Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Jan. 16, 2024 | Mar. 31, 2023 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Entity File Number | 001-32998 | ||
Document Transition Report | false | ||
Document Period End Date | Sep. 30, 2023 | ||
Entity Registrant Name | Energy Services of America CORP | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-4606266 | ||
Entity Address, Address Line One | 75 West 3rd Ave. | ||
Entity Address, City or Town | Huntington | ||
Entity Address, Postal Zip Code | 25701 | ||
Entity Address, State or Province | WV | ||
City Area Code | 304 | ||
Local Phone Number | 522-3868 | ||
Title of 12(g) Security | Common Stock, par value $0.0001per share | ||
Trading Symbol | ESOA | ||
Security Exchange Name | NASDAQ | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 16,607,185 | ||
Entity Central Index Key | 0001357971 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --09-30 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 28,138,219 | ||
Auditor Name | Baker Tilly US, LLP | ||
Auditor Location | Pittsburgh, Pennsylvania | ||
Auditor Firm ID | 23 | ||
ICFR Auditor Attestation Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Current assets | ||
Cash and cash equivalents | $ 16,431,572 | $ 7,427,474 |
Accounts receivable trade | 51,219,958 | 38,525,223 |
Allowance for doubtful accounts | (51,063) | (70,310) |
Retainages receivable | 7,589,749 | 4,443,679 |
Other receivables | 516,968 | 10,866 |
Contract assets | 15,955,220 | 16,109,593 |
Prepaid expenses and other | 3,520,178 | 3,945,968 |
Total current assets | 95,182,582 | 70,392,493 |
Property, plant, and equipment, at cost | 84,329,349 | 73,736,433 |
less accumulated depreciation | (47,799,840) | (41,074,646) |
Total fixed assets | 36,529,509 | 32,661,787 |
Right-of-use assets-operating lease | 3,326,405 | 1,611,321 |
Intangible assets, net | 3,383,099 | 3,873,690 |
Goodwill | 4,087,554 | 4,087,554 |
Total assets | 142,509,149 | 112,626,845 |
Current liabilities | ||
Current maturities of long-term debt | 6,107,277 | 4,060,016 |
Lines of credit and short-term borrowings | 19,847,470 | 23,164,851 |
Current maturities of operating lease liabilities | 1,075,815 | 588,653 |
Accounts payable | 22,026,639 | 20,314,408 |
Accrued expenses and other current liabilities | 13,103,944 | 11,266,008 |
Contract liabilities | 17,743,001 | 6,027,578 |
Total current liabilities | 79,904,146 | 65,421,514 |
Long-term debt, less current maturities | 18,870,529 | 13,494,084 |
Long-term operating lease liabilities, less current maturities | 2,274,975 | 1,015,624 |
Deferred tax liability | 6,870,510 | 4,455,079 |
Total liabilities | 107,920,160 | 84,386,301 |
Shareholders' equity | ||
Common stock, $.0001 par value Authorized 50,000,000 shares, 17,885,615 issued and 16,567,185 outstanding at September 30, 2023 and 17,885,615 issued and 16,667,185 outstanding at September 30, 2022 | 1,789 | 1,789 |
Treasury stock, 1,318,430 shares at September 30, 2023 and 1,218,430 at September 30, 2022 | (132) | (122) |
Additional paid in capital | 60,288,745 | 60,508,350 |
Retained deficit | (25,701,413) | (32,269,473) |
Total shareholders' equity | 34,588,989 | 28,240,544 |
Total liabilities and shareholders' equity | $ 142,509,149 | $ 112,626,845 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Sep. 30, 2023 | Sep. 30, 2022 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 17,885,615 | 17,885,615 |
Common stock, shares outstanding | 16,567,185 | 16,667,185 |
Treasury stock, shares | 1,318,430 | 1,218,430 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CONSOLIDATED STATEMENTS OF INCOME | ||
Revenue | $ 304,104,492 | $ 197,590,000 |
Cost of revenues | 267,291,157 | 175,219,252 |
Gross profit | 36,813,335 | 22,370,748 |
Selling and administrative expenses | 23,776,898 | 15,878,138 |
Income from operations | 13,036,437 | 6,492,610 |
Other income (expense) | ||
Interest income | 196 | 576 |
Other nonoperating expense | (287,602) | (248,006) |
Interest expense | (2,406,839) | (987,689) |
Gain on sale of equipment | 34,478 | 755,470 |
Other nonoperating income (expense), Total | (2,659,767) | (479,649) |
Income before income taxes | 10,376,670 | 6,012,961 |
Income tax expense | 2,975,250 | 2,262,646 |
Net income | $ 7,401,420 | $ 3,750,315 |
Weighted average shares outstanding-basic (in shares) | 16,646,086 | 16,323,790 |
Weighted average shares-diluted (in shares) | 16,670,963 | 16,323,790 |
Earnings per share-basic available to common shareholders (in dollars per share) | $ 0.44 | $ 0.23 |
Earnings per share-diluted available to common shareholders (in dollars per share) | $ 0.44 | $ 0.23 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 7,401,420 | $ 3,750,315 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation expense on property, plant, and equipment | 7,316,594 | 5,568,929 |
Accreted interest on PPP loans | 99,789 | 99,758 |
Gain on sale of equipment | (34,478) | (755,470) |
Provision for deferred taxes | 2,415,431 | 2,421,646 |
Provision for loss on contract | 0 | 248,770 |
Amortization of intangible assets | 490,591 | 444,565 |
Accreted interest on notes payable | 54,687 | 49,638 |
Increase in accounts receivable | (12,713,982) | (17,432,706) |
Increase in retainage receivable | (3,146,070) | (3,526,153) |
(Increase) decrease in other receivables | (506,102) | 532,462 |
Decrease (increase) in contract assets | 154,373 | (7,379,191) |
Decrease in prepaid expenses and other | 4,237,434 | 2,940,958 |
Increase in accounts payable | 1,712,231 | 13,029,016 |
Increase in accrued expenses and other current liabilities | 1,870,432 | 5,417,842 |
Increase in contract liabilities | 11,715,423 | 2,874,288 |
Net cash provided by operating activities | 21,067,773 | 8,284,667 |
Cash flows from investing activities: | ||
Investment in property and equipment | (10,822,373) | (5,308,189) |
Acquisition of Ryan Environmental and Ryan Transport | 0 | (4,042,057) |
Proceeds from sales of property and equipment | 647,111 | 1,071,723 |
Net cash used in investing activities | (10,175,262) | (8,278,523) |
Cash flows from financing activities: | ||
Preferred stock redemption | 0 | (1,210,525) |
Borrowings on lines of credit and short-term debt, net of repayments | 1,258,271 | 4,687,099 |
Proceeds from long-term debt | 3,100,000 | 0 |
Treasury stock repurchased | (219,615) | 0 |
Special cash dividend on common stock | (833,360) | 0 |
Principal payments on long-term debt | (5,193,709) | (4,281,983) |
Net cash used in financing activities | (1,888,413) | (805,409) |
Increase (decrease) in cash and cash equivalents | 9,004,098 | (799,265) |
Cash and cash equivalents beginning of period | 7,427,474 | 8,226,739 |
Cash and cash equivalents end of period | 16,431,572 | 7,427,474 |
Supplemental schedule of noncash investing and financing activities: | ||
Purchases of property and equipment under financing agreements | 975,643 | 549,455 |
Prepaid insurance premiums financed | 3,811,644 | 3,352,971 |
Operating line of credit refinanced to long-term note for equipment purchases | 8,487,085 | 0 |
Debt assumed in acquisitions for equipment | 0 | 390,445 |
Sellers' note Tri-State Paving acquisition | 0 | 936,000 |
Note payable to finance Tri-State Paving acquisition | 0 | 7,500,000 |
Common stock issued to finance Tri-State Paving acquisition | 0 | 1,048,218 |
Par value of common stock issued from preferred stock conversion | 0 | 263 |
Operating lease right-of-use assets received in exchange for operating lease liabilities | 2,590,566 | 1,710,032 |
Cash paid during the year for: | ||
Interest | 2,302,976 | 846,129 |
Income taxes | $ 28,589 | $ 50,231 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) | Common Stock | Additional Paid in Capital | Retained Deficit | Treasury Stock | Total |
Balance at the beginning at Sep. 30, 2021 | $ 1,484 | $ 60,670,699 | $ (36,019,788) | $ (122) | $ 24,652,273 |
Balance at the beginning (in shares) at Sep. 30, 2021 | 13,621,406 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 3,750,315 | 3,750,315 | |||
Preferred share redemption, net of accrued dividends | (1,210,525) | (1,210,525) | |||
Preferred share conversion | $ 263 | 263 | |||
Shares issued for Tri-State Paving acquisition | $ 42 | 1,048,176 | 1,048,218 | ||
Shares issued for Tri-State Paving acquisition (in shares) | 419,287 | ||||
Preferred share conversion (in shares) | 2,626,492 | ||||
Balance at the end at Sep. 30, 2022 | $ 1,789 | 60,508,350 | (32,269,473) | (122) | 28,240,544 |
Balance at the end (in shares) at Sep. 30, 2022 | 16,667,185 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 7,401,420 | 7,401,420 | |||
Special cash dividend on common stock ($0.05 per share) | (833,360) | (833,360) | |||
Treasury stock repurchased by Company | (219,605) | (10) | (219,615) | ||
Treasury stock repurchased by Company (in shares) | (100,000) | ||||
Balance at the end at Sep. 30, 2023 | $ 1,789 | $ 60,288,745 | $ (25,701,413) | $ (132) | $ 34,588,989 |
Balance at the end (in shares) at Sep. 30, 2023 | 16,567,185 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parentheticals) | 12 Months Ended |
Sep. 30, 2023 $ / shares | |
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY | |
Dividends on common stock (in dollars per share) | $ 0.05 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 12 Months Ended |
Sep. 30, 2023 | |
BUSINESS AND ORGANIZATION | |
BUSINESS AND ORGANIZATION | 1. BUSINESS AND ORGANIZATION: Energy Services of America Corporation (“Energy Services” or the “Company”), formed in 2006, is a contractor and service company that operates primarily in the mid-Atlantic and central regions of the United States and provides services to customers in the natural gas, petroleum, water distribution, automotive, chemical, and power industries. For the gas industry, the Company is primarily engaged in the construction, replacement and repair of natural gas pipelines and storage facilities for utility companies and private natural gas companies. Energy Services is involved in the construction of both interstate and intrastate pipelines, with an emphasis on the latter. For the oil industry, the Company provides a variety of services relating to pipeline, storage facilities and plant work. For the power, chemical, and automotive industries, the Company provides a full range of electrical and mechanical installations and repairs including substation and switchyard services, site preparation, equipment setting, pipe fabrication and installation, packaged buildings, transformers, and other ancillary work with regards thereto. Energy Services’ other pipeline services include corrosion protection services, horizontal drilling services, liquid pipeline construction, pump station construction, production facility construction, water and sewer pipeline installations, various maintenance and repair services and other services related to pipeline construction. The Company has also added the ability to install broadband and solar electric systems and perform civil and general contracting services. The Company had consolidated operating revenues of $304.1 million for the fiscal year ended September 30, 2023, of which 48.8 % was attributable to electrical, mechanical, and general contract services, 30.3 % to gas and petroleum transmission projects, and 20.9 % to gas & water distributions services. The Company had consolidated operating revenues of $197.6 million for the fiscal year ended September 30, 2022, of which 43.5 % was attributable to electrical, mechanical, and general contract services, 29.5 % to gas and petroleum transmission projects, and 27.0 % to gas & water distributions services . |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue Recognition The Company recognizes revenue as performance obligations are satisfied and control of the promised goods and service is transferred to the customer. For Lump Sum and Unit Price contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward complete satisfaction of the performance obligation(s) using an input (i.e., “cost to cost”) method. For Cost Plus and Time and Material (“T&M”) contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward satisfaction of the performance obligation(s) using an output method. The Company does have certain service and maintenance contracts in which each customer purchase order is considered its own performance obligation recognized over time and would be recognized depending on the type of contract mentioned above. The Company also does certain T&M service work that is generally completed in a short duration and is recognized at a point in time. All contract costs, including those associated with affirmative claims, change orders and back charges, are recorded as incurred and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Contract costs consist of direct costs on contracts, including labor and materials, amounts payable to subcontractors and outside equipment providers, direct overhead costs and internal equipment expense (primarily depreciation, fuel, maintenance, and repairs). The Company recognizes revenue, but not profit, on certain uninstalled materials. Revenue on these uninstalled materials is recognized when the cost is incurred (when control is transferred), but the associated profit is not recognized until the materials are installed. The costs of uninstalled materials are tracked separately within the Company’s accounting software. Pre-contract and bond costs, if required, and mobilization costs on projects are generally immaterial to the total value of the Company’s contracts and are expensed when incurred. As a practical expedient, the Company recognizes these incremental costs as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. For projects expected to last greater than one year, mobilization costs are capitalized as incurred and amortized over the expected duration of the project. For these projects, mobilization costs will be tracked separately in the Company’s accounting software. This includes costs associated with setting up a project lot or lay-down yard, equipment, tool and supply transportation, temporary facilities and utilities and worker qualification and safety training. Contracts may require the Company to warranty that work is performed in accordance with the contract; however, the warranty is not priced separately, and the Company does not offer customers an option to purchase a warranty. Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries, Contractors Rental, Nitro, and Pinnacle. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries. Use of Estimates and Assumptions The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S.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 the reported amounts of income and loss during the reporting period. Actual results could differ materially from those estimates. Cash and Cash Equivalents Energy Services considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Fair Value Measurements The “Fair Value Measurement” Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP and specifies disclosures about fair value measurements. Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The “Fair Value Measurement” Topic establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 Level 2 Level 3 A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying amount for borrowings under the Company’s revolving credit facility approximates fair value because of the variable market interest rate charged to the Company for these borrowings. The fair value of the Company’s long term fixed-rate debt was estimated using a discounted cash flow analysis and a yield rate that was estimated based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $33.8 million at September 30, 2023 was $32.1 million. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $25.1 million at September 30, 2022 was $24.3 million. All other current assets and liabilities are carried at a net realizable value which approximates fair value because of their short duration to maturity. Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable consists of amounts that have been billed to customers. Collateral is generally not required. A majority of the Company’s contracts have monthly billing terms and payment terms within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. Certain construction contracts include retention provisions to provide assurance to our customers that we will perform in accordance with the contract terms and are therefore not considered a financing benefit. The balances billed but not paid by customers pursuant to these provisions generally become due upon completion and acceptance of the project work or products by the customer. We have determined there are no significant financing components in our contracts as of and for the years ended September 30, 2023 and 2022. Retainage billed but not paid pursuant to contract provisions will be due upon completion of the contracts. Based on the Company’s experience, management considers all amounts classified as retainage receivable to be collectible. All retainage receivable amounts are expected to be collected within the next fiscal year. The Company provides an allowance for doubtful accounts when collection of an account or note receivable is considered doubtful, and receivables are written off against the allowance when deemed uncollectible. Inherent in the assessment of the allowance for doubtful accounts are certain judgments and estimates including, among others, the customer’s access to capital, the customer’s willingness or ability to pay, general economic conditions and the ongoing relationship with the customer. Property and Equipment Property and equipment are recorded at cost. Costs which extend the useful lives or increase the productivity of the assets are capitalized, while normal repairs and maintenance that do not extend the useful life or increase productivity of the asset are expensed as incurred. Property and equipment are depreciated principally on the straight-line method over the estimated useful lives of the assets: buildings 39 years; operating equipment and vehicles 5 5 Intangible Assets Acquired intangible assets subject to amortization are amortized on a straight-line basis, which approximates the pattern in which the economic benefit of the respective intangible assets is realized, over their respective estimated useful lives. The definite-lived identifiable intangible assets recognized as part of the Company’s business combinations were initially recorded at their estimated fair value. Impairment of Long-Lived Assets A long-lived asset shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset would be compared to the asset’s carrying amount to determine if a write-down to market value is required. Claims Claims are amounts in excess of the agreed contract price that a contractor seeks to collect from customers or others for customer-caused delays, errors in specifications and designs, contract terminations, change orders in dispute or unapproved as to both scope and price, or other causes of unanticipated additional costs. The Company records revenue on claims that management believes are probable. Revenue from a claim is recorded only to the extent that contract costs relating to the claim have been incurred. Self -Insurance The Company has its workers compensation, general liability and auto insurance through a captive insurance company. While the Company believes that this arrangement has been very beneficial in reducing and stabilizing insurance costs, the Company has to maintain a surety deposit to guarantee payment of premiums. The surety deposit had a balance of $1.9 million and $1.8 million as of September 30, 2023 and 2022, respectively, which is in “Prepaid expenses and other” on the Company’s Consolidated Balance Sheets. Should the captive experience severe losses over an extended period, it could increase the Company’s insurance expense or surety deposit required. Advertising All advertising costs are expensed as incurred. Total advertising expenses were $138,000 and $17,000 for the years ended September 30, 2023 and 2022, respectively. Stock Compensation Plans The Company accounts for its equity-based compensation as prescribed by U.S. GAAP for share-based payments. The Company has adopted a fair value-based method of accounting for employee equity-based plans, whereby compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. As a result, compensation expense relating to stock compensation plans will be reflected in net income as part of “Selling and administrative expenses” on the consolidated statements of income. Income Taxes The Company and all subsidiaries file a consolidated federal and various state income tax returns on a fiscal year basis. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years ending prior to September 30, 2020. The Company follows the liability method of accounting for income taxes in accordance with U.S. GAAP. Under this method, deferred tax assets and liabilities are recorded for future tax consequences of temporary differences between financial reporting and tax bases 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. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. U.S. GAAP also prescribes a comprehensive model for how companies should recognize, measure, present and disclose in their financial statements uncertain tax positions taken or to be taken on a tax return. This evaluation is a two-step process. First, the recognition process determines if it is more likely than not that a tax position will be sustained based on the merits of the tax position upon examination by the appropriate taxing authority. Second, a measurement process is calculated to determine the amount of benefit/expense to recognize in the financial statements if a tax position meets the more likely than not recognition threshold. The tax position is measured at the greatest amount of benefit/expense that is more likely than not of being realized upon ultimate settlement. Any interest and penalty related to the unrecognized tax benefits, as the result of recognition of tax obligations resulting from uncertain tax positions, are included in general and administrative expenses. The Company had not recognized any uncertain tax positions at September 30, 2023 or 2022. Earnings Per Common Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the year, and diluted earnings per share is computed using the weighted average number of common shares outstanding during the year adjusted for all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. Collective Bargaining Agreements Certain Energy Services subsidiaries are party to collective bargaining agreements with unions representing members that are employed by the Company. The agreements require such subsidiaries to pay specified wages and provide certain benefits to the union employees. These agreements expire at various times and have typically been renegotiated and renewed on terms that are similar to the ones contained in the expiring agreements. Under certain collective bargaining agreements, the applicable Energy Services subsidiary is required to make contributions to multi-employer pension plans. If the subsidiary were to cease participation in one or more of these plans, a liability could potentially be assessed related to any underfunding of these plans. The amount of such an assessment, were one to be made, cannot be reasonably estimated. Litigation Costs The Company recognizes reserves when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Litigation costs are expensed as incurred. Treasury Stock When the Company’s stock is retired or repurchased for constructive retirement (with or without an intention to retire the stock formally in accordance with applicable laws), an excess of par or stated value over the cost of treasury shares is credited to additional paid-in capital. New Accounting Pronouncements On October 28, 2021, the FASB released Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. The amendments of this ASU require entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2022. For all other entities they are effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Entities should apply the amendments prospectively to business combinations that occur after the effective date. Early adoption is permitted, including in any interim period, for public business entities for periods for which financial statements have not yet been issued, and for all other entities for periods for which financial statements have not yet been made available for issuance. The Company is currently assessing the effect that ASU 2021-08 will have on their results of operations, financial position, and cash flows; however, the Company does not expect a significant impact. The FASB recently issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance”, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. Entities are required to provide the new disclosures prospectively for all transactions with a government entity that are accounted for under either a grant or a contribution accounting model and are reflected in the financial statements at the date of initially applying the new amendments, and to new transactions entered into after that date. Retrospective application of the guidance is permitted. The Company adopted ASU 2021-10 on October 1, 2022, and its adoption did not have a significant impact on the Company’s consolidated financial statements. |
ACCOUNTING FOR PPP LOANS
ACCOUNTING FOR PPP LOANS | 12 Months Ended |
Sep. 30, 2023 | |
ACCOUNTING FOR PPP LOANS | |
ACCOUNTING FOR PPP LOANS | 3. ACCOUNTING FOR PPP LOANS Due to the economic uncertainties created by COVID-19 and limited operating funds available, the Company applied for loans under the PPP. On April 15, 2020, the Company and its subsidiaries, C.J. Hughes, Contractors Rental and Nitro, entered into separate PPP notes effective April 7, 2020, with its Lender in an aggregate principal amount of $13.1 million pursuant to the PPP Loans. In a special meeting held on April 27, 2020, the Board of Directors of the Company unanimously voted to return $3.3 million of the PPP Loans after discussing the financing needs of the Company and subsidiaries. That left the Company and subsidiaries with $9.8 million in PPP Loans to fund operations. During fiscal year 2021, the Company received notice that the SBA had granted forgiveness of the $9.8 million of PPP Loans and the SBA repaid the Lender in full. The forgiveness was recorded as other income for the fiscal year ended September 30, 2021. During April 2023, management received notification from the SBA that one of the Company’s forgiveness applications related to the PPP Loans was under review. As part of the review, the SBA requested additional payroll information. Additionally, the SBA requested information regarding the ability of the Company’s affiliates to meet SBA size standards and/or PPP corporate maximum limits. The requested information was subsequently provided to the SBA through the Lender. The Company recognizes that there is a possibility that the SBA could reverse its previous determination on the forgiveness of the PPP Loans. As a result of this uncertainty, the Company restated the previously issued financial statements of the Company that were included in the Reports. The Company has recorded a short-term borrowing due to the SBA inquiry for the full $9.8 million, plus accrued interest for all periods presented. During July 2023, management received notification from the SBA that two additional forgiveness applications related to the PPP Loans were under review. As part of the review, the SBA requested information regarding the ability of the Company’s affiliates to meet SBA size standards and/or PPP corporate maximum limits. The requested information was subsequently provided to the SBA through the Lender. Borrowers must retain PPP documentation for at least six years after the date the loan is forgiven or paid in full, and the SBA and SBA Inspector General must be granted these files upon request. The SBA could revisit its forgiveness decision and determine that the Company does not qualify in whole or in part for loan forgiveness and demand repayment of the loans. In addition, it is unknown what type of penalties could be assessed against the Company if the SBA disagrees with the Company’s certification. Any penalties in addition to the potential repayment of the PPP Loans could negatively impact the Company’s business, financial condition and results of operations and prospects. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Sep. 30, 2023 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | 4. REVENUE RECOGNITION Our revenue is primarily derived from construction contracts that can span several quarters. We recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract 2. Identify performance obligations 3. Determine the transaction price 4. Allocate the transaction price 5. Recognize revenue The accuracy of our revenue and profit recognition in a given period depends on the accuracy of our estimates of the cost to complete each project. We believe our experience allows us to create materially reliable estimates. There are a number of factors that can contribute to changes in estimates of contract cost and profitability. The most significant of these include: ● the completeness and accuracy of the original bid; ● costs associated with scope changes; ● changes in costs of labor and/or materials; ● extended overhead and other costs due to owner, weather and other delays; ● subcontractor performance issues; ● changes in productivity expectations; ● site conditions that differ from those assumed in the original bid; ● changes from original design on design-build projects; ● the availability and skill level of workers in the geographic location of the project; ● a change in the availability and proximity of equipment and materials; ● our ability to fully and promptly recover on affirmative claims and back charges for additional contract costs; and ● the customer’s ability to properly administer the contract. The foregoing factors, as well as the stage of completion of contracts in process and the mix of contracts at different margins may cause fluctuations in gross profit from period to period. Significant changes in cost estimates, particularly in our larger, more complex projects, could have a significant effect on our profitability. Our contract assets include cost and estimated earnings in excess of billings that represent amounts earned and reimbursable under contracts, including claim recovery estimates, but have a conditional right for billing and payment such as achievement of milestones or completion of the project. Except for customer affirmative claims, generally, such unbilled amounts will become billable according to the contract terms and generally will be billed and collected over the next three months. Settlement with the customer of outstanding affirmative claims is dependent on the claims resolution process and could extend beyond one year. Based on our historical experience, we generally consider the collection risk related to billable amounts to be low. When events or conditions indicate that it is probable that the amounts outstanding become unbillable, the transaction price and associated contract asset is reduced. Our contract liabilities consist of provisions for losses and billings in excess of costs and estimated earnings. Provisions for losses, if incurred, are recognized in the consolidated statements of income at the uncompleted performance obligation level for total estimated losses in the period that evidence indicates that the estimated total cost of a performance obligation exceeds its estimated total revenue. Billings in excess of costs and estimated earnings are billings to customers on contracts in advance of work performed, including advance payments negotiated as a contract condition. Generally, unearned project-related costs will be earned over the next twelve months. |
DISAGGREGATION OF REVENUE
DISAGGREGATION OF REVENUE | 12 Months Ended |
Sep. 30, 2023 | |
DISAGGREGATION OF REVENUE | |
DISAGGREGATION OF REVENUE | 5 . DISAGGREGATION OF REVENUE The Company disaggregates revenue based on the following lines of service: (1) Gas & Water Distribution, (2) Gas & Petroleum Transmission, and (3) Electrical, Mechanical, & General services and construction. Certain reclassifications have been made to the year ended September 30, 2022, to reflect the current presentation. Our contract types are: Lump Sum, Unit Price, Cost Plus and T&M. The following tables present our disaggregated revenue for the fiscal years ended September 30, 2023 and 2022: Year Ended September 30, 2023 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission & General from contracts Lump sum contracts $ — $ — $ 101,700,805 $ 101,700,805 Unit price contracts 68,066,230 86,738,111 6,110,395 160,914,736 Cost plus and T&M contracts — 609,184 40,879,767 41,488,951 Total revenue from contracts $ 68,066,230 $ 87,347,295 $ 148,690,967 $ 304,104,492 Earned over time $ 25,184,336 $ 86,738,111 $ 107,674,083 $ 219,596,530 Earned at point in time 42,881,894 609,184 41,016,884 84,507,962 Total revenue from contracts $ 68,066,230 $ 87,347,295 $ 148,690,967 $ 304,104,492 Year Ended September 30, 2022 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission & General from contracts Lump sum contracts $ — $ — $ 49,451,175 $ 49,451,175 Unit price contracts 53,311,569 55,637,622 525,092 109,474,283 Cost plus and T&M contracts — 2,630,879 36,033,663 38,664,542 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Earned over time $ 34,493,112 $ 54,551,248 $ 83,557,477 $ 172,601,837 Earned at point in time 18,818,457 3,717,253 2,452,453 24,988,163 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 |
CONTRACT BALANCES
CONTRACT BALANCES | 12 Months Ended |
Sep. 30, 2023 | |
CONTRACT BALANCES | |
CONTRACT BALANCES | 6 . CONTRACT BALANCES The Company’s accounts receivable consists of amounts that have been billed to customers and collateral is generally not required. Most of the Company’s contracts have monthly billing terms; however, billing terms for some are based on project completion. Payment terms are generally within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. During the twelve months ended September 30, 2023, we recognized revenue of $6.0 million that was included in the contract liability balance at September 30, 2022. Accounts receivable-trade, net of allowance for doubtful accounts, contract assets and contract liabilities consisted of the following: September 30, 2023 September 30, 2022 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 51,168,895 $ 38,454,913 $ 12,713,982 Contract assets Cost and estimated earnings in excess of billings $ 15,955,220 $ 16,109,593 $ (154,373) Contract liabilities Billings in excess of cost and estimated earnings $ 17,743,001 $ 6,027,578 $ 11,715,423 |
PERFORMANCE OBLIGATIONS
PERFORMANCE OBLIGATIONS | 12 Months Ended |
Sep. 30, 2023 | |
PERFORMANCE OBLIGATIONS | |
PERFORMANCE OBLIGATIONS | 7. PERFORMANCE OBLIGATIONS The changes in contract transaction price can occur from items such as executed or estimated change orders, and unresolved contract modifications and claims. For the year ended September 30, 2023, there was no significant amount of revenue recognized as a result of changes in contract transaction price related to performance obligations that were satisfied prior to September 30, 2022. For the year ended September 30, 2022, there was no significant amount of revenue recognized as a result of changes in contract transaction price related to performance obligations that were satisfied prior to September 30, 2021. At September 30, 2023, the Company had $147.5 million in remaining unsatisfied performance obligations, in which revenue is expected to be recognized in less than twelve months. |
ALLOWANCE FOR DOUBTFUL ACCOUNTS
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 12 Months Ended |
Sep. 30, 2023 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 8. ALLOWANCE FOR DOUBTFUL ACCOUNTS Activity in the Company’s allowance for doubtful accounts consists of the following: Year Ended September 30, 2023 2022 Balance at beginning of year $ 70,310 $ 70,310 Charged to expense — — Deductions for uncollectible receivables written off, net of recoveries (19,247) — Balance at end of year $ 51,063 $ 70,310 |
UNCOMPLETED CONTRACTS
UNCOMPLETED CONTRACTS | 12 Months Ended |
Sep. 30, 2023 | |
UNCOMPLETED CONTRACTS | |
UNCOMPLETED CONTRACTS | 9. UNCOMPLETED CONTRACTS Costs and estimated earnings in excess of billings on uncompleted contracts are included in contract assets on the Consolidated Balance Sheets. Billings in excess of costs and estimated earnings on uncompleted contracts are included in contract liabilities on the Consolidated Balance Sheets. Costs, estimated earnings, and billings on uncompleted contracts are summarized as follows: September 30, September 30, 2023 2022 Costs incurred on contracts in progress $ 287,347,650 $ 192,957,145 Estimated earnings, net of estimated losses 38,976,895 28,150,060 326,324,545 221,107,205 Less billings to date 328,112,326 211,025,190 $ (1,787,781) $ 10,082,015 Costs and estimated earnings in excess of billings on uncompleted contracts $ 15,955,220 $ 16,109,593 Less billings in excess of costs and estimated earnings on uncompleted contracts 17,743,001 6,027,578 $ (1,787,781) $ 10,082,015 The Company’s unaudited backlog at September 30, 2023, and September 30, 2022, was $229.8 million and $142.3 million, respectively. |
CLAIMS
CLAIMS | 12 Months Ended |
Sep. 30, 2023 | |
CLAIMS | |
CLAIMS | 10. CLAIMS The Company does not have any claims receivable as of September 30, 2023 and 2022. Claims receivable is a component of contract assets. |
PROVISION FOR LOSS
PROVISION FOR LOSS | 12 Months Ended |
Sep. 30, 2023 | |
PROVISION FOR LOSS | |
PROVISION FOR LOSS | 11. PROVISION FOR LOSS The Company did not have a provision for loss at September 30, 2023. The Company had one project with a $248,000 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Sep. 30, 2023 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | 12. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: Year Ended September 30, 2023 2022 Land $ 2,974,354 $ 2,942,190 Buildings and leasehold improvements 10,000,570 9,291,898 Operating equipment and vehicles 70,126,093 60,245,329 Office equipment, furniture and fixtures 1,225,570 1,046,172 Assets not yet in service 2,762 210,844 84,329,349 73,736,433 Less accumulated depreciation 47,799,840 41,074,646 Property, plant and equipment, net $ 36,529,509 $ 32,661,787 |
SHORT-TERM DEBT
SHORT-TERM DEBT | 12 Months Ended |
Sep. 30, 2023 | |
SHORT-TERM DEBT | |
SHORT-TERM DEBT | 13. SHORT-TERM DEBT Operating Line of Credit On July 13, 2022, the Company received a one-year extension on its $15.0 million operating line of credit effective June 28, 2022. The interest rate on the line of credit is the “ Wall Street Journal “Wall Street Journal” The modified financial covenants for the quarter ended June 30, 2023, and all subsequent quarters, are below: ● Minimum tangible net worth of $28.0 million, ● Minimum traditional debt service coverage of 1.50x on a rolling twelve- month basis, ● Minimum current ratio of 1.20x , ● Maximum debt to tangible net worth ratio (“TNW”) of 2.75x , ● Each ratio and covenant shall be determined, tested, and measured as of each calendar quarter beginning June 30, 2023, ● The Company shall maintain a ratio of Maximum Senior Funded Debt (“SFD”) to Earnings before Interest, Taxes, Depreciation and Amortization (“EBDITA”) equal to or less than 3.5 :1. SFD shall mean any funded debt or lease of the Company, other than subordinated debt. The covenant shall be tested quarterly, at the end of each fiscal quarter, with EBITDA based on the preceding four quarters. The Company’s lender has agreed to omit the effect of the PPP loan restatement from the Company’s covenant compliance calculations while a final decision on PPP loan forgiveness remains in question. Thus, the Company was in compliance with all covenants at September 30, 2023. The Company projects to meet all covenant requirements for the next twelve months. Insurance Premiums Financed The Company also finances its captive insurance policy premiums on a short-term basis through a financing company. These insurance policies include workers’ compensation, general liability, automobile, umbrella, and equipment policies. The Company makes a down payment in January and finances the remaining premium amount over eleven monthly payments. At September 30, 2023 and September 30, 2022, the remaining balance of the insurance premiums was $950,000 and $580,000, respectively. Paycheck Protection Program Loans Due to the economic uncertainties created by COVID-19 and limited operating funds available, the Company applied for loans under the PPP. On April 15, 2020, the Company and its subsidiaries, C.J. Hughes, Contractors Rental and Nitro, entered into separate PPP notes effective April 7, 2020, with its Lender in an aggregate principal amount of $13.1 million pursuant to the PPP Loans. In a special meeting held on April 27, 2020, the Board of Directors of the Company unanimously voted to return $3.3 million of the PPP Loans after discussing the financing needs of the Company and subsidiaries. That left the Company and subsidiaries with $9.8 million in PPP Loans to fund operations. During fiscal year 2021, the Company received notice that the SBA had granted forgiveness of the $9.8 million of PPP Loans and the SBA repaid the Lender in full. The forgiveness was recorded as other income for the fiscal year ended September 30, 2021. During April 2023, management received notification from the SBA that one of the Company’s forgiveness applications related to the PPP Loans was under review. As part of the review, the SBA requested additional payroll information. Additionally, the SBA requested information regarding the ability of the Company’s affiliates to meet SBA size standards and/or PPP corporate maximum limits. The requested information was subsequently provided to the SBA through the Lender. The Company recognizes that there is a possibility that the SBA could reverse its previous determination on the forgiveness of the PPP Loans. As a result of this uncertainty, the Company restated the previously audited financial statements of the Company for the fiscal years 2022 and 2021. The Company has recorded a short-term borrowing due to the SBA inquiry for the full $9.8 million, plus accrued interest. During July 2023, management received notification from the SBA that two additional forgiveness applications related to the PPP Loans were under review. As part of the review, the SBA requested information regarding the ability of the Company’s affiliates to meet SBA size standards and/or PPP corporate maximum limits. The requested information was subsequently provided to the SBA through the Lender. Borrowers must retain PPP documentation for at least six years after the date the loan is forgiven or paid in full, and the SBA and SBA Inspector General must be granted these files upon request. The SBA could revisit its forgiveness decision and determine that the Company does not qualify in whole or in part for loan forgiveness and demand repayment of the loans. In addition, it is unknown what type of penalties could be assessed against the Company if the SBA disagrees with the Company’s certification. Any penalties in addition to the potential repayment of the PPP Loans could negatively impact the Company’s business, financial condition and results of operations and prospects. |
SHORT-TERM AND LONG-TERM DEBT
SHORT-TERM AND LONG-TERM DEBT | 12 Months Ended |
Sep. 30, 2023 | |
SHORT-TERM AND LONG-TERM DEBT | |
SHORT-TERM AND LONG-TERM DEBT | 14. SHORT-TERM AND LONG-TERM DEBT A summary of short-term and long-term debt as of September 30, 2023 and 2022 is as follows: 2023 2022 Line of credit payable to bank, variable interest rate of 8.50% at September 30, 2023, final payment due by June 28, 2024, guaranteed by certain directors of the Company. See also Note 5. $ 8,712,915 $ 12,500,000 Paycheck Protection Program loans from Small Business Administration, 1.0% simple interest, initially forgiven in the fiscal year ended September 30, 2021. Final forgiveness decision has not been determined. See also Note 3 10,184,320 10,084,531 Term notes payable to United Bank, WV Pipeline acquisition, due in monthly installments of $64,853, fixed interest at 4.25%, final payment due by March 25, 2026, secured by receivables and equipment, guaranteed by certain directors of the Company. 1,790,051 2,529,421 Notes payable to finance companies, due in monthly installments totaling $50,000 at September 30, 2023 and $60,000 at September 30, 2022, including interest ranging from 0.00% to 6.92%, final payments due October 2023 through August 2026, secured by equipment. 1,290,148 889,165 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $327,000 in FY 2023 and $282,000 in FY 2022, including interest rate at 6.7%, final payment December 2023. 950,235 580,320 Notes payable to bank, due in monthly installments totaling $7,848, including interest at 4.75%, final payment due November 2034 secured by building and property. 813,242 867,383 Notes payable to bank, due in monthly installments totaling $12,580, variable interest of 9.50% at September 30, 2023, final payment due November 2025 secured by building and property, guaranteed by certain directors of the Company. 294,761 412,917 Notes payable to bank, due in monthly installments totaling $59,932, including fixed interest at 6.0%, final payment due October 2027 secured by receivables and equipment, guaranteed by certain directors of the Company. 2,601,404 — Equipment line of credit with a total of $8.5 million of $9.3 million available borrowed at September 30, 2023, fixed interest at 7.25% of outstanding balance due in monthly installments between June 1, 2023 and December 1, 2023. Note payments due in monthly installments, including fixed interest at 7.25%, beginning January 2024 with final payment due February 2028, secured by equipment, guaranteed by certain directors of the Company. 8,487,085 — Notes payable to David Bolton and Daniel Bolton, due in annual installments totaling $500,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 1,660,000 2,380,000 Notes payable to bank, fixed interest at 4.25% of outstanding balance due in monthly installments between January 2021 and January 2022. Note payments due in monthly installments totaling $68,150, including variable interest rate of 9.50% at September 30, 2023, with final payment due September 2026, secured by equipment, guaranteed by certain directors of the Company. 1,873,831 2,549,281 Term notes payable to United Bank, Tri-State Paving acquisition, due in monthly installments of $129,910, fixed interest at 4.50%, final payment due by June 1, 2027, secured by receivables and equipment, guaranteed by certain directors of the Company. 5,698,761 6,982,097 Notes payable to Corns Enterprises, due in annual installments totaling $250,000, including interest at 3.50%, final payment due April 29, 2026, unsecured 468,523 943,836 Total debt $ 44,825,276 $ 40,718,951 Less current maturities 25,954,747 27,224,867 Total long-term debt $ 18,870,529 $ 13,494,084 At September 30, 2023, future expected payments due on short-term and long-term debt are as follows: 2024 $ 25,954,747 2025 6,736,040 2026 5,831,751 2027 3,962,217 2028 1,804,953 Thereafter 535,568 $ 44,825,276 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | 15. INCOME TAXES The components of income taxes are as follows: Year Ended September 30, 2023 2022 Federal Current $ 432,251 $ 78,000 Deferred 1,865,019 1,686,864 Total 2,297,270 1,764,864 State Current 127,568 22,000 Deferred 550,412 475,782 Total 677,980 497,782 Total income tax expense (benefit) $ 2,975,250 $ 2,262,646 The Company’s income tax expense and deferred tax assets and liabilities reflect management’s best estimate of current and future taxes to be paid. Significant judgments and estimates are required in the determination of the consolidated income tax expense. The Company’s provision for income taxes is computed by applying a federal rate of 21.0% and a state rate of 6.0% to taxable income or loss after consideration of non-taxable and non-deductible items. The income tax expense for the fiscal year ended September 30, 2023 was $3.0 million and was due to an increase in taxable income. The income tax expense for the fiscal year ended September 30, 2022, was $2.3 million. The effective income tax rate for the fiscal year ended September 30, 2023 was 28.7%. The effective income tax rate for the fiscal year ended September 30, 2022 was 37.6%. Effective income tax rates are estimates and may vary from period to period due to changes in the amount of taxable income or loss, non-taxable and non-deductible expenses. Year Ended September 30, 2023 2022 Statutory rate 21.0 % 21.0 % State income taxes 6.0 % 6.0 % Non-deductible meals and other 1.7 % 10.0 % Non-deductible PPP Loan interest * 0.6 % Effective tax rate 28.7 % 37.6 % (*Not material) Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, which will result in taxable or deductible amounts in the future. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company had $3.0 million and $10.5 million of federal net operating loss carryforwards at September 30, 2023 and 2022, respectively. The federal net operating loss carryforwards do not expire; however, are limited to 80% of future taxable income. The Company had $23.3 million and $26.4 million of state net operating loss carryforwards at September 30, 2023 and 2022, respectively. The state net operating loss carryforwards begin to expire in 2025. The income tax effects of temporary differences giving rise to the deferred tax assets and liabilities are as follows: Year Ended September 30, 2023 2022 Deferred tax liabilities Property and equipment $ 8,141,025 $ 7,686,064 Other 588,632 7,632 Total deferred tax liabilities $ 8,729,657 $ 7,693,696 Deferred income tax assets Other $ 948,704 $ 404,093 Net operating loss carryforward 910,443 2,834,524 Total deferred tax assets $ 1,859,147 $ 3,238,617 Total net deferred tax liabilities $ 6,870,510 $ 4,455,079 The Company does not believe that it has any unrecognized tax benefits included in its consolidated financial statements that require recognition. The Company has not had any settlements in the current period with taxing authorities, nor has it recognized tax benefits as a result of a lapse of the applicable statute of limitations. The Company recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in general and administrative expenses. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Sep. 30, 2023 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 16. EARNINGS PER SHARE Earnings per share for the years ended September 30, 2023, and 2022 are as follow: Year Ended Year Ended September 30, September 30, 2023 2022 Net income $ 7,401,420 $ 3,750,315 Weighted average shares outstanding-basic 16,646,086 16,323,790 Weighted average shares outstanding-diluted 16,670,963 16,323,790 Earnings per share available to common shareholders $ 0.44 $ 0.23 Earnings per share available to common shareholders-diluted $ 0.44 $ 0.23 The diluted weighted average shares outstanding calculation included a 24,877 dilutive effect for 40,000 restricted stock grants awarded during the twelve months ended September 30, 2023. |
STOCK REPURCHASE PLAN
STOCK REPURCHASE PLAN | 12 Months Ended |
Sep. 30, 2023 | |
STOCK REPURCHASE PLAN | |
STOCK REPURCHASE PLAN | 17. STOCK REPURCHASE PLAN On July 6, 2022, the Company’s Board of Directors authorized a share repurchase program (the “Program”), pursuant to which the Company may, from time to time, purchase shares of its common stock for an aggregate repurchase not to exceed 1,000,000 shares, which is approximately 6.0% of its outstanding common stock. The Program does not obligate the Company to purchase any number of shares, and there is no guarantee as to the exact number of shares to be repurchased by the Company. The repurchases of Energy Services of America Corporation’s shares of its common stock during the twelve months ended September 30, 2023 was as follows: Total Maximum Number of Number of Average Value of Shares Purchased Shares That May Yet Be Shares Price Paid as Part of Publicly Announced Purchased Under Period Purchased Per Share Plans or Programs (1) the Plan or Programs March 1, 2023-March 31, 2023 32,181 $ 2.23 $ 71,655 967,819 April 1, 2023-April 30, 2023 31,047 2.21 68,498 936,772 May 1, 2023-May 30, 2023 36,772 2.16 79,462 900,000 Total 100,000 $ 2.20 $ 219,615 |
LONG TERM INCENTIVE PLAN
LONG TERM INCENTIVE PLAN | 12 Months Ended |
Sep. 30, 2023 | |
LONG TERM INCENTIVE PLAN | |
LONG TERM INCENTIVE PLAN | 18. LONG TERM INCENTIVE PLAN On February 16, 2022, the stockholders of Energy Services approved the Company’s 2022 Equity Incentive Plan (the “Equity Incentive Plan”), which provides for the grant of stock-based awards to officers and employees of the Company and its subsidiaries. The maximum number of shares of stock, in the aggregate, that may be granted under the Equity Incentive Plan as stock options, restricted stock or restricted stock units is 1,500,000 shares. A description of the material terms of the Equity Incentive Plan is contained in the Company’s definitive proxy statement for the Annual Meeting of Stockholders filed with the Securities and Exchange Commission on January 11, 2022. The amount recognized for compensation expense for the twelve months ended September 30, 2023 was not significant. A table of restricted stock grants awarded during the twelve months ended September 30, 2023 are below: Exercised or converted Exercisable or Available at Granted during Forfeited during Expired during Available at convertible at the beginning of during current current fiscal current fiscal current fiscal the end of current fiscal the end of current fiscal current fiscal year fiscal year year year year year year 1,500,000 40,000 (1) — — — 1,460,000 — (1) Restricted stock grant awarded on February 15, 2023 with three year vesting period beginning in February 2024. Shares of unvested restricted stock are excluded from the calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding. Year Vesting Shares 2024 13,334 2025 13,333 2026 13.333 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Sep. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 19. RELATED PARTY TRANSACTIONS We intend that all transactions between us and our executive officers, directors, holders of 10% or more of the shares of any class of our common stock and affiliates thereof, will be on terms no less favorable than those terms given to unaffiliated third parties and will be approved by a majority of our independent outside directors not having any interest in the transaction. On December 16, 2014, the Company’s Nitro subsidiary entered into a 20-year On April 29, 2022, the Company entered into a $1.0 million promissory note agreement with Corns Enterprises as partial consideration for the purchase of Tri-State Paving. This four-year agreement requires $250,000 principal installment payments on or before the end of each twelve (12) full calendar month period beginning April 29, 2022. Interest payments due shall be calculated on the principal balance remaining and shall be at the stated rate of 3.5% per year. The Company has made $500,000 in principal payments on this note as of September 30, 2023. Subsequent to the April 29, 2022 acquisition of Tri-State Paving, the Company entered into an operating lease for facilities in Hurricane, West Virginia with Corns Enterprises. This thirty-six-month lease is treated as a right-of-use asset and has payments of $7,000 per month. The total net present value at inception was $236,000 with a carrying value of $133,000 at September 30, 2023. SQP made an equity investment of $156,000 in 1030 Quarrier Development, LLC (“Development”) in August 2022. Development is a variable interest entity (“VIE”) that is 75% owned by 1030 Quarrier Ventures, LLC (“Ventures”) and 25% owned by SQP. SQP is not the primary beneficiary of the VIE and therefore will not consolidate Development into its consolidated financial statements. Instead, SQP will apply the equity method of accounting for its investment in Development. Development, a 1% owner, and United Bank, a 99% owner, formed 1030 Quarrier Landlord, LLC (“Landlord”). Landlord decided to pursue the following development project (the “Project”): a historical building at 1030 Quarrier Street, Charleston, West Virginia as well as associated land (the “Property”) was purchased to be developed/rehabilitated into a commercial project including apartments and commercial space. Upon the completion of development, the Property will be used to generate rental income. SQP has been awarded the construction contract for the Project. United Bank provided $5.0 million in loans to fund the Project. SQP and Ventures have jointly provided an unconditional guarantee for the $5.0 million of obligations associated with the Project. Other than mentioned above, there were no new material related party transactions entered into during the fiscal year ended September 30, 2023. Certain Energy Services subsidiaries routinely engage in transactions in the normal course of business with each other, including sharing employee benefit plan coverage, payment for insurance and other expenses on behalf of other affiliates, and other services incidental to business of each of the affiliates. All revenue and related expense transactions, as well as the related accounts payable and accounts receivable have been eliminated in consolidation. |
