Cover Page
Cover Page - shares | 9 Months Ended | |
Jun. 30, 2019 | Aug. 07, 2019 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-38479 | |
Entity Registrant Name | Construction Partners, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-0758017 | |
Entity Address, Postal Zip Code | 36303 | |
City Area Code | 334 | |
Local Phone Number | 673-9763 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001718227 | |
Current Fiscal Year End Date | --09-30 | |
Entity Address, State or Province | AL | |
Entity Address, City or Town | Dothan | |
Entity Address, Address Line One | 290 Healthwest Drive, Suite 2 | |
Title of 12(b) Security | Class A common stock, par value $0.001 per share | |
Security Exchange Name | NASDAQ | |
Trading Symbol | ROAD | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 32,567,545 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 19,114,417 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 59,648 | $ 99,137 |
Contracts receivable including retainage, net | 134,709 | 120,291 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 14,043 | 9,334 |
Inventories | 37,069 | 24,556 |
Prepaid expenses and other current assets | 13,533 | 14,137 |
Total current assets | 259,002 | 267,455 |
Property, plant and equipment, net | 201,712 | 178,692 |
Goodwill | 36,968 | 32,919 |
Intangible assets, net | 3,091 | 3,735 |
Investment in joint venture | 384 | 1,659 |
Other assets | 6,292 | 10,270 |
Deferred income taxes, net | 1,575 | 1,580 |
Total assets | 509,024 | 496,310 |
Current liabilities: | ||
Accounts payable | 65,232 | 63,510 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 32,344 | 38,738 |
Current maturities of debt | 14,771 | 14,773 |
Accrued expenses and other current liabilities | 19,028 | 17,520 |
Total current liabilities | 131,375 | 134,541 |
Long-term liabilities: | ||
Long-term debt, net of current maturities | 37,096 | 48,115 |
Deferred income taxes, net | 8,749 | 8,890 |
Other long-term liabilities | 5,621 | 5,295 |
Total long-term liabilities | 51,466 | 62,300 |
Total liabilities | 182,841 | 196,841 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, par value $0.001; 10,000,000 shares authorized and no shares issued and outstanding at June 30, 2019 and September 30, 2018 | 0 | 0 |
Additional paid-in capital | 242,639 | 242,493 |
Treasury stock, at cost, 2,922,952 shares of Class B common stock, par value $0.001 | (15,603) | (15,603) |
Retained earnings | 99,093 | 72,525 |
Total stockholders' equity | 326,183 | 299,469 |
Total liabilities and stockholders' equity | 509,024 | 496,310 |
Class A Common Stock | ||
Stockholders' equity: | ||
Common stock | 32 | 12 |
Total stockholders' equity | 32 | 12 |
Class B Common Stock | ||
Stockholders' equity: | ||
Common stock | 22 | 42 |
Total stockholders' equity | $ 22 | $ 42 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2019 | Sep. 30, 2018 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 39,464,619 | |
Treasury stock, shares (in shares) | 2,922,952 | |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 32,442,545 | 11,950,000 |
Common stock, shares outstanding (in shares) | 32,442,545 | 11,950,000 |
Class B Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 22,162,369 | 42,387,571 |
Common stock, shares outstanding (in shares) | 19,239,417 | 39,464,619 |
Treasury stock, shares (in shares) | 2,922,952 | 2,922,592 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenues | $ 227,290 | $ 195,075 | $ 545,921 | $ 464,395 |
Cost of revenues | 189,198 | 165,606 | 466,900 | 398,379 |
Gross profit | 38,092 | 29,469 | 79,021 | 66,016 |
General and administrative expenses | (15,968) | (14,788) | (45,170) | (40,572) |
Settlement income | 0 | 0 | 0 | 14,803 |
Gain on sale of equipment, net | 58 | 86 | 1,085 | 1,117 |
Operating income | 22,182 | 14,767 | 34,936 | 41,364 |
Interest expense, net | (615) | (406) | (1,509) | (956) |
Other income (expense), net | 190 | 15 | 296 | (45) |
Income before provision for income taxes and earnings from investment in joint venture | 21,757 | 14,376 | 33,723 | 40,363 |
Provision for income taxes | 4,941 | 1,409 | 8,080 | 5,382 |
Earnings from investment in joint venture | 386 | 436 | 925 | 666 |
Net income | $ 17,202 | $ 13,403 | $ 26,568 | $ 35,647 |
Net income per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ 0.33 | $ 0.29 | $ 0.52 | $ 0.82 |
Diluted (in dollars per share) | $ 0.33 | $ 0.29 | $ 0.52 | $ 0.81 |
Weighted average number of common shares outstanding: | ||||
Basic (in shares) | 51,414,619 | 46,557,785 | 51,414,619 | 43,648,309 |
Diluted (in shares) | 51,422,899 | 46,988,359 | 51,414,887 | 43,932,546 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Class A Common Stock | Class B Common Stock |
Beginning balance (in shares) at Sep. 30, 2017 | 44,987,575 | 0 | 0 | ||||
Beginning balance at Sep. 30, 2017 | $ 152,181 | $ 45 | $ 142,385 | $ (11,983) | $ 21,734 | $ 0 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 10,996 | 10,996 | |||||
Ending balance (in shares) at Dec. 31, 2017 | 44,987,575 | 0 | 0 | ||||
Ending balance at Dec. 31, 2017 | 163,177 | $ 45 | 142,385 | (11,983) | 32,730 | $ 0 | $ 0 |
Beginning balance (in shares) at Sep. 30, 2017 | 44,987,575 | 0 | 0 | ||||
Beginning balance at Sep. 30, 2017 | 152,181 | $ 45 | 142,385 | (11,983) | 21,734 | $ 0 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 35,647 | ||||||
Ending balance (in shares) at Jun. 30, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Ending balance at Jun. 30, 2018 | 284,325 | $ 0 | 242,493 | (15,603) | 57,381 | $ 12 | $ 42 |
Beginning balance (in shares) at Dec. 31, 2017 | 44,987,575 | 0 | 0 | ||||
Beginning balance at Dec. 31, 2017 | 163,177 | $ 45 | 142,385 | (11,983) | 32,730 | $ 0 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 11,248 | 11,248 | |||||
Equity-based compensation expense | 604 | 604 | |||||
Issuance of restricted shares from treasury | 5 | (453) | 458 | ||||
Ending balance (in shares) at Mar. 31, 2018 | 44,987,575 | 0 | 0 | ||||
Ending balance at Mar. 31, 2018 | 175,034 | $ 45 | 142,536 | (11,525) | 43,978 | $ 0 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 13,403 | 13,403 | |||||
Equity-based compensation expense | 371 | 371 | |||||
Issuance of stock (in shares) | 9,350,000 | ||||||
Issuance of stock | 98,009 | 98,000 | $ 9 | ||||
Conversion of Class B Shares to Class A Shares (in shares) | 2,600,000 | 2,600,000 | |||||
Conversion of Class B common stock to Class A common stock | 0 | $ 3 | $ (3) | ||||
Reclassification of common stock (in shares) | 44,987,575 | 44,987,571 | |||||
Reclassification of common stock | 0 | $ (45) | $ 45 | ||||
Cashless option exercise | (2,492) | 1,586 | (4,078) | ||||
Ending balance (in shares) at Jun. 30, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Ending balance at Jun. 30, 2018 | 284,325 | $ 0 | 242,493 | (15,603) | 57,381 | $ 12 | $ 42 |
Beginning balance (in shares) at Sep. 30, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Beginning balance at Sep. 30, 2018 | 299,469 | $ 0 | 242,493 | (15,603) | 72,525 | $ 12 | $ 42 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 5,154 | 5,154 | |||||
Ending balance (in shares) at Dec. 31, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Ending balance at Dec. 31, 2018 | 304,623 | $ 0 | 242,493 | (15,603) | 77,679 | $ 12 | $ 42 |
Beginning balance (in shares) at Sep. 30, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Beginning balance at Sep. 30, 2018 | 299,469 | $ 0 | 242,493 | (15,603) | 72,525 | $ 12 | $ 42 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 26,568 | ||||||
Ending balance (in shares) at Jun. 30, 2019 | 0 | 32,442,545 | 22,162,369 | ||||
Ending balance at Jun. 30, 2019 | 326,183 | $ 0 | 242,639 | (15,603) | 99,093 | $ 32 | $ 22 |
Beginning balance (in shares) at Dec. 31, 2018 | 0 | 11,950,000 | 42,387,571 | ||||
Beginning balance at Dec. 31, 2018 | 304,623 | $ 0 | 242,493 | (15,603) | 77,679 | $ 12 | $ 42 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 4,212 | 4,212 | |||||
Ending balance (in shares) at Mar. 31, 2019 | 0 | 11,950,000 | 42,387,571 | ||||
Ending balance at Mar. 31, 2019 | 308,835 | $ 0 | 242,493 | (15,603) | 81,891 | $ 12 | $ 42 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 17,202 | 17,202 | |||||
Equity-based compensation expense | 146 | 146 | |||||
Issuance of stock (in shares) | 267,343 | ||||||
Issuance of stock | 0 | ||||||
Conversion of Class B Shares to Class A Shares (in shares) | 20,225,202 | 20,225,202 | |||||
Conversion of Class B common stock to Class A common stock | 0 | $ 20 | $ (20) | ||||
Ending balance (in shares) at Jun. 30, 2019 | 0 | 32,442,545 | 22,162,369 | ||||
Ending balance at Jun. 30, 2019 | $ 326,183 | $ 0 | $ 242,639 | $ (15,603) | $ 99,093 | $ 32 | $ 22 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 26,568 | $ 35,647 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, depletion and amortization of long-lived assets | 22,698 | 17,929 |
Amortization of deferred debt issuance costs and debt discount | 83 | 60 |
Provision for bad debt | 421 | 435 |
Gain on sale of equipment, net | (1,085) | (1,117) |
Equity-based compensation expense | 146 | 975 |
Earnings from investment in joint venture | (925) | (666) |
Deferred income taxes | (136) | (1,430) |
Changes in operating assets and liabilities: | ||
Contracts receivable including retainage, net | (14,839) | 14,055 |
Costs and estimated earnings in excess of billings on uncompleted contracts | (4,709) | (6,128) |
Inventories | (11,992) | (3,335) |
Other current assets | 604 | (9,165) |
Other assets | 3,978 | (12,079) |
Accounts payable | 1,722 | (7,944) |
Billings in excess of costs and estimated earnings on uncompleted contracts | (6,394) | 2,823 |
Accrued expenses and other current liabilities | 1,497 | (6,048) |
Other long-term liabilities | 326 | (352) |
Net cash provided by operating activities, net of acquisitions | 17,963 | 23,660 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (31,744) | (33,460) |
Proceeds from sale of equipment | 2,898 | 2,889 |
Business acquisition, net of cash acquired | (8,854) | (51,319) |
Acquisition of liquid asphalt terminal assets | (10,848) | 0 |
Investment in joint venture | 0 | (400) |
Distributions received from investment in joint venture | 2,200 | 0 |
Net cash used in investing activities | (46,348) | (82,290) |
Cash flows from financing activities: | ||
Repayments on revolving credit facility | 0 | (5,000) |
Proceeds from issuance of long-term debt, net of debt issuance costs and discount | 0 | 21,917 |
Repayments of long-term debt | (11,104) | (8,665) |
Proceeds from initial public offering of Class A common stock, net of offering costs | 0 | 98,009 |
Proceeds from reissuance of treasury stock | 0 | 5 |
Net cash (used in) provided by financing activities | (11,104) | 106,266 |
Net change in cash and cash equivalents | (39,489) | 47,636 |
Cash and cash equivalents: | ||
Beginning of period | 99,137 | 27,547 |
End of period | 59,648 | 75,183 |
Supplemental cash flow information: | ||
Cash paid for interest | 1,998 | 1,578 |
Cash paid for income taxes | 3,232 | 12,557 |
Non-cash items: | ||
Property, plant and equipment financed with accounts payable | $ 332 | $ 152 |
General
General | 9 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General Business Description Construction Partners, Inc. (the "Company") is a leading infrastructure and road construction company operating in Alabama, Florida, Georgia, North Carolina and South Carolina through its wholly owned subsidiaries. The Company provides site development, paving, utility and drainage systems, as well as construction materials including hot mix asphalt ("HMA"), aggregates, ready-mix concrete and liquid asphalt. The Company executes projects for a mix of private, municipal, state, and federal customers that are both privately and publicly funded. The majority of the work is performed under fixed unit price contracts and, to a lesser extent, fixed total price contracts. The Company was formed as a Delaware corporation in 2007 as a holding company for its wholly owned subsidiary, Construction Partners Holdings, Inc., a Delaware corporation ("CPHI"), which incorporated in 1999 and began operations in 2001 to execute an acquisition growth strategy in the hot mix asphalt paving and construction industry. SunTx Capital Partners ("SunTx"), a private equity firm based in Dallas, Texas, is the Company's majority investor and has owned a controlling interest in the Company's stock since the Company's inception. Seasonality The use and consumption of our products and services fluctuate due to seasonality. Our products are used, and our construction operations and production facilities are located, outdoors. Therefore, seasonal changes and other weather-related conditions, in particular extended snowy, rainy or cold weather in the winter, spring or fall and major weather events, such as hurricanes, tornadoes, tropical storms and heavy snows, can adversely affect our business and operations through a decline in both the use of our products and demand for our services. In addition, construction materials production and shipment levels follow activity in the construction industry, which typically occurs in the spring, summer and fall. Warmer and drier weather during the third and fourth quarters of our fiscal year typically result in higher activity and revenues during those quarters. The first and second quarters of our fiscal year typically have lower levels of activity due to adverse weather conditions. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Basis of Presentation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. These interim consolidated statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"), which permit reduced disclosure for interim periods. The Consolidated Balance Sheet as of September 30, 2018 was derived from audited financial statements for the fiscal year then ended, but does not include all necessary disclosures required by generally accepted accounting principles in the United States of America ("GAAP") with respect to annual financial statements. In the opinion of management, the unaudited consolidated financial statements include all recurring adjustments and normal accruals necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the dates and periods presented. These consolidated financial statements and accompanying notes should be read in conjunction with the Company's audited annual consolidated financial statements and notes thereto included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2018 (the "2018 Form 10-K"). Results for interim periods are not necessarily indicative of the results to be expected for a full fiscal year or for any future period. Management's Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the recorded amounts of assets, liabilities, stockholders' equity, revenues and expenses during the reporting period, and the disclosure of contingent liabilities at the date of the consolidated financial statements. Estimates are used in accounting for items such as recognition of revenues and cost of revenues, goodwill and other intangible assets, allowance for doubtful accounts, valuation allowances related to income taxes, accruals for potential liabilities related to lawsuits or insurance claims, and the fair value of equity-based compensation awards. Estimates are continually evaluated based on historical information and actual experience; however, actual results could differ from these estimates. A description of certain critical accounting policies of the Company is presented below. Additional critical accounting policies and the underlying judgments and uncertainties are described in the notes to the Company's annual consolidated financial statements included in its 2018 Form 10-K. Emerging Growth Company The Company is an "emerging growth company" as defined by the Jumpstart Our Business Startups Act (the "JOBS Act"), enacted in April 2012. As an emerging growth company, the Company could have taken advantage of an exemption that would have allowed the Company to wait to comply with new or revised financial accounting standards until the effective date of such standards for private companies. However, the JOBS Act provides that a company may elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but such election to opt out is irrevocable. The Company has elected to opt out of such extended transition period, which means that when a standard is issued or revised and it has different effective dates for public and private companies, the Company is required to adopt the new or revised standard at the effective date applicable to public companies that are not emerging growth companies. Cash and Cash Equivalents Cash consists principally of currency on hand and demand deposits at commercial banks. Cash equivalents are short-term, highly liquid investments that are both readily convertible to known amounts of cash and are so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Cash equivalents include investments with original maturities of three months or less. The Company maintains demand accounts, money market accounts and certificates of deposit at several banks. Contracts Receivable Including Retainage, net Contracts receivable are generally based on amounts billed and currently due from customers, amounts currently due but unbilled, and amounts retained by the customer pending completion of a project. It is common in the Company's industry for a small portion of progress billings or the contract price, typically 10%, to be withheld by the customer until the Company completes a project to the satisfaction of the customer in accordance with contract terms. Such amounts, defined as retainage, represent a contract asset and are included on the Consolidated Balance Sheet as "Contracts receivable including retainage, net". Based on the Company's experience with similar contracts in recent years, billings for such retainage balances are generally collected within one year of the completion of the project. The carrying value of contracts receivable including retainage, net of the allowance for doubtful accounts, represents their estimated net realizable value. Management provides for uncollectible accounts through a charge to earnings and a credit to the allowance for doubtful accounts based on its assessment of the current status of individual accounts, type of service performed, and current economic conditions. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and an adjustment of the contract receivable. Contract Assets and Contract Liabilities Billing practices for the Company's contracts are governed by the contract terms of each project based on (i) progress toward completion approved by the owner, (ii) achievement of milestones or (iii) pre-agreed schedules. Billings do not necessarily correlate with revenues recognized under the percentage-of-completion method of accounting. The Company records contract assets and contract liabilities to account for these differences in timing. The contract asset, "Costs and estimated earnings in excess of billings on uncompleted contracts," arises when the Company recognizes revenues for services performed under its construction projects, but the Company is not yet entitled to bill the customer under the terms of the contract. Amounts billed to customers are excluded from this asset and reflected on the Consolidated Balance Sheet as "Contracts receivable including retainage, net". Included in costs and estimated earnings on uncompleted contracts are amounts the Company seeks or will seek to collect from customers or others for (i) errors, (ii) changes in contract specifications or design, (iii) contract change orders in dispute, unapproved as to scope and price, or (iv) other customer-related causes of unanticipated additional contract costs (such as claims). Such amounts are recorded at estimated net realizable value when realization is probable and can be reasonably estimated. Claims and unapproved change orders made by the Company may involve negotiation and, in rare cases, litigation. Unapproved change orders and claims also involve the use of estimates, and revenues associated with unapproved change orders and claims are included when realization is probable and amounts can be reliably determined. The Company did not recognize any material amounts associated with claims and unapproved change orders during the periods presented. The contract liability, "Billings in excess of costs and estimated earnings on uncompleted contracts," represents the Company's obligation to transfer goods or services to a customer for which the Company has been paid by the customer or for which the Company has billed the customer under the terms of the contract. Revenue for future services reflected in this account are recognized, and the liability is reduced, as the Company subsequently satisfies the performance obligation under the contract. Concentration of Risks Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of contracts receivable including retainage. In the normal course of business, the Company provides credit to its customers and does not generally require collateral. Concentrations of credit risk associated with these receivables are monitored on an ongoing basis. The Company has not historically experienced significant credit losses, due primarily to management's assessment of customers' credit ratings. The Company principally deals with recurring customers, state and local governments and well-known local companies whose reputations are known to management. The Company performs credit checks for significant new customers and generally requires progress payments for significant projects. The Company generally has the ability to file liens against the property if payments are not made on a timely basis. No single customer accounted for more than 10% of the Company's contracts receivable including retainage, net balance at June 30, 2019 or September 30, 2018. Projects performed for various Departments of Transportation accounted for 41.8% and 45.6% of consolidated revenues for the three months ended June 30, 2019 and 2018, respectively, and for 39.4% and 40.9% of consolidated revenues for the nine months ended June 30, 2019 and 2018, respectively. Customers that accounted for more than 10% of consolidated revenues during those periods are presented below: % of Consolidated Revenues For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Alabama Department of Transportation 15.4 % 17.0 % 12.9 % 14.8 % North Carolina Department of Transportation 13.9 % 14.8 % 13.4 % 13.5 % Revenues from Contracts with Customers The Company derives all of its revenues from contracts with its customers, predominantly by performing construction services for both public and private infrastructure projects, with an emphasis on highways, roads, bridges, airports and commercial and residential developments. These projects are performed for a mix of federal, state, municipal and private customers. In addition, the Company generates revenues from the sale of construction materials including HMA, aggregates, liquid asphalt and ready-mix concrete to third-party public and private customers pursuant to contracts with those customers. The following table reflects, for the periods presented, (i) revenues generated from public infrastructure construction projects and the sale of construction materials to public customers and (ii) revenues generated from private infrastructure construction projects and the sale of construction materials to private customers. For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Private $ 66,207 $ 56,293 $ 166,193 $ 148,525 Public $ 161,083 $ 138,782 $ 379,728 $ 315,870 Revenues derived from construction projects are recognized over time, using the percentage-of-completion method of accounting, as the Company satisfies its performance obligations by transferring control of the asset created or enhanced by the project to the customer. Recognition of revenues and cost of revenues for construction projects requires significant judgment by management, including, among other things, estimating total costs expected to be incurred to complete a project and measuring progress toward completion. Management reviews contract estimates regularly to assess revisions of estimated costs to complete a project and measurement of progress toward completion. Management believes the Company maintains reasonable estimates based on prior experience; however, many factors contribute to changes in estimates of contract costs. Accordingly, estimates made with respect to uncompleted projects are subject to change as each project progresses and better estimates of contract costs become available. All contract costs are recorded as incurred, and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Provisions are recognized for the full amount of estimated losses on uncompleted contracts whenever evidence indicates that the estimated total cost of a contract exceeds its estimated total revenue, regardless of the stage of completion. When the Company incurs additional costs related to work performed by subcontractors, the Company may be able to utilize contractual provisions to back charge the subcontractors for those costs. A reduction to costs related to back charges is recognized when the estimated recovery is probable and the amount can be reasonably estimated. Contract costs consist of (i) direct costs on contracts, including labor, materials, and amounts payable to subcontractors and (ii) indirect costs related to contract performance, such as insurance, employee benefits, and equipment (primarily depreciation, fuel, maintenance and repairs). Progress toward completion is estimated using the input method, measured by the relationship of total cost incurred through the measurement date to total estimated costs required to complete the project (cost-to-cost method). The Company believes this method best depicts the transfer of goods and services to the customer because it represents satisfaction of the Company's performance obligation under the contract, which occurs as the Company incurs costs. The Company measures percentage of completion based on the performance of a single performance obligation under its construction projects. Each of the Company's construction contracts represents a single performance obligation to complete a defined construction project. This is because goods and services promised for delivery to a customer are not distinct, as the customer cannot benefit from any individual portion of the services on its own. All deliverables under a contract are part of a project defined by a customer and represent a series of integrated goods and services that have the same pattern of delivery to the customer and use the same measure of progress toward satisfaction of the performance obligation as the customer's asset is created or enhanced by the Company. The Company's obligation is not satisfied until the entire project is complete. Revenue recognized during a reporting period is based on the estimated incremental percentage-of-completion applied to the total contract price, including adjustments for variable consideration such as liquidated damages, penalties or bonuses related to the timeliness or quality of project performance. Such adjustments are made to reflect the most likely amount of consideration management expects the Company to be entitled to at the completion of the contract, based on the best information available to the Company. The basis for total contract price is a stated amount in the contract, which is generally either fixed unit price or fixed total price, as described below. The Company adjusts the estimated contract price to include variable consideration to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur or when the uncertainty associated with the variable consideration is resolved. Total contract price is adjusted to reflect expected liquidated damages assessments or other penalties in the period the Company determines they will be incurred or when the customer imposes the penalty. Total contract price is adjusted to reflect contract bonus provisions related to timeliness or quality metrics when realization is probable and amounts can be reliably determined, which is generally when they are awarded by the customer. We account for changes in the measure of progress and changes to the estimated transaction price using a cumulative catch-up adjustment. The majority of the Company's public construction contracts are fixed unit price contracts. Under fixed unit price contracts, the Company is committed to providing materials or services required by a contract at fixed unit prices (for example, dollars per ton of asphalt placed). The Company's private customer contracts are primarily fixed total price contracts, also known as lump sum contracts, which require that the total amount of work be performed for a single price. Contract cost is recorded as incurred, and revisions in contract revenue and cost estimates are reflected in the accounting period when known. Changes in job performance, job conditions and estimated profitability, including those changes arising from contract change orders, penalty provisions and final contract settlements, may result in revisions to estimated revenues and costs and are recognized in the period in which the revisions are determined. Change orders are modifications of an original contract that effectively change the existing provisions of the contract and become part of the single performance obligation that is partially satisfied at the date of the contract modification. This is because goods and services promised under change orders are generally not distinct from the remaining goods and services under the existing contract, due to the significant integration of services performed in the context of the contract. Accordingly, change orders are generally accounted for as a modification of the existing contract and single performance obligation. We account for the modification using a cumulative catch-up adjustment. Either the Company or its customers may initiate change orders, which may include changes in specifications or designs, manner of performance, facilities, equipment, materials, sites and period of completion of the work. Revenues derived from the sale of HMA, aggregates, ready-mix concrete, and liquid asphalt are recognized at a point in time, which is when control of the product is transferred to the customer. Generally, that point in time is when the customer accepts delivery at its facility or receives product in its own transport vehicles from one of the Company's HMA plants. Upon purchase, the Company generally provides an invoice or similar document detailing the goods transferred to the customer. The Company generally offers payment terms customary in the industry, which typically require payment ranging from point-of-sale to 30 days following purchase. Income Taxes The provision for income taxes includes federal and state income taxes. Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying values and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which the temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Management evaluates the realization of deferred tax assets and establishes a valuation allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized. Deferred tax assets and deferred tax liabilities are presented on a net basis by taxing authority and classified as non-current on the Consolidated Balance Sheets. The Company classifies income tax-related interest and penalties as interest expense and other expenses, respectively. Earnings per Share As described in Note 8 – Equity, the Company completed an initial public offering (the "IPO") and reclassification (the "Reclassification") of its common stock during the fiscal year ended September 30, 2018, involving, among other things, a 25.2 to 1 split of shares of common stock (the "Stock Split") and the creation of a dual-class common stock structure. Prior to the Reclassification, all net income of the Company was attributable to the holders of shares of common stock immediately prior to the Reclassification. During the period beginning from the Reclassification through the IPO, all net income of the Company was attributable to holders of Class B common stock. Since the IPO, all net income of the Company has been attributable equally, on a per share basis, to the holders of Class A common stock and Class B common stock. Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of aggregate shares of pre-Reclassification common stock, Class A common stock and Class B common stock, as applicable for the respective periods, calculated on a post-Stock Split basis. Diluted earnings per share is calculated by dividing net income attributable to common stockholders by the weighted average number of aggregate shares of pre-Reclassification common stock, Class A common stock, Class B common stock and potential dilutive common shares determined using the treasury method, calculated on a post-Stock Split basis as applicable for the respective periods. Securities that are anti-dilutive are not included in the calculation of diluted earnings per share. |
Accounting Standards
Accounting Standards | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Accounting Standards | Accounting Standards Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09 , Revenue from Contracts with Customers (Topic 606) ("ASC 606"), which revises and consolidates current guidance, eliminates industry-specific revenue recognition guidance and establishes a comprehensive principle-based approach for determining revenue recognition. The core principle of the guidance is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for providing those goods or services. Amendments of this update set forth a five-step revenue recognition model to be applied consistently to all contracts with customers, except those that are within the scope of other topics in the Accounting Standards Codification ("ASC"): (i) identify the contract with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The update also provides guidance regarding the recognition of costs related to obtaining and fulfilling customer contracts. This update also requires quantitative and qualitative disclosures sufficient to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including disclosures on significant judgments made when applying the guidance. The FASB subsequently amended ASC 606 on multiple occasions to, among other things, delay its effective date and clarify certain implementation guidance. The update permits adoption using either (i) a full retrospective approach, under which all years included in the financial statements are presented under the revised guidance, or (ii) a modified retrospective approach, under which financial statements are prepared under the revised guidance for the year of adoption, but not for prior years. Under the latter method, entities recognize a cumulative adjustment to the opening balance of retained earnings for contracts that still require performance by the entity at the date of adoption. Management adopted this update for the Company's fiscal year beginning October 1, 2018, using the modified retrospective approach. The adoption of ASC 606 on October 1, 2018 did not result in a material impact that required recognition of a cumulative adjustment of the opening retained earnings balance for contracts that still required performance at September 30, 2018. Application of ASC 606 for the nine months ended June 30, 2019 had the following impact on the Company's Consolidated Balance Sheet at June 30, 2019 and Consolidated Statements of Income for the three and nine months ended June 30, 2019 (in thousands): As Reported Impact of ASC 606 Without Application of ASC 606 At June 30, 2019 Costs and estimated earnings in excess of billings on uncompleted contracts $ 14,043 $ (982) $ 15,025 Inventories 37,069 1,205 35,864 Accrued expenses and other liabilities 19,028 (29) 19,057 Billings in excess of costs and estimated earnings on uncompleted contracts $ 32,344 $ 338 $ 32,006 For the Three Months Ended June 30, 2019 Revenues $ 227,290 $ (343) $ 227,633 Cost of revenues 189,198 311 188,887 Provision (benefit) for income taxes 4,941 9 4,932 Net income $ 17,202 $ (23) $ 17,225 For the Nine Months Ended June 30, 2019 Revenues $ 545,921 $ (1,321) $ 547,242 Cost of revenues 466,900 (1,205) 468,105 Provision (benefit) for income taxes 8,080 (29) 8,109 Net income $ 26,568 $ (87) $ 26,655 The Company has refined its accounting policies and related internal controls affected by this update. Management's assessment of the Company's construction contracts under the new standard supports the recognition of revenue over time using the percentage-of-completion method of accounting, measured by the relationship of total cost incurred to total estimated contract costs (cost-to-cost method), which is consistent with the Company's historical revenue recognition practices. As such, the Company's construction contracts continue to be recognized over time considering the continuous transfer of control to its customers during the performance of construction projects. The Company also enhanced its disclosures regarding judgments and estimates used by management in the application of ASC 606 in Note 2 - Significant Accounting Policies. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business ("ASC 805"). The amendments of this update refine the definition of a business. Prior to this update, guidance in ASC 805 defined a business as having an integrated set of assets along with three elements or activities: inputs, processes, and outputs (collectively referred to as a "set"). The amendments of this update provided a framework to assist in the evaluation of when a set is not a business. If substantially all of the fair value of gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If that threshold is not met, the Company must perform further analysis to determine whether the set is a business. At a minimum, the set must include an input and a substantive process that together significantly contribute to the ability to create outputs. The Company adopted this update for the Company’s fiscal year beginning October 1, 2018 and applied the guidance to acquisitions during the second quarter of the fiscal year ending September 30, 2019 as described in Note 4 - Business Acquisitions and Note 7 - Property, Plant and Equipment. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which becomes effective for the Company on October 1, 2019. The standard requires that lessees present right-of-use assets and lease liabilities on the balance sheet. The Company’s implementation efforts are focused on accounting policy and disclosure updates and system enhancements required to meet the new standard. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures. |
Business Acquisitions
Business Acquisitions | 9 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Business Acquisitions | Business Acquisitions Florida Acquisition On Februar y 26, 2019, a subsidiary of the Company executed an asset purchase agreement to acquire substantially all of the assets of an HMA and ready-mix concrete business located in Okeechobee, Florida. This transaction enables the Company to serve new markets in south central Florida through an expanded geographic presence in the state. The acquisition was accounted for as a business combination in accordance with ASC 805. The purchase price of $8.9 million was paid from cash on hand at closing on February 28, 2019. The provisional allocation of the purchase price to assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, was determined in accordance with the methodology described under Fair Value Measurements in Note 3 to the Company's audited financial statements for the fiscal year ended September 30, 2018. The amounts allocated were not material to the Company's Consolidated Balance Sheet. The purchase price exceeding the net fair value of identifiable assets acquired and liabilities assumed was recorded as goodwill in the amount of $4.0 million, which is deductible for income tax purposes. Goodwill primarily represents the assembled work force and synergies expected to result from the acquisition. Upon finalizing the accounting for this transaction, management expects to ascribe value to other identifiable intangible assets, including customer relationships and customer backlog, which will reduce the amount allocated to goodwill. The results of operations since the February 28, 2019 acquisition date attributable to this acquisition are included in the consolidated financial statements since the acquisition date and were not material to the Consolidated Statements of Income for the three or nine months ended June 30, 2019. Pro forma results of operations as if the acquisition had been consummated on October 1, 2017 would not be material to the Consolidated Statements of Income. The Company recorded certain costs to effect the acquisition as they were incurred, which are reflected as general and administrative expenses on the Company's Consolidated Statements of Income in the amount of $0.1 million for the three and nine months ended June 30, 2019. The Scruggs Company On May 15, 2018, the Company executed a stock purchase agreement (the "Stock Purchase Agreement") to complete the acquisition of 100% of the common shares and voting interests of The Scruggs Company ("Scruggs"), which complemented the Company's vertically integrated southeastern United States operations, providing new bidding areas in the expanding Georgia market (the "Scruggs Acquisition"). This acquisition was accounted for as a business combination in accordance with ASC 805 . The Consolidated Statements of Income include $18.5 million of revenue and $2.3 million of net in come attributable to operations of Scruggs for the three months ended June 30, 2019 , a nd $53.2 million of revenue and $5.2 million of net income attrib utable to the operations of Scruggs for the nine months ended June 30, 2019. The following presents unaudited pro forma revenues and net income for the three and nine months ended June 30, 2018 as though the Scruggs Acquisition had occurred on October 1, 2016 (in thousands): For the Three Months Ended June 30, 2018 For the Nine Months Ended June 30, 2018 Pro forma revenues $ 206,924 $ 519,735 Pro forma net income $ 15,379 $ 40,653 Unaudited pro forma financial information is pr esented as if the operations of Scruggs had been included in the consolidated results of the Company and gives effect to transactions that are directly attributable to the Scruggs Acquisition, including adjustments to: a. Include the pro forma results of operations of Scruggs for the three and nine months ended June 30, 2018. b. Include additional depreciation and depletion expense related to the fair value of acquired property, plant and equipment and quarry reserves, as applicable, as if such assets were acquired on October 1, 2016 and the Company's depreciation and depletion methodologies were consistently applied to such assets. c. Include interest expense under the Compass Term Loan, defined in Note 9 - Debt, as if the $22.0 million borrowed to partially finance the purchase price was borrowed on October 1, 2016. Interest expense calculations further assume that no principal payments were made applicable to the $22.0 million borrowed during the period from October 1, 2016 through June 30, 2018, and that the interest rate in effect on the date the Company made the additional $22.0 million borrowing on May 15, 2018 was in effect for the period from October 1, 2016 through June 30, 2018. Unaudited pro forma information is presented for informational purposes only and may not be indicative of revenue or net income that have been achieved if the Scruggs Acquisition had occurred on October 1, 2016. |
Contracts Receivable Including
Contracts Receivable Including Retainage, Net | 9 Months Ended |
Jun. 30, 2019 | |
Contractors [Abstract] | |
Contracts Receivable Including Retainage, Net | Contracts Receivable Including Retainage, net Contracts receivable including retainage, net consisted of the following at June 30, 2019 and September 30, 2018 (in thousands): June 30, 2019 September 30, 2018 (unaudited) Contracts receivable $ 117,046 $ 104,541 Retainage 19,182 16,848 136,228 121,389 Allowance for doubtful accounts (1,519) (1,098) Contracts receivable including retainage, net $ 134,709 $ 120,291 Retainage receivables have been billed, but are not due until contract completion and acceptance by the customer. |
Costs and Estimated Earnings on
Costs and Estimated Earnings on Uncompleted Contracts | 9 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Costs and Estimated Earnings on Uncompleted Contracts | Costs and Estimated Earnings on Uncompleted Contracts Costs and estimated earnings compared to billings on uncompleted contracts at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, 2019 September 30, 2018 (unaudited) Costs on uncompleted contracts $ 913,628 $ 743,322 Estimated earnings to date on uncompleted contracts 123,914 95,155 1,037,542 838,477 Billings to date on uncompleted contracts (1,055,843) (867,881) Net billings in excess of costs and estimated earnings on uncompleted contracts $ (18,301) $ (29,404) Significant changes to balances of costs and estimated earnings in excess of billings (contract asset) and billings in excess of costs and estimated earnings (contract liability) on uncompleted contracts from September 30, 2018 to June 30, 2019 are presented below (in thousands): Costs and Estimated Earnings in Excess of Billings on Billings in Excess of Costs and Estimated Earnings on Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts September 30, 2018 $ 9,334 $ (38,738) $ (29,404) Changes in revenue billed, contract price or cost estimates 4,709 6,394 11,103 June 30, 2019 (unaudited) $ 14,043 $ (32,344) $ (18,301) |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, 2019 September 30, 2018 (unaudited) Construction equipment $ 217,662 $ 190,420 Asphalt plants 82,855 79,563 Land and improvements 34,888 29,624 Quarry reserves 20,749 20,908 Buildings 14,248 12,416 Furniture and fixtures 4,588 4,422 Leasehold improvements 1,347 765 Total property, plant and equipment, gross 376,337 338,118 Accumulated depreciation, depletion and amortization (175,660) (160,795) Construction in progress 1,035 1,369 Total property, plant and equipment, net $ 201,712 $ 178,692 On February 28, 2019, the Company acquired a liquid asphalt terminal located in Panama City, Florida. The purchase price of $10.8 million was paid in cash on the date of acquisition. The Company uses the terminal to receive, store and process liquid asphalt primarily for use in its construction projects. The transaction was accounted for as an asset acquisition in accordance with ASC 805. Accordingly, the purchase price and direct costs of $0.1 million incurred to complete the transaction were allocated to asset categories based on their relative fair value at the date of acquisition. Depreciation, depletion and amortization expense related to property, plant and equipment was $7.8 million and $6.5 million for the three months ended June 30, 2019 and June 30, 2018, respectively, and $22.1 million and $17.6 million for the nine months ended June 30, 2019 and June 30, 2018, respectively. |
Equity
Equity | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Equity | Equity At June 30, 2019 and September 30, 2018, the Company had authorized for issuance 10,000,000 shares of preferred stock, par value $0.001. No shares of preferred stock were issued and outstanding at June 30, 2019 or September 30, 2018. Reclassification of Common Stock and Initial Public Offering On April 23, 2018, the Company completed the Reclassification by amending and restating its certificate of incorporation to effectuate a dual class common stock structure consisting of Class A common stock and Class B common stock. As a result, each share of common stock, was reclassified into 25.2 shares of Class B common stock so that all holders of shares of outstanding common stock became the holders of 41,817,537 shares of Class B common stock, and shares held by the Company in treasury became 3,170,034 Class B treasury shares. All share and per share amounts have been retroactively adjusted for all periods presented to give effect to the Stock Split. On May 8, 2018, the Company completed its IPO, in which it sold 11,250,000 shares of Class A common stock at a price of $12.00 per share. Of these shares, 9,000,000 were shares of Class A common stock sold by the Company and 2,250,000 were sold by holders of Class B common stock, which shares upon sale automatically converted into 2,250,000 shares of Class A common stock. On May 24, 2018, the underwriters of the IPO partially exercised their over-allotment option to purchase an additional 700,000 shares of Class A common stock at the IPO price of $12.00, less the underwriting discount and commissions. Of these shares, 350,000 were shares of Class A common stock sold by the Company and 350,000 were sold by holders of Class B common stock, which shares upon sale automatically converted into 350,000 shares of Class A common stock. At June 30, 2019 and September 30, 2018, the Company had authorized for issuance 400,000,000 shares of Class A common stock, of which 32,442,545 were issued and outstanding at June 30, 2019, and 11,950,000 were issued and outstanding at September 30, 2018. At June 30, 2019 and September 30, 2018, the Company had authorized for issuance 100,000,000 shares of Class B common stock, of which 22,162,369 were issued and 19,239,417 were outstanding at June 30, 2019, and 42,387,571 were issued and 39,464,619 were outstanding at September 30, 2018. At June 30, 2019 and September 30, 2018, the Company held 2,922,952 Class B shares in treasury, at an average cost of $5.34 per share. Conversion of Class B common stock to Class A common stock During the three months ended June 30, 2019, certain stockholders of the Company converted a total of 20,225,202 shares of the Company's Class B common stock, on a one-for-one basis, into shares of the Company's Class A common stock. Following the conversion, there were 32,442,545 shares of Class A common stock and 19,239,417 shares of Class B common stock outstanding. Grant of Restricted Shares of Class A common stock As described in Note 14 – Equity-Based Compensation, during the three months ended June 30, 2019, the Company awarded a total of 267,343 restricted shares of Class A common stock to its non-employee directors under the Construction Partners, Inc. 2018 Equity Incentive Plan (as amended, the "Equity Incentive Plan"). Amendment to the Equity Incentive Plan |
Debt
Debt | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt The Company maintains various credit facilities from time to time to finance acquisitions, the purchase of real estate, construction equipment, asphalt plants and other fixed assets, and for general working capital purposes. This includes, among other things, a credit agreement with BBVA Compass Bank (formerly known as Compass Bank) as agent, sole lead arranger and sole book runner (as amended, the "Compass Credit Agreement") providing for a $72.0 million term loan (the "Compass Term Loan") and a $30.0 million revolving credit facility (the "Compass Revolving Credit Facility"). Debt at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, September 30, 2019 2018 (unaudited) Long-term debt: Compass Term Loan $ 46,500 $ 57,300 Compass Revolving Credit Facility 5,000 5,000 Other long-term debt 661 964 Total long-term debt 52,161 63,264 Deferred debt issuance costs (288) (362) Debt discount (6) (14) Current maturities of long-term debt (14,771) (14,773) Long-term debt, net of current maturities $ 37,096 $ 48,115 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share As described in Note 8 - Equity, the Company completed an IPO and Reclassification of common stock during the third quarter of the fiscal year ended September 30, 2018. As described in Note 2 - Significant Accounting Policies, Earnings Per Share , diluted earnings per share is calculated by dividing net income attributable to common stockholders by the basic weighted average number of common shares outstanding and potential dilutive common shares determined using the treasury method, as applicable for the respective periods. Securities that are anti-dilutive are not included in the calculation of diluted earnings per share. The following table summarizes the weighted-average number of basic and diluted common shares outstanding and the calculation of basic and diluted earnings per share for the periods presented (in thousands, except share and per share amounts): Basic For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Numerator Net income attributable to common stockholders $ 17,202 $ 13,403 $ 26,568 $ 35,647 Denominator Weighted average number of common shares outstanding, basic 51,414,619 46,557,785 51,414,619 43,648,309 Net income per common share attributable to common shareholders, basic $ 0.33 $ 0.29 $ 0.52 $ 0.82 Diluted For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Numerator Net income attributable to common stockholders $ 17,202 $ 13,403 $ 26,568 $ 35,647 Denominator Weighted average number of common 51,414,619 46,557,785 51,414,619 43,648,309 Effect of dilutive securities: 2010 Non-Plan Stock Options — 387,892 — 271,163 2018 Restricted Stock Grants — 42,682 — 13,074 2019 Restricted Stock Grants 8,280 — 268 — Weighted average number of common 51,422,899 46,988,359 51,414,887 43,932,546 Net income per common share attributable $ 0.33 $ 0.29 $ 0.52 $ 0.81 |
Provision for Income Taxes
Provision for Income Taxes | 9 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Provision for Income Taxes | Provision for Income Taxes The Company files a consolidated United States income tax return and income tax returns in various states. Management evaluated the Company's tax positions at June 30, 2019, based on appropriate provisions of applicable enacted tax laws and regulations, and believes that they are supportable based on their specific technical merits and the facts and circumstances of the respective transactions. On December 22, 2017, the United States government enacted comprehensive tax legislation known as the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act included broad and complex changes to the United States tax code, including a reduction in the United States federal corporate income tax rate from 35.0% to 21.0% effective January 1, 2018. For periods during the fiscal year ended September 30, 2018, the Company recorded its income tax provision based on a blended U.S. statutory rate of 24.5%, which is based on a prorated applicable tax rate before and after the effective date of the Tax Act, and the applicable state income taxes. During the nine months ended June 30, 2018, the Company recorded a provisional discrete tax benefit of $4.4 million related to the Tax Act, primarily related to an adjustment of its United States deferred tax liabilities by the same amount, reflecting the reduction in the United States federal corporate income tax rate. This net reduction in deferred tax liabilities also included the estimated impact on the Company's net state deferred tax assets. The Company completed its accounting for the income tax effects of the Tax Act during the fourth quarter of its fiscal year ended September 30, 2018. The Company's effective tax rate for the three months ended June 30, 2019 and June 30, 2018 was 22.3% and 9.5%, respectively. The lower effective tax rate for the three months ended June 30, 2018 compared to the three months ended June 30, 2019 was primarily due |
Related Parties
Related Parties | 9 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties On December 31, 2017, the Company sold an indirect wholly owned subsidiary to an immediate family member of a Senior Vice President of the Company ("Purchaser of subsidiary") in consideration for an interest-bearing note receivable in the amount of $0.9 million, which approximated the net book value of the disposed entity. At June 30, 2019, $0.1 million and $0.8 million was reflected on the Company's Consolidated Balance Sheet within other current assets and other assets, respectively, representing the remaining balances on this note receivable. In connection with this transaction, the Company also received an interest-bearing note receivable from the disposed entity ("Disposed entity") on December 31, 2017 in the amount of $1.0 million representing certain accounts payable of the Disposed entity that were paid by the Company. At June 30, 2019, $0.1 million and $0.9 million was reflected on the Company's Consolidated Balance Sheet within other current assets and other assets, respectively, representing the remaining balances on this note receivable. Remaining principal and interest payments are scheduled to be made in periodic installments during fiscal year 2019 through fiscal year 2026. From time to time, the Company conducts or has conducted business with the following related parties: • Entities owned by immediate family members of a Senior Vice President of the Company perform subcontract work for a subsidiary of the Company, including trucking and grading services ("Subcontracting Services"). • From time to time, a subsidiary of the Company provides construction services to various companies owned by family members of a Senior Vice President of the Company ("Construction Services"). • For periodic corporate events, the Company has chartered a boat from Deep South Adventures, LLC, which is owned by a Senior Vice President of the Company. • The Company rents and purchases vehicles from an entity owned by a family member of a Senior Vice President of the Company ("Vehicles"). • Family members of a Senior Vice President of the Company provide consulting services to a subsidiary of the Company ("Consulting Services"). • A law firm previously owned by a family member of a Senior Vice President of the Company provided legal services to a subsidiary of the Company ("Legal Services"). • A subsidiary of the Company leases office space for its Dothan, Alabama office from H&K, Ltd. ("H&K"), an entity partially owned by a Senior Vice President of the Company. The office space was originally leased through early 2020, but the subsidiary terminated the lease in June 2019 and paid $15,000 to H&K as consideration for the early termination. Under the lease agreement, the Company paid a fixed minimum rent per month. • A subsidiary of the Company leased office space for its Montgomery, Alabama office from H&A Properties LLC ("H&A"), an entity partially owned by two Senior Vice Presidents of the Company. Under the lease agreement, the Company paid a fixed minimum rent per month. In September 2018, the subsidiary purchased this office from H&A for $0.5 million. • On June 1, 2014, the Company entered into an access agreement with Island Pond Corporate Services, LLC ("Island Pond"), which provides a location for the Company to conduct business development activities from time to time on a property owned by the Executive Chairman of the Company's Board of Directors. • The Company is party to a management services agreement with SunTx, under which the Company pays SunTx $0.25 million per fiscal quarter and reimburses certain travel and other out-of-pocket expenses. The following table presents revenues earned and expenses incurred by the Company during the three and nine months ended June 30, 2019 and June 30, 2018, if and to the extent the Company engaged in transactions with the parties described above during the respective periods, and accounts receivable and accounts payable balances at June 30, 2019 and September 30, 2018, related to transactions with such parties (in thousands): Revenue Earned (Expense Incurred) Accounts Receivable (Payable) For the Three Months Ended June 30, For the Nine Months Ended June 30, June 30, September 30, 2019 2018 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Purchaser of subsidiary $ — $ — $ — $ — $ 876 $ 850 Disposed entity $ — $ — $ — $ — $ 966 $ 937 Subcontracting Services (1) $ (7,195) $ (4,321) $ (13,561) $ (8,687) $ (1,724) $ (790) Construction Services $ 1,609 $ 57 $ 2,783 $ 1,633 $ 4,350 $ 2,863 Deep South Adventures, LLC (2) $ — $ — $ — $ (33) $ — $ — Vehicles (2) $ (496) $ (288) $ (1,128) $ (864) $ — $ — Consulting Services (2) $ (64) $ (87) $ (198) $ (203) $ — $ — Legal Services (2) $ — $ — $ — $ (58) $ — $ — H&K (2) $ (36) $ (21) $ (78) $ (63) $ — $ — H&A (2) $ — $ (17) $ — $ (51) $ — $ — Island Pond (2) $ (80) $ (80) $ (240) $ (240) $ — $ — SunTx (2) $ (316) $ (468) $ (957) $ (1,119) $ — $ — (1) Cost is reflected as cost of revenues on the Company's Consolidated Statements of Income. (2) Cost is reflected as general and administrative expenses on the Company's Consolidated Statements of Income. |
Settlement Agreement
Settlement Agreement | 9 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Settlement Agreement | Settlement AgreementOn April 19, 2018, certain of the Company's subsidiaries entered into settlement agreements with a third party, pursuant to which they will receive aggregate net payments of approximately $15.7 million. These agreements provided for the payments to be made in four equal installments between January 2019 and July 2020, in exchange for releasing and waiving all current and future claims against the third party relating to a business interruption event that occurred more than five years ago that did not directly relate to the Company's business and that has not, and is not expected to, recur (the "Settlement"). The Company recorded a pre-tax gain of $14.8 million during the nine months ended June 30, 2018 related to the Settlement. The subsidiaries received the first installment payments in the total amount of $3.9 million in January 2019. Future payments are reflected on the Consolidated Balance Sheet at June 30, 2019 as other current assets and other assets in the amount of $7.9 million and $3.7 million, respectively. |
Equity-Based Compensation
Equity-Based Compensation | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Equity-Based Compensation | Equity-Based Compensation During the three months and nine months ended June 30, 2019, the Company awarded a total of 267,343 restricted shares of Class A common stock to its non-employee directors under the Equity Incentive Plan in lieu of any cash compensation. The grants are classified as equity awards. The aggregate grant date fair value of these restricted stock grants was $3.4 million. The grants will vest as to two-thirds of the underlying shares on January 1, 2021 and as to the remaining one-third of the underlying shares on January 1, 2022. During the three months and nine months ended June 30, 2019, the Company recorded compensation expense in connection with these grants in the amount of $0.1 million, which is reflected as general and administrative expenses in the Company’s Consolidated Statements of Income. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Alabama Acquisition On July 12, 2019, a subsidiary of the Company acquired substantially all of the assets of an HMA manufacturing plant and paving company located near Gadsden, Alabama. The acquired business is expected to benefit from geographic synergies resulting from its proximity to the Company’s current operations in northeast Alabama, including an aggregates quarry. The acquisition was accounted for as a business combination in accordance with ASC 805. The purchase price of $5.0 million was paid from cash on hand at closing. The provisional allocation of the purchase price to assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, was determined in accordance with the methodology described under Fair Value Measurements in Note 3 to the Company's audited financial statements for the fiscal year ended September 30, 2018, as set forth in the 2018 Form 10-K. The amounts allocated were not material to the Company's Consolidated Balance Sheet. The purchase price exceeding the net fair value of identifiable assets acquired and liabilities assumed was recorded as goodwill in the amount of $2.4 million, which is deductible for income tax purposes. Goodwill primarily represents the assembled workforce and synergies expected to result from the acquisition. Upon finalizing the accounting for this transaction, management expects to ascribe value to other identifiable intangible assets, including customer relationships and customer backlog, which will reduce the amount allocated to goodwill. Conversion of Class B common stock to Class A common stock Subsequent to June 30, 2019, a stockholder of the Company converted a total of 125,000 shares of the Company's Class B common stock, on a one-for-one basis, into shares of the Company's Class A common stock. Following the conversion, there were 32,567,545 shares of Class A common stock and 19,114,417 shares of Class B common stock outstanding. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Seasonality | Seasonality The use and consumption of our products and services fluctuate due to seasonality. Our products are used, and our construction operations and production facilities are located, outdoors. Therefore, seasonal changes and other weather-related conditions, in particular extended snowy, rainy or cold weather in the winter, spring or fall and major weather events, such as hurricanes, tornadoes, tropical storms and heavy snows, can adversely affect our business and operations through a decline in both the use of our products and demand for our services. In addition, construction materials production and shipment levels follow activity in the construction industry, which typically occurs in the spring, summer and fall. Warmer and drier weather during the third and fourth quarters of our fiscal year typically result in higher activity and revenues during those quarters. The first and second quarters of our fiscal year typically have lower levels of activity due to adverse weather conditions. |
Basis of Presentation | Basis of PresentationThe consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. These interim consolidated statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"), which permit reduced disclosure for interim periods. The Consolidated Balance Sheet as of September 30, 2018 was derived from audited financial statements for the fiscal year then ended, but does not include all necessary disclosures required by generally accepted accounting principles in the United States of America ("GAAP") with respect to annual financial statements. In the opinion of management, the unaudited consolidated financial statements include all recurring adjustments and normal accruals necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the dates and periods presented. These consolidated financial statements and accompanying notes should be read in conjunction with the Company's audited annual consolidated financial statements and notes thereto included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2018 (the "2018 Form 10-K"). Results for interim periods are not necessarily indicative of the results to be expected for a full fiscal year or for any future period. |
Management’s Estimates | Management's Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the recorded amounts of assets, liabilities, stockholders' equity, revenues and expenses during the reporting period, and the disclosure of contingent liabilities at the date of the consolidated financial statements. Estimates are used in accounting for items such as recognition of revenues and cost of revenues, goodwill and other intangible assets, allowance for doubtful accounts, valuation allowances related to income taxes, accruals for potential liabilities related to lawsuits or insurance claims, and the fair value of equity-based compensation awards. Estimates are continually evaluated based on historical information and actual experience; however, actual results could differ from these estimates. |
Emerging Growth Company | Emerging Growth Company The Company is an "emerging growth company" as defined by the Jumpstart Our Business Startups Act (the "JOBS Act"), enacted in April 2012. As an emerging growth company, the Company could have taken advantage of an exemption that would have allowed the Company to wait to comply with new or revised financial accounting standards until the effective date of such standards for private companies. However, the JOBS Act provides that a company may elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but such election to opt out is irrevocable. The Company has elected to opt out of such extended transition period, which means that when a standard is issued or revised and it has different effective dates for public and private companies, the Company is required to adopt the new or revised standard at the effective date applicable to public companies that are not emerging growth companies. |
Cash and Cash Equivalents | Cash and Cash EquivalentsCash consists principally of currency on hand and demand deposits at commercial banks. Cash equivalents are short-term, highly liquid investments that are both readily convertible to known amounts of cash and are so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Cash equivalents include investments with original maturities of three months or less. The Company maintains demand accounts, money market accounts and certificates of deposit at several banks. |
Contracts Receivable Including Retainage, net | Contracts Receivable Including Retainage, net Contracts receivable are generally based on amounts billed and currently due from customers, amounts currently due but unbilled, and amounts retained by the customer pending completion of a project. It is common in the Company's industry for a small portion of progress billings or the contract price, typically 10%, to be withheld by the customer until the Company completes a project to the satisfaction of the customer in accordance with contract terms. Such amounts, defined as retainage, represent a contract asset and are included on the Consolidated Balance Sheet as "Contracts receivable including retainage, net". Based on the Company's experience with similar contracts in recent years, billings for such retainage balances are generally collected within one year of the completion of the project. The carrying value of contracts receivable including retainage, net of the allowance for doubtful accounts, represents their estimated net realizable value. Management provides for uncollectible accounts through a charge to earnings and a credit to the allowance for doubtful accounts based on its assessment of the current status of individual accounts, type of service performed, and current economic conditions. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the allowance for doubtful accounts and an adjustment of the contract receivable. |
Contract Assets and Contract Liabilities | Contract Assets and Contract Liabilities Billing practices for the Company's contracts are governed by the contract terms of each project based on (i) progress toward completion approved by the owner, (ii) achievement of milestones or (iii) pre-agreed schedules. Billings do not necessarily correlate with revenues recognized under the percentage-of-completion method of accounting. The Company records contract assets and contract liabilities to account for these differences in timing. The contract asset, "Costs and estimated earnings in excess of billings on uncompleted contracts," arises when the Company recognizes revenues for services performed under its construction projects, but the Company is not yet entitled to bill the customer under the terms of the contract. Amounts billed to customers are excluded from this asset and reflected on the Consolidated Balance Sheet as "Contracts receivable including retainage, net". Included in costs and estimated earnings on uncompleted contracts are amounts the Company seeks or will seek to collect from customers or others for (i) errors, (ii) changes in contract specifications or design, (iii) contract change orders in dispute, unapproved as to scope and price, or (iv) other customer-related causes of unanticipated additional contract costs (such as claims). Such amounts are recorded at estimated net realizable value when realization is probable and can be reasonably estimated. Claims and unapproved change orders made by the Company may involve negotiation and, in rare cases, litigation. Unapproved change orders and claims also involve the use of estimates, and revenues associated with unapproved change orders and claims are included when realization is probable and amounts can be reliably determined. The Company did not recognize any material amounts associated with claims and unapproved change orders during the periods presented. The contract liability, "Billings in excess of costs and estimated earnings on uncompleted contracts," represents the Company's obligation to transfer goods or services to a customer for which the Company has been paid by the customer or for which the Company has billed the customer under the terms of the contract. Revenue for future services reflected in this account are recognized, and the liability is reduced, as the Company subsequently satisfies the performance obligation under the contract. |
Concentration of Risks | Concentration of RisksFinancial instruments that potentially subject the Company to concentrations of credit risk consist primarily of contracts receivable including retainage. In the normal course of business, the Company provides credit to its customers and does not generally require collateral. Concentrations of credit risk associated with these receivables are monitored on an ongoing basis. The Company has not historically experienced significant credit losses, due primarily to management's assessment of customers' credit ratings. The Company principally deals with recurring customers, state and local governments and well-known local companies whose reputations are known to management. The Company performs credit checks for significant new customers and generally requires progress payments for significant projects. The Company generally has the ability to file liens against the property if payments are not made on a timely basis. |
Revenue from Contract with Customers | Revenues from Contracts with Customers The Company derives all of its revenues from contracts with its customers, predominantly by performing construction services for both public and private infrastructure projects, with an emphasis on highways, roads, bridges, airports and commercial and residential developments. These projects are performed for a mix of federal, state, municipal and private customers. In addition, the Company generates revenues from the sale of construction materials including HMA, aggregates, liquid asphalt and ready-mix concrete to third-party public and private customers pursuant to contracts with those customers. The following table reflects, for the periods presented, (i) revenues generated from public infrastructure construction projects and the sale of construction materials to public customers and (ii) revenues generated from private infrastructure construction projects and the sale of construction materials to private customers. For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Private $ 66,207 $ 56,293 $ 166,193 $ 148,525 Public $ 161,083 $ 138,782 $ 379,728 $ 315,870 Revenues derived from construction projects are recognized over time, using the percentage-of-completion method of accounting, as the Company satisfies its performance obligations by transferring control of the asset created or enhanced by the project to the customer. Recognition of revenues and cost of revenues for construction projects requires significant judgment by management, including, among other things, estimating total costs expected to be incurred to complete a project and measuring progress toward completion. Management reviews contract estimates regularly to assess revisions of estimated costs to complete a project and measurement of progress toward completion. Management believes the Company maintains reasonable estimates based on prior experience; however, many factors contribute to changes in estimates of contract costs. Accordingly, estimates made with respect to uncompleted projects are subject to change as each project progresses and better estimates of contract costs become available. All contract costs are recorded as incurred, and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Provisions are recognized for the full amount of estimated losses on uncompleted contracts whenever evidence indicates that the estimated total cost of a contract exceeds its estimated total revenue, regardless of the stage of completion. When the Company incurs additional costs related to work performed by subcontractors, the Company may be able to utilize contractual provisions to back charge the subcontractors for those costs. A reduction to costs related to back charges is recognized when the estimated recovery is probable and the amount can be reasonably estimated. Contract costs consist of (i) direct costs on contracts, including labor, materials, and amounts payable to subcontractors and (ii) indirect costs related to contract performance, such as insurance, employee benefits, and equipment (primarily depreciation, fuel, maintenance and repairs). Progress toward completion is estimated using the input method, measured by the relationship of total cost incurred through the measurement date to total estimated costs required to complete the project (cost-to-cost method). The Company believes this method best depicts the transfer of goods and services to the customer because it represents satisfaction of the Company's performance obligation under the contract, which occurs as the Company incurs costs. The Company measures percentage of completion based on the performance of a single performance obligation under its construction projects. Each of the Company's construction contracts represents a single performance obligation to complete a defined construction project. This is because goods and services promised for delivery to a customer are not distinct, as the customer cannot benefit from any individual portion of the services on its own. All deliverables under a contract are part of a project defined by a customer and represent a series of integrated goods and services that have the same pattern of delivery to the customer and use the same measure of progress toward satisfaction of the performance obligation as the customer's asset is created or enhanced by the Company. The Company's obligation is not satisfied until the entire project is complete. Revenue recognized during a reporting period is based on the estimated incremental percentage-of-completion applied to the total contract price, including adjustments for variable consideration such as liquidated damages, penalties or bonuses related to the timeliness or quality of project performance. Such adjustments are made to reflect the most likely amount of consideration management expects the Company to be entitled to at the completion of the contract, based on the best information available to the Company. The basis for total contract price is a stated amount in the contract, which is generally either fixed unit price or fixed total price, as described below. The Company adjusts the estimated contract price to include variable consideration to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur or when the uncertainty associated with the variable consideration is resolved. Total contract price is adjusted to reflect expected liquidated damages assessments or other penalties in the period the Company determines they will be incurred or when the customer imposes the penalty. Total contract price is adjusted to reflect contract bonus provisions related to timeliness or quality metrics when realization is probable and amounts can be reliably determined, which is generally when they are awarded by the customer. We account for changes in the measure of progress and changes to the estimated transaction price using a cumulative catch-up adjustment. The majority of the Company's public construction contracts are fixed unit price contracts. Under fixed unit price contracts, the Company is committed to providing materials or services required by a contract at fixed unit prices (for example, dollars per ton of asphalt placed). The Company's private customer contracts are primarily fixed total price contracts, also known as lump sum contracts, which require that the total amount of work be performed for a single price. Contract cost is recorded as incurred, and revisions in contract revenue and cost estimates are reflected in the accounting period when known. Changes in job performance, job conditions and estimated profitability, including those changes arising from contract change orders, penalty provisions and final contract settlements, may result in revisions to estimated revenues and costs and are recognized in the period in which the revisions are determined. Change orders are modifications of an original contract that effectively change the existing provisions of the contract and become part of the single performance obligation that is partially satisfied at the date of the contract modification. This is because goods and services promised under change orders are generally not distinct from the remaining goods and services under the existing contract, due to the significant integration of services performed in the context of the contract. Accordingly, change orders are generally accounted for as a modification of the existing contract and single performance obligation. We account for the modification using a cumulative catch-up adjustment. Either the Company or its customers may initiate change orders, which may include changes in specifications or designs, manner of performance, facilities, equipment, materials, sites and period of completion of the work. Revenues derived from the sale of HMA, aggregates, ready-mix concrete, and liquid asphalt are recognized at a point in time, which is when control of the product is transferred to the customer. Generally, that point in time is when the customer accepts delivery at its facility or receives product in its own transport vehicles from one of the Company's HMA plants. Upon purchase, the Company generally provides an invoice or similar document detailing the goods transferred to the customer. The Company generally offers payment terms customary in the industry, which typically require payment ranging from point-of-sale to 30 days following purchase. |
Income Taxes | Income Taxes The provision for income taxes includes federal and state income taxes. Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying values and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which the temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Management evaluates the realization of deferred tax assets and establishes a valuation allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized. Deferred tax assets and deferred tax liabilities are presented on a net basis by taxing authority and classified as non-current on the Consolidated Balance Sheets. The Company classifies income tax-related interest and penalties as interest expense and other expenses, respectively. |
Earnings per Share | Earnings per Share As described in Note 8 – Equity, the Company completed an initial public offering (the "IPO") and reclassification (the "Reclassification") of its common stock during the fiscal year ended September 30, 2018, involving, among other things, a 25.2 to 1 split of shares of common stock (the "Stock Split") and the creation of a dual-class common stock structure. Prior to the Reclassification, all net income of the Company was attributable to the holders of shares of common stock immediately prior to the Reclassification. During the period beginning from the Reclassification through the IPO, all net income of the Company was attributable to holders of Class B common stock. Since the IPO, all net income of the Company has been attributable equally, on a per share basis, to the holders of Class A common stock and Class B common stock. Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of aggregate shares of pre-Reclassification common stock, Class A common stock and Class B common stock, as applicable for the respective periods, calculated on a post-Stock Split basis. Diluted earnings per share is calculated by dividing net income attributable to common stockholders by the weighted average number of aggregate shares of pre-Reclassification common stock, Class A common stock, Class B common stock and potential dilutive common shares determined using the treasury method, calculated on a post-Stock Split basis as applicable for the respective periods. Securities that are anti-dilutive are not included in the calculation of diluted earnings per share. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09 , Revenue from Contracts with Customers (Topic 606) ("ASC 606"), which revises and consolidates current guidance, eliminates industry-specific revenue recognition guidance and establishes a comprehensive principle-based approach for determining revenue recognition. The core principle of the guidance is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for providing those goods or services. Amendments of this update set forth a five-step revenue recognition model to be applied consistently to all contracts with customers, except those that are within the scope of other topics in the Accounting Standards Codification ("ASC"): (i) identify the contract with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The update also provides guidance regarding the recognition of costs related to obtaining and fulfilling customer contracts. This update also requires quantitative and qualitative disclosures sufficient to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including disclosures on significant judgments made when applying the guidance. The FASB subsequently amended ASC 606 on multiple occasions to, among other things, delay its effective date and clarify certain implementation guidance. The update permits adoption using either (i) a full retrospective approach, under which all years included in the financial statements are presented under the revised guidance, or (ii) a modified retrospective approach, under which financial statements are prepared under the revised guidance for the year of adoption, but not for prior years. Under the latter method, entities recognize a cumulative adjustment to the opening balance of retained earnings for contracts that still require performance by the entity at the date of adoption. Management adopted this update for the Company's fiscal year beginning October 1, 2018, using the modified retrospective approach. The adoption of ASC 606 on October 1, 2018 did not result in a material impact that required recognition of a cumulative adjustment of the opening retained earnings balance for contracts that still required performance at September 30, 2018. Application of ASC 606 for the nine months ended June 30, 2019 had the following impact on the Company's Consolidated Balance Sheet at June 30, 2019 and Consolidated Statements of Income for the three and nine months ended June 30, 2019 (in thousands): As Reported Impact of ASC 606 Without Application of ASC 606 At June 30, 2019 Costs and estimated earnings in excess of billings on uncompleted contracts $ 14,043 $ (982) $ 15,025 Inventories 37,069 1,205 35,864 Accrued expenses and other liabilities 19,028 (29) 19,057 Billings in excess of costs and estimated earnings on uncompleted contracts $ 32,344 $ 338 $ 32,006 For the Three Months Ended June 30, 2019 Revenues $ 227,290 $ (343) $ 227,633 Cost of revenues 189,198 311 188,887 Provision (benefit) for income taxes 4,941 9 4,932 Net income $ 17,202 $ (23) $ 17,225 For the Nine Months Ended June 30, 2019 Revenues $ 545,921 $ (1,321) $ 547,242 Cost of revenues 466,900 (1,205) 468,105 Provision (benefit) for income taxes 8,080 (29) 8,109 Net income $ 26,568 $ (87) $ 26,655 The Company has refined its accounting policies and related internal controls affected by this update. Management's assessment of the Company's construction contracts under the new standard supports the recognition of revenue over time using the percentage-of-completion method of accounting, measured by the relationship of total cost incurred to total estimated contract costs (cost-to-cost method), which is consistent with the Company's historical revenue recognition practices. As such, the Company's construction contracts continue to be recognized over time considering the continuous transfer of control to its customers during the performance of construction projects. The Company also enhanced its disclosures regarding judgments and estimates used by management in the application of ASC 606 in Note 2 - Significant Accounting Policies. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business ("ASC 805"). The amendments of this update refine the definition of a business. Prior to this update, guidance in ASC 805 defined a business as having an integrated set of assets along with three elements or activities: inputs, processes, and outputs (collectively referred to as a "set"). The amendments of this update provided a framework to assist in the evaluation of when a set is not a business. If substantially all of the fair value of gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If that threshold is not met, the Company must perform further analysis to determine whether the set is a business. At a minimum, the set must include an input and a substantive process that together significantly contribute to the ability to create outputs. The Company adopted this update for the Company’s fiscal year beginning October 1, 2018 and applied the guidance to acquisitions during the second quarter of the fiscal year ending September 30, 2019 as described in Note 4 - Business Acquisitions and Note 7 - Property, Plant and Equipment. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which becomes effective for the Company on October 1, 2019. The standard requires that lessees present right-of-use assets and lease liabilities on the balance sheet. The Company’s implementation efforts are focused on accounting policy and disclosure updates and system enhancements required to meet the new standard. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of revenue by major customers | The following table reflects, for the periods presented, (i) revenues generated from public infrastructure construction projects and the sale of construction materials to public customers and (ii) revenues generated from private infrastructure construction projects and the sale of construction materials to private customers. For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Private $ 66,207 $ 56,293 $ 166,193 $ 148,525 Public $ 161,083 $ 138,782 $ 379,728 $ 315,870 |
Schedule of customer concentration risk | Customers that accounted for more than 10% of consolidated revenues during those periods are presented below: % of Consolidated Revenues For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Alabama Department of Transportation 15.4 % 17.0 % 12.9 % 14.8 % North Carolina Department of Transportation 13.9 % 14.8 % 13.4 % 13.5 % |
Accounting Standards (Tables)
Accounting Standards (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Application of ASC 606 for the nine months ended June 30, 2019 had the following impact on the Company's Consolidated Balance Sheet at June 30, 2019 and Consolidated Statements of Income for the three and nine months ended June 30, 2019 (in thousands): As Reported Impact of ASC 606 Without Application of ASC 606 At June 30, 2019 Costs and estimated earnings in excess of billings on uncompleted contracts $ 14,043 $ (982) $ 15,025 Inventories 37,069 1,205 35,864 Accrued expenses and other liabilities 19,028 (29) 19,057 Billings in excess of costs and estimated earnings on uncompleted contracts $ 32,344 $ 338 $ 32,006 For the Three Months Ended June 30, 2019 Revenues $ 227,290 $ (343) $ 227,633 Cost of revenues 189,198 311 188,887 Provision (benefit) for income taxes 4,941 9 4,932 Net income $ 17,202 $ (23) $ 17,225 For the Nine Months Ended June 30, 2019 Revenues $ 545,921 $ (1,321) $ 547,242 Cost of revenues 466,900 (1,205) 468,105 Provision (benefit) for income taxes 8,080 (29) 8,109 Net income $ 26,568 $ (87) $ 26,655 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of pro forma revenues and net income | The following presents unaudited pro forma revenues and net income for the three and nine months ended June 30, 2018 as though the Scruggs Acquisition had occurred on October 1, 2016 (in thousands): For the Three Months Ended June 30, 2018 For the Nine Months Ended June 30, 2018 Pro forma revenues $ 206,924 $ 519,735 Pro forma net income $ 15,379 $ 40,653 Unaudited pro forma financial information is pr esented as if the operations of Scruggs had been included in the consolidated results of the Company and gives effect to transactions that are directly attributable to the Scruggs Acquisition, including adjustments to: a. Include the pro forma results of operations of Scruggs for the three and nine months ended June 30, 2018. b. Include additional depreciation and depletion expense related to the fair value of acquired property, plant and equipment and quarry reserves, as applicable, as if such assets were acquired on October 1, 2016 and the Company's depreciation and depletion methodologies were consistently applied to such assets. c. Include interest expense under the Compass Term Loan, defined in Note 9 - Debt, as if the $22.0 million borrowed to partially finance the purchase price was borrowed on October 1, 2016. Interest expense calculations further assume that no principal payments were made applicable to the $22.0 million borrowed during the period from October 1, 2016 through June 30, 2018, and that the interest rate in effect on the date the Company made the additional $22.0 million borrowing on May 15, 2018 was in effect for the period from October 1, 2016 through June 30, 2018. |
Contracts Receivable Includin_2
Contracts Receivable Including Retainage, Net (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Contractors [Abstract] | |
Schedule of Contracts Receivable Including Retainage, Net | Contracts receivable including retainage, net consisted of the following at June 30, 2019 and September 30, 2018 (in thousands): June 30, 2019 September 30, 2018 (unaudited) Contracts receivable $ 117,046 $ 104,541 Retainage 19,182 16,848 136,228 121,389 Allowance for doubtful accounts (1,519) (1,098) Contracts receivable including retainage, net $ 134,709 $ 120,291 |
Costs and Estimated Earnings _2
Costs and Estimated Earnings on Uncompleted Contracts (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Costs and Estimated Earnings Compared to Billings on Uncompleted Contracts | Costs and estimated earnings compared to billings on uncompleted contracts at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, 2019 September 30, 2018 (unaudited) Costs on uncompleted contracts $ 913,628 $ 743,322 Estimated earnings to date on uncompleted contracts 123,914 95,155 1,037,542 838,477 Billings to date on uncompleted contracts (1,055,843) (867,881) Net billings in excess of costs and estimated earnings on uncompleted contracts $ (18,301) $ (29,404) Significant changes to balances of costs and estimated earnings in excess of billings (contract asset) and billings in excess of costs and estimated earnings (contract liability) on uncompleted contracts from September 30, 2018 to June 30, 2019 are presented below (in thousands): Costs and Estimated Earnings in Excess of Billings on Billings in Excess of Costs and Estimated Earnings on Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts September 30, 2018 $ 9,334 $ (38,738) $ (29,404) Changes in revenue billed, contract price or cost estimates 4,709 6,394 11,103 June 30, 2019 (unaudited) $ 14,043 $ (32,344) $ (18,301) |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | Property, plant and equipment at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, 2019 September 30, 2018 (unaudited) Construction equipment $ 217,662 $ 190,420 Asphalt plants 82,855 79,563 Land and improvements 34,888 29,624 Quarry reserves 20,749 20,908 Buildings 14,248 12,416 Furniture and fixtures 4,588 4,422 Leasehold improvements 1,347 765 Total property, plant and equipment, gross 376,337 338,118 Accumulated depreciation, depletion and amortization (175,660) (160,795) Construction in progress 1,035 1,369 Total property, plant and equipment, net $ 201,712 $ 178,692 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt at June 30, 2019 and September 30, 2018 consisted of the following (in thousands): June 30, September 30, 2019 2018 (unaudited) Long-term debt: Compass Term Loan $ 46,500 $ 57,300 Compass Revolving Credit Facility 5,000 5,000 Other long-term debt 661 964 Total long-term debt 52,161 63,264 Deferred debt issuance costs (288) (362) Debt discount (6) (14) Current maturities of long-term debt (14,771) (14,773) Long-term debt, net of current maturities $ 37,096 $ 48,115 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Summary of Earnings Per Share | The following table summarizes the weighted-average number of basic and diluted common shares outstanding and the calculation of basic and diluted earnings per share for the periods presented (in thousands, except share and per share amounts): Basic For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Numerator Net income attributable to common stockholders $ 17,202 $ 13,403 $ 26,568 $ 35,647 Denominator Weighted average number of common shares outstanding, basic 51,414,619 46,557,785 51,414,619 43,648,309 Net income per common share attributable to common shareholders, basic $ 0.33 $ 0.29 $ 0.52 $ 0.82 Diluted For the Three Months Ended June 30, For the Nine Months Ended June 30, 2019 2018 2019 2018 Numerator Net income attributable to common stockholders $ 17,202 $ 13,403 $ 26,568 $ 35,647 Denominator Weighted average number of common 51,414,619 46,557,785 51,414,619 43,648,309 Effect of dilutive securities: 2010 Non-Plan Stock Options — 387,892 — 271,163 2018 Restricted Stock Grants — 42,682 — 13,074 2019 Restricted Stock Grants 8,280 — 268 — Weighted average number of common 51,422,899 46,988,359 51,414,887 43,932,546 Net income per common share attributable $ 0.33 $ 0.29 $ 0.52 $ 0.81 |
Related Parties (Tables)
Related Parties (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | The following table presents revenues earned and expenses incurred by the Company during the three and nine months ended June 30, 2019 and June 30, 2018, if and to the extent the Company engaged in transactions with the parties described above during the respective periods, and accounts receivable and accounts payable balances at June 30, 2019 and September 30, 2018, related to transactions with such parties (in thousands): Revenue Earned (Expense Incurred) Accounts Receivable (Payable) For the Three Months Ended June 30, For the Nine Months Ended June 30, June 30, September 30, 2019 2018 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Purchaser of subsidiary $ — $ — $ — $ — $ 876 $ 850 Disposed entity $ — $ — $ — $ — $ 966 $ 937 Subcontracting Services (1) $ (7,195) $ (4,321) $ (13,561) $ (8,687) $ (1,724) $ (790) Construction Services $ 1,609 $ 57 $ 2,783 $ 1,633 $ 4,350 $ 2,863 Deep South Adventures, LLC (2) $ — $ — $ — $ (33) $ — $ — Vehicles (2) $ (496) $ (288) $ (1,128) $ (864) $ — $ — Consulting Services (2) $ (64) $ (87) $ (198) $ (203) $ — $ — Legal Services (2) $ — $ — $ — $ (58) $ — $ — H&K (2) $ (36) $ (21) $ (78) $ (63) $ — $ — H&A (2) $ — $ (17) $ — $ (51) $ — $ — Island Pond (2) $ (80) $ (80) $ (240) $ (240) $ — $ — SunTx (2) $ (316) $ (468) $ (957) $ (1,119) $ — $ — (1) Cost is reflected as cost of revenues on the Company's Consolidated Statements of Income. (2) Cost is reflected as general and administrative expenses on the Company's Consolidated Statements of Income. |
Significant Accounting Polici_4
Significant Accounting Policies (Details) $ in Thousands | Apr. 23, 2018 | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2018 |
Concentration Risk [Line Items] | ||||||
Revenues | $ 227,290 | $ 195,075 | $ 545,921 | $ 464,395 | ||
Class B Common Stock | ||||||
Concentration Risk [Line Items] | ||||||
Stock split, conversion ratio | 25.2 | 25.2 | ||||
Revenues | Customer Concentration Risk | Private | ||||||
Concentration Risk [Line Items] | ||||||
Revenues | 66,207 | 56,293 | 166,193 | 148,525 | ||
Revenues | Customer Concentration Risk | Public | ||||||
Concentration Risk [Line Items] | ||||||
Revenues | $ 161,083 | $ 138,782 | $ 379,728 | $ 315,870 | ||
Revenues | Department of Transportation | Customer Concentration Risk | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk percentage | 41.80% | 45.60% | 39.40% | 40.90% | ||
Revenues | Alabama Department of Transportation | Customer Concentration Risk | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk percentage | 15.40% | 17.00% | 12.90% | 14.80% | ||
Revenues | North Carolina Department of Transportation | Customer Concentration Risk | ||||||
Concentration Risk [Line Items] | ||||||
Concentration risk percentage | 13.90% | 14.80% | 13.40% | 13.50% |
Accounting Standards (Details)
Accounting Standards (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Costs and estimated earnings in excess of billings on uncompleted contracts | $ 14,043 | $ 14,043 | $ 9,334 | ||||||
Inventories | 37,069 | 37,069 | 24,556 | ||||||
Accrued expenses and other liabilities | 19,028 | 19,028 | 17,520 | ||||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 32,344 | 32,344 | $ 38,738 | ||||||
Revenues | 227,290 | $ 195,075 | 545,921 | $ 464,395 | |||||
Cost of revenues | 189,198 | 165,606 | 466,900 | 398,379 | |||||
Provision (benefit) for income taxes | 4,941 | 1,409 | 8,080 | 5,382 | |||||
Net income | 17,202 | $ 4,212 | $ 5,154 | $ 13,403 | $ 11,248 | $ 10,996 | 26,568 | $ 35,647 | |
Impact of ASC 606 | Accounting Standards Update 2014-09 | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Costs and estimated earnings in excess of billings on uncompleted contracts | (982) | (982) | |||||||
Inventories | 1,205 | 1,205 | |||||||
Accrued expenses and other liabilities | (29) | (29) | |||||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 338 | 338 | |||||||
Revenues | (343) | (1,321) | |||||||
Cost of revenues | 311 | (1,205) | |||||||
Provision (benefit) for income taxes | 9 | (29) | |||||||
Net income | (23) | (87) | |||||||
Without Application of ASC 606 | |||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||
Costs and estimated earnings in excess of billings on uncompleted contracts | 15,025 | 15,025 | |||||||
Inventories | 35,864 | 35,864 | |||||||
Accrued expenses and other liabilities | 19,057 | 19,057 | |||||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 32,006 | 32,006 | |||||||
Revenues | 227,633 | 547,242 | |||||||
Cost of revenues | 188,887 | 468,105 | |||||||
Provision (benefit) for income taxes | 4,932 | 8,109 | |||||||
Net income | $ 17,225 | $ 26,655 |
Business Acquisitions - Additio
Business Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | Feb. 26, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | May 15, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 36,968 | $ 36,968 | $ 32,919 | ||
Hot Mix Asphalt and Ready-Mix Concrete | |||||
Business Acquisition [Line Items] | |||||
Purchase price | $ 8,900 | ||||
Goodwill | $ 4,000 | ||||
Acquisition costs incurred | 100 | 100 | |||
Scruggs Company | |||||
Business Acquisition [Line Items] | |||||
Acquisition of common shares and voting interest | 10000.00% | ||||
Revenues | 18,500 | 53,200 | |||
Net income | $ 2,300 | $ 5,200 |
Business Acquisitions - Proform
Business Acquisitions - Proforma Revenue and Net Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Sep. 30, 2018 | May 15, 2018 | |
Business Acquisition [Line Items] | |||||
Long-term debt | $ 52,161 | $ 63,264 | |||
Senior Notes | |||||
Business Acquisition [Line Items] | |||||
Long-term debt | $ 46,500 | $ 57,300 | |||
Scruggs Company | |||||
Business Acquisition [Line Items] | |||||
Pro forma revenues | $ 206,924 | $ 519,735 | |||
Pro forma net income | $ 15,379 | $ 40,653 | |||
Scruggs Company | Senior Notes | |||||
Business Acquisition [Line Items] | |||||
Long-term debt | $ 22,000 |
Contracts Receivable Includin_3
Contracts Receivable Including Retainage, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Contractors [Abstract] | ||
Contracts receivable | $ 117,046 | $ 104,541 |
Retainage | 19,182 | 16,848 |
Contracts receivable including retainage, gross | 136,228 | 121,389 |
Allowance for doubtful accounts | (1,519) | (1,098) |
Contracts receivable including retainage, net | $ 134,709 | $ 120,291 |
Costs and Estimated Earnings _3
Costs and Estimated Earnings on Uncompleted Contracts - Cost and Estimated Earnings Compared to Billings on Uncompleted Contracts (Detail) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Revenue from Contract with Customer [Abstract] | ||
Costs on uncompleted contracts | $ 913,628 | $ 743,322 |
Estimated earnings to date on uncompleted contracts | 123,914 | 95,155 |
Costs and estimated earnings to date on uncompleted contracts | 1,037,542 | 838,477 |
Billings to date on uncompleted contracts | (1,055,843) | (867,881) |
Net billings in excess of costs and estimated earnings on uncompleted contracts | $ (18,301) | $ (29,404) |
Costs and Estimated Earnings _4
Costs and Estimated Earnings on Uncompleted Contracts - Reconciliation of Net Billings in Excess of Costs and Estimated Earnings (Detail) $ in Thousands | 9 Months Ended |
Jun. 30, 2019USD ($) | |
Costs and Estimated Earnings in Excess of Billings on Uncompleted Contracts | |
Contract asset, beginning balance | $ 9,334 |
Changes in revenue billed, contract price or cost estimates | 4,709 |
Contract asset, ending balance | 14,043 |
Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | |
Contract liability, beginning balance | (38,738) |
Changes in revenue billed, contract price or cost estimates | 6,394 |
Contract liability, ending balance | (32,344) |
Net Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts | |
Net billings in excess of costs, beginning balance | (29,404) |
Changes in revenue billed, contract price or cost estimates | 11,103 |
Net billings in excess of costs, Ending balance | $ (18,301) |
Costs and Estimated Earnings _5
Costs and Estimated Earnings on Uncompleted Contracts - Narrative (Details) $ in Millions | Jun. 30, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, amount | $ 522 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, amount | $ 321 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligation, expected timing of satisfaction, period | 3 months |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of PP&E (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 376,337 | $ 338,118 |
Accumulated depreciation, depletion and amortization | (175,660) | (160,795) |
Construction in progress | 1,035 | 1,369 |
Total property, plant and equipment, net | 201,712 | 178,692 |
Construction equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 217,662 | 190,420 |
Asphalt plants | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 82,855 | 79,563 |
Land and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 34,888 | 29,624 |
Quarry reserves | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 20,749 | 20,908 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 14,248 | 12,416 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 4,588 | 4,422 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 1,347 | $ 765 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Thousands | Feb. 28, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | |||||
Depreciation, depletion and amortization expense | $ 22,698 | $ 17,929 | |||
Asphalt Terminal | |||||
Property, Plant and Equipment [Line Items] | |||||
Purchase price | $ 10,800 | ||||
Acquisition costs incurred | $ 100 | ||||
Depreciation, depletion and amortization expense | $ 7,800 | $ 6,500 | $ 22,100 | $ 17,600 |
Equity (Details)
Equity (Details) $ / shares in Units, $ in Thousands | May 24, 2019USD ($) | May 24, 2018shares | May 08, 2018$ / sharesshares | Apr. 23, 2018shares | Jun. 30, 2019$ / sharesshares | Jun. 30, 2019$ / sharesshares | Sep. 30, 2018$ / sharesshares |
Schedule Of Stockholders Equity [Line Items] | |||||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | ||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Preferred stock, shares issued (in shares) | 0 | 0 | 0 | ||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | ||||
Common stock, shares outstanding (in shares) | 11,250,000 | 39,464,619 | |||||
Treasury stock, shares (in shares) | (2,922,952) | (2,922,952) | |||||
Non-employee Director | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Amount of limit of dollar value of equity-based awards | $ | $ 750 | ||||||
Class B Common Stock | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Stock split, conversion ratio | 25.2 | 25.2 | |||||
Conversion of stock, shares issued (in shares) | 2,250,000 | 41,817,537 | |||||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | 100,000,000 | ||||
Common stock, shares issued (in shares) | 22,162,369 | 22,162,369 | 42,387,571 | ||||
Common stock, shares outstanding (in shares) | 19,239,417 | 19,239,417 | 39,464,619 | ||||
Treasury stock, shares (in shares) | (2,922,952) | (2,922,952) | (2,922,592) | ||||
Average cost of treasury shares (in dollars per share) | $ / shares | $ 5.34 | $ 5.34 | |||||
Conversion rate | 1 | ||||||
Class B Common Stock | Treasury Stock | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Conversion of stock, shares issued (in shares) | 3,170,034 | ||||||
Class A Common Stock | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Number of shares issued in transaction (in shares) | 350,000 | ||||||
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 | 400,000,000 | ||||
Common stock, shares issued (in shares) | 32,442,545 | 32,442,545 | 11,950,000 | ||||
Common stock, shares outstanding (in shares) | 9,000,000 | 32,442,545 | 32,442,545 | 11,950,000 | |||
Class A Common Stock | Restricted Stock | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Number of shares awarded (in shares) | 267,343 | 267,343 | |||||
Class A Common Stock | IPO | |||||||
Schedule Of Stockholders Equity [Line Items] | |||||||
Number of shares issued in transaction (in shares) | 700,000 | ||||||
Shares issued, price per share (in dollars per share) | $ / shares | $ 12 |
Debt (Details)
Debt (Details) - USD ($) | Jun. 30, 2019 | Sep. 30, 2018 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 52,161,000 | $ 63,264,000 |
Deferred debt issuance costs | (288,000) | (362,000) |
Debt discount | (6,000) | (14,000) |
Current maturities of long-term debt | (14,771,000) | (14,773,000) |
Long-term debt, net of current maturities | 37,096,000 | 48,115,000 |
Compass Term Loan | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | 72,000,000 | |
Long-term debt | 46,500,000 | 57,300,000 |
Compass Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Line of credit, maximum borrowing capacity | 30,000,000 | |
Long-term debt | 5,000,000 | 5,000,000 |
Other long-term debt | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 661,000 | $ 964,000 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator | ||||||||
Net income attributable to common stockholders | $ 17,202 | $ 4,212 | $ 5,154 | $ 13,403 | $ 11,248 | $ 10,996 | $ 26,568 | $ 35,647 |
Denominator | ||||||||
Weighted average number of common shares outstanding, basic (in shares) | 51,414,619 | 46,557,785 | 51,414,619 | 43,648,309 | ||||
Net income per common share attributable to common shareholders, basic (in dollars per share) | $ 0.33 | $ 0.29 | $ 0.52 | $ 0.82 | ||||
Effect of dilutive securities: | ||||||||
Weighted average number of common shares outstanding, diluted (in shares) | 51,422,899 | 46,988,359 | 51,414,887 | 43,932,546 | ||||
Net income per common share attributable to common stockholders, diluted (in dollars per share) | $ 0.33 | $ 0.29 | $ 0.52 | $ 0.81 | ||||
2010 Non-Plan Stock Options | ||||||||
Effect of dilutive securities: | ||||||||
Stock Options Agreements and Grants (in shares) | 0 | 387,892 | 0 | 271,163 | ||||
2018 Restricted Stock Grant | ||||||||
Effect of dilutive securities: | ||||||||
Stock Options Agreements and Grants (in shares) | 0 | 42,682 | 0 | 13,074 | ||||
2019 Restricted Stock Grant | ||||||||
Effect of dilutive securities: | ||||||||
Stock Options Agreements and Grants (in shares) | 8,280 | 0 | 268 | 0 |
Provision for Income Taxes (Det
Provision for Income Taxes (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||||
Blended statutory tax rate, percent | 24.50% | ||||
Income tax benefit related to tax act | $ 4.4 | ||||
Effective tax rate, percent | 22.30% | 9.50% | 23.30% | 13.10% |
Related Parties - Additional In
Related Parties - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Dec. 31, 2017 | |
Affiliated Entity | H&A | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | $ 500 | |||
Affiliated Entity | H&K | ||||
Related Party Transaction [Line Items] | ||||
Payment to related party | $ 15 | |||
Affiliated Entity | SunTx Capital Partners | ||||
Related Party Transaction [Line Items] | ||||
Payment to related party | $ 250 | |||
Consideration Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | $ 900 | |||
Accounts Payable Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | $ 1,000 | |||
Other Current Assets | Consideration Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | 100 | 100 | ||
Other Current Assets | Accounts Payable Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | 100 | 100 | ||
Other Assets | Consideration Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | 800 | 800 | ||
Other Assets | Accounts Payable Note Receivable | ||||
Related Party Transaction [Line Items] | ||||
Note receivable as consideration for sale of the wholly-owned subsidiary | $ 900 | $ 900 |
Related Parties - Schedule Of R
Related Parties - Schedule Of Related Party Transactions (Details) - Affiliated Entity - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Purchaser of subsidiary | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | $ 0 | $ 0 | $ 0 | $ 0 | |
Accounts Receivable (Payable) | 876 | 876 | $ 850 | ||
Disposed entity | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | 0 | 0 | 0 | 0 | |
Accounts Receivable (Payable) | 966 | 966 | 937 | ||
Subcontracting Services | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (7,195) | (4,321) | (13,561) | (8,687) | |
Accounts Receivable (Payable) | (1,724) | (1,724) | (790) | ||
Construction Services | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | 1,609 | 57 | 2,783 | 1,633 | |
Accounts Receivable (Payable) | 4,350 | 4,350 | 2,863 | ||
Deep South Adventures, LLC | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | 0 | 0 | 0 | (33) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
Vehicles | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (496) | (288) | (1,128) | (864) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
Consulting Services | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (64) | (87) | (198) | (203) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
Legal Services | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | 0 | 0 | 0 | (58) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
H&K | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (36) | (21) | (78) | (63) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
H&A | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | 0 | (17) | 0 | (51) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
Island Pond | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (80) | (80) | (240) | (240) | |
Accounts Receivable (Payable) | 0 | 0 | 0 | ||
SunTx | |||||
Related Party Transaction [Line Items] | |||||
Revenue Earned (Expense Incurred) | (316) | $ (468) | (957) | $ (1,119) | |
Accounts Receivable (Payable) | $ 0 | $ 0 | $ 0 |
Settlement Agreement (Detail)
Settlement Agreement (Detail) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jan. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2018USD ($) | Apr. 19, 2018USD ($)installment | |
Loss Contingencies [Line Items] | |||||||
Settlement income | $ 0 | $ 0 | $ 0 | $ 14,803 | |||
Other current assets | 13,533 | 13,533 | $ 14,137 | ||||
Other assets | 6,292 | 6,292 | $ 10,270 | ||||
Settlement Agreement | |||||||
Loss Contingencies [Line Items] | |||||||
Aggregate net payments to be received | $ 15,700 | ||||||
Number of equal installments payable | installment | 4 | ||||||
Settlement income | $ 14,800 | ||||||
Installment payments received | $ 3,900 | ||||||
Other current assets | 7,900 | 7,900 | |||||
Other assets | $ 3,700 | $ 3,700 |
Equity-Based Compensation (Deta
Equity-Based Compensation (Details) - Class A Common Stock - Restricted Stock - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares awarded (in shares) | 267,343 | 267,343 |
Grant date fair value of award | $ 3.4 | |
Share-based compensation expense | $ 0.1 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | Jul. 12, 2019USD ($) | Aug. 09, 2019shares | Jun. 30, 2019USD ($)shares | Jun. 30, 2018shares | Sep. 30, 2018USD ($) |
Subsequent Event [Line Items] | |||||
Goodwill | $ | $ 36,968 | $ 32,919 | |||
Class A Common Stock | |||||
Subsequent Event [Line Items] | |||||
Total shares converted (in shares) | 20,225,202 | 2,600,000 | |||
Class B Common Stock | |||||
Subsequent Event [Line Items] | |||||
Total shares converted (in shares) | 20,225,202 | 2,600,000 | |||
Conversion rate | 1 | ||||
Subsequent Event | Class A Common Stock | |||||
Subsequent Event [Line Items] | |||||
Shares converted (in shares) | 32,567,545 | ||||
Subsequent Event | Class B Common Stock | |||||
Subsequent Event [Line Items] | |||||
Total shares converted (in shares) | 125,000 | ||||
Conversion rate | 1 | ||||
Shares converted (in shares) | 19,114,417 | ||||
Subsequent Event | Alabama | Hot Mix Asphalt Manufacturing Plan | |||||
Subsequent Event [Line Items] | |||||
Purchase price | $ | $ 5,000 | ||||
Goodwill | $ | $ 2,400 |