its customers and is subject to potential credit risk related to changes in business and overall economic activity. The Company analyzes specific accounts receivable balances, historical bad debts, customer credit-worthiness, current economic trends and changes in customer payment terms when evaluating the adequacy of the allowance for doubtful accounts. In the event that a customer balance is deemed to be uncollectible, the account balance is written-off against the allowance for doubtful accounts. 56 TABLE OF CONTENTS Classification of Contract Assets and Liabilities The Company recognizes revenue associated with its contracts with customers over time, for which the Company has an enforceable right to receive compensation. Many of our contracts contain specific provisions that determine when the Company can bill for its work performed under these contracts. Any revenue earned on a contract that has not yet been billed to the customer is recorded as a contract asset on the Company’s consolidated balance sheets. Contract retainages associated with contract work that has been completed and billed but not paid by its customers until the contracts are substantially complete, pursuant to contract retainage provisions under the contract, are also included in contract assets. The Company’s consolidated balance sheets present contract liabilities that contain deferred revenue that represent any costs incurred on contracts in process for which revenue has not yet been recognized. Additionally, accruals for contracts in a loss provision are included in contract liabilities. Property and Equipment Property and equipment is carried at cost, except for assets acquired in a business combination which are recorded at fair value at the date of acquisition. Depreciation is computed using the straight-line method over estimated useful lives. Major modifications or refurbishments which extend the useful life of the assets are capitalized and depreciated over the adjusted remaining useful life of the assets. Upon retirement or disposition of property and equipment, the cost and related accumulated depreciation are removed and any resulting gain or loss is recognized in income from operations. The cost of maintenance and repairs is charged to expense as incurred. Property and equipment is reviewed for impairment and tested for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the carrying value of property and equipment exceeds its fair value, an impairment charge would be recorded in the statement of operations. Leases The Company enters into non-cancelable leases for some of our facility, vehicle and equipment needs. These leases allow the Company to conserve cash by paying a monthly lease rental fee for the use of facilities, vehicles and equipment rather than purchasing them. The Company’s leases have remaining terms ranging from less than one to nine years , some of which may include options to extend the leases for up to ten years , and some of which may include options to terminate the leases within one year . Currently, all the Company’s leases contain fixed payment terms. The Company may decide to cancel or terminate a lease before the end of its term, in which case we are typically liable to the lessor for the remaining lease payments under the term of the lease. Additionally, all of the Company’s month-to-month leases are cancelable, by the Company or the lessor, at any time and are not included in our right-of-use asset or liability. As of December 31, 2024, the Company had several leases with residual value guarantees. The total amount probable of being owed of residual leases guarantees is not significant. Typically, the Company has purchase options on the equipment underlying its long-term leases and many of its short-term rental arrangements. The Company may exercise some of these purchase options when the need for equipment is ongoing and the purchase option price is attractive. Nonperformance-related default covenants, cross-default provisions, subjective default provisions and material adverse change clauses contained in material lease agreements, if any, are also evaluated to determine whether those clauses affect lease classification in accordance with ASC Topic 842. Leases are accounted for as operating or finance leases, depending on the terms of the lease. Finance Leases. The Company leases some vehicles and certain equipment under finance leases. The economic substance of the leases is a financing transaction for acquisition of the vehicles and equipment. Accordingly, the right-of-use assets for these leases are included on the Company’s consolidated balance sheets in property and equipment, net of accumulated depreciation, with a corresponding amount recorded in current portion of finance lease obligations or finance lease obligations, net of current maturities, as appropriate. The finance lease assets are amortized over the life of the lease or, if shorter, the life of the leased asset, on a straight-line basis and included in depreciation expense. The financing component associated with finance lease obligations is included in interest expense. Generally, for the Company’s finance leases an implicit rate to calculate present value is provided in the lease agreement. However, if a rate is not provided the Company determines this rate by estimating the Company’s incremental borrowing rate, utilizing the borrowing rates associated with the Company’s various debt instruments. 57 TABLE OF CONTENTS Operating Right-of-Use Leases. Operating right-of-use leases are included in operating lease right-of-use assets, current portion of operating lease obligations and operating lease obligations, net of current maturities on the Company’s consolidated balance sheets, as appropriate. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate to calculate present value, the Company determines this rate by estimating the Company’s incremental borrowing rate, utilizing the borrowing rates associated with the Company’s various debt instruments. The operating lease right-of-use asset also includes any lease payments made and initial direct costs incurred and excludes lease incentives. Our lease terms may include options to extend or terminate the lease, which are considered in the present value calculations when it is reasonably certain we will exercise those options. Insurance The Company carries insurance policies, which are subject to certain deductibles, for workers’ compensation, general liability, automobile liability and other coverages. The deductible for each line of coverage is up to $ 1.0 million. Certain health benefit plans are subject to a stop-loss limit of up to $ 0.2 million, for qualified individuals. Losses up to the deductible amounts are accrued based upon the Company’s estimates of the ultimate liability for claims reported and an estimate of claims incurred but not yet reported. The insurance and claims accruals are based on known facts, actuarial estimates and historical trends. While recorded accruals are based on the ultimate liability, which includes amounts in excess of the deductible, a corresponding receivable for amounts in excess of the deductible is included in current assets on the Company’s consolidated balance sheets. Goodwill and Intangible Assets Goodwill and intangible assets with indefinite lives are not amortized. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. The Company performs either a qualitative or quantitative assessment to review goodwill and intangible assets with indefinite lives for impairment on an annual basis. This assessment is performed at the beginning of the fourth quarter, or when circumstances change, such as a significant adverse change in the business climate or the decision to sell a business, both of which would indicate that impairment may have occurred. Intangible assets with finite lives are also reviewed for impairment and tested for recoverability whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. A qualitative assessment considers financial, industry, segment and macroeconomic factors. If the qualitative assessment indicates a potential for impairment, a quantitative assessment is performed to determine if impairment exists. The quantitative assessment begins with a comparison of the fair value of the reporting unit or intangible asset with its carrying value. If the carrying amount of the reporting unit or intangible asset exceeds its fair value, an impairment loss would be recognized in an amount equal to that excess, limited to the total amount of the goodwill allocated to the reporting unit or intangible asset. If the carrying value of goodwill or other indefinite lived assets exceeds its implied fair value, an impairment charge would be recorded in the statement of operations. As a result of the annual qualitative review process in 2023 and 2022, the Company determined it was not necessary to perform a quantitative assessment. In 2024, the Company performed a quantitative assessment on goodwill and intangible assets with indefinite lives, this assessment did not indicate that the Company’s goodwill or indefinite lived intangible assets were impaired. Concentrations Financial instruments that potentially subject the Company to a concentration of credit risk consist principally of cash and cash equivalents and accounts receivable. The Company maintains substantially all of its cash and cash equivalent balances with large financial institutions which are believed to be high quality institutions. The Company is subject to a concentration of risk because it derives a significant portion of its revenues from a few customers. The Company’s top ten customers accounted for approximately 37.8 %, 37.9 %, and 35.4 % of consolidated revenues for the years ended December 31, 2024, 2023 and 2022, respectively. For the years ended December 31, 2024, 2023 and 2022, no single customer accounted for more than 10.0% of annual revenues. 58 TABLE OF CONTENTS The Company grants trade credit under contractual payment terms, generally without collateral, to its customers, which include high credit quality electric utilities, governmental entities, general contractors and builders, owners and managers of commercial and industrial properties. Consequently, the Company is subject to potential credit risk related to changes in business and economic factors. However, the Company generally has certain statutory lien rights with respect to services provided. Under certain circumstances such as foreclosures or negotiated settlements, the Company may take title to the underlying assets in lieu of cash in settlement of receivables. As of December 31, 2024, one customer individually exceeded 10.0% of accounts receivable with approximately 11.3 % of the total accounts receivable amount (excluding the impact of allowance for doubtful accounts). As of December 31, 2023, none of the Company’s customers individually exceeded 10.0% of accounts receivable. The Company believes the terms and conditions in its contracts, billing and collection policies are adequate to minimize the potential credit risk. As of December 31, 2024, approximately 87 % of the Company’s craft labor employees were covered by collective bargaining agreements. Although the majority of these agreements prohibit strikes and work stoppages, the Company cannot be certain that strikes or work stoppages will not occur in the future. Recent Accounting Pronouncements Changes to GAAP are typically established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. The Company, based on its assessment, determined that any recently issued or proposed ASUs not listed below are either not applicable to the Company or will have minimal impact on its Financial Statements when adopted. Recently Adopted Accounting Pronouncements In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant reportable segment expenses and other disclosure requirements. The Company has adopted this ASU enhancing our segment disclosures. See Note 7–Segment Reporting for further information related to the Company’s segments. Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to improve the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The guidance also includes certain other amendments intended to improve the effectiveness of income tax disclosures. The update is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted. The amendments in this pronouncement should be applied on a prospective basis, with the option to apply them retrospectively. The Company is currently evaluating the impact of the new standard on the Company’s income tax disclosures. In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires the disaggregation of certain expenses in the notes of the financials, to provide enhanced transparency into the expense captions presented on the face of the income statement. The guidance will require disclosure of certain costs and expenses on an interim and annual basis in the notes to the consolidated financial statements. The update is effective for annual reporting periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The amendments in this pronouncement should be applied either (i) prospectively to financial statements issued for reporting periods after the effective date or (ii) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact of the new standard on the Company’s consolidated financial statements and related disclosures. 2. Acquisition Powerline Plus Ltd On January 4, 2022, the Company acquired all issued and outstanding shares of capital stock of Powerline Plus Ltd. and its affiliate PLP Redimix Ltd. (collectively, the “Powerline Plus Companies"), a full-service electrical distribution construction company based in Toronto, Ontario. Cash consideration paid, funded through a combination of cash on hand and borrowings under the Facility (as defined below), including $ 0.1 million of net asset and other adjustments, was $ 110.7 million, net of cash acquired. The Company finalized the purchase price accounting relating to the acquisition of the Powerline Plus Companies during the year ended December 31, 2022. 59 TABLE OF CONTENTS Additionally, the acquisition includes contingent earn-out consideration that may be payable if the Powerline Plus Companies achieve certain performance targets over a three-year post-acquisition period. As of the acquisition date, the fair value of the contingent earn-out consideration was $ 0.9 million. As of December 31, 2024 and 2023, the fair value of the contingent earn-out consideration was zero . The minimum thresholds of the performance targets were not achieved, and therefor no future payout of contingent earn-out consideration is necessary. Changes in contingent earn-out consideration, subsequent to the acquisition, of zero , $ 0.2 million and $ 0.7 million were recorded in other income, for the years ended December 31, 2024, 2023 and 2022, respectively. The results of the Powerline Plus Companies are included in the Company’s consolidated financial statements beginning on the transaction date. The purchase agreement also includes contingent consideration provisions for down-side margin guarantee adjustments based upon certain contract performance subsequent to the acquisition. The contracts were valued at fair value at the acquisition date, causing no margin guarantee estimate or adjustments for fair value. Unfavorable changes in contract estimates, such as modified costs to complete or change order recognition, will result in changes to these margin guarantee estimates. No changes in margin guarantee adjustments on contracts, subsequent to the acquisition, have been recorded for the years ended December 31, 2024, 2023 and 2022. No margin guarantee adjustments will be recognized in other income in 2025. The following table summarizes the allocation of the opening balance sheet as of the date of the Powerline Plus Companies acquisition: (in thousands) January 4, 2022 acquisition date (initial estimates) Measurement Period Adjustments Final Acquisition Allocation Cash paid $ 114,429 $ — $ 114,429 Contingent consideration - fair value at acquisition date 10,608 ( 9,743 ) 865 Net asset and other adjustments 563 ( 479 ) 84 Total consideration, net of estimated net asset adjustments 125,600 ( 10,222 ) 115,378 Less: Acquired cash ( 3,853 ) — ( 3,853 ) Total consideration less cash acquired, net of net asset and other adjustments $ 121,747 $ ( 10,222 ) $ 111,525 Cash and cash equivalents $ 3,853 $ — $ 3,853 Accounts receivable 12,131 ( 52 ) 12,079 Contract assets 12,443 148 12,591 Refundable income taxes 394 482 876 Prepaid expenses and other current assets 1,233 ( 121 ) 1,112 Property and equipment 10,366 1,577 11,943 Operating lease right-of-use assets 6,631 ( 511 ) 6,120 Intangible assets — 50,246 50,246 Accounts payable ( 8,095 ) ( 466 ) ( 8,561 ) Contract liabilities ( 1,597 ) ( 95 ) ( 1,692 ) Current portion of operating lease obligations ( 1,224 ) — ( 1,224 ) Current portion of finance lease obligations ( 1,492 ) — ( 1,492 ) Deferred income tax liabilities ( 1,358 ) ( 13,991 ) ( 15,349 ) Operating lease obligations, net of current maturities ( 4,897 ) — ( 4,897 ) Finance lease obligations, net of current maturities ( 3,243 ) — ( 3,243 ) Net identifiable assets and liabilities 25,145 37,217 62,362 Unallocated intangible assets 56,650 ( 56,650 ) — Total acquired assets and liabilities 81,795 ( 19,433 ) 62,362 Goodwill $ 43,805 $ 9,211 $ 53,016 60 TABLE OF CONTENTS The following table summarizes the estimated fair values of identifiable intangible assets and the related weighted average amortization periods as of the acquisition date of the Powerline Plus Companies. Estimated Fair Value at Acquisition Date Weighted Average Amortization Period at Acquisition Date (in thousands) (in years) Amortizable Intangible Assets Customer relationships $ 39,757 15.0 Backlog 4,007 1.0 Below market lease 511 5.0 Total amortizable intangible assets $ 44,275 14.9 Indefinite-lived Intangible Assets Trade names 5,971 Indefinite Total intangible assets $ 50,246 The acquisition date fair values of intangible assets were determined using the income approach, which discounts the projected future cash flows using a discount rate that appropriately reflects the risks associated with the projected cash flows. Under the income approach, the acquisition date fair value of the customer relationships and backlog were estimated using a multi-period excess earnings valuation method and the acquisition date fair value of the trade names was estimated using a relief from royalty valuation method. The fair value of the acquired operating lease obligation and operating right of use asset was estimated by applying the income approach. The fair value of the operating lease obligation was determined by comparing the difference between the annual lease contract rent over the remaining contractual term to a market rate cash flow stream, discounted to the present value. The Company calculated the fair value of the operating right of use asset based on the fair values of the operating lease obligation adjusted for a below market lease positions. The contractual value of the acquired accounts receivable is equal to the fair market value. 3. Contract Assets and Liabilities Contracts with customers usually stipulate the timing of payment, which is defined by the terms found within the various contracts under which work was performed during the period. Therefore, contract assets and liabilities are created when the timing of costs incurred on work performed does not coincide with the billing terms. These contracts frequently include retention provisions contained in each contract. The Company’s consolidated balance sheets present contract assets, which contain unbilled revenue and contract retainages associated with contract work that has been completed and billed but not paid by customers, pursuant to retainage provisions, that are generally due once the job is completed and approved. The allowance for doubtful accounts associated with contract assets was $ 0.4 million as of December 31, 2024 and $ 0.6 million as of December 31, 2023. Contract assets consisted of the following at December 31: (in thousands) 2024 2023 Change Unbilled revenue, net $ 149,449 $ 217,083 $ ( 67,634 ) Contract retainages, net 152,493 203,533 ( 51,040 ) Contract assets, net $ 301,942 $ 420,616 $ ( 118,674 ) The Company’s consolidated balance sheets present contract liabilities that contain deferred revenue and an accrual for contracts in a loss provision. Contract liabilities consisted of the following at December 31: (in thousands) 2024 2023 Change Deferred revenue $ 312,632 $ 231,604 $ 81,028 Accrued loss provision 9,326 8,807 519 Contract liabilities $ 321,958 $ 240,411 $ 81,547 61 TABLE OF CONTENTS The following table provides information about contract assets and contract liabilities from contracts with customers at December 31: (in thousands) 2024 2023 Change Contract assets, net $ 301,942 $ 420,616 $ ( 118,674 ) Contract liabilities ( 321,958 ) ( 240,411 ) ( 81,547 ) Net contract assets $ ( 20,016 ) $ 180,205 $ ( 200,221 ) The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the timing of the Company’s billings in relation to its performance of work. The amounts of revenues recognized in the period that were included in the opening contract liability balances were $ 160.3 million and $ 130.7 million for the year ended December 31, 2024 and 2023, respectively. This revenue consists primarily of work performed on previous billings to customers. The net asset position for contracts in process consisted of the following at December 31: (in thousands) 2024 2023 Costs and estimated earnings on uncompleted contracts $ 7,627,894 $ 6,716,990 Less: billings to date 7,791,077 6,731,511 $ ( 163,183 ) $ ( 14,521 ) The net asset position for contracts in process is included within the contract asset and contract liability in the accompanying consolidated balance sheets as follows at December 31: (in thousands) 2024 2023 Unbilled revenue, net $ 149,449 $ 217,083 Deferred revenue ( 312,632 ) ( 231,604 ) $ ( 163,183 ) $ ( 14,521 ) 4. Lease Obligations From time to time, the Company enters into non-cancelable leases for some of our facility, vehicle and equipment needs. These leases allow the Company to conserve cash by paying a monthly lease rental fee for the use of facilities, vehicles and equipment rather than purchasing them. The Company’s leases have remaining terms ranging from less than one to nine years , some of which may include options to extend the leases for up to ten years , and some of which may include options to terminate the leases within one year . Currently, all the Company’s leases contain fixed payment terms. The Company may decide to cancel or terminate a lease before the end of its term, in which case we are typically liable to the lessor for the remaining lease payments under the term of the lease. Additionally, all of the Company's month-to-month leases are cancelable, by the Company or the lessor, at any time and are not included in our right-of-use asset or liability. At December 31, 2024 and 2023, the Company had several leases with residual value guarantees. Typically, the Company has purchase options on the equipment underlying its long-term leases and many of its short-term rental arrangements. The Company may exercise some of these purchase options when the need for equipment is ongoing and the purchase option price is attractive. Leases are accounted for as operating or finance leases, depending on the terms of the lease. 62 TABLE OF CONTENTS The following is a summary of the lease-related assets and liabilities recorded: December 31, 2024 December 31, 2023 (in thousands) Classification on the Consolidated Balance Sheet Assets Operating lease right-of-use assets Operating lease right-of-use assets $ 42,648 $ 35,012 Finance lease right-of-use assets Property and equipment, net of accumulated depreciation 3,215 2,363 Total right-of-use lease assets $ 45,863 $ 37,375 Liabilities Current Operating lease obligations Current portion of operating lease obligations $ 12,141 $ 9,237 Finance lease obligations Current portion of finance lease obligations 1,046 2,039 Total current obligations 13,187 11,276 Non-current Operating lease obligations Operating lease obligations, net of current maturities 30,496 25,775 Finance lease obligations Finance lease obligations, net of current maturities 1,930 314 Total non-current obligations 32,426 26,089 Total lease obligations $ 45,613 $ 37,365 The following is a summary of the lease terms and discount rates: December 31, 2024 December 31, 2023 Weighted-average remaining lease term – finance leases 3.3 years 0.9 years Weighted-average remaining lease term – operating leases 3.7 years 4.0 years Weighted-average discount rate – finance leases 3.9 % 3.1 % Weighted-average discount rate – operating leases 4.0 % 4.0 % The following is a summary of certain information related to the lease costs for finance and operating leases: Year ended December 31, (in thousands) 2024 2023 2022 Lease cost: Finance lease cost: Amortization of right-of-use assets $ 968 $ 791 $ 1,138 Interest on lease liabilities 101 83 128 Operating lease cost 15,621 14,302 13,428 Variable lease costs 385 353 415 Total lease cost $ 17,075 $ 15,529 $ 15,109 The following is a summary of other information and supplemental cash flow information related to finance and operating leases: Year ended December 31, (in thousands) 2024 2023 2022 Other information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 15,025 $ 14,519 $ 13,287 Right-of-use asset obtained in exchange for new operating lease obligations $ 19,264 $ 11,039 $ 21,663 Right-of-use asset obtained in exchange for new finance lease obligations $ 3,226 $ — $ 517 Information on operating and financing lease right of use assets and corresponding lease obligations acquired with the Powerline Plus Companies is provided in Note 2–Acquisitions to the Financial Statements. 63 TABLE OF CONTENTS The future undiscounted minimum lease payments, as reconciled to the discounted minimum lease obligation indicated on the Company’s consolidated balance sheets, under current portion of operating lease obligations and operating lease obligations, net of current maturities, as of December 31, 2024 were as follows: (in thousands) Finance Lease Obligations Operating Lease Obligations Total Lease Obligations 2025 $ 1,142 $ 16,415 $ 17,557 2026 828 13,218 14,046 2027 829 8,347 9,176 2028 370 6,709 7,079 2029 — 4,062 4,062 Thereafter — 904 904 Total minimum lease payments 3,169 49,655 52,824 Financing component ( 193 ) ( 7,018 ) ( 7,211 ) Net present value of minimum lease payments 2,976 42,637 45,613 Less: current portion of operating lease obligations ( 1,046 ) ( 12,141 ) ( 13,187 ) Long-term operating lease obligations $ 1,930 $ 30,496 $ 32,426 The financing component for finance lease obligations represents the interest component of finance leases that will be recognized as interest expense in future periods. The financing component for operating lease obligations represents the effect of discounting the lease payments to their present value. Certain subsidiaries of the Company have operating leases for facilities from third party companies that are owned, in whole or part, by employees of the subsidiaries. The terms and rental rates of these leases are at market rental rates. Lease expense associated with these leases was $ 2.5 million, $ 2.7 million and $ 2.4 million for the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, the minimum lease payments required under these leases totaled $ 10.0 million, which are due over the next 4.7 years. 5. Fair Value Measurements The Company uses the three-tier hierarchy of fair value measurement, which prioritizes the inputs used in measuring fair value based upon their degree of availability in external active markets. These tiers include: Level 1 (the highest priority), defined as observable inputs, such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3 (the lowest priority), defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. As of December 31, 2024 and 2023, the Company determined that the carrying value of cash and cash equivalents approximated fair value based on Level 1 inputs. As of December 31, 2024 and 2023, the fair value of the Company’s long-term debt and finance lease obligations were based on Level 2 inputs. The Company’s long-term debt was based on variable and fixed interest rates at December 31, 2024 and 2023. Long-term debt with variable interest rates is based on rates for new issues with similar remaining maturities, and approximated carrying value. In addition, based on borrowing rates currently available to the Company for borrowings with similar terms, the carrying value of the Company’s long term debt with fixed interest rates approximated fair value. As of December 31, 2024, the fair value of the Company’s contingent earn-out consideration liability associated with the acquisition of the Powerline Plus Companies, was based on Level 3 inputs. The contingent earn-out consideration recorded represents the estimated fair value of future amounts potentially payable to the former owners of the acquired Powerline Plus Companies, if the Powerline Plus Companies achieve certain performance targets over a three-year post-acquisition period. The fair value was initially determined using a Monte Carlo simulation valuation methodology based on probability-weighted performance projections and other inputs, including a discount rate and an expected volatility factor. The fair value of this contingent earn-out consideration liability will be evaluated on an ongoing basis by management. Accordingly, the level of inputs used for these fair value measurements is the lowest level (Level 3). Significant changes in any of these assumptions could result in a significantly higher or lower potential liability. 64 TABLE OF CONTENTS 6. Accounts Receivable Accounts receivable consisted of the following at December 31: (in thousands) 2024 2023 Contract receivables $ 651,746 $ 516,142 Other 2,452 7,738 654,198 523,880 Less: allowance for doubtful accounts ( 1,129 ) ( 1,987 ) $ 653,069 $ 521,893 The roll-forward of activity in the allowance for doubtful accounts was as follows for the years ended December 31: (in thousands) 2024 2023 2022 Balance at beginning of period $ 1,987 $ 2,073 $ 2,441 Less: reduction in (provision for) allowances ( 19 ) 85 320 Less: write offs, net of recoveries 860 3 45 Change in foreign currency translation ( 17 ) 2 ( 3 ) Balance at end of period $ 1,129 $ 1,987 $ 2,073 7. Prepaid Expenses and Other Current Assets Prepaid expense and other current assets consisted of the following at December 31: (in thousands) 2024 2023 Prepaid expenses $ 40,872 $ 44,410 Other current assets 1,596 2,125 $ 42,468 $ 46,535 8. Property and Equipment Property and equipment consisted of the following at December 31: (dollars in thousands) Estimated Useful Life in Years 2024 2023 Land — $ 10,351 $ 10,351 Buildings and improvements 3 to 39 51,880 44,352 Construction equipment 3 to 12 586,335 578,563 Office equipment 3 to 10 16,883 16,177 665,449 649,443 Less: accumulated depreciation and amortization ( 387,223 ) ( 380,465 ) $ 278,226 $ 268,978 Construction equipment includes assets under finance leases — see additional information provided in Note 4 — Lease Obligations to the Financial Statements. Depreciation and amortization expense of property and equipment for the years ended December 31, 2024, 2023 and 2022 was $ 60.3 million, $ 54.2 million and $ 49.2 million, respectively. 65 TABLE OF CONTENTS 9. Goodwill and Intangible Assets Goodwill and intangible assets consisted of the following at December 31: 2024 2023 (in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Goodwill T&D $ 93,240 $ — $ 93,240 $ 93,240 $ — $ 93,240 C&I 25,830 — 25,830 25,830 — 25,830 Foreign currency translation ( 6,087 ) — ( 6,087 ) ( 2,117 ) — ( 2,117 ) Total goodwill $ 112,983 $ — $ 112,983 $ 116,953 $ — $ 116,953 Amortizable Intangible Assets Backlog $ 9,296 $ 9,296 $ — $ 9,296 $ 9,296 $ — Customer relationships 71,139 25,319 45,820 71,139 20,905 50,234 Trade names 695 450 245 695 403 292 Below market lease 511 283 228 511 200 311 Foreign currency translation ( 5,073 ) ( 775 ) ( 4,298 ) ( 1,768 ) ( 270 ) ( 1,498 ) Indefinite-lived Intangible Assets Trade names 34,413 — 34,413 34,412 — 34,412 Foreign currency translation ( 717 ) — ( 717 ) ( 235 ) — ( 235 ) Total intangible assets $ 110,264 $ 34,573 $ 75,691 $ 114,050 $ 30,534 $ 83,516 Customer relationships, amortizable trade names and backlog are being amortized on a straight-line method over an estimated useful life ranging up to 15 years and the remaining life of the contract, respectively, and have been determined to have no residual value. Certain trade names have indefinite lives and, therefore, are not being amortized. Intangible asset amortization expense was $ 4.9 million, $ 4.9 million and $ 9.0 million for the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, estimated future intangible asset amortization expense for the each of the next five years and thereafter was as follows: (in thousands) Future Amortization Expense 2025 $ 4,749 2026 4,749 2027 4,617 2028 4,607 2029 4,569 Thereafter 18,704 Total $ 41,995 66 TABLE OF CONTENTS 10. Accrued Liabilities Other current liabilities consisted of the following at December 31: (in thousands) 2024 2023 Payroll and incentive compensation $ 34,120 $ 39,986 Union dues and benefits 21,277 26,107 Payroll, sales and other taxes 10,602 13,903 Profit sharing and thrift plan 3,162 8,592 Other 18,676 12,005 $ 87,837 $ 100,593 11. Debt The table below reflects the Company’s total debt, including borrowings under its credit agreement and equipment notes: (dollars in thousands) Inception Date Stated Interest Rate (per annum) Payment Frequency Term (years) Outstanding Balance as of December 31, 2024 Outstanding Balance as of December 31, 2023 Credit Agreement Revolving loans 5/31/2023 Variable Variable 5 $ 58,395 $ 13,201 Equipment Notes Equipment Note 8 12/27/2019 2.75 % Semi-annual 5 — 2,871 Equipment Note 10 8/26/2022 4.32 % Semi-annual 5 15,957 20,125 Other equipment note 4/11/2022 4.55 % Monthly 5 29 44 15,986 23,040 Total debt 74,381 36,241 Less: current portion of long-term debt ( 4,363 ) ( 7,053 ) Long-term debt $ 70,018 $ 29,188 Credit Agreement On May 31, 2023, the Company entered into a five-year third amended and restated credit agreement with a maturity date of May 31, 2028, (the “Credit Agreement”) through a syndicate of banks led by JPMorgan Chase Bank, N.A. and Bank of America, N.A, that provides for a $ 490 million revolving credit facility (the “Facility”), subject to certain financial covenants as defined in the Credit Agreement. The Facility allows for revolving loans in Canadian dollars and other non-US currencies, up to the U.S. dollars equivalent of $ 150 million. Up to $ 75 million of the Facility may be used for letters of credit, with an additional $ 75 million available for letters of credit, subject to the sole discretion of each issuing bank. The Facility also allows for $ 15 million to be used for swingline loans. The Company has an expansion option to increase the commitments under the Facility or enter into incremental term loans, subject to certain conditions, by up to an additional $ 200 million upon receipt of additional commitments from new or existing lenders. Subject to certain exceptions, the Facility is secured by substantially all of the assets of the Company and its domestic subsidiaries, and by a pledge of substantially all of the capital stock of the Company’s domestic subsidiaries and 65 % of the capital stock of the direct foreign subsidiaries of the Company. Additionally, subject to certain exceptions, the Company’s domestic subsidiaries also guarantee the repayment of all amounts due under the Credit Agreement. The Credit Agreement provides for customary events of default. If an event of default occurs and is continuing, on the terms and subject to the conditions set forth in the Credit Agreement, amounts outstanding under the Facility may be accelerated and may become or be declared immediately due and payable. Borrowings under the Credit Agreement are used to refinance existing indebtedness, and to provide for future working capital, capital expenditures, acquisitions and other general corporate purposes. 67 TABLE OF CONTENTS Amounts borrowed under the Credit Agreement bear interest, at the Company’s option, at a rate equal to either (1) the Alternate Base Rate (as defined in the Credit Agreement), plus an applicable margin ranging from 0.25 % to 1.00 %; or (2) the Term Benchmark Rate (as defined in the Credit Agreement) plus an applicable margin ranging from 1.25 % to 2.00 %. The applicable margin is determined based on the Company’s Net Leverage Ratio (as defined in the Credit Agreement). Letters of credit issued under the Facility are subject to a letter of credit fee of 1.25 % to 2.00 % for non-performance letters of credit or 0.625 % to 1.00 % for performance letters of credit, based on the Company’s Net Leverage Ratio. The Company is subject to a commitment fee of 0.20 % to 0.30 %, based on the Company’s Net Leverage Ratio, on any unused portion of the Facility. The Credit Agreement restricts certain types of payments when the Company’s Net Leverage Ratio, after giving pro forma effect thereto, exceeds 2.75 . The weighted average interest rate on borrowings outstanding on the Facility was 6.63 % and 7.07 % per annum, for the year ended December 31, 2024 and 2023, respectively. Under the Credit Agreement, the Company is subject to certain financial covenants including a maximum Net Leverage Ratio of 3.0 and a minimum Interest Coverage Ratio (as defined in the Credit Agreement) of 3.0 . The Credit Agreement also contains covenants including limitations on asset sales, investments, indebtedness and liens. The Company was in compliance with all of its financial covenants under the Credit Agreement as of December 31, 2024. As of December 31, 2024, the Company had $ 58.4 million of borrowings outstanding under the Facility and letters of credit outstanding under the Facility of approximately $ 37.3 million, including $ 32.6 million related to the Company's payment obligation under its insurance programs and approximately $ 4.7 million related to contract performance obligations. As of December 31, 2023, the Company had $ 13.2 million of borrowings outstanding under the Facility and letters of credit outstanding under the Facility of approximately $ 34.4 million, including $ 27.1 million related to the Company's payment obligation under its insurance programs and approximately $ 7.3 million related to contract performance obligations. The Company had remaining deferred debt issuance costs related to the Facility totaling $ 1.8 million and $ 2.2 million as of December 31, 2024 and 2023, respectively. As permitted, debt issuance costs have been deferred and are presented as an asset within other assets, which is amortized as interest expense over the term of the Credit Agreement. Equipment Notes The Company has entered into Master Equipment Loan and Security Agreements (the “Master Loan Agreements”) with multiple finance companies. The Master Loan Agreements may be used for the financing of equipment between the Company and the lenders pursuant to one or more equipment notes (“Equipment Note”). Each Equipment Note executed under the Master Loan Agreements constitutes a separate, distinct and independent financing of equipment and a contractual obligation of the Company, which may contain prepayment clauses. As of December 31, 2024, the Company had one Equipment Note outstanding under the Master Loan Agreements that is collateralized by equipment and vehicles owned by the Company. As of December 31, 2024, the Company had one other equipment note outstanding that is collateralized by a vehicle owned by the Company. The following table sets forth our remaining principal payments for the Company’s outstanding equipment notes as of December 31, 2024: (in thousands) Future Equipment Notes Principal Payments 2025 $ 4,363 2026 4,554 2027 7,069 2028 — 2029 — Thereafter — Total future principal payments $ 15,986 Less: current portion of equipment notes ( 4,363 ) Long-term principal obligations $ 11,623 68 TABLE OF CONTENTS 12. Revenue Recognition Disaggregation of Revenue A majority of the Company’s revenues are earned through contracts with customers that normally provide for payment upon completion of specified work or units of work as identified in the contract. Although there is considerable variation in the terms of these contracts, they are primarily structured as fixed-price contracts, under which the Company agrees to perform a defined scope of a project for a fixed amount, or unit-price contracts, under which the Company agrees to do the work at a fixed price per unit of work as specified in the contract. The Company also enters into time-and-equipment and time-and-materials contracts under which the Company is paid for labor and equipment at negotiated hourly billing rates and for other expenses, including materials, as incurred at rates agreed to in the contract. Finally, the Company sometimes enters into cost-plus contracts, where the Company is paid for costs plus a negotiated margin. On occasion, time-and-equipment, time-and-materials and cost-plus contracts require the Company to include a guarantee not-to-exceed a maximum price. Historically, fixed-price and unit-price contracts have had the highest potential margins; however, they have had a greater risk in terms of profitability because cost overruns may not be recoverable. Time-and-equipment, time-and-materials and cost-plus contracts have historically had less margin upside, but generally have had a lower risk of cost overruns. The Company also provides services under master service agreements (“MSAs”) and other variable-term service agreements. MSAs normally cover maintenance, upgrade and extension services, as well as new construction. Work performed under MSAs is typically billed on a unit-price, time-and-materials or time-and-equipment basis. MSAs are typically one to three years in duration; however, most of the Company’s contracts, including MSAs, may be terminated by the customer on short notice, typically 30 to 90 days, even if the Company is not in default under the contract. Under MSAs, customers generally agree to use the Company for certain services in a specified geographic region. Most MSAs include no obligation for the contract counterparty to assign specific volumes of work to the Company and do not require the counterparty to use the Company exclusively, although in some cases the MSA contract gives the Company a right of first refusal for certain work. Additional information related to the Company’s market types is provided in Note 17–Segment Information to the Financial Statements. The components of the Company’s revenue by contract type were as follows for the year ended December 31: 2024 T&D C&I Total (dollars in thousands) Amount Percent Amount Percent Amount Percent Fixed price $ 824,643 43.9 % $ 1,202,653 81.2 % $ 2,027,296 60.3 % Unit price 596,089 31.7 80,507 5.4 676,596 20.1 T&E (1) 459,769 24.4 198,629 13.4 658,398 19.6 $ 1,880,501 100.0 % $ 1,481,789 100.0 % $ 3,362,290 100.0 % 2023 T&D C&I Total (dollars in thousands) Amount Percent Amount Percent Amount Percent Fixed price $ 1,100,273 52.7 % $ 1,274,763 82.0 % $ 2,375,036 65.2 % Unit price 549,221 26.3 92,581 6.0 641,802 17.6 T&E (1) 439,702 21.0 187,365 12.0 627,067 17.2 $ 2,089,196 100.0 % $ 1,554,709 100.0 % $ 3,643,905 100.0 % 2022 T&D C&I Total (dollars in thousands) Amount Percent Amount Percent Amount Percent Fixed price $ 835,288 47.8 % $ 1,051,428 83.3 % $ 1,886,716 62.7 % Unit price 475,276 27.2 78,714 6.2 553,990 18.4 T&E (1) 435,228 25.0 132,608 10.5 567,836 18.9 $ 1,745,792 100.0 % $ 1,262,750 100.0 % $ 3,008,542 100.0 % (1) The Company T&E contract type includes time-and-equipment, time-and-materials and cost-plus contracts. 69 TABLE OF CONTENTS The components of the Company’s revenue by market type were as follows for the year ended December 31: 2024 2023 2022 (dollars in thousands) Segment Amount Percent Amount Percent Amount Percent Transmission T&D $ 1,139,848 33.9 % $ 1,380,923 37.9 % $ 1,083,415 36.0 % Distribution T&D 740,653 22.0 708,273 19.4 662,377 22.0 Electrical construction C&I 1,481,789 44.1 1,554,709 42.7 1,262,750 42.0 Total revenue $ 3,362,290 100.0 % $ 3,643,905 100.0 % $ 3,008,542 100.0 % Remaining Performance Obligations On December 31, 2024, the Company had $ 2.34 billion of remaining performance obligations. The Company’s remaining performance obligations include projects that have a written award, a letter of intent, a notice to proceed or an agreed-upon work order to perform work on mutually accepted terms and conditions. The timing of when remaining performance obligations are recognized is evaluated quarterly and is largely driven by the estimated start date and duration of the underlying projects. The following table summarizes the total amount of remaining performance obligations as of December 31, 2024 that the Company expects to be realized, the amount of the remaining performance obligations that the Company reasonably estimates will be recognized within the next twelve months, and the amount estimated to be recognized after the next twelve months. Remaining Performance Obligations as of December 31, 2024 (in thousands) Total Amount estimated to be recognized within 12 months Amount estimated to be recognized after 12 months T&D $ 592,032 $ 580,086 $ 11,946 C&I 1,746,929 1,262,780 484,149 Total $ 2,338,961 $ 1,842,866 $ 496,095 The Company estimates approximately 95 % or more of the remaining performance obligations will be recognized within twenty-four months, including approximately 80 % of the remaining performance obligations estimated to be recognized within twelve months, although the timing of the Company’s performance is not always under its control. The timing of when remaining performance obligations are recognized by the Company can vary considerably and is impacted by multiple variables including, but not limited to: changes in the estimated versus actual start time of a project; the availability of labor, equipment and materials; changes in project workflow; weather; project delays and accelerations; and the timing of final contract settlements. Additionally, the difference between the remaining performance obligations and backlog is due to the exclusion of a portion of the Company’s MSAs under certain contract types from the Company’s remaining performance obligations as these contracts can be canceled for convenience at any time by the Company or the customer without considerable cost incurred by the customer. Additional information related to backlog is provided in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report. 13. Income Taxes Income before income taxes by geographic area was, for the years ended December 31: (in thousands) 2024 2023 2022 Federal $ 64,068 $ 102,014 $ 104,185 Foreign ( 17,575 ) 22,990 10,019 $ 46,493 $ 125,004 $ 114,204 70 TABLE OF CONTENTS Income tax expense consisted of the following for the years ended December 31: (in thousands) 2024 2023 2022 Current Federal $ 11,437 $ 21,337 $ 13,948 Foreign 1,788 1,821 2,148 State 3,405 7,348 5,154 16,630 30,506 21,250 Deferred Federal 4,917 ( 159 ) 7,739 Foreign ( 8,318 ) 3,984 465 State 3,001 ( 317 ) 1,369 ( 400 ) 3,508 9,573 Income tax expense $ 16,230 $ 34,014 $ 30,823 The differences between the U.S. federal statutory tax rate and the Company’s effective tax rate for operations were as follows for the years ended December 31: 2024 2023 2022 U.S federal statutory rate 21.0 % 21.0 % 21.0 % State income taxes, net of U.S. federal income tax expense 10.3 4.4 4.5 Change in valuation allowance 0.1 — — Tax differential on foreign earnings ( 2.0 ) 0.7 0.6 Non-deductible meals and entertainment 1.6 0.5 0.2 Stock compensation excess tax benefits ( 4.6 ) ( 2.6 ) ( 2.4 ) Uncertain tax positions ( 0.5 ) — 0.1 Provision to return adjustments, net 0.6 0.7 0.7 Section 162(m) limitation 10.6 2.5 2.4 Tax credits ( 0.6 ) — — Other income, net ( 1.6 ) — ( 0.1 ) Effective rate 34.9 % 27.2 % 27.0 % 71 TABLE OF CONTENTS The net deferred tax assets and (liabilities) arising from temporary differences was as follows at December 31: (in thousands) 2024 2023 Deferred income tax assets: Self-insurance reserves $ 1,498 $ 3,850 Contract loss reserves 2,076 2,273 Stock-based awards 3,521 3,336 Bonus 10,128 11,137 Accrued vacation 2,653 2,295 Accrued profit sharing 161 1,707 Operating lease liabilities 11,126 8,115 Non-U.S. operating loss 13,166 2,411 Other 3,064 1,090 Total deferred income tax assets before valuation allowances 47,393 36,214 Less: valuation allowances ( 2,247 ) ( 2,412 ) Total deferred income tax assets 45,146 33,802 Deferred income tax liabilities: Property and equipment — tax over book depreciation ( 48,194 ) ( 45,332 ) Non-U.S. intangible assets — tax over book amortization ( 9,601 ) ( 10,363 ) Intangible assets — tax over book amortization ( 5,200 ) ( 4,013 ) Right-of-use operating lease assets ( 11,129 ) ( 8,115 ) Non-U.S. deferred income tax liabilities — ( 8,819 ) Contract revenue adjustment ( 17,303 ) ( 4,790 ) Other ( 483 ) ( 600 ) Total deferred income tax liabilities ( 91,910 ) ( 82,032 ) Net deferred income taxes $ ( 46,764 ) $ ( 48,230 ) The Company determined that it is more-likely-than-not that it will not realize certain deferred tax assets related to net operating loss carryforwards on certain Canadian subsidiaries and therefore recorded a valuation allowance against the deferred tax assets for those entities. Earnings from the Company’s Canadian subsidiaries are indefinitely reinvested in Canada, therefore as of December 31, 2024, the Company had no undistributed earnings or withholding deferral associated with its Canadian subsidiaries. The Company is subject to taxation in various jurisdictions. The Company’s 2020 through 2023 tax returns are subject to examination by U. S. federal authorities. The Company’s tax returns are subject to examination by various state authorities for the years 2019 through 2023. The Company has recorded a liability for unrecognized tax benefits related to tax positions taken on its various income tax returns. If recognized, the entire amount of unrecognized tax benefits would favorably impact the effective tax rate that is reported in future periods. The decrease in the unrecognized tax benefits as of December 31, 2024 was primarily due to the lapses in the applicable statutes of limitations. The total unrecognized tax benefits is expected to be reduced by less than $ 0.2 million within the next 12 months. Interest and penalties related to uncertain income tax positions are included as a component of income tax expense in the Financial Statements. 72 TABLE OF CONTENTS The following is a reconciliation of the beginning and ending liability for unrecognized tax benefits at December 31: (in thousands) 2024 2023 Balance at beginning of period $ 417 $ 390 Gross increases (decreases) in current period tax positions ( 122 ) 54 Reductions in tax positions due to lapse of statutory limitations ( 30 ) ( 27 ) Balance at end of period 265 417 Accrued interest and penalties at end of period 24 107 Total liability for unrecognized tax benefits $ 289 $ 524 The liability for unrecognized tax benefits, including accrued interest and penalties, was included in other liabilities on the accompanying consolidated balance sheets. The amount of interest and penalties charged or credited to income tax expense as a result of the unrecognized tax benefits was no t significant in the years ended December 31, 2024, 2023 and 2022. 14. Commitments and Contingencies Purchase Commitments As of December 31, 2024, the Company had approximately $ 4.9 million in outstanding purchase orders for certain construction equipment, with cash payments scheduled to occur in 2025. Insurance and Claims Accruals The Company carries insurance policies, which are subject to certain deductibles and limits, for workers’ compensation, general liability, automobile liability and other insurance coverage. The deductible per occurrence for each line of coverage is up to $ 1.0 million. The Company’s health benefit plans are subject to stop-loss limits of up to $ 0.2 million for qualified individuals. Losses up to the deductible and stop-loss amounts are accrued based upon the Company’s estimates of the ultimate liability for claims reported and an estimate of claims incurred but not yet reported. The insurance and claims accruals are based on known facts, actuarial estimates and historical trends. While recorded accruals are based on the ultimate liability, which includes amounts in excess of the deductible, a corresponding receivable for amounts in excess of the deductible is included in total assets on the Company’s consolidated balance sheets. The following table includes the Company’s accrued short- and long-term insurance liabilities at December 31: (in thousands) 2024 2023 Balance at beginning of period $ 80,065 $ 80,039 Net increases in accrued self-insurance 90,586 86,093 Net payments made ( 91,168 ) ( 86,067 ) Balance at end of period $ 79,483 $ 80,065 Insurance expense, including premiums, for workers’ compensation, general liability, automobile liability, employee health benefits, and other coverages for the years ended December 31, 2024, 2023 and 2022 was $ 90.6 million, $ 88.3 million and $ 77.1 million, respectively. Performance and Payment Bonds and Parent Guarantees In certain circumstances, the Company is required to provide performance and payment bonds in connection with its future performance on certain contractual commitments. The Company has indemnified its sureties for any expenses paid out under these bonds. As of December 31, 2024, an aggregate of approximately $ 2.27 billion in original face amount of bonds issued by the Company’s sureties were outstanding. The Company estimated the remaining cost to complete these bonded projects was approximately $ 662.6 million as of December 31, 2024. From time to time, the Company guarantees the obligations of wholly-owned subsidiaries, including obligations under certain contracts with customers, certain lease agreements and, in some states, obligations in connection with obtaining contractors’ licenses. Additionally, from time to time, the Company is required to post letters of credit to guarantee the obligations of its wholly-owned subsidiaries, which reduces the borrowing availability under the Facility. 73 TABLE OF CONTENTS Indemnities From time to time, pursuant to its service arrangements, the Company indemnifies its customers for claims related to the services it provides under those service arrangements. These indemnification obligations may subject the Company to indemnity claims, liabilities and related litigation. The Company is not aware of any material unrecorded liabilities for asserted claims in connection with these indemnification obligations. Collective Bargaining Agreements Most of the Company’s subsidiaries’ craft labor employees are covered by collective bargaining agreements. The agreements require the subsidiaries to pay specified wages, provide certain benefits and contribute certain amounts to multi-employer pension plans. If a subsidiary withdraws from any of the multi-employer pension plans or if the plans were to otherwise become underfunded, the subsidiary could incur liabilities for additional contributions related to these plans. Although the Company has been informed that the status of some multi-employer pension plans to which its subsidiaries contribute have been classified as “critical”, the Company is not currently aware of any potential liabilities related to this issue. See Note 16 — Employee Benefit Plans to the Financial Statements for further information related to the Company’s participation in multi-employer plans. Litigation and Other Legal Matters The Company is from time to time party to various lawsuits, claims, and other legal proceedings that arise in the ordinary course of business. These actions typically seek, among other things, compensation for alleged personal injury, breach of contract, property damages, punitive damages, civil penalties or other losses, or injunctive or declaratory relief. With respect to all such lawsuits, claims and proceedings, the Company records reserves when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company does not believe that any of these proceedings, separately or in the aggregate, would be expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows. The Company is routinely subject to other civil claims, litigation and arbitration, and regulatory investigations arising in the ordinary course of business. Some of these claims and litigations include claims related to the Company’s current services and operations, the Company believes that it has strong defenses to these claims as well as insurance coverages that could contribute to any settlement or liability in the event claims are not resolved in our favor. These claims have not had a material impact on the Company to date, and the Company believes that the likelihood that a future material adverse outcome will result from these claims is remote. However, if facts and circumstances change in the future, the Company cannot be certain that an adverse outcome of one or more of these claims would not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. 15. Stock-Based Compensation The Company maintains two equity compensation plans under which stock-based compensation has been granted, the 2017 Long-Term Incentive Plan (Amended and Restated as of April 24, 2024) (the “LTIP”) and the 2007 Long-Term Incentive Plan (Amended and Restated as of May 1, 2014) (the “2007 LTIP” and, collectively with the LTIP, the “Long-Term Incentive Plans”). Upon the initial adoption of the LTIP in 2017, awards were no longer granted under the 2007 LTIP. The LTIP was approved by our shareholders and provides for grants of (a) incentive stock options qualified as such under U.S. federal income tax laws, (b) stock options that do not qualify as incentive stock options, (c) stock appreciation rights, (d) restricted stock awards, (e) restricted stock units, (f) performance awards, (g) phantom stock, (h) stock bonuses, (i) dividend equivalents, or (j) any combination of such awards. The LTIP permits the granting of up to 1,500,000 shares to directors, officers and other employees of the Company. Grants of awards to employees are approved by the Compensation Committee of the Board of Directors and grants to independent members of the Board of Directors are approved by the Board of Directors. All awards are made with an exercise price or base price, as the case may be, that is not less than the full fair market value per share on the date of grant. No stock option or stock appreciation right may be exercised more than 10 years from the date of grant. Shares issued as a result of stock option exercises or stock grants are made available from authorized unissued shares of common stock or treasury stock. 74 TABLE OF CONTENTS Stock Options The Company has not awarded any stock options since 2013, and in 2023 the Company's final outstanding and exercisable options were exercised or expired. Stock options granted to the Company’s employees or directors were granted with an exercise price equal to the market price of the Company’s stock on the date of grant. The Company used the Black-Scholes-Merton option-pricing model to estimate the fair value of options as of the date of grant. All stock options were fully expensed as of December 31, 2016. Following is a summary of stock option activity for the two-year period ended December 31, 2023: Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2022 2,709 $ 23.74 Exercised ( 1,680 ) $ 23.67 Expired ( 160 ) $ 19.37 Outstanding and Exercisable at December 31, 2022 869 $ 24.68 0.2 years $ 63 Exercised ( 827 ) $ 24.68 Expired ( 42 ) $ 24.68 Outstanding and Exercisable at December 31, 2023 — $ — 0.0 years $ — During the years ended December 31, 2023 and 2022, the intrinsic value of stock options exercised was $ 0.1 million. Time-Vested Stock Awards The company grants time-vested stock awards under the LTIP in the form of restricted stock awards, restricted stock units or equity-settled phantom stock. The grant date fair value of the time-vested stock awards is equal to the closing market price of the Company’s common stock on the date of grant. Time-vested stock awards granted under the LTIP to eligible employees in 2024 vest ratably on an annual basis, over three years . Time-vested stock awards granted under the LTIP to non-employee directors in 2024 vest over a one year period. The Company recognizes stock-based compensation expense related to restricted stock awards and restricted stock units based on the grant date fair value, which was the closing price of the Company’s stock on the date of grant. The fair value is expensed over the service period, which is generally three years for time-vested stock awards granted to eligible employees and one year for non-employee directors. During the years ended December 31, 2024, 2023 and 2022, time-vested stock vesting activity settled in common stock had an intrinsic value, at the time of vesting, of $ 6.8 million, $ 7.3 million and $ 7.0 million, respectively. 75 TABLE OF CONTENTS Following is a summary of time-vested stock awards activity for the three-year period ended December 31, 2024: Shares Per Share Weighted- Average Grant Date Fair Value Outstanding unvested at January 1, 2022 132,497 $ 44.88 Granted 45,992 $ 76.93 Vested ( 73,373 ) $ 42.47 Forfeited ( 2,500 ) $ 58.43 Outstanding unvested at December 31, 2022 102,616 $ 69.70 Granted 51,167 $ 117.60 Vested ( 63,722 ) $ 59.71 Forfeited ( 9,323 ) $ 90.75 Outstanding unvested at December 31, 2023 80,738 $ 105.50 Granted 40,723 $ 171.55 Vested ( 42,554 ) $ 99.52 Forfeited ( 2,183 ) $ 138.38 Outstanding unvested at December 31, 2024 76,724 $ 142.95 Performance Awards The Company grants performance awards under the LTIP. Under these awards, shares of the Company’s common stock may be earned based on the Company’s performance compared to defined metrics. The number of shares earned under a performance award may vary from zero to 200 % of the target shares awarded, based upon the Company’s performance compared to certain financial and other metrics. The metrics used for the grant are determined by the Compensation Committee of the Board of Directors and may be either based on internal measures such as the Company’s financial performance compared to target or on a market-based metric such as the Company’s stock performance compared to a peer group. Performance awards cliff vest upon attainment of at least the minimum stated performance targets and minimum service requirements and are paid in the Company’s common stock. For performance awards, the Company recognizes stock-based compensation expense based on the grant date fair value of the award. The fair value of internal metric-based performance awards is determined by the closing stock price of the Company’s common stock on the date of the grant. The fair value of market-based performance awards is computed using a Monte Carlo simulation. Performance awards granted in 2024 are expensed over the service period of approximately 2.8 years. The Company adjusts the stock-based compensation expense related to internal metric-based performance awards according to its determination of the shares expected to vest at each reporting date. Stock-based compensation expense related to market metric-based performance awards is expensed at their grant date fair value regardless of performance. During the years ended December 31, 2024, 2023 and 2022, performance award vesting activity settled in common stock had an intrinsic value, at the time of vesting, of $ 3.2 million, $ 12.0 million and $ 15.7 million, respectively. 76 TABLE OF CONTENTS Following is a summary of performance share award activity for the three-year period ended December 31, 2024: Shares Per Share Weighted- Average Grant Date Fair Value Outstanding unvested at January 1, 2022 121,327 $ 50.06 Granted at target 31,603 $ 118.82 Adjusted for performance above target 78,684 $ 34.10 Vested ( 157,368 ) $ 34.10 Forfeited ( 738 ) $ 45.71 Outstanding unvested at December 31, 2022 73,508 $ 96.75 Granted at target 32,994 $ 136.54 Adjusted for performance above target 38,916 $ 80.07 Vested ( 77,832 ) $ 80.07 Forfeited ( 8,468 ) $ 108.24 Outstanding unvested at December 31, 2023 59,118 $ 128.29 Granted at target 29,566 $ 197.89 Adjusted for performance below target ( 3,923 ) $ 148.83 Vested ( 23,323 ) $ 118.75 Forfeited ( 396 ) $ 133.68 Outstanding unvested at December 31, 2024 61,042 $ 166.25 Stock-based Compensation Expense The Company recognized stock-based compensation expense of approximately $ 8.5 million, $ 8.4 million and $ 7.9 million for the years ended December 31, 2024, 2023 and 2022, respectively, in selling, general and administrative expenses on the Company’s consolidated statements of operations. As of December 31, 2024, there was approximately $ 12.6 million of unrecognized stock-based compensation expense related to awards granted under the Long-Term Incentive Plans. This included $ 6.9 million of unrecognized compensation cost related to unvested time-vested stock awards expected to be recognized over a remaining weighted average vesting period of approximately 1.5 years and $ 5.7 million of unrecognized compensation cost related to unvested performance awards, expected to be recognized over a remaining weighted average vesting period of approximately 1.5 years. 16. Employee Benefit Plans The Company sponsors multiple defined contribution plans for eligible employees not covered by collective bargaining agreements. The plans include various features such as voluntary employee pre-tax and Roth-based contributions and matching contributions made by the Company. In addition, at the discretion of our Board of Directors, we may make additional profit sharing contributions to the plans. Company contributions under these defined contribution plans are based upon a percentage of income with limitations as defined by each plan. Total contributions for the years ended December 31, 2024, 2023 and 2022 amounted to $ 12.4 million, $ 15.9 million, and $ 15.7 million, respectively. The Company contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees, who are represented by more than 300 local unions. The related collective-bargaining agreements between those organizations and the Company, which specify the rate at which the Company must contribute to the multi-employer defined pension plan, expire at different times between 2025 and 2027. 77 TABLE OF CONTENTS The risks of participating in these multiemployer defined benefit pension plans are different from single-employer plans in the following aspects: 1) Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers. 2) If a participating employer stops contributing to a plan, the unfunded obligations of the plan may be borne by the remaining participating employers. 3) If the Company chooses to stop participating in a multiemployer plan, it may be required to pay the plan an amount based on the underfunded status of the plan, referred to as a withdrawal liability. The amount of additional funds, if any, that the Company may be obligated to contribute to these plans in the future cannot be estimated due to uncertainty of the future levels of work that require the specific use of union employees covered by these plans, as well as the future contribution levels and possible surcharges on contributions applicable to these plans. The following table summarizes plan information relating to the Company’s participation in multi-employer defined benefit pension plans, including company contributions for the last three years, the status under the Pension Protection Act of 2006, as amended by the Consolidated and Further Continuing Appropriations Act of 2015 (“PPA”) of the plans and whether the plans are subject to a funding improvement or rehabilitation plan, or contribution surcharges. The most recent zone status is for the plan’s year-end indicated in the table. The zone status is based on information that the Company received from the plan, as well as from publicly available information on the U.S. Department of Labor website. The PPA zone status for the plan year ended on December 31, 2024 has not been listed because Forms 5500 were not yet available. Among other factors, plans in the red “critical” zone are generally less than 65 percent funded, plans in the yellow “endangered” zone are between 65 and 80 percent funded, and plans in the green zone are at least 80 percent funded. Also listed in the table below are the Company’s contributions to defined contribution plans. Information in the table has been presented separately for individually significant plans and in the aggregate for all other plans. Pension Fund EIN/Pension Plan Number Pension Protection Act Zone Status Contributions to Plan for the Year ended December 31, Funding Plan Surcharge Imposed Status Plan Year End Status Plan Year End 2024 2023 2022 (in thousands) Defined Benefit Plans: Southern California IBEW-NECA Pension Trust Fund 95-6392774 001 Yellow 6/30/2023 Yellow 6/30/2022 $ 46,185 $ 51,136 $ 40,810 Yes No Eighth District Electrical Pension Fund 84-6100393 001 Green 3/31/2024 Green 3/31/2023 16,736 15,158 15,097 No No National Electrical Benefit Fund 53-0181657 001 Green 12/31/2023 Green 12/31/2022 14,127 14,598 13,804 No No IBEW Local 332 Pension Plan Part A 94-2688032 004 Green 12/31/2023 Green 12/31/2022 9,552 4,292 5,723 No No IBEW Local 769 Management Pension Plan A 86-6049763 001 Green 6/30/2023 Green 6/30/2022 6,545 5,222 5,061 No No IBEW Local Union 1249 Pension Fund 15-6035161 001 Green 12/31/2023 Green 12/31/2022 1,600 5,706 3,791 No No Laborers Local Union 158 Pension Fund 23-6580323 001 Green 12/31/2023 Green 12/31/2022 1,494 3,246 256 No No Defined Contribution Plans: National Electrical Annuity Plan 52-6132372 001 n/a n/a 34,859 30,758 36,982 n/a n/a Eighth District Electrical Pension Fund Annuity Plan 84-6100393 002 n/a n/a 4,081 3,624 3,347 n/a n/a San Mateo Country Electrical Construction Industry Retirement Plan 51-6052127 001 n/a n/a 2,973 4,752 2,953 n/a n/a All other plans: 29,535 40,716 28,014 Total contributions: $ 167,687 $ 179,208 $ 155,838 Total contributions to these plans, at any given time, correspond to the number of union employees employed and the plans in which they participate, which varies depending upon location, the number of ongoing projects and the need for union resources in connection with such projects at a given time. The PPA data presented in the table above represents data available to us for the two most recent plan years. 78 TABLE OF CONTENTS One of the Company’s subsidiaries was listed in the Eighth District Electrical Pension Fund’s Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan years ended March 31, 2024, 2023 and 2022, in the National Electrical Benefit Fund’s Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan years ended December 31, 2023 and 2022, and in the IBEW local 769 Management Pension Plan A’s Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan years ended June 30, 2023, 2022 and 2021. Another of the company’s subsidiaries was listed in the Southern California IBEW-NECA Pension Trust Fund Plan’s Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan year ended June 30, 2023, 2022 and 2021, and in the IBEW Local 332 Pension Plan Part A’s Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan years ended December 31, 2023 and 2022. The Company also had a subsidiary that was listed in the Laborers Local Union 158 Pension Fund's Form 5500 as providing more than five percent of the total contributions to that plan or was one of the top-ten highest contributors to that plan, for the plan year ended December 31, 2023. 17. Segment Information MYR Group is a holding company of specialty contractors serving electrical utility infrastructure and commercial construction markets in the United States and Canada. The Company has two reporting segments, each a separate operating segment, which are referred to as T&D and C&I. Operating segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM is the Chief Executive Officer. For the CODM’s primary allocation of resources and performance assessment, he receives revenue and income for operations, by segment and excluding general corporate expenses, over multiple time periods, along with a comparison to the corresponding budgeted and prior year totals. General corporate expenses include corporate facility and staffing costs, which includes safety costs, professional fees, IT expenses and certain management fees. The CODM also considers many other factors, such as contract terms, individual project performance, project location and other items when determining performance measurement and resource allocation. Transmission and Distribution: The T&D segment provides a broad range of services on electric transmission and distribution networks and substation facilities which include design, engineering, procurement, construction, upgrade, maintenance and repair services with a particular focus on construction, maintenance and repair. T&D services include the construction and maintenance of high voltage transmission lines, substations and lower voltage underground and overhead distribution systems, clean energy projects and electric vehicle charging infrastructure. The T&D segment also provides emergency restoration services. T&D customers include investor-owned utilities, cooperatives, private developers, government-funded utilities, independent power producers, independent transmission companies, industrial facility owners and other contractors. Commercial and Industrial: The C&I segment provides services such as the design, installation, maintenance and repair of commercial and industrial wiring, the installation of intelligent transportation systems, roadway lighting, signalization and electric vehicle charging infrastructure. Typical C&I contracts cover electrical contracting services for airports, hospitals, data centers, hotels, stadiums, commercial and industrial facilities, clean energy projects, manufacturing plants, processing facilities, water/waste-water treatment facilities, mining facilities, and transportation control and management systems. The C&I segment generally provides electric construction and maintenance services as a subcontractor to general contractors in the C&I industry, but also contracts directly with facility owners. 79 TABLE OF CONTENTS The information in the following tables are derived from the segment’s internal financial reports used for corporate management purposes: For the Year ended December 31, 2024 (in thousands) T&D C&I General Corporate Consolidated Contract revenues $ 1,880,501 $ 1,481,789 $ — $ 3,362,290 Operating costs (1) 1,811,127 1,433,748 63,333 3,308,208 Income from operations 69,374 48,041 ( 63,333 ) 54,082 Other income (expense): Interest income 415 Interest expense ( 6,525 ) Other income (expense), net ( 1,479 ) Income before provision for income taxes 46,493 Income tax expense 16,230 Net income $ 30,263 For the Year ended December 31, 2023 (in thousands) T&D C&I General Corporate Consolidated Contract revenues $ 2,089,196 $ 1,554,709 $ — $ 3,643,905 Operating costs (1) 1,939,493 1,508,820 66,499 3,514,812 Income from operations 149,703 45,889 ( 66,499 ) 129,093 Other income (expense): Interest income 888 Interest expense ( 4,939 ) Other income (expense), net ( 38 ) Income before provision for income taxes 125,004 Income tax expense 34,014 Net income $ 90,990 For the Year ended December 31, 2022 (in thousands) T&D C&I General Corporate Consolidated Contract revenues $ 1,745,792 $ 1,262,750 $ — $ 3,008,542 Operating costs (1) 1,606,906 1,219,591 67,138 2,893,635 Income from operations 138,886 43,159 ( 67,138 ) 114,907 Other income (expense): Interest income 187 Interest expense ( 3,563 ) Other income (expense), net 2,673 Income before provision for income taxes 114,204 Income tax expense 30,823 Net income $ 83,381 (1) Operating costs include T&D, C&I and general corporate portion of contract costs, selling, general and administrative expenses, amortization of intangible assets and gain on sale of property and equipment. The expenses found in these other segment items are generally viewed as operating costs by the CODM and are not considered individually significant segment reporting items. 80 TABLE OF CONTENTS The Company does not identify capital expenditures and total assets by segment in its internal financial reports due in part to the shared use of a centralized fleet of vehicles and specialized equipment. Identifiable assets, consisting of contract receivables, contract assets, construction materials inventory, goodwill and intangibles for each segment are as follows as of December 31: (in thousands) 2024 2023 T&D $ 601,546 $ 632,788 C&I 539,687 502,451 General Corporate 432,826 443,507 $ 1,574,059 $ 1,578,746 An allocation of total depreciation, including depreciation of shared construction equipment, and amortization to each segment is as follows: For the Year ended December 31, (in thousands) 2024 2023 2022 Depreciation and amortization T&D $ 56,624 $ 51,470 $ 50,825 C&I 8,565 7,668 7,345 $ 65,189 $ 59,138 $ 58,170 As of December 31, 2024 and 2023, there were $ 177.9 million and $ 169.0 million, respectively, of identifiable assets attributable to Canadian operations. 18. Earnings Per Share The Company computes earnings per share using the treasury stock method. Under the treasury stock method, basic earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the period plus all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. Net income and the weighted average number of common shares used to compute basic and diluted earnings per share was as follows: For the Year ended December 31, (in thousands, except per share data) 2024 2023 2022 Numerator: Net income $ 30,263 $ 90,990 $ 83,381 Denominator: Weighted average common shares outstanding 16,467 16,682 16,760 Weighted average dilutive securities 59 155 220 Weighted average common shares outstanding, diluted 16,526 16,837 16,980 Net income per share: Basic $ 1.84 $ 5.45 $ 4.98 Diluted $ 1.83 $ 5.40 $ 4.91 81 TABLE OF CONTENTS For the years ended December 31, 2024, 2023 and 2022, certain common stock equivalents were excluded from the calculation of dilutive securities because their inclusion would have been anti-dilutive. The following table summarizes the shares of common stock underlying the Company’s unvested time-vested stock awards and performance awards that were excluded from the calculation of dilutive securities: (in thousands) 2024 2023 2022 Time-vested stock awards 35 — — Performance awards 30 13 13 Share Repurchase Program On May 6, 2024, the Company announced that its Board of Directors had authorized a new $ 75.0 million share repurchase program (the "Repurchase Program") which became effective on May 9, 2024. The Repurchase Program expired on November 8, 2024. The Company’s prior $ 75.0 million repurchase program that commenced on November 9, 2023 expired on May 8, 2024. During 2024 the Company repurchased 643,549 shares of its common stock under multiple repurchase programs at a weighted-average price of $ 116.54 per share. During 2023 the Company repurchased 25,042 shares of its common stock under multiple repurchase programs at a weighted-average price of $ 114.55 per share. All of the shares repurchased were retired. The shares repurchased resulted in no change to authorized shares and an increase to unissued shares. As of December 31, 2024, the Company had exhausted substantially all of the funds available to repurchase shares of the Company’s common stock under the Repurchase Program. During 2024 and 2023, the Company repurchased 36,397 and 76,150 shares of stock, respectively, for approximately $ 5.9 million and $ 7.9 million, respectively, from its employees to satisfy tax obligations on shares vested under the LTIP. All of the shares repurchased were retired and returned to authorized but unissued stock. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.