LEASE OBLIGATIONS
LEASE OBLIGATIONS | 12 Months Ended |
Sep. 30, 2023 | |
LEASE OBLIGATIONS | |
LEASE OBLIGATIONS | 20. LEASE OBLIGATIONS The Company leases office space for SQP for $1,500 per month. The lease, which was originally signed on March 25, 2021, is for a period of two years with five one-year renewals available immediately following the end of the base term. The Company has only committed to a one-year renewal and is evaluating the intent to renew for additional periods. The Company has two lease agreements for construction equipment with a combined amount of $160,000. The leases have a term of twenty-two months with a stated interest rate of 0%, combined monthly installment payments of $6,645 and are cancellable at any time without penalty. The Company has the right to purchase the equipment at the expiration of the leases by applying the two-month deposit paid. The related assets and finance lease obligations associated with these lease agreements are included in the consolidated balance sheets within property, plant and equipment and long-term debt. The Company has two right-of-use operating leases acquired on April 29, 2022, as part of the Tri-State Paving, LLC transaction. The first operating lease, for the Hurricane, West Virginia facility, had a net present value of $236,000 at inception, and a carrying value of $133,000 at September 30, 2023. The second operating lease, for the Chattanooga, Tennessee facility, had a net present value of $144,000 at inception, and a carrying value of $57,000 at September 30, 2023. The 4.5% interest rate on the operating leases is based on the Company’s incremental borrowing rate at inception. The Company has a right-of-use operating lease with Enterprise acquired on August 11, 2022, as part of the Ryan Environmental acquisition. This lease agreement was initially for thirty-one vehicles with a net present value of $1.2 million. The Company subsequently netted forty-one additional leased vehicles with a net present value of $2.4 million. The right-of-use operating lease has a carrying value of $2.9 million at September 30, 2023. Each vehicle leased under the master lease program has its own implicit rate ranging from 12.8% to 15.6%. The Company has a right-of-use operating lease with RICA Developers, LLC acquired on August 12, 2022, as part of the Ryan Environmental acquisition. This lease, for the Bridgeport, West Virginia facility, had a net present value of $140,000 at inception and no carrying value at September 30, 2023. The 4.5% interest rate on the operating lease was based on the Company’s incremental borrowing rate at inception. The Company has signed a one-year renewal agreement effective October 1, 2023 through September 30, 2024. The Company has a right-of-use operating lease acquired on March 28, 2023. This lease, for the Winchester, Kentucky facility, had a net present value of $290,000 at inception and a carrying value of $262,000 at September 30, 2023. The 7.75% interest rate on the operating lease is based on the Company’s incremental borrowing rate at inception. Schedules related to the Company’s operating leases at fiscal year ended September 30, 2023 can be found below: Operating Lease-Weighted Average Remaining Term Present value of Years left remaining liability Lease end Fiscal year end Operating lease 1 1.6 $ 133,000 4/30/2025 2025 Operating lease 2 0.7 57,031 5/31/2024 2024 Operating lease 3 3.7 2,898,588 8/10/2026 2027 Operating lease 4 0.0 — 9/30/2023 2023 Operating lease 5 2.5 262,171 3/31/2026 2026 $ 3,350,790 Weighted average remaining term 3.4 years Operating Lease Maturity Schedule 2024 $ 1,205,658 2025 1,097,808 2026 969,003 2027 326,022 3,598,491 Less amounts representing interest (247,701) Present value of operating lease liabilities $ 3,350,790 Year ended Year ended September 30, September 30, Operating Lease Expense 2023 2022 Amortization Operating lease 1 $ 72,267 $ 30,933 Operating lease 2 62,001 25,554 Operating lease 3 568,114 22,672 Operating lease 4 113,480 19,552 Operating lease 5 28,191 — Total amortization 844,053 98,711 Interest Operating lease 1 7,355 4,067 Operating lease 2 3,825 2,411 Operating lease 3 87,416 4,360 Operating lease 4 2,802 964 Operating lease 5 11,391 — 112,789 11,802 Total amortization and interest $ 956,842 $ 110,513 Year ended Year ended September 30, September 30, Cash Paid for Operating Leases 2023 2022 Operating lease 1 $ 79,622 $ 35,000 Operating lease 2 65,826 27,965 Operating lease 3 655,530 27,032 Operating lease 4 116,282 27,561 Operating lease 5 39,582 — $ 956,842 $ 117,558 The Company rents equipment for use on construction projects with rental agreements being week to week or month to month. Rental expense can vary by fiscal year due to equipment requirements on construction projects and the availability of Company owned equipment. Rental expense, which is included in cost of goods sold on the consolidated statements of income, was $12.1 million and $9.8 million for the years ended September 30, 2023, and 2022, respectively. |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Sep. 30, 2023 | |
MAJOR CUSTOMERS | |
MAJOR CUSTOMERS | 21. MAJOR CUSTOMERS The tables below present customers that represent 10.0% or more of the Company’s revenue or accounts receivable, net of retention as of or for the fiscal years ended September 30, 2023, and 2022: Revenue FY 2023 FY 2022 TransCanada Corporation 13.9 % 16.6 % NiSource and subsidiaries 17.5 % * % All other 68.6 % 83.4 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Accounts receivable, net of retention FY 2023 FY 2022 NiSource and subsidiaries 11.8 % * % TransCanada Corporation * % 11.6 % All other 88.2 % 88.4 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Virtually all work performed for major customers was awarded under competitive bid fixed price or unit price arrangements. The loss of a major customer could have a severe impact on the profitability of the operations of the Company. However, due to the nature of the Company’s operations, the major customers and sources of revenues may change from year to year. |
RETIREMENT AND EMPLOYEE BENEFIT
RETIREMENT AND EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Sep. 30, 2023 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | 22. RETIREMENT AND EMPLOYEE BENEFIT PLANS In 2023 and 2022, C. J. Hughes maintained a tax-qualified 401(k) retirement plan for union employees. Employees can contribute up to 15% of eligible wages, provided the compensation deferred for a plan year does not exceed the indexed dollar amount set by the Internal Revenue Service which was $22,500 for 2023 and $20,500 for 2022. C. J. Hughes matches $0.25 on each dollar contributed up to 6% of eligible wages. C. J. Hughes contributed $17,000 and $22,000 to the union plan for the fiscal years September 30, 2023 and 2022, respectively. Additionally, each plan year, C. J. Hughes may make a discretionary profit-sharing contribution for participants who are actively employed on the last day of the plan year. No discretionary profit-sharing contribution was made for the 2023 or 2022 plan year. Effective January 1, 2010, Energy Services became the successor plan sponsor of the C. J. Hughes Construction Company, Inc. 401(k) Plan for non-union employees (the “Plan”). The Plan was renamed the Energy Services of America Staff 401(k) Retirement Savings Plan. Employees are eligible to participate in the Plan upon completion of six months of service but must wait until a quarterly entry to join the Plan. In addition, participants who are age 50 or older by the end of the Plan year may elect to defer up to an additional $7,500 into the Plan for 2023. Energy Services may make annual discretionary matching contributions and/or profit-sharing contributions to the Plan. The matching contribution formula for the Plan was 100% of each dollar contributed for the first 3% of eligible wages and 50% of each dollar contributed for the next 3% of eligible wages. The Company’s matching contribution is used by the Plan’s third-party administrator to purchase Energy Services of America common stock from the open market. No restrictions on the match exist after it has been contributed. No profit-sharing contribution was made for the 2023 or 2022 plan year. Energy Services and its wholly owned subsidiaries contributed $599,000 and $402,000, respectively, for the fiscal years ended September 30, 2023, and 2022 to the Plan. The Company contributes to a number of multi-employers defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multi-employer plans are different from single-employer plans in the following aspects: ● Assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers. If participating employers stop contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. ● If the Company chooses to stop participating in some of its multi-employer plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. The following table presents our participation in these plans: Contributions of Pension Protection Act (“PPA”) Energy Services Certified Zone Status (1) FIP/RP Status Companies Expiration Date of EIN/Pension Pending/ Surcharge Collective Bargaining Pension Fund Plan Number 2022 2021 Implemented (2) 2023 2022 Imposed Agreement Central States, Southeast and Southwest Areas Pension Fund 36-6044243/001 Red Red Implemented $ 160,566 $ 123,142 no Various Employer-Teamsters Local Nos. 175 and 505 55-6021850/001 Red Red Implemented — — no Various Laborers National Pension Fund 75-1280827/001 Red Red Implemented 46,167 384,908 no Various Laborers’ District Council of Western Pennsylvania Pension Plan 25-6135576/001 Yellow Yellow Implemented — 269,915 no Various Operating Engineers Local 324 Pension Fund 38-1900637/001 Red Red Implemented 837 66,757 no Various National Automatic Sprinkler Industry Pension Fund 52-6054620/001 Red Red Implemented 214,590 199,984 no Various Iron Workers District Council of Southern Ohio &Vicinity Pension Trust 31-6038516/001 Green Yellow Implemented 279,998 208,588 no Various Carpenters Pension Fund of WV 55-6027998/001 Red Red Implemented 907,515 719,665 no Various Plumbers & Pipefitters National Pension Fund 52-6152779/001 Yellow Yellow Implemented 817,059 660,324 no Various Sheet Metal Workers’ National Pension Fund 52-6112463/001 Yellow Yellow Implemented 188,749 175,643 no Various Plumbers and Steamfitters Local 577 Pension Fund 31-6134953/001 Red Red Implemented 5,623 — no Various All Other Green Green 8,978,053 3,611,624 no Various $ 11,599,157 $ 6,420,550 (1) The most recent PPA zone status available in 2023 and 2022 is the plan’s year-end during 2022 and 2021, respectively. The zone status is based on information that we received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the orange zone are less than 80 percent funded and have an Accumulated Funding Deficiency in the current year or projected into the next six years, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. (2) Indicates whether the plan has a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) which is either pending or has been implemented. The Company currently does not have any intention of withdrawing from any of the multi-employer pension plans in which it participates. On November 12, 2021, the Company received a withdrawal liability claim from a pension plan to which the Company made pension contributions for union construction employees performing covered work in a particular jurisdiction. The Company has not performed covered work in their jurisdiction since 2011; however, the Company disagrees with the withdrawal claim and believes it is covered by an exemption under federal law. The demand called for thirty-four quarterly installment payments of $41,000 starting December 15, 2021. The Company must comply with the demand under federal pension law; however, the Company firmly believes no withdrawal liability exists. The Company is in negotiations with the pension fund to resolve the matter and all future payments have been suspended as part of the negotiation. The Company has expensed all $164,000 in payments made through September 30, 2022, and does not expect any future liabilities related to this claim. The Company made no payments during the twelve months ended September 30, 2023. |
CREDIT RISK
CREDIT RISK | 12 Months Ended |
Sep. 30, 2023 | |
CREDIT RISK | |
CREDIT RISK | 23. CREDIT RISK Financial instruments which potentially subject the Company to credit risk consist primarily of cash, cash equivalents and contract receivables. The Company places its cash with high quality financial institutions. At times, the balances in such institutions may exceed the FDIC insurance limit of $250,000 per depositor, per insured bank, for each account ownership category. FDIC insurance covers all deposit accounts, including checking accounts, savings accounts, money market deposit accounts, and certificates of deposit. As of September 30, 2023, the Company had $15.0 million of uninsured deposits. The Company performs periodic credit evaluations of its customer’s financial condition and generally does not require collateral. Consequently, the Company is subject to potential credit risk related to business and economic factors that would affect these companies. However, the Company generally has certain statutory lien rights with respect to services provided. Credit losses consistently have been within management’s expectations. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Sep. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 24. COMMITMENTS AND CONTINGENCIES During the normal course of operations, the Company is subject to certain subcontractor claims, mechanic’s liens, and other litigation. Management is of the opinion that no material obligations will arise from any pending legal proceedings. Accordingly, no provision has been made in the financial statements for such litigation. Some customers, particularly new ones or governmental agencies require the Company to post bid bonds, performance bonds and payment bonds (collectively, performance bonds). These performance bonds are obtained through insurance carriers and guarantee to the customer that we will perform under the terms of a contract and that we will pay subcontractors and vendors. If the Company fails to perform under a contract or to pay subcontractors and vendors, the customer may demand that the insurer make payments or provide services under the bond. The Company must reimburse the insurer for any expenses or outlays it is required to make. In February 2014, the Company entered into an agreement with a surety company to provide bonding which will suit the Company’s immediate needs. The ability to obtain bonding for future contracts is an important factor in the contracting industry with respect to the type and value of contracts that can be bid on. Depending upon the size and conditions of a particular contract, the Company may be required to post letters of credit or other collateral in favor of the insurer. Posting these letters or other collateral will reduce our borrowing capabilities. The Company does not anticipate any claims in the foreseeable future. At September 30, 2023, the Company had $72.0 million in performance bonds outstanding. In the fiscal year 2020, the Company received $9.8 million in PPP Loans. The Company believes it meets the SBA’s certification requirement based on its limited access to capital, weakened business operations during the pandemic and small market value. The Company’s shares of common stock did not trade on a national exchange at that time. However, no assurance can be given as to the outcome if the SBA re-evaluates the Company’s loan certification. The SBA could determine that the Company does not qualify in whole or in part for loan forgiveness. In addition, it is unknown what type of penalties could be assessed against the Company if the SBA disagrees with the Company’s certification. The Company could be required to repay its PPP Loans. Any penalties in addition to the potential repayment of the PPP Loans could negatively impact the Company’s business, financial condition and results of operations and prospects. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Sep. 30, 2023 | |
ACQUISITIONS | |
ACQUISITIONS | 25. Energy Services accounts for business combinations under the acquisition method in accordance with ASC Topic 805 “Business Combinations”. Accordingly, for the transaction, the purchase price is allocated to the fair value of the assets acquired and liabilities assumed as of the date of the acquisition. In conjunction with ASC 805, upon receipt of final fair value estimates during the measurement period, which must be within one year of the acquisition date, Energy Services records any adjustments to the preliminary fair value estimates in the reporting period in which the adjustments are determined. On April 29, 2022, the Company completed the acquisition of Tri-State Paving LLC, located in Hurricane, West Virginia. Pursuant to the Asset Purchase Agreement (“Agreement”) signed on April 6, 2022, and amended on April 29, 2022, the Company acquired substantially all the assets (including but not limited to customer contracts, employees, and equipment) of Tri-State Paving, LLC for $7.5 million in cash, a $1.0 million promissory note, and $1.0 million in Energy Services common stock. The $7.5 million in cash was funded through a loan from United Bank and the transaction resulted in the issuance of 419,287 common shares. As part of the Agreement, the Company entered into a four-year, $1.0 million note that requires $250,000 principal installment payments on or before the end of each twelve (12) full calendar month period beginning on the date of the Note, April 29, 2022. Interest payments due shall be calculated on the principal balance remaining and shall be at the stated rate of 3.5% per year. The non-cash purchase price, including $390,000 of debt assumed, for the Tri-State Paving acquisition is allocated in the table below: Property and equipment $ 5,709,094 Goodwill 2,273,237 Customer relationships 1,649,159 Non-compete 39,960 Tradename 203,213 Total $ 9,874,663 Tri-State Paving earned revenues of $4.9 million from April 29, 2022 through September 30, 2022 and $13.5 million for the twelve months ended September 30, 2023. ASC 805-10-50-2 requires public companies that present comparative financial statements to present pro forma financial statements as though the business combination that occurred during the current fiscal year had occurred as of the beginning of the comparable prior annual reporting period. As allowed under ASC 805-10-50-2, the Company finds this information impracticable to provide for the periods presented due to the lack of availability of meaningful financial statements of the acquired companies that comply with U.S. GAAP. On August 11, 2022, Ryan Construction, a newly formed wholly owned subsidiary of Energy Services, completed the acquisition of Ryan Environmental, located in Bridgeport, WV, pursuant to an order issued by the United States Bankruptcy Court for the Northern District of West Virginia (the “Court”) on August 9, 2022 and Ryan Transport, located in Bridgeport, West Virginia, under the terms of an Asset Purchase Agreement. As part of the business combination, the Company acquired certain assets, including equipment, vehicles, and small tools, of Ryan Environmental for $3.0 million in cash and certain assets, including equipment and small tools, of Ryan Transport for $1.0 million in cash. The purchase price for the Ryan Environmental and Ryan Transport acquisitions is allocated in the table below: Property and equipment $ 3,237,559 Accounts receivable 677,254 Unbilled receivable 127,244 Total $ 4,042,057 Ryan Construction earned revenues of $852,000 from August 11, 2022 through September 30, 2022 and $8.1 million for the twelve months ended September 30, 2023. ASC 805-10-50-2 requires public companies that present comparative financial statements to present pro forma financial statements as though the business combination that occurred during the current fiscal year had occurred as of the beginning of the comparable prior annual reporting period. As allowed under ASC 805-10-50-2, the Company finds this information impracticable to provide for the periods presented due to the lack of availability of meaningful financial statements of the acquired companies that comply with U.S. GAAP. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | 26. GOODWILL AND INTANGIBLE ASSETS The Company follows the guidance of ASC 350-20-35-3 “Intangibles-Goodwill and Other (Topic 350)” which requires a company to record an impairment charge based on the excess of a reporting unit’s carrying amount of goodwill over its fair value. Under the current guidance, companies can first choose to assess any impairment based on qualitative factors (Step 0). If a company fails this test or decides to bypass this step, it must proceed with a quantitative assessment of goodwill impairment. The Company did not have a goodwill impairment at September 30, 2023 or 2022. A table of the Company’s goodwill is below: September 30, September 30, 2023 2022 Beginning balance $ 4,087,554 $ 1,814,317 Acquired — 2,273,237 Ending balance $ 4,087,554 $ 4,087,554 A table of the Company’s intangible assets subject to amortization at September 30, 2023, is below: Accumulated Accumulated Amortization and Amortization and Amortization and Amortization and Impairment Impairment Net Book Remaining Life at Impairment at Impairment at Twelve Months Ended Twelve Months Ended Value September 30, Original September 30, September 30, September 30, September 30, September 30, Intangible assets: 2023 Cost 2023 2022 2023 2022 2023 West Virginia Pipeline: Customer Relationships 87 months $ 2,209,724 $ 607,661 $ 386,693 $ 220,968 $ 220,968 $ 1,602,063 Tradename 87 months 263,584 72,500 46,136 26,364 26,364 191,084 Non-competes - months 83,203 83,203 72,806 10,397 41,604 — Revolt Energy: Employment agreement/non-compete - months 100,000 100,000 77,779 22,221 63,890 — Tri-State Paving: Customer Relationships 103 months 1,649,159 233,631 66,781 166,850 66,781 1,415,528 Tradename 103 months 203,213 28,789 8,368 20,421 8,368 174,424 Non-competes - months 39,960 39,960 16,590 23,370 16,590 — Total intangible assets $ 4,548,843 $ 1,165,744 $ 675,153 $ 490,591 $ 444,565 $ 3,383,099 Amortization expense associated with the identifiable intangible assets is expected to be as follows: Amortization Expense 2024 $ 432,564 2025 432,564 2026 432,564 2027 432,564 2028 432,564 After 1,220,279 Total $ 3,383,099 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Sep. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 27. SUBSEQUENT EVENTS On November 15, 2023, the Company’s Board of Directors approved an annual dividend of $0.06 per common share. The 2024 dividend was paid on January 2, 2024 to holders of record as of December 15, 2023. While this is expected to be an annual dividend, factors such as income from operations, cash flows, and overall financial outlook may affect future dividend payments. Management has evaluated all subsequent events for accounting and disclosure. There have been no other material events during the period, other than noted above, that would either impact the results reflected in the report or the Company’s results going forward. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Revenue Recognition | Revenue Recognition The Company recognizes revenue as performance obligations are satisfied and control of the promised goods and service is transferred to the customer. For Lump Sum and Unit Price contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward complete satisfaction of the performance obligation(s) using an input (i.e., “cost to cost”) method. For Cost Plus and Time and Material (“T&M”) contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward satisfaction of the performance obligation(s) using an output method. The Company does have certain service and maintenance contracts in which each customer purchase order is considered its own performance obligation recognized over time and would be recognized depending on the type of contract mentioned above. The Company also does certain T&M service work that is generally completed in a short duration and is recognized at a point in time. All contract costs, including those associated with affirmative claims, change orders and back charges, are recorded as incurred and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Contract costs consist of direct costs on contracts, including labor and materials, amounts payable to subcontractors and outside equipment providers, direct overhead costs and internal equipment expense (primarily depreciation, fuel, maintenance, and repairs). The Company recognizes revenue, but not profit, on certain uninstalled materials. Revenue on these uninstalled materials is recognized when the cost is incurred (when control is transferred), but the associated profit is not recognized until the materials are installed. The costs of uninstalled materials are tracked separately within the Company’s accounting software. Pre-contract and bond costs, if required, and mobilization costs on projects are generally immaterial to the total value of the Company’s contracts and are expensed when incurred. As a practical expedient, the Company recognizes these incremental costs as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. For projects expected to last greater than one year, mobilization costs are capitalized as incurred and amortized over the expected duration of the project. For these projects, mobilization costs will be tracked separately in the Company’s accounting software. This includes costs associated with setting up a project lot or lay-down yard, equipment, tool and supply transportation, temporary facilities and utilities and worker qualification and safety training. Contracts may require the Company to warranty that work is performed in accordance with the contract; however, the warranty is not priced separately, and the Company does not offer customers an option to purchase a warranty. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries, Contractors Rental, Nitro, and Pinnacle. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S.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 the reported amounts of income and loss during the reporting period. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Energy Services considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Fair Value Measurements | Fair Value Measurements The “Fair Value Measurement” Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP and specifies disclosures about fair value measurements. Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The “Fair Value Measurement” Topic establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 Level 2 Level 3 A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying amount for borrowings under the Company’s revolving credit facility approximates fair value because of the variable market interest rate charged to the Company for these borrowings. The fair value of the Company’s long term fixed-rate debt was estimated using a discounted cash flow analysis and a yield rate that was estimated based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $33.8 million at September 30, 2023 was $32.1 million. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $25.1 million at September 30, 2022 was $24.3 million. All other current assets and liabilities are carried at a net realizable value which approximates fair value because of their short duration to maturity. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable consists of amounts that have been billed to customers. Collateral is generally not required. A majority of the Company’s contracts have monthly billing terms and payment terms within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. Certain construction contracts include retention provisions to provide assurance to our customers that we will perform in accordance with the contract terms and are therefore not considered a financing benefit. The balances billed but not paid by customers pursuant to these provisions generally become due upon completion and acceptance of the project work or products by the customer. We have determined there are no significant financing components in our contracts as of and for the years ended September 30, 2023 and 2022. Retainage billed but not paid pursuant to contract provisions will be due upon completion of the contracts. Based on the Company’s experience, management considers all amounts classified as retainage receivable to be collectible. All retainage receivable amounts are expected to be collected within the next fiscal year. The Company provides an allowance for doubtful accounts when collection of an account or note receivable is considered doubtful, and receivables are written off against the allowance when deemed uncollectible. Inherent in the assessment of the allowance for doubtful accounts are certain judgments and estimates including, among others, the customer’s access to capital, the customer’s willingness or ability to pay, general economic conditions and the ongoing relationship with the customer. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Costs which extend the useful lives or increase the productivity of the assets are capitalized, while normal repairs and maintenance that do not extend the useful life or increase productivity of the asset are expensed as incurred. Property and equipment are depreciated principally on the straight-line method over the estimated useful lives of the assets: buildings 39 years; operating equipment and vehicles 5 5 |
Intangible Assets | Intangible Assets Acquired intangible assets subject to amortization are amortized on a straight-line basis, which approximates the pattern in which the economic benefit of the respective intangible assets is realized, over their respective estimated useful lives. The definite-lived identifiable intangible assets recognized as part of the Company’s business combinations were initially recorded at their estimated fair value. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets A long-lived asset shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset would be compared to the asset’s carrying amount to determine if a write-down to market value is required. |
Claims | Claims Claims are amounts in excess of the agreed contract price that a contractor seeks to collect from customers or others for customer-caused delays, errors in specifications and designs, contract terminations, change orders in dispute or unapproved as to both scope and price, or other causes of unanticipated additional costs. The Company records revenue on claims that management believes are probable. Revenue from a claim is recorded only to the extent that contract costs relating to the claim have been incurred. |
Self-Insurance | Self -Insurance The Company has its workers compensation, general liability and auto insurance through a captive insurance company. While the Company believes that this arrangement has been very beneficial in reducing and stabilizing insurance costs, the Company has to maintain a surety deposit to guarantee payment of premiums. The surety deposit had a balance of $1.9 million and $1.8 million as of September 30, 2023 and 2022, respectively, which is in “Prepaid expenses and other” on the Company’s Consolidated Balance Sheets. Should the captive experience severe losses over an extended period, it could increase the Company’s insurance expense or surety deposit required. |
Advertising | Advertising All advertising costs are expensed as incurred. Total advertising expenses were $138,000 and $17,000 for the years ended September 30, 2023 and 2022, respectively. |
Stock Compensation Plans | Stock Compensation Plans The Company accounts for its equity-based compensation as prescribed by U.S. GAAP for share-based payments. The Company has adopted a fair value-based method of accounting for employee equity-based plans, whereby compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. As a result, compensation expense relating to stock compensation plans will be reflected in net income as part of “Selling and administrative expenses” on the consolidated statements of income. |
Income Taxes | Income Taxes The Company and all subsidiaries file a consolidated federal and various state income tax returns on a fiscal year basis. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years ending prior to September 30, 2020. The Company follows the liability method of accounting for income taxes in accordance with U.S. GAAP. Under this method, deferred tax assets and liabilities are recorded for future tax consequences of temporary differences between financial reporting and tax bases 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. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. U.S. GAAP also prescribes a comprehensive model for how companies should recognize, measure, present and disclose in their financial statements uncertain tax positions taken or to be taken on a tax return. This evaluation is a two-step process. First, the recognition process determines if it is more likely than not that a tax position will be sustained based on the merits of the tax position upon examination by the appropriate taxing authority. Second, a measurement process is calculated to determine the amount of benefit/expense to recognize in the financial statements if a tax position meets the more likely than not recognition threshold. The tax position is measured at the greatest amount of benefit/expense that is more likely than not of being realized upon ultimate settlement. Any interest and penalty related to the unrecognized tax benefits, as the result of recognition of tax obligations resulting from uncertain tax positions, are included in general and administrative expenses. The Company had not recognized any uncertain tax positions at September 30, 2023 or 2022. |
Earnings Per Common Share | Earnings Per Common Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the year, and diluted earnings per share is computed using the weighted average number of common shares outstanding during the year adjusted for all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. |
Collective Bargaining Agreements | Collective Bargaining Agreements Certain Energy Services subsidiaries are party to collective bargaining agreements with unions representing members that are employed by the Company. The agreements require such subsidiaries to pay specified wages and provide certain benefits to the union employees. These agreements expire at various times and have typically been renegotiated and renewed on terms that are similar to the ones contained in the expiring agreements. Under certain collective bargaining agreements, the applicable Energy Services subsidiary is required to make contributions to multi-employer pension plans. If the subsidiary were to cease participation in one or more of these plans, a liability could potentially be assessed related to any underfunding of these plans. The amount of such an assessment, were one to be made, cannot be reasonably estimated. |
Litigation Costs | Litigation Costs The Company recognizes reserves when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Litigation costs are expensed as incurred. |
Treasury Stock | Treasury Stock When the Company’s stock is retired or repurchased for constructive retirement (with or without an intention to retire the stock formally in accordance with applicable laws), an excess of par or stated value over the cost of treasury shares is credited to additional paid-in capital. |
New Accounting Pronouncements | New Accounting Pronouncements On October 28, 2021, the FASB released Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. The amendments of this ASU require entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2022. For all other entities they are effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Entities should apply the amendments prospectively to business combinations that occur after the effective date. Early adoption is permitted, including in any interim period, for public business entities for periods for which financial statements have not yet been issued, and for all other entities for periods for which financial statements have not yet been made available for issuance. The Company is currently assessing the effect that ASU 2021-08 will have on their results of operations, financial position, and cash flows; however, the Company does not expect a significant impact. The FASB recently issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance”, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. Entities are required to provide the new disclosures prospectively for all transactions with a government entity that are accounted for under either a grant or a contribution accounting model and are reflected in the financial statements at the date of initially applying the new amendments, and to new transactions entered into after that date. Retrospective application of the guidance is permitted. The Company adopted ASU 2021-10 on October 1, 2022, and its adoption did not have a significant impact on the Company’s consolidated financial statements. |
DISAGGREGATION OF REVENUE (Tabl
DISAGGREGATION OF REVENUE (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
DISAGGREGATION OF REVENUE | |
Schedule of disaggregation of revenue | Year Ended September 30, 2023 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission & General from contracts Lump sum contracts $ — $ — $ 101,700,805 $ 101,700,805 Unit price contracts 68,066,230 86,738,111 6,110,395 160,914,736 Cost plus and T&M contracts — 609,184 40,879,767 41,488,951 Total revenue from contracts $ 68,066,230 $ 87,347,295 $ 148,690,967 $ 304,104,492 Earned over time $ 25,184,336 $ 86,738,111 $ 107,674,083 $ 219,596,530 Earned at point in time 42,881,894 609,184 41,016,884 84,507,962 Total revenue from contracts $ 68,066,230 $ 87,347,295 $ 148,690,967 $ 304,104,492 Year Ended September 30, 2022 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission & General from contracts Lump sum contracts $ — $ — $ 49,451,175 $ 49,451,175 Unit price contracts 53,311,569 55,637,622 525,092 109,474,283 Cost plus and T&M contracts — 2,630,879 36,033,663 38,664,542 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Earned over time $ 34,493,112 $ 54,551,248 $ 83,557,477 $ 172,601,837 Earned at point in time 18,818,457 3,717,253 2,452,453 24,988,163 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 |
CONTRACT BALANCES (Tables)
CONTRACT BALANCES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
CONTRACT BALANCES | |
Schedule of accounts receivable-trade, net of allowance for doubtful accounts, contract assets and contract liabilities | September 30, 2023 September 30, 2022 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 51,168,895 $ 38,454,913 $ 12,713,982 Contract assets Cost and estimated earnings in excess of billings $ 15,955,220 $ 16,109,593 $ (154,373) Contract liabilities Billings in excess of cost and estimated earnings $ 17,743,001 $ 6,027,578 $ 11,715,423 |
ALLOWANCE FOR DOUBTFUL ACCOUN_2
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
Schedule of allowance for doubtful accounts receivable | Year Ended September 30, 2023 2022 Balance at beginning of year $ 70,310 $ 70,310 Charged to expense — — Deductions for uncollectible receivables written off, net of recoveries (19,247) — Balance at end of year $ 51,063 $ 70,310 |
UNCOMPLETED CONTRACTS (Tables)
UNCOMPLETED CONTRACTS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
UNCOMPLETED CONTRACTS | |
Schedule of costs, estimated earnings and billings on uncompleted contracts | September 30, September 30, 2023 2022 Costs incurred on contracts in progress $ 287,347,650 $ 192,957,145 Estimated earnings, net of estimated losses 38,976,895 28,150,060 326,324,545 221,107,205 Less billings to date 328,112,326 211,025,190 $ (1,787,781) $ 10,082,015 Costs and estimated earnings in excess of billings on uncompleted contracts $ 15,955,220 $ 16,109,593 Less billings in excess of costs and estimated earnings on uncompleted contracts 17,743,001 6,027,578 $ (1,787,781) $ 10,082,015 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of property, plant and equipment | Year Ended September 30, 2023 2022 Land $ 2,974,354 $ 2,942,190 Buildings and leasehold improvements 10,000,570 9,291,898 Operating equipment and vehicles 70,126,093 60,245,329 Office equipment, furniture and fixtures 1,225,570 1,046,172 Assets not yet in service 2,762 210,844 84,329,349 73,736,433 Less accumulated depreciation 47,799,840 41,074,646 Property, plant and equipment, net $ 36,529,509 $ 32,661,787 |
SHORT-TERM AND LONG-TERM DEBT (
SHORT-TERM AND LONG-TERM DEBT (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
SHORT-TERM AND LONG-TERM DEBT | |
Schedule of short-term and long-term debt | 2023 2022 Line of credit payable to bank, variable interest rate of 8.50% at September 30, 2023, final payment due by June 28, 2024, guaranteed by certain directors of the Company. See also Note 5. $ 8,712,915 $ 12,500,000 Paycheck Protection Program loans from Small Business Administration, 1.0% simple interest, initially forgiven in the fiscal year ended September 30, 2021. Final forgiveness decision has not been determined. See also Note 3 10,184,320 10,084,531 Term notes payable to United Bank, WV Pipeline acquisition, due in monthly installments of $64,853, fixed interest at 4.25%, final payment due by March 25, 2026, secured by receivables and equipment, guaranteed by certain directors of the Company. 1,790,051 2,529,421 Notes payable to finance companies, due in monthly installments totaling $50,000 at September 30, 2023 and $60,000 at September 30, 2022, including interest ranging from 0.00% to 6.92%, final payments due October 2023 through August 2026, secured by equipment. 1,290,148 889,165 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $327,000 in FY 2023 and $282,000 in FY 2022, including interest rate at 6.7%, final payment December 2023. 950,235 580,320 Notes payable to bank, due in monthly installments totaling $7,848, including interest at 4.75%, final payment due November 2034 secured by building and property. 813,242 867,383 Notes payable to bank, due in monthly installments totaling $12,580, variable interest of 9.50% at September 30, 2023, final payment due November 2025 secured by building and property, guaranteed by certain directors of the Company. 294,761 412,917 Notes payable to bank, due in monthly installments totaling $59,932, including fixed interest at 6.0%, final payment due October 2027 secured by receivables and equipment, guaranteed by certain directors of the Company. 2,601,404 — Equipment line of credit with a total of $8.5 million of $9.3 million available borrowed at September 30, 2023, fixed interest at 7.25% of outstanding balance due in monthly installments between June 1, 2023 and December 1, 2023. Note payments due in monthly installments, including fixed interest at 7.25%, beginning January 2024 with final payment due February 2028, secured by equipment, guaranteed by certain directors of the Company. 8,487,085 — Notes payable to David Bolton and Daniel Bolton, due in annual installments totaling $500,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 1,660,000 2,380,000 Notes payable to bank, fixed interest at 4.25% of outstanding balance due in monthly installments between January 2021 and January 2022. Note payments due in monthly installments totaling $68,150, including variable interest rate of 9.50% at September 30, 2023, with final payment due September 2026, secured by equipment, guaranteed by certain directors of the Company. 1,873,831 2,549,281 Term notes payable to United Bank, Tri-State Paving acquisition, due in monthly installments of $129,910, fixed interest at 4.50%, final payment due by June 1, 2027, secured by receivables and equipment, guaranteed by certain directors of the Company. 5,698,761 6,982,097 Notes payable to Corns Enterprises, due in annual installments totaling $250,000, including interest at 3.50%, final payment due April 29, 2026, unsecured 468,523 943,836 Total debt $ 44,825,276 $ 40,718,951 Less current maturities 25,954,747 27,224,867 Total long-term debt $ 18,870,529 $ 13,494,084 |
Schedule of future expected payments due on short-term and long-term debt | 2024 $ 25,954,747 2025 6,736,040 2026 5,831,751 2027 3,962,217 2028 1,804,953 Thereafter 535,568 $ 44,825,276 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
Schedule of components of income taxes | Year Ended September 30, 2023 2022 Federal Current $ 432,251 $ 78,000 Deferred 1,865,019 1,686,864 Total 2,297,270 1,764,864 State Current 127,568 22,000 Deferred 550,412 475,782 Total 677,980 497,782 Total income tax expense (benefit) $ 2,975,250 $ 2,262,646 |
Schedule of effective income tax rates are estimates taxable income or loss, non-taxable and non-deductible expenses | Year Ended September 30, 2023 2022 Statutory rate 21.0 % 21.0 % State income taxes 6.0 % 6.0 % Non-deductible meals and other 1.7 % 10.0 % Non-deductible PPP Loan interest * 0.6 % Effective tax rate 28.7 % 37.6 % (*Not material) |
Schedule of income tax effects to deferred tax assets and liabilities | Year Ended September 30, 2023 2022 Deferred tax liabilities Property and equipment $ 8,141,025 $ 7,686,064 Other 588,632 7,632 Total deferred tax liabilities $ 8,729,657 $ 7,693,696 Deferred income tax assets Other $ 948,704 $ 404,093 Net operating loss carryforward 910,443 2,834,524 Total deferred tax assets $ 1,859,147 $ 3,238,617 Total net deferred tax liabilities $ 6,870,510 $ 4,455,079 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
EARNINGS PER SHARE | |
Schedule of earnings per share | Year Ended Year Ended September 30, September 30, 2023 2022 Net income $ 7,401,420 $ 3,750,315 Weighted average shares outstanding-basic 16,646,086 16,323,790 Weighted average shares outstanding-diluted 16,670,963 16,323,790 Earnings per share available to common shareholders $ 0.44 $ 0.23 Earnings per share available to common shareholders-diluted $ 0.44 $ 0.23 |
STOCK REPURCHASE PLAN (Tables)
STOCK REPURCHASE PLAN (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
STOCK REPURCHASE PLAN | |
Schedule of stock repurchases during the period | Total Maximum Number of Number of Average Value of Shares Purchased Shares That May Yet Be Shares Price Paid as Part of Publicly Announced Purchased Under Period Purchased Per Share Plans or Programs (1) the Plan or Programs March 1, 2023-March 31, 2023 32,181 $ 2.23 $ 71,655 967,819 April 1, 2023-April 30, 2023 31,047 2.21 68,498 936,772 May 1, 2023-May 30, 2023 36,772 2.16 79,462 900,000 Total 100,000 $ 2.20 $ 219,615 |
LONG TERM INCENTIVE PLAN (Table
LONG TERM INCENTIVE PLAN (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
LONG TERM INCENTIVE PLAN | |
Schedule of restricted stock grants awarded | Exercised or converted Exercisable or Available at Granted during Forfeited during Expired during Available at convertible at the beginning of during current current fiscal current fiscal current fiscal the end of current fiscal the end of current fiscal current fiscal year fiscal year year year year year year 1,500,000 40,000 (1) — — — 1,460,000 — (1) Restricted stock grant awarded on February 15, 2023 with three year vesting period beginning in February 2024. Shares of unvested restricted stock are excluded from the calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding. |
Schedule of vesting shares during the period | Year Vesting Shares 2024 13,334 2025 13,333 2026 13.333 |
LEASE OBLIGATIONS (Tables)
LEASE OBLIGATIONS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
LEASE OBLIGATIONS | |
Schedule of information about operating leases | Operating Lease-Weighted Average Remaining Term Present value of Years left remaining liability Lease end Fiscal year end Operating lease 1 1.6 $ 133,000 4/30/2025 2025 Operating lease 2 0.7 57,031 5/31/2024 2024 Operating lease 3 3.7 2,898,588 8/10/2026 2027 Operating lease 4 0.0 — 9/30/2023 2023 Operating lease 5 2.5 262,171 3/31/2026 2026 $ 3,350,790 Weighted average remaining term 3.4 years Year ended Year ended September 30, September 30, Operating Lease Expense 2023 2022 Amortization Operating lease 1 $ 72,267 $ 30,933 Operating lease 2 62,001 25,554 Operating lease 3 568,114 22,672 Operating lease 4 113,480 19,552 Operating lease 5 28,191 — Total amortization 844,053 98,711 Interest Operating lease 1 7,355 4,067 Operating lease 2 3,825 2,411 Operating lease 3 87,416 4,360 Operating lease 4 2,802 964 Operating lease 5 11,391 — 112,789 11,802 Total amortization and interest $ 956,842 $ 110,513 |
Schedule of cash paid for operating leases | Year ended Year ended September 30, September 30, Cash Paid for Operating Leases 2023 2022 Operating lease 1 $ 79,622 $ 35,000 Operating lease 2 65,826 27,965 Operating lease 3 655,530 27,032 Operating lease 4 116,282 27,561 Operating lease 5 39,582 — $ 956,842 $ 117,558 |
Schedule of operating lease maturity schedule | Operating Lease Maturity Schedule 2024 $ 1,205,658 2025 1,097,808 2026 969,003 2027 326,022 3,598,491 Less amounts representing interest (247,701) Present value of operating lease liabilities $ 3,350,790 |
MAJOR CUSTOMERS (Tables)
MAJOR CUSTOMERS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
MAJOR CUSTOMERS | |
Schedule of Company's revenue or accounts receivable net | Revenue FY 2023 FY 2022 TransCanada Corporation 13.9 % 16.6 % NiSource and subsidiaries 17.5 % * % All other 68.6 % 83.4 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Accounts receivable, net of retention FY 2023 FY 2022 NiSource and subsidiaries 11.8 % * % TransCanada Corporation * % 11.6 % All other 88.2 % 88.4 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable |
RETIREMENT AND EMPLOYEE BENEF_2
RETIREMENT AND EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |
Schedule of multi-employer defined benefit pension plans | Contributions of Pension Protection Act (“PPA”) Energy Services Certified Zone Status (1) FIP/RP Status Companies Expiration Date of EIN/Pension Pending/ Surcharge Collective Bargaining Pension Fund Plan Number 2022 2021 Implemented (2) 2023 2022 Imposed Agreement Central States, Southeast and Southwest Areas Pension Fund 36-6044243/001 Red Red Implemented $ 160,566 $ 123,142 no Various Employer-Teamsters Local Nos. 175 and 505 55-6021850/001 Red Red Implemented — — no Various Laborers National Pension Fund 75-1280827/001 Red Red Implemented 46,167 384,908 no Various Laborers’ District Council of Western Pennsylvania Pension Plan 25-6135576/001 Yellow Yellow Implemented — 269,915 no Various Operating Engineers Local 324 Pension Fund 38-1900637/001 Red Red Implemented 837 66,757 no Various National Automatic Sprinkler Industry Pension Fund 52-6054620/001 Red Red Implemented 214,590 199,984 no Various Iron Workers District Council of Southern Ohio &Vicinity Pension Trust 31-6038516/001 Green Yellow Implemented 279,998 208,588 no Various Carpenters Pension Fund of WV 55-6027998/001 Red Red Implemented 907,515 719,665 no Various Plumbers & Pipefitters National Pension Fund 52-6152779/001 Yellow Yellow Implemented 817,059 660,324 no Various Sheet Metal Workers’ National Pension Fund 52-6112463/001 Yellow Yellow Implemented 188,749 175,643 no Various Plumbers and Steamfitters Local 577 Pension Fund 31-6134953/001 Red Red Implemented 5,623 — no Various All Other Green Green 8,978,053 3,611,624 no Various $ 11,599,157 $ 6,420,550 (1) The most recent PPA zone status available in 2023 and 2022 is the plan’s year-end during 2022 and 2021, respectively. The zone status is based on information that we received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the orange zone are less than 80 percent funded and have an Accumulated Funding Deficiency in the current year or projected into the next six years, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. (2) Indicates whether the plan has a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) which is either pending or has been implemented. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
Tri-State Paving | |
ACQUISITIONS | |
Schedule of allocation of purchase price for the cash and non-cash | Property and equipment $ 5,709,094 Goodwill 2,273,237 Customer relationships 1,649,159 Non-compete 39,960 Tradename 203,213 Total $ 9,874,663 |
Ryan Environmental and Ryan Transport | |
ACQUISITIONS | |
Schedule of allocation of purchase price for the cash and non-cash | Property and equipment $ 3,237,559 Accounts receivable 677,254 Unbilled receivable 127,244 Total $ 4,042,057 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND INTANGIBLE ASSETS | |
Summary of changes in goodwill | September 30, September 30, 2023 2022 Beginning balance $ 4,087,554 $ 1,814,317 Acquired — 2,273,237 Ending balance $ 4,087,554 $ 4,087,554 |
Schedule of intangible assets subject to amortization | Accumulated Accumulated Amortization and Amortization and Amortization and Amortization and Impairment Impairment Net Book Remaining Life at Impairment at Impairment at Twelve Months Ended Twelve Months Ended Value September 30, Original September 30, September 30, September 30, September 30, September 30, Intangible assets: 2023 Cost 2023 2022 2023 2022 2023 West Virginia Pipeline: Customer Relationships 87 months $ 2,209,724 $ 607,661 $ 386,693 $ 220,968 $ 220,968 $ 1,602,063 Tradename 87 months 263,584 72,500 46,136 26,364 26,364 191,084 Non-competes - months 83,203 83,203 72,806 10,397 41,604 — Revolt Energy: Employment agreement/non-compete - months 100,000 100,000 77,779 22,221 63,890 — Tri-State Paving: Customer Relationships 103 months 1,649,159 233,631 66,781 166,850 66,781 1,415,528 Tradename 103 months 203,213 28,789 8,368 20,421 8,368 174,424 Non-competes - months 39,960 39,960 16,590 23,370 16,590 — Total intangible assets $ 4,548,843 $ 1,165,744 $ 675,153 $ 490,591 $ 444,565 $ 3,383,099 |
Schedule of amortization on identifiable intangible assets | Amortization Expense 2024 $ 432,564 2025 432,564 2026 432,564 2027 432,564 2028 432,564 After 1,220,279 Total $ 3,383,099 |
BUSINESS AND ORGANIZATION (Deta
BUSINESS AND ORGANIZATION (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
BUSINESS AND ORGANIZATION | ||
Operating revenue | $ 304,104,492 | $ 197,590,000 |
Gas & Water Distribution | ||
BUSINESS AND ORGANIZATION | ||
Operating revenue | $ 68,066,230 | $ 53,311,569 |
Percentage of revenue | 20.90% | 27% |
Gas & Petroleum Transmission | ||
BUSINESS AND ORGANIZATION | ||
Operating revenue | $ 87,347,295 | $ 58,268,501 |
Percentage of revenue | 30.30% | 29.50% |
Electrical, Mechanical, and General | ||
BUSINESS AND ORGANIZATION | ||
Percentage of revenue | 48.80% | 43.50% |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Aggregate principal amount of fixed-rate debt | $ 33,800,000 | $ 25,100,000 |
Fair value of aggregate principal amount of debt | 32,100,000 | 24,300,000 |
Surety deposit balance | 1,900,000 | 1,800,000 |
Advertising Expense | $ 138,000 | $ 17,000 |
Buildings | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Estimated useful lives | 39 years | |
Minimum | Operating equipment and vehicles | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Estimated useful lives | 5 years | |
Minimum | Office equipment, furniture and fixtures | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Estimated useful lives | 5 years | |
Maximum | Operating equipment and vehicles | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Estimated useful lives | 7 years | |
Maximum | Office equipment, furniture and fixtures | ||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Estimated useful lives | 7 years |
ACCOUNTING FOR PPP LOANS (Detai
ACCOUNTING FOR PPP LOANS (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Apr. 27, 2020 | Apr. 30, 2023 | Sep. 30, 2020 | Apr. 07, 2020 | |
ACCOUNTING FOR PPP LOANS | ||||
PPP loans received | $ 9.8 | |||
PPP Loans | ||||
ACCOUNTING FOR PPP LOANS | ||||
Lender aggregate principal amount | $ 13.1 | |||
Unanimously voted to return loans | $ 3.3 | |||
Amount of PPP loans to fund operations | 9.8 | |||
PPP loans received | $ 9.8 | |||
Short-term borrowings due to accrued interest | $ 9.8 |
DISAGGREGATION OF REVENUE (Deta
DISAGGREGATION OF REVENUE (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
DISAGGREGATION OF REVENUE | ||
Operating revenue | $ 304,104,492 | $ 197,590,000 |
Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 219,596,530 | 172,601,837 |
Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 84,507,962 | 24,988,163 |
Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 101,700,805 | 49,451,175 |
Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 160,914,736 | 109,474,283 |
Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 41,488,951 | 38,664,542 |
Gas & Water Distribution | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 68,066,230 | 53,311,569 |
Gas & Water Distribution | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 25,184,336 | 34,493,112 |
Gas & Water Distribution | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 42,881,894 | 18,818,457 |
Gas & Water Distribution | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 0 | 0 |
Gas & Water Distribution | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 68,066,230 | 53,311,569 |
Gas & Water Distribution | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 0 | 0 |
Gas & Petroleum Transmission | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 87,347,295 | 58,268,501 |
Gas & Petroleum Transmission | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 86,738,111 | 54,551,248 |
Gas & Petroleum Transmission | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 609,184 | 3,717,253 |
Gas & Petroleum Transmission | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 0 | 0 |
Gas & Petroleum Transmission | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 86,738,111 | 55,637,622 |
Gas & Petroleum Transmission | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 609,184 | 2,630,879 |
Electrical, Mechanical, & General | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 148,690,967 | 86,009,930 |
Electrical, Mechanical, & General | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 107,674,083 | 83,557,477 |
Electrical, Mechanical, & General | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 41,016,884 | 2,452,453 |
Electrical, Mechanical, & General | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 101,700,805 | 49,451,175 |
Electrical, Mechanical, & General | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | 6,110,395 | 525,092 |
Electrical, Mechanical, & General | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Operating revenue | $ 40,879,767 | $ 36,033,663 |
CONTRACT BALANCES - Accounts re
CONTRACT BALANCES - Accounts receivable-trade, net of allowance for doubtful accounts (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CONTRACT BALANCES | ||
Accounts receivable-trade, net of allowance for doubtful accounts | $ 51,168,895 | $ 38,454,913 |
Change in accounts receivable-trade, net of allowance for doubtful accounts | 12,713,982 | 17,432,706 |
Contract assets | ||
Cost and estimated earnings in excess of billings | 15,955,220 | 16,109,593 |
Change in cost and estimated earnings in excess of billings | (154,373) | 7,379,191 |
Contract liabilities | ||
Billings in excess of cost and estimated earnings | 17,743,001 | 6,027,578 |
Change in billings in excess of cost and estimated earnings | $ 11,715,423 | $ 2,874,288 |
CONTRACT BALANCES - Additional
CONTRACT BALANCES - Additional information (Details) $ in Millions | 12 Months Ended |
Sep. 30, 2023 USD ($) | |
CONTRACT BALANCES | |
Recognized revenue included in contract liability | $ 6 |
Minimum | |
CONTRACT BALANCES | |
Billing and payment term | 30 days |
Maximum | |
CONTRACT BALANCES | |
Billing and payment term | 45 days |
PERFORMANCE OBLIGATIONS (Detail
PERFORMANCE OBLIGATIONS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
PERFORMANCE OBLIGATIONS | ||
Recognized revenue | $ 0 | $ 0 |
Amount of remaining unsatisfied performance obligations | $ 147,500,000 |
ALLOWANCE FOR DOUBTFUL ACCOUN_3
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Allowance for Doubtful Accounts Receivable | ||
Balance at beginning of year | $ 70,310 | $ 70,310 |
Charged to expense | 0 | 0 |
Deductions for uncollectible receivables written off, net of recoveries | (19,247) | 0 |
Balance at end of year | $ 51,063 | $ 70,310 |
UNCOMPLETED CONTRACTS - Summary
UNCOMPLETED CONTRACTS - Summary of costs, estimated earnings, and billings on uncompleted contracts (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
UNCOMPLETED CONTRACTS | ||
Costs incurred on contracts in progress | $ 287,347,650 | $ 192,957,145 |
Estimated earnings, net of estimated losses | 38,976,895 | 28,150,060 |
Costs of uncompleted contracts including net estimated earnings | 326,324,545 | 221,107,205 |
Less billings to date | 328,112,326 | 211,025,190 |
Unbilled contracts | (1,787,781) | 10,082,015 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 15,955,220 | 16,109,593 |
Billings in excess of cost and estimated earnings | 17,743,001 | 6,027,578 |
Unbilled contracts receivable | $ (1,787,781) | $ 10,082,015 |
UNCOMPLETED CONTRACTS - Backlog
UNCOMPLETED CONTRACTS - Backlog (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Sep. 30, 2022 |
UNCOMPLETED CONTRACTS | ||
Backlog | $ 229.8 | $ 142.3 |
PROVISION FOR LOSS (Details)
PROVISION FOR LOSS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
PROVISION FOR LOSS | ||
Provision for loss on contract | $ 0 | $ 248,770 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | $ 84,329,349 | $ 73,736,433 |
Less accumulated depreciation | 47,799,840 | 41,074,646 |
Total fixed assets | 36,529,509 | 32,661,787 |
Land | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 2,974,354 | 2,942,190 |
Buildings and leasehold improvements | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 10,000,570 | 9,291,898 |
Operating equipment and vehicles | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 70,126,093 | 60,245,329 |
Office equipment, furniture and fixtures | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 1,225,570 | 1,046,172 |
Assets not yet in service | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | $ 2,762 | $ 210,844 |
SHORT-TERM DEBT (Details)
SHORT-TERM DEBT (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||
Apr. 27, 2020 | Apr. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2020 | Jan. 19, 2023 | Jul. 13, 2022 | Apr. 07, 2020 | |
SHORT-TERM AND LONG-TERM DEBT | ||||||||
Insurance policy premium outstanding | $ 950,000 | $ 580,000 | ||||||
PPP loans received | $ 9,800,000 | |||||||
PPP Loans | ||||||||
SHORT-TERM AND LONG-TERM DEBT | ||||||||
Lender aggregate principal amount | $ 13,100,000 | |||||||
Unanimously voted to return loans | $ 3,300,000 | |||||||
Amount of PPP loans to fund operations | 9,800,000 | |||||||
PPP loans received | $ 9,800,000 | |||||||
Short-term borrowings due to accrued interest | $ 9,800,000 | |||||||
Revolving credit facility | United Bank, Inc. | ||||||||
SHORT-TERM AND LONG-TERM DEBT | ||||||||
Line of credit | $ 12,500,000 | $ 30,000,000 | $ 15,000,000 | |||||
Interest rate on the line of credit description | “Wall Street Journal” Prime Rate | |||||||
Interest rate on line of credit | 4.50% | 4.99% | ||||||
Interest rate | 8.50% | 5.50% | ||||||
Amount available to borrowing | $ 8,700,000 | |||||||
Amount of loan covenants | 23,900,000 | |||||||
Minimum tangible net worth | $ 28,000,000 | |||||||
Minimum traditional debt service coverage ratio | 1.50x | |||||||
Minimum current ratio | 1.20x | |||||||
Maximum debt to tangible net worth ratio | 2.75x | |||||||
Ratio to be maintained by borrower for maximum senior funded debt to EBDITA | 3.5 |
SHORT-TERM AND LONG-TERM DEBT -
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | $ 44,825,276 | $ 40,718,951 |
Less current maturities | 25,954,747 | 27,224,867 |
Total long term debt | 18,870,529 | 13,494,084 |
Line of credit payable to bank, final payment due by June 28, 2024 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 8,712,915 | 12,500,000 |
Paycheck Protection Program loans from Small Business Administration, 1.0% simple interest, initially forgiven in the fiscal year ended September 30, 2021. Final forgiveness decision has not been determined. | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 10,184,320 | 10,084,531 |
Term note payable to United Bank, WV Pipeline acquisition, final payment due by March 25, 2026 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 1,790,051 | 2,529,421 |
Notes payable to finance companies due October 2023 through August 2026 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 1,290,148 | 889,165 |
Notes payable to finance companies, final payment, due by december 2023 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 950,235 | 580,320 |
Notes payable to bank, final payment due November 2034 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 813,242 | 867,383 |
Notes payable to bank, final payment due November 2025 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 294,761 | 412,917 |
Notes payable to banks due October 2027 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 2,601,404 | |
Notes payable secured by equipment due by February 2028 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 8,487,085 | |
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 1,660,000 | 2,380,000 |
Notes payable to bank, monthly interest rate at 9.50, final payment due September 2026 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 1,873,831 | 2,549,281 |
Term notes payable to United Bank, Tri-State Paving acquisition, final payment due by June 1, 2027 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | 5,698,761 | 6,982,097 |
Notes payable to Corns Enterprises, final payment due April 29, 2026 | ||
SHORT-TERM AND LONG-TERM DEBT | ||
Total debt | $ 468,523 | $ 943,836 |
SHORT-TERM AND LONG-TERM DEBT_2
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Details) (Parenthetical) - USD ($) | 12 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 | |
SHORT-TERM AND LONG-TERM DEBT | |||
Debt instrument face amount | $ 33,800,000 | $ 25,100,000 | |
Line of credit payable to bank, final payment due by June 28, 2024 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 8.50% | ||
Paycheck Protection Program loans from Small Business Administration, 1.0% simple interest, initially forgiven in the fiscal year ended September 30, 2021. Final forgiveness decision has not been determined. | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 1% | ||
Term note payable to United Bank, WV Pipeline acquisition, final payment due by March 25, 2026 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 4.25% | ||
Note payable in monthly or annual installments | $ 64,853 | ||
Notes payable to finance companies due October 2023 through August 2026 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Note payable in monthly or annual installments | $ 50,000 | 60,000 | |
Notes payable to finance companies due October 2023 through August 2026 | Minimum | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 0% | ||
Notes payable to finance companies due October 2023 through August 2026 | Maximum | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 6.92% | ||
Notes payable to finance companies, final payment, due by december 2023 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 6.70% | ||
Note payable in monthly or annual installments | $ 327,000 | $ 282,000 | |
Notes payable to bank, final payment due November 2034 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 4.75% | ||
Note payable in monthly or annual installments | $ 7,848 | ||
Notes payable to bank, final payment due November 2025 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 9.50% | ||
Note payable in monthly or annual installments | $ 12,580 | ||
Notes payable to banks due October 2027 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 6% | ||
Note payable in monthly or annual installments | $ 59,932 | ||
Notes payable secured by equipment due by February 2028 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 7.25% | ||
Debt instrument face amount | $ 8,500,000 | ||
Amount available to borrowing | $ 9,300,000 | ||
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 3.25% | ||
Note payable in monthly or annual installments | $ 500,000 | ||
Notes payable to bank, monthly interest rate at 9.50, final payment due September 2026 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 4.25% | ||
Note payable in monthly or annual installments | $ 68,150 | ||
Notes payable to bank, monthly interest rate at 9.50, final payment due September 2026 | Minimum | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 9.50% | ||
Term notes payable to United Bank, Tri-State Paving acquisition, final payment due by June 1, 2027 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 4.50% | ||
Debt instrument face amount | $ 129,910 | ||
Notes payable to Corns Enterprises, final payment due April 29, 2026 | |||
SHORT-TERM AND LONG-TERM DEBT | |||
Interest rate | 3.50% | ||
Debt instrument face amount | $ 250,000 |
SHORT-TERM AND LONG-TERM DEBT_3
SHORT-TERM AND LONG-TERM DEBT - future expected payments due on short-term and long-term debt (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
SHORT-TERM AND LONG-TERM DEBT | ||
2024 | $ 25,954,747 | |
2025 | 6,736,040 | |
2026 | 5,831,751 | |
2027 | 3,962,217 | |
2028 | 1,804,953 | |
Thereafter | 535,568 | |
Total debt | $ 44,825,276 | $ 40,718,951 |
INCOME TAXES - Components of in
INCOME TAXES - Components of income taxes (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Federal | ||
Current | $ 432,251 | $ 78,000 |
Deferred | 1,865,019 | 1,686,864 |
Total | 2,297,270 | 1,764,864 |
State | ||
Current | 127,568 | 22,000 |
Deferred | 550,412 | 475,782 |
Total | 677,980 | 497,782 |
Total income tax expense (benefit) | $ 2,975,250 | $ 2,262,646 |
INCOME TAXES - Summary of effec
INCOME TAXES - Summary of effective income tax rates are estimates taxable income or loss, non-taxable and non-deductible expenses (Details) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
INCOME TAXES | ||
Statutory rate | 21% | 21% |
State income taxes | 6% | 6% |
Non-deductible meals and other | 1.70% | 10% |
Non-deductible PPP Loan interest | 0.60% | |
Effective tax rate | 28.70% | 37.60% |
INCOME TAXES - Summary of incom
INCOME TAXES - Summary of income tax effects to deferred tax assets and liabilities (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
Deferred tax liabilities | ||
Property and equipment | $ 8,141,025 | $ 7,686,064 |
Other | 588,632 | 7,632 |
Total deferred tax liabilities | 8,729,657 | 7,693,696 |
Deferred income tax assets | ||
Other | 948,704 | 404,093 |
Net operating loss carryforward | 910,443 | 2,834,524 |
Total deferred tax assets | 1,859,147 | 3,238,617 |
Total net deferred tax liabilities | $ 6,870,510 | $ 4,455,079 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
INCOME TAXES | ||
Federal rate | 21% | 21% |
State rate | 6% | 6% |
Income tax expense | $ 2,975,250 | $ 2,262,646 |
Effective tax rate | 28.70% | 37.60% |
Future taxable income | 80% | |
Federal | ||
INCOME TAXES | ||
Net operating loss carryforwards | $ 3,000,000 | $ 10,500,000 |
State | ||
INCOME TAXES | ||
Net operating loss carryforwards | $ 23,300,000 | $ 26,400,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
EARNINGS PER SHARE | ||
Net income | $ 7,401,420 | $ 3,750,315 |
Weighted average shares outstanding-basic (in shares) | 16,646,086 | 16,323,790 |
Weighted average shares outstanding-diluted | 16,670,963 | 16,323,790 |
Earnings per share available to common shareholders | $ 0.44 | $ 0.23 |
Earnings per share available to common shareholders-diluted | $ 0.44 | $ 0.23 |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Details) - Restricted stock awards | 12 Months Ended |
Sep. 30, 2023 shares | |
EARNINGS PER SHARE | |
Dilutive effect of restricted stock grants | 24,877 |
Number of shares granted | 40,000 |
STOCK REPURCHASE PLAN (Details)
STOCK REPURCHASE PLAN (Details) - Employee Stock Purchase Plan | Jul. 06, 2022 shares |
STOCK PURCHASE PLAN | |
Percent of shares repurchased to its outstanding common stock | 6% |
Maximum | |
STOCK PURCHASE PLAN | |
Maximum number of common stocks agreed to repurchase | 1,000,000 |
STOCK REPURCHASE PLAN - Stock R
STOCK REPURCHASE PLAN - Stock Repurchases (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
May 31, 2023 | Apr. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2023 | |
STOCK REPURCHASE PLAN | ||||
Total Number of Shares Purchased | 36,772 | 31,047 | 32,181 | 100,000 |
Average Price Paid Per Share | $ 2.16 | $ 2.21 | $ 2.23 | $ 2.20 |
Value of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | $ 79,462 | $ 68,498 | $ 71,655 | $ 219,615 |
Maximum Number of Shares That May Yet Be Purchased Under the Plan or Programs | 900,000 | 936,772 | 967,819 |
LONG TERM INCENTIVE PLAN (Detai
LONG TERM INCENTIVE PLAN (Details) | Feb. 16, 2022 shares |
2022 Equity Incentive Plan | |
LONG TERM INCENTIVE PLAN | |
Maximum number of shares of stock, granted under the Plan as stock options, restricted stock or restricted stock units | 1,500,000 |
LONG TERM INCENTIVE PLAN - Rest
LONG TERM INCENTIVE PLAN - Restricted stocks grants awarded (Details) - Restricted stock awards - 2022 Equity Incentive Plan | 12 Months Ended |
Sep. 30, 2023 shares | |
LONG TERM INCENTIVE PLAN | |
Available at the beginning of current fiscal year | 1,500,000 |
Granted during current fiscal year | 40,000 |
Available at the end of current fiscal year | 1,460,000 |
Vesting period | 3 years |
LONG TERM INCENTIVE PLAN - Vest
LONG TERM INCENTIVE PLAN - Vesting shares (Details) - Restricted stock awards - 2022 Equity Incentive Plan | Sep. 30, 2023 shares |
2024 | |
LONG TERM INCENTIVE PLAN | |
Total vesting of shares during the year | 13,334 |
2025 | |
LONG TERM INCENTIVE PLAN | |
Total vesting of shares during the year | 13,333 |
2026 | |
LONG TERM INCENTIVE PLAN | |
Total vesting of shares during the year | 13.333 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Dec. 16, 2014 | Mar. 31, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
RELATED PARTY TRANSACTIONS | ||||
Percentage of shares of common stock transaction between executive, officers, directors and holders | 10% or more | |||
Aggregate principal amount of fixed-rate debt | $ 33,800,000 | $ 25,100,000 | ||
loan agreement | Nitro Electric | ||||
RELATED PARTY TRANSACTIONS | ||||
Term of loan agreement | 20 years | |||
Aggregate principal amount of fixed-rate debt | $ 1,200,000 | |||
Monthly rent | $ 6,300 | |||
Interest rate | 4.82% | |||
Note payable in monthly or annual installments | $ 7,800 | |||
Principal installment payments | $ 373,000 | |||
Interest payment | $ 424,000 |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Apr. 30, 2022 | Aug. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Apr. 29, 2022 | |
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 33,800,000 | $ 25,100,000 | |||
Fair value of debt | 32,100,000 | 24,300,000 | |||
Carrying value | 3,326,405 | $ 1,611,321 | |||
Unconditional guarantee | $ 5,000,000 | ||||
Development | Ventures | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage | 75% | ||||
Landlord | Development | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage by non controlling owners | 1% | ||||
Landlord | United Bank | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage by parent | 99% | ||||
SQP | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 5,000,000 | ||||
SQP | Development | |||||
RELATED PARTY TRANSACTIONS | |||||
Equity investment | $ 156,000 | ||||
SQP | Development | |||||
RELATED PARTY TRANSACTIONS | |||||
Equity method investment ownership percentage | 25% | ||||
Tri State Paving | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | 236,000 | ||||
Carrying value | 133,000 | ||||
Unsecured loan agreement with David Bolton and Daniel Bolton | |||||
RELATED PARTY TRANSACTIONS | |||||
Interest rate | 3.50% | ||||
Unsecured loan agreement with David Bolton and Daniel Bolton | Tri State Paving | |||||
RELATED PARTY TRANSACTIONS | |||||
Interest payment | $ 7,000 | ||||
Promissory Note agreement with Corns Enterprises | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 1,000,000 | ||||
Principal installment payments | $ 500,000 | ||||
Fair value of debt | $ 250,000 |
LEASE OBLIGATIONS (Details)
LEASE OBLIGATIONS (Details) | 12 Months Ended | ||||||
Aug. 12, 2022 USD ($) item | Aug. 11, 2022 USD ($) item | Apr. 29, 2022 USD ($) item | Mar. 25, 2021 item | Sep. 30, 2023 USD ($) agreement | Sep. 30, 2022 USD ($) | Mar. 28, 2023 USD ($) | |
LEASE OBLIGATIONS | |||||||
Operating lease payments for office space per month | $ 1,500 | ||||||
Term of operating lease | 2 years | ||||||
Number of renewable options available | item | 5 | ||||||
Operating lease, renewal term | 1 year | ||||||
Number of financing leases entered | agreement | 2 | ||||||
Finance lease, value | $ 160,000 | ||||||
Term of finance leases | 22 months | ||||||
Finance lease, interest rate | 0% | ||||||
Finance lease, monthly installment payments | $ 6,645 | ||||||
Option to cancel the finance lease | false | ||||||
Number of right of use operating leases | item | 2 | ||||||
Carrying value | $ 1,075,815 | $ 588,653 | |||||
Rental expense | $ 12,100,000 | $ 9,800,000 | |||||
Maximum | |||||||
LEASE OBLIGATIONS | |||||||
Vehicle lease program rate on operating lease | 15.60% | ||||||
Minimum | |||||||
LEASE OBLIGATIONS | |||||||
Vehicle lease program rate on operating lease | 12.80% | ||||||
Operating Lease for Hurricane, WV Facility | |||||||
LEASE OBLIGATIONS | |||||||
Net present value | $ 236,000 | ||||||
Carrying value | $ 133,000 | ||||||
Operating Lease for Chattanooga, Tennessee Facility | |||||||
LEASE OBLIGATIONS | |||||||
Net present value | $ 144,000 | ||||||
Carrying value | 57,000 | ||||||
Interest rate on operating lease | 4.50% | ||||||
Operating Lease with Enterprise | |||||||
LEASE OBLIGATIONS | |||||||
Net present value | $ 2,400,000 | $ 1,200,000 | |||||
Carrying value | $ 2,900,000 | ||||||
Number of vehicles to be used | item | 41 | 31 | |||||
Operating Lease with RICA Developers, LLC | |||||||
LEASE OBLIGATIONS | |||||||
Term of operating lease | 1 year | ||||||
Net present value | $ 140,000 | ||||||
Carrying value | $ 0 | ||||||
Interest rate on operating lease | 4.50% | ||||||
Operating Lease for Winchester, Kentucky Facility | |||||||
LEASE OBLIGATIONS | |||||||
Net present value | $ 290,000 | ||||||
Carrying value | $ 262,000 | ||||||
Interest rate on operating lease | 7.75% |
LEASE OBLIGATIONS - Operating l
LEASE OBLIGATIONS - Operating lease-weighted average remaining term (Details) | Sep. 30, 2023 USD ($) |
LEASE OBLIGATIONS | |
Weighted average remaining term | 3 years 4 months 24 days |
Present value of remaining liability | $ 3,350,790 |
Operating lease 1 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 1 year 7 months 6 days |
Present value of remaining liability | $ 133,000 |
Operating lease 2 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 8 months 12 days |
Present value of remaining liability | $ 57,031 |
Operating lease 3 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 3 years 8 months 12 days |
Present value of remaining liability | $ 2,898,588 |
Operating lease 4 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 0 years |
Operating lease 5 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 2 years 6 months |
Present value of remaining liability | $ 262,171 |
LEASE OBLIGATIONS - Operating_2
LEASE OBLIGATIONS - Operating lease maturity schedule (Details) | Sep. 30, 2023 USD ($) |
LEASE OBLIGATIONS | |
2024 | $ 1,205,658 |
2025 | 1,097,808 |
2026 | 969,003 |
2027 | 326,022 |
Operating lease liability | 3,598,491 |
Less amounts representing interest | (247,701) |
Present value of operating lease liabilities | $ 3,350,790 |
LEASE OBLIGATIONS - Operating_3
LEASE OBLIGATIONS - Operating lease expense (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
LEASE OBLIGATIONS | ||
Total amortization | $ 844,053 | $ 98,711 |
Total interest | 112,789 | 11,802 |
Total amortization and interest | 956,842 | 110,513 |
Operating lease 1 | ||
LEASE OBLIGATIONS | ||
Total amortization | 72,267 | 30,933 |
Total interest | 7,355 | 4,067 |
Operating lease 2 | ||
LEASE OBLIGATIONS | ||
Total amortization | 62,001 | 25,554 |
Total interest | 3,825 | 2,411 |
Operating lease 3 | ||
LEASE OBLIGATIONS | ||
Total amortization | 568,114 | 22,672 |
Total interest | 87,416 | 4,360 |
Operating lease 4 | ||
LEASE OBLIGATIONS | ||
Total amortization | 113,480 | 19,552 |
Total interest | 2,802 | $ 964 |
Operating lease 5 | ||
LEASE OBLIGATIONS | ||
Total amortization | 28,191 | |
Total interest | $ 11,391 |
LEASE OBLIGATIONS - Cash paid f
LEASE OBLIGATIONS - Cash paid for operating leases (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
LEASE OBLIGATIONS | ||
Cash paid for operating leases | $ 956,842 | $ 117,558 |
Operating lease 1 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 79,622 | 35,000 |
Operating lease 2 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 65,826 | 27,965 |
Operating lease 3 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 655,530 | 27,032 |
Operating lease 4 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 116,282 | $ 27,561 |
Operating lease 5 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | $ 39,582 |
MAJOR CUSTOMERS (Details)
MAJOR CUSTOMERS (Details) - Customer concentration risk | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
MAJOR CUSTOMERS | ||
Customers concentration percentage | 10% | |
Revenue | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 100% | 100% |
Revenue | TransCanada Corporation | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 13.90% | 16.60% |
Revenue | NiSource and subsidiaries | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 17.50% | |
Revenue | All other | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 68.60% | 83.40% |
Revenue | Customer one | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 10% | |
Accounts receivable, net of retention | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 100% | 100% |
Accounts receivable, net of retention | TransCanada Corporation | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 11.60% | |
Accounts receivable, net of retention | NiSource and subsidiaries | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 11.80% | |
Accounts receivable, net of retention | All other | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 88.20% | 88.40% |
Accounts receivable, net of retention | Customer two | ||
MAJOR CUSTOMERS | ||
Customers concentration percentage | 10% |
RETIREMENT AND EMPLOYEE BENEF_3
RETIREMENT AND EMPLOYEE BENEFIT PLANS - C.J. Hughes retirement plan (Details) - Union Employees Retirement Plan - C J Hughes Construction Company - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Percentage of employees contribution to retirement compensation plan | 15% | 15% |
Maximum amount of employees contribution | $ 22,500 | $ 20,500 |
Amount of contribution matched per dollar | $ 0.25 | $ 0.25 |
Percentage of contribution of eligible wages | 6% | 6% |
Amount of contribution to union plan | $ 17,000 | $ 22,000 |
RETIREMENT AND EMPLOYEE BENEF_4
RETIREMENT AND EMPLOYEE BENEFIT PLANS - Energy Services of America retirement plan (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Non Union Employees Retirement Plan | Nitro Electric And C. J. Hughes Construction Company merger | ||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Defined contribution plan employer matching contribution percent of each dollar contributed for the first 3% | 100% | |
Defined contribution plan employer matching contribution percent of each dollar contributed for the next 3% | 50% | |
Retirement Plan | Energy Services of America | ||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Amount of contribution to union plan | $ 599,000 | $ 402,000 |
RETIREMENT AND EMPLOYEE BENEF_5
RETIREMENT AND EMPLOYEE BENEFIT PLANS - Summary of Participation in Pension Fund Plan (Details) - USD ($) | 12 Months Ended | |||
Dec. 15, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
Multiemployer Plan, Employer Contribution, Cost | $ 11,599,157 | $ 6,420,550 | ||
Payments for installment | $ 41,000 | |||
Amount expensed | $ 0 | $ 164,000 | ||
Central States, Southeast and Southwest Areas Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 36-6044243/001 | 36-6044243/001 | 36-6044243/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 160,566 | $ 123,142 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Employer-Teamsters Local Nos. 175 and 505 | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 55-6021850/001 | 55-6021850/001 | 55-6021850/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 0 | |||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Laborers National Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 75-1280827/001 | 75-1280827/001 | 75-1280827/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 46,167 | $ 384,908 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Laborers' District Council of Western Pennsylvania Pension Plan | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 25-6135576/001 | 25-6135576/001 | 25-6135576/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 269,915 | |||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Operating Engineers Local 324 Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 38-1900637/001 | 38-1900637/001 | 38-1900637/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 837 | $ 66,757 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
National Automatic Sprinkler Industry Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 52-6054620/001 | 52-6054620/001 | 52-6054620/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 214,590 | $ 199,984 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Iron Workers District Council of Southern Ohio &Vicinity Pension Trust | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 31-6038516/001 | 31-6038516/001 | 31-6038516/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Green | Yellow | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 279,998 | $ 208,588 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Carpenters Pension Fund of WV | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 55-6027998/001 | 55-6027998/001 | 55-6027998/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 907,515 | $ 719,665 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Plumbers & Pipefitters National Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 52-6152779/001 | 52-6152779/001 | 52-6152779/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 817,059 | $ 660,324 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Sheet Metal Workers' National Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 52-6112463/001 | 52-6112463/001 | 52-6112463/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 188,749 | $ 175,643 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Plumbers and Steamfitters Local 577 Pension Fund | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
EIN/Pension Plan Number | 31-6134953/001 | 31-6134953/001 | 31-6134953/001 | |
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | ||
FIP/RP Status | Implemented | Implemented | Implemented | |
Contributions of Energy Services Companies | $ 5,623 | $ 0 | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
All Other | ||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||||
Pension Protection Act ("PPA") Certified Zone Status | Green | Green | ||
Surcharge Imposed | No | No | No | |
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | |
Multiemployer Plan, Pension, Insignificant, Employer Contribution, Cost | $ 8,978,053 | $ 3,611,624 |
CREDIT RISK (Details)
CREDIT RISK (Details) $ in Millions | Sep. 30, 2023 USD ($) |
CREDIT RISK | |
Uninsured deposits | $ 15 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES | ||
Performance bonds outstanding amount | $ 72 | |
PPP loans received | $ 9.8 |
ACQUISITIONS - Non-cash purchas
ACQUISITIONS - Non-cash purchase price for the Tri-State Paving acquisition (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 |
ACQUISITIONS | |||
Property and equipment | $ 36,529,509 | $ 32,661,787 | |
Goodwill | 4,087,554 | 4,087,554 | $ 1,814,317 |
Intangible assets, net | 3,383,099 | $ 3,873,690 | |
Tri-State Paving | |||
ACQUISITIONS | |||
Property and equipment | 5,709,094 | ||
Goodwill | 2,273,237 | ||
Total | 9,874,663 | ||
Tri-State Paving | Customer Relationships | |||
ACQUISITIONS | |||
Intangible assets, net | 1,649,159 | ||
Tri-State Paving | Non-competes | |||
ACQUISITIONS | |||
Intangible assets, net | 39,960 | ||
Tri-State Paving | Tradename | |||
ACQUISITIONS | |||
Intangible assets, net | $ 203,213 |
ACQUISITIONS - Purchase price f
ACQUISITIONS - Purchase price for the Ryan Environmental and Ryan Transport acquisitions (Details) - USD ($) | Sep. 30, 2023 | Sep. 30, 2022 |
ACQUISITIONS | ||
Property and equipment | $ 36,529,509 | $ 32,661,787 |
Ryan Environmental and Ryan Transport | ||
ACQUISITIONS | ||
Property and equipment | 3,237,559 | |
Accounts receivable | 677,254 | |
Unbilled receivable | 127,244 | |
Total | $ 4,042,057 |
ACQUISITIONS - Additional Infor
ACQUISITIONS - Additional Information (Details) - USD ($) | 2 Months Ended | 5 Months Ended | 12 Months Ended | |||
Aug. 11, 2022 | Apr. 29, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
ACQUISITIONS | ||||||
Value of common stock issued | $ 0 | $ 1,048,218 | ||||
Debt instrument face amount | $ 25,100,000 | $ 25,100,000 | 33,800,000 | $ 25,100,000 | ||
Tri-State Paving | ||||||
ACQUISITIONS | ||||||
Payments to Acquire Productive Assets | $ 7,500,000 | |||||
Non-cash purchase price of debt | 390,000 | |||||
Cash consideration | 7,500,000 | |||||
Ryan Environmental | ||||||
ACQUISITIONS | ||||||
Amount of consideration | $ 3,000,000 | |||||
Ryan Transport | ||||||
ACQUISITIONS | ||||||
Payments to Acquire Productive Assets | 1,000,000 | |||||
Cash consideration | $ 1,000,000 | |||||
Promissory Note agreement with Corns Enterprises | ||||||
ACQUISITIONS | ||||||
Debt instrument face amount | 1,000,000 | |||||
Principal installment payments | 500,000 | |||||
Tri-State Paving | ||||||
ACQUISITIONS | ||||||
Seller note as consideration for acquiring assets | 1,000,000 | |||||
Value of common stock issued | $ 1,000,000 | |||||
Number of shares issued | 419,287 | |||||
Earned revenues | $ 4,900,000 | 13,500,000 | ||||
Tri-State Paving | Promissory Note agreement with Corns Enterprises | ||||||
ACQUISITIONS | ||||||
Term of debt | 4 years | |||||
Debt instrument face amount | $ 1,000,000 | |||||
Principal installment payments | $ 250,000 | |||||
Interest rate on carrying value | 3.50% | |||||
Ryan Environmental and Ryan Transport | ||||||
ACQUISITIONS | ||||||
Earned revenues | $ 852,000 | $ 8,100,000 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) | 12 Months Ended |
Sep. 30, 2022 USD ($) | |
Goodwill | |
Beginning balance | $ 1,814,317 |
Acquired | 2,273,237 |
Ending balance | $ 4,087,554 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible assets subject to amortization (Details) - USD ($) | 12 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | ||||
Original Cost | $ 4,548,843 | $ 4,548,843 | ||
Accumulated Amortization and Impairment | 1,165,744 | $ 675,153 | 490,591 | $ 444,565 |
Net Book Value | $ 3,383,099 | $ 3,383,099 | ||
Customer Relationships | West Virginia Pipeline | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Remaining Life | 87 months | 87 months | ||
Original Cost | $ 2,209,724 | $ 2,209,724 | ||
Accumulated Amortization and Impairment | 607,661 | 386,693 | 220,968 | 220,968 |
Net Book Value | $ 1,602,063 | $ 1,602,063 | ||
Customer Relationships | Tri-State Paving | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Remaining Life | 103 months | 103 months | ||
Original Cost | $ 1,649,159 | $ 1,649,159 | ||
Accumulated Amortization and Impairment | 233,631 | 66,781 | 166,850 | 66,781 |
Net Book Value | $ 1,415,528 | $ 1,415,528 | ||
Tradename | West Virginia Pipeline | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Remaining Life | 87 months | 87 months | ||
Original Cost | $ 263,584 | $ 263,584 | ||
Accumulated Amortization and Impairment | 72,500 | 46,136 | 26,364 | 26,364 |
Net Book Value | $ 191,084 | $ 191,084 | ||
Tradename | Tri-State Paving | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Remaining Life | 103 months | 103 months | ||
Original Cost | $ 203,213 | $ 203,213 | ||
Accumulated Amortization and Impairment | 28,789 | 8,368 | 20,421 | 8,368 |
Net Book Value | 174,424 | 174,424 | ||
Non-competes | West Virginia Pipeline | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Original Cost | 83,203 | 83,203 | ||
Accumulated Amortization and Impairment | 83,203 | 72,806 | 10,397 | 41,604 |
Non-competes | Tri-State Paving | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Original Cost | 39,960 | 39,960 | ||
Accumulated Amortization and Impairment | 39,960 | 16,590 | 23,370 | 16,590 |
Employment agreement/non-compete | Revolt Energy | ||||
GOODWILL AND INTANGIBLE ASSETS | ||||
Original Cost | 100,000 | 100,000 | ||
Accumulated Amortization and Impairment | $ 100,000 | $ 77,779 | $ 22,221 | $ 63,890 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Amortization expenses (Details) | Sep. 30, 2023 USD ($) |
GOODWILL AND INTANGIBLE ASSETS | |
2024 | $ 432,564 |
2025 | 432,564 |
2026 | 432,564 |
2027 | 432,564 |
2028 | 432,564 |
After | 1,220,279 |
Total | $ 3,383,099 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Nov. 15, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | |
SUBSEQUENT EVENTS | |||
Annual dividend per common share approved | $ 0.05 | ||
Debt instrument face amount | $ 33.8 | $ 25.1 | |
Subsequent event | |||
SUBSEQUENT EVENTS | |||
Annual dividend per common share approved | $ 0.06 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |