MASTEC, INC.

FORM 10-Q

QUARTER ENDED ~~SEPTEMBER 30, 2017~~MARCH 31, 2022

TABLE OF CONTENTS



		Page
Part I. FINANCIAL INFORMATION		3
Item 1	Financial Statements (Unaudited)	3
	~~Condensed Unaudited~~ Consolidated Statements of Operations	3
	~~Condensed Unaudited~~ Consolidated Statements of Comprehensive Income	4
	~~Condensed Unaudited~~ Consolidated Balance Sheets	5
	~~Condensed Unaudited~~ Consolidated Statements of Equity	6
	Consolidated Statements of Cash Flows	67
	Notes to ~~the Condensed Unaudited~~ Consolidated Financial Statements (Unaudited)	78
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2926
Item 3	Quantitative and Qualitative Disclosures About Market Risk	4136
Item 4	Controls and Procedures	4136
Part II. OTHER INFORMATION		4237
Item 1	Legal Proceedings	4237
Item 1A	Risk Factors	4237
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	4237
Item 4	Mine Safety Disclosures	4237
Item 65	~~Exhibits~~Other Information	4237
~~SIGNATURES~~Item 6	43Exhibits	38
SIGNATURES		39

PART I. FINANCIAL INFORMATION


~~ITEM 1.~~	ITEM 1. FINANCIAL STATEMENTS

MASTEC, INC.

~~CONDENSED UNAUDITED~~ CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited - in thousands, except per share amounts)


	For the Three Months Ended March 31,
	2022		2021
Revenue	$	1,954,400	$	1,775,424
Costs of revenue, excluding depreciation and amortization	1,733,316		1,513,859
Depreciation	85,194		79,264
Amortization of intangible assets	25,589		11,247
General and administrative expenses	145,390		70,591
Interest expense, net	16,041		12,459
Equity in earnings of unconsolidated affiliates, net	(6,777)		(7,346)

Other expense (income), net	3,754		(79)
(Loss) income before income taxes	$	(48,107)	$	95,429
Benefit from (provision for) income taxes	13,148		(29,317)
Net (loss) income	$	(34,959)	$	66,112
Net income attributable to non-controlling interests	19		463
Net (loss) income attributable to MasTec, Inc.	$	(34,978)	$	65,649

(Loss) earnings per share (Note 2):
Basic (loss) earnings per share	$	(0.47)	$	0.91
Basic weighted average common shares outstanding	74,789		72,439

Diluted (loss) earnings per share	$	(0.47)	$	0.89
Diluted weighted average common shares outstanding	74,789		73,846

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
Revenue $ 1,955,752
$ 1,586,181
$ 5,004,116
$ 3,792,811
Costs of revenue, excluding depreciation and amortization 1,726,173
1,368,988
4,323,642
3,321,571
Depreciation and amortization 50,101
42,584
138,384
122,249
General and administrative expenses 66,397
67,131
202,001
195,031
Interest expense, net 17,578
13,097
44,966
37,895
Equity in (earnings) losses of unconsolidated affiliates (7,399 ) 6
(15,105 ) (3,549 )
Other income, net (4,677 ) (971 ) (4,102 ) (12,803 )
Income before income taxes $ 107,579
$ 95,346
$ 314,330
$ 132,417
Provision for income taxes (43,378 ) (38,816 ) (126,170 ) (54,331 )
Net income $ 64,201
$ 56,530
$ 188,160
$ 78,086
Net income attributable to non-controlling interests 449
253
1,770
414
Net income attributable to MasTec, Inc. $ 63,752

$ 56,277
$ 186,390
$ 77,672

Earnings per share (Note 2):
Basic earnings per share $ 0.79
$ 0.70
$ 2.31
$ 0.97
Basic weighted average common shares outstanding 80,953
80,462
80,859
80,323

Diluted earnings per share $ 0.77
$ 0.69
$ 2.27
$ 0.96
Diluted weighted average common shares outstanding 82,386
81,545
82,281
81,241

The accompanying notes are an integral part of these ~~condensed unaudited~~ consolidated financial statements.

MASTEC, INC.

~~CONDENSED UNAUDITED~~ CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited - in thousands)


	For the Three Months Ended March 31,
	2022		2021
Net (loss) income	$	(34,959)	$	66,112
Other comprehensive income:
Foreign currency translation gains, net of tax	913		371
Unrealized gains on investment activity, net of tax	13,754		13,839
Comprehensive (loss) income	$	(20,292)	$	80,322
Comprehensive income attributable to non-controlling interests	19		463
Comprehensive (loss) income attributable to MasTec, Inc.	$	(20,311)	$	79,859

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
Net income $ 64,201
$ 56,530
$ 188,160
$ 78,086
Other comprehensive income:
Foreign currency translation gains (losses), net of tax 641
(1,454 ) 2,415
4,417
Unrealized gains (losses) on equity investee activity, net of tax 808
(345 ) (1,287 ) (12,932 )
Comprehensive income $ 65,650
$ 54,731
$ 189,288
$ 69,571
Comprehensive income attributable to non-controlling interests 449
253
1,770
414
Comprehensive income attributable to MasTec, Inc. $ 65,201
$ 54,478
$ 187,518
$ 69,157

The accompanying notes are an integral part of these ~~condensed unaudited~~ consolidated financial statements.

MASTEC, INC.

~~CONDENSED UNAUDITED~~ CONSOLIDATED BALANCE SHEETS

(unaudited - in thousands, except ~~shares and per~~ share ~~amounts)~~information)


	March 31, 2022		December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	233,133	$	360,736
Accounts receivable, net of allowance	902,477		1,019,324
Contract assets	1,324,300		1,227,927
Inventories, net	101,420		92,595
Prepaid expenses	105,651		91,488
Other current assets	117,297		81,884
Total current assets	$	2,784,278	$	2,873,954
Property and equipment, net	1,484,677		1,436,087
Operating lease right-of-use assets	262,848		260,410
Goodwill, net	1,504,341		1,520,575
Other intangible assets, net	692,989		670,280
Other long-term assets	358,863		360,087
Total assets	$	7,087,996	$	7,121,393
Liabilities and equity
Current liabilities:
Current portion of long-term debt, including finance leases	$	133,963	$	137,912
Current portion of operating lease liabilities	92,066		95,426
Accounts payable	704,313		663,063
Accrued salaries and wages	229,493		203,141
Other accrued expenses	207,719		229,936
Contract liabilities	298,347		313,965
Other current liabilities	200,136		141,155
Total current liabilities	$	1,866,037	$	1,784,598
Long-term debt, including finance leases	1,788,727		1,876,233
Long-term operating lease liabilities	181,712		176,378
Deferred income taxes	462,688		450,361
Other long-term liabilities	276,755		289,962
Total liabilities	$	4,575,919	$	4,577,532
Commitments and contingencies (Note 14)	0		0
Equity
Preferred stock, $1.00 par value: authorized shares - 5,000,000; issued and outstanding shares – none	$	—	$	—
Common stock, $0.10 par value: authorized shares - 145,000,000; issued shares - 95,488,017 and 95,371,211 (including 1,686,060 and 1,747,385 of unvested stock awards) as of March 31, 2022 and December 31, 2021, respectively	9,549		9,537
Capital surplus	1,035,902		1,033,615
Retained earnings	2,127,410		2,162,388
Accumulated other comprehensive loss	(64,109)		(78,776)
Treasury stock, at cost: 19,129,904 and 18,941,926 shares as of March 31, 2022 and December 31, 2021, respectively	(600,746)		(586,955)
Total MasTec, Inc. shareholders’ equity	$	2,508,006	$	2,539,809
Non-controlling interests	$	4,071	$	4,052
Total equity	$	2,512,077	$	2,543,861
Total liabilities and equity	$	7,087,996	$	7,121,393

September 30,
2017 December 31,
2016
Assets
Current assets:
Cash and cash equivalents $ 43,822
$ 38,767
Accounts receivable, net 1,534,790
1,156,031
Inventories, net 84,460
111,031
Prepaid expenses 53,832
41,548
Other current assets 30,843
55,109
Total current assets $ 1,747,747
$ 1,402,486
Property and equipment, net 691,430
549,084
Goodwill, net 1,135,450
995,874
Other intangible assets, net 195,454
179,711
Other long-term assets 172,094
55,977
Total assets $ 3,942,175
$ 3,183,132
Liabilities and equity
Current liabilities:
Current portion of long-term debt $ 86,547
$ 64,600
Accounts payable 457,213
363,668
Accrued salaries and wages 119,553
67,126
Other accrued expenses 128,769
112,291
Billings in excess of costs and earnings 111,898
161,459
Other current liabilities 98,171
70,846
Total current liabilities $ 1,002,151
$ 839,990
Long-term debt 1,192,311
961,379
Deferred income taxes 274,465
178,355
Other long-term liabilities 170,203
99,774
Total liabilities $ 2,639,130
$ 2,079,498
Commitments and contingencies (Note 14)

Equity
Preferred stock, $1.00 par value: authorized shares - 5,000,000; issued and outstanding shares – none $ —
$ —
Common stock, $0.10 par value: authorized shares - 145,000,000; issued shares - 90,843,339 and 90,634,771 (including 1,790,632 and 1,927,286 of unvested restricted shares) as of September 30, 2017 and December 31, 2016, respectively 9,084
9,063
Capital surplus 800,297
788,914
Retained earnings 696,331
509,941
Accumulated other comprehensive loss (64,686 ) (65,814 )
Treasury stock, at cost: 8,094,004 shares as of both September 30, 2017 and December 31, 2016 (145,573 ) (145,573 )
Total MasTec, Inc. shareholders’ equity $ 1,295,453
$ 1,096,531
Non-controlling interests $ 7,592
$ 7,103
Total equity $ 1,303,045
$ 1,103,634
Total liabilities and equity $ 3,942,175
$ 3,183,132

The accompanying notes are an integral part of these ~~condensed unaudited~~ consolidated financial statements.

MASTEC, INC.

~~CONDENSED UNAUDITED~~ CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~EQUITY

(unaudited - in ~~thousands)~~thousands, except shares)


	Common Stock			Treasury Stock			Capital Surplus		Retained Earnings		Accumulated Other Comprehensive Loss		Total MasTec, Inc. Shareholders’ Equity		Non-Controlling Interests		Total Equity
	Shares	Amount		Shares	Amount
For the Three Months Ended March 31, 2022
Balance as of December 31, 2021	95,371,211	$	9,537	(18,941,926)	$	(586,955)	$	1,033,615	$	2,162,388	$	(78,776)	$	2,539,809	$	4,052	$	2,543,861
Net (loss) income									(34,978)				(34,978)		19		(34,959)
Other comprehensive income											14,667		14,667				14,667
Non-cash stock-based compensation							6,336						6,336				6,336
Issuance of restricted shares, net	165,010	17					(17)						—				—
Shares withheld for taxes, net of other share activity	(48,204)	(5)					(4,032)						(4,037)				(4,037)
Acquisition of treasury stock, at cost				(187,978)	(13,791)								(13,791)				(13,791)


Balance as of March 31, 2022	95,488,017	$	9,549	(19,129,904)	$	(600,746)	$	1,035,902	$	2,127,410	$	(64,109)	$	2,508,006	$	4,071	$	2,512,077

For the Three Months Ended March 31, 2021
Balance as of December 31, 2020	93,107,440	$	9,311	(18,941,926)	$	(586,955)	$	837,453	$	1,833,557	$	(91,444)	$	2,001,922	$	3,603	$	2,005,525
Net income									65,649				65,649		463		66,112
Other comprehensive income											14,210		14,210				14,210
Non-cash stock-based compensation							5,528						5,528				5,528
Issuance of restricted shares, net	138,081	14					(14)						—				—
Other stock issuances, net of shares withheld for taxes	7,747	—					(2,400)						(2,400)				(2,400)


Balance as of March 31, 2021	93,253,268	$	9,325	(18,941,926)	$	(586,955)	$	840,567	$	1,899,206	$	(77,234)	$	2,084,909	$	4,066	$	2,088,975

For the Nine Months Ended September 30
2017 2016
Cash flows from operating activities:
Net income $ 188,160
$ 78,086
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 138,384
122,249
Non-cash interest expense, net 2,375
2,209
Non-cash stock-based compensation expense 10,551
11,291
Provision for (benefit from) deferred income taxes 92,188
(1,339 )
Equity in earnings of unconsolidated affiliates (15,105 ) (3,549 )
(Gains) losses on sales of assets, net, including fixed assets held-for-sale (3,335 ) 378
Other non-cash items, net 14,920
1,951
Changes in assets and liabilities, net of acquisitions:
Accounts receivable (334,383 ) (302,590 )
Inventories 33,579
(18,900 )
Other assets, current and long-term portion (61,900 ) 48,032
Accounts payable and accrued expenses 132,963
172,731
Billings in excess of costs and earnings (54,199 ) 16,581
Book overdrafts (4,603 ) 8,883
Other liabilities, current and long-term portion 39,030
(8,872 )
Net cash provided by operating activities $ 178,625
$ 127,141
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired (115,995 ) (4,102 )
Capital expenditures (83,330 ) (89,050 )
Proceeds from sale of property and equipment 13,585
6,824
Payments for other investments (77,105 ) (8,858 )
Proceeds from other investments 13,416
1,125
Net cash used in investing activities $ (249,429 ) $ (94,061 )
Cash flows from financing activities:
Proceeds from credit facilities 2,002,430
1,186,816
Repayments of credit facilities (1,840,409 ) (1,149,930 )
Repayments of other borrowings (12,080 ) (8,188 )
Payments of capital lease obligations (48,748 ) (41,828 )
Payments of acquisition-related contingent consideration (18,843 ) (19,822 )
Distributions to non-controlling interests (1,280 ) —
Proceeds from stock-based awards, net 853
3,938
Other financing activities, net (6,301 ) 1,385
Net cash provided by (used in) financing activities $ 75,622
$ (27,629 )
Effect of currency translation on cash 237
(1,008 )
Net increase in cash and cash equivalents $ 5,055
$ 4,443
Cash and cash equivalents - beginning of period $ 38,767
$ 4,984
Cash and cash equivalents - end of period $ 43,822
$ 9,427

Supplemental cash flow information:
Interest paid $ 47,163
$ 40,433
Income taxes paid, net of refunds $ 77,533
$ 15,141
Supplemental disclosure of non-cash information:
Acquisition-related contingent consideration, new business combinations

$ 89,614
$ —
Equipment acquired under capital lease and financing arrangements $ 129,567
$ 13,015
Accrued capital expenditures $ 1,345
$ 4,119

The accompanying notes are an integral part of these ~~condensed unaudited~~ consolidated financial statements.

MASTEC, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited - in thousands)


	For the Three Months Ended March 31,
	2022		2021
Cash flows from operating activities:
Net (loss) income	$	(34,959)	$	66,112
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation	85,194		79,264
Amortization of intangible assets	25,589		11,247
Non-cash stock-based compensation expense	6,336		5,528
Provision for (benefit from) deferred income taxes	1,647		(19,838)


Equity in earnings of unconsolidated affiliates, net	(6,777)		(7,346)
Gains on sales of assets, net	(2,568)		(1,965)
Non-cash interest expense, net	854		783
Other non-cash items, net	(926)		(5,578)
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	121,646		(61,993)
Contract assets	(104,490)		26,799
Inventories	(8,980)		651
Other assets, current and long-term portion	36,268		(7,961)
Accounts payable and accrued expenses	14,537		153,386
Contract liabilities	(13,802)		14,782
Other liabilities, current and long-term portion	11,949		3,293
Net cash provided by operating activities	$	131,518	$	257,164
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired	(21,840)		(88,646)
Capital expenditures	(83,191)		(48,058)
Proceeds from sale of property and equipment	4,630		6,035
Payments for other investments	(960)		(4,350)
Proceeds from other investments	—		557
Other investing activities, net	—		(150)
Net cash used in investing activities	$	(101,361)	$	(134,612)
Cash flows from financing activities:
Proceeds from credit facilities	773,500		18,155
Repayments of credit facilities	(855,083)		(8,869)



Payments of finance lease obligations	(41,600)		(38,222)



Payments for stock-based awards	(3,996)		(3,753)
Repurchases of common stock	(13,791)		—


Other financing activities, net	(17,046)		(502)
Net cash used in financing activities	$	(158,016)	$	(33,191)
Effect of currency translation on cash	256		(72)
Net (decrease) increase in cash and cash equivalents	$	(127,603)	$	89,289
Cash and cash equivalents - beginning of period	$	360,736	$	423,118
Cash and cash equivalents - end of period	$	233,133	$	512,407


Supplemental cash flow information:
Interest paid	$	23,178	$	21,689

Supplemental disclosure of non-cash information:
Additions to property and equipment from finance leases	$	48,604	$	50,772

The accompanying notes are an integral part of these consolidated financial statements.

MASTEC, INC.

NOTES TO ~~CONDENSED UNAUDITED~~ CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Business, Basis of Presentation and Significant Accounting Policies

Nature of the Business

MasTec, Inc. (collectively with its subsidiaries, “MasTec” or the “Company”) is a leading infrastructure construction company operating mainly throughout North America across a range of industries. The Company’s primary activities include the engineering, building, installation, maintenance and upgrade of communications, energy, utility and ~~utility~~other infrastructure, such as: power delivery services, including transmission and distribution; wireless, wireline/fiber ~~install-to-the-home~~ and customer fulfillment activities; ~~petroleum~~power generation, primarily from clean energy and renewable sources; pipeline infrastructure, including natural gas pipeline ~~infrastructure; electrical utility transmission~~ and ~~distribution; power generation;~~distribution infrastructure; heavy civil; and industrial infrastructure. MasTec’s customers are primarily in these industries. MasTec reports its results under ~~five~~5 reportable segments: (1) Communications; (2) Clean Energy and Infrastructure; (3) Oil and Gas; ~~(3) Electrical Transmission;~~ (4) Power ~~Generation and Industrial;~~Delivery; and (5) Other. In the first quarter of 2022, the Company began integration of Henkels & McCoy Holdings, Inc., formerly known as Henkels & McCoy Group, Inc. (“HMG”). The HMG acquisition was completed on December 30, 2021, with its initial balance sheet reported within the Company’s Power Delivery segment. During the first quarter of 2022, the Company reported portions of HMG’s operations within its Power Delivery, Communications and Oil and Gas segments, as appropriate, and HMG’s corporate functions within its Corporate results. Accordingly, HMG’s December 31, 2021 balance sheet information was recast to conform with the new reporting structure. See Note 13 - Segments and Related Information.

Basis of Presentation

The accompanying ~~condensed unaudited~~ consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The accompanying ~~condensed~~ consolidated balance sheet as of December 31, ~~2016~~2021 is derived from the Company’s audited financial statements as of that date. Because certain information and footnote disclosures have been condensed or omitted, these ~~condensed unaudited~~ consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, ~~2016~~2021 contained in the Company’s ~~2016~~2021 Annual Report on Form 10-K (the ~~“2016~~“2021 Form 10-K”). In management’s opinion, all normal and recurring adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been included. ~~Certain~~When necessary, certain prior year amounts have been reclassified to conform towith the current period ~~presentation.~~presentation, including for the first quarter 2022 change in segment balance sheet information for HMG, as discussed above. In addition, in the fourth quarter of 2021, the Company updated its presentation of gains or losses, net, from the sale of property and equipment to include such amounts within general and administrative expenses. Previously, such gains or losses were included within other income or expense. Interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. The Company believes that the disclosures made in these ~~condensed unaudited~~ consolidated financial statements are adequate to make the information not misleading.

Principles of Consolidation

The accompanying ~~condensed unaudited~~ consolidated financial statements include MasTec, Inc. and its subsidiaries and include the accounts of all majority owned subsidiaries over which the Company exercises control and, when applicable, entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. Other parties’ interests in entities that MasTec consolidates are reported as non-controlling interests within ~~equity.~~equity, except for mandatorily redeemable non-controlling interests, which are recorded within other liabilities. Net income or loss attributable to non-controlling interests is reported as a separate line item below net income or loss. The ~~Company’s~~Company applies the equity method of accounting for its investments in entities for which ~~the Company~~it does not have a controlling financial interest, but ~~for~~over which it has the ability to exert significant influence, are accounted for using the equity method of accounting. Equity method investments are recorded as other long-term assets, or, for investments in a net liability position, within other long-term liabilities. Income or loss from these investments is recorded as a separate line item in the statements of operations. Intercompany profits or losses associated with the Company’s equity method investments are eliminated until realized by the investee in transactions with third parties.influence. For equity investees in which the Company has an undivided interest in the assets, liabilities and profits or losses of an unincorporated entity, but ~~the Company~~ does not exercise control over the entity, the Company consolidates its proportional interest in the accounts of the entity. ~~The cost method is used for investments in entities for which the Company does not have the ability to exert significant influence.~~

Management determines whether each business entity in which it has equity interests, debt, or other investments constitutes a variable interest entity (“VIE”) based on the nature and characteristics of such arrangements. If an investment arrangement is determined to be a VIE, then management determines if the Company is the VIE’s primary beneficiary by evaluating several factors, including the Company’s: (i) risks and responsibilities; (ii) ownership interests; (iii) decision making powers; and (iv) financial interests, among other factors. If management determines the Company is the primary beneficiary of a VIE, then it would be consolidated, and other parties’ interests in the VIE would be accounted for as non-controlling interests. The primary beneficiary consolidating the VIE must normally have both (i) the power to direct the primary activities of the VIE and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE, which, in either case, could be significant to the VIE. As of September 30, 2017, the Company determined that certain of its investment arrangements were VIEs; however, because it does not have the power to direct the primary activities that most significantly impact the economic performance of these VIEs, the Company is not the primary beneficiary, and accordingly, has not consolidated these VIEs.

Translation of Foreign Currencies

The assets and liabilities of foreign subsidiaries with a functional currency other than the U.S. dollar are translated into U.S. dollars at period-end exchange rates, with resulting translation gains or losses ~~accumulated~~included within other comprehensive income or loss. Revenue and expenses are translated into U.S. dollars at average rates of exchange during the applicable period. Substantially all of the Company’s foreign operations use their local currency as their functional currency. For foreign operations for which the local currency is not the functional currency, the operation’s non-monetary assets are remeasured into U.S. dollars at historical exchange rates. All other accounts are remeasured at current exchange rates. Gains or losses from remeasurement are included in other income or expense, net. Currency gains or losses resulting from transactions executed in currencies other than the functional currency are included in other income or expense, net.

In these ~~condensed unaudited~~ consolidated financial statements, “$” means U.S. dollars unless otherwise noted.

Management Estimates

The preparation of consolidated financial statements in ~~conformity~~accordance with U.S. GAAP requires the use of estimates and assumptions that affect

the amounts reported in the consolidated financial statements and accompanying notes. ~~Key~~These estimates ~~include: the recognition of revenue~~are based on historical experience and ~~project profit or loss (which the Company defines as project revenue, less project costs of revenue, including project-related depreciation), in particular, on construction contracts accounted for~~various other assumptions that management believes to be reasonable under the ~~percentage-of-completion method,~~circumstances, including the potential future effects of public health matters, such as the COVID-19 pandemic, climate-related matters, and macroeconomic trends and events, such as inflation and interest rate levels, as well as global events, such as the ongoing military conflict in Ukraine. These estimates form the basis for ~~which~~making judgments about the ~~recorded amounts require estimates of costs to complete~~Company’s

operating results and the ~~amount of probable contract price adjustments; allowances for doubtful accounts; estimated fair~~carrying values of ~~goodwill~~assets and intangible assets; acquisition-related contingent consideration and investments in equity investees; asset lives used in computing depreciation and amortization; fair values of financial instruments; accrued self-insured claims; share-based compensation;liabilities that are not readily apparent from other ~~accruals and allowances; accounting for income taxes; and the estimated impact of litigation and other contingencies.~~sources. While management believes that such estimates are reasonable when considered in conjunction with the Company’s consolidated financial position and results of operations taken as a whole, actual results could differ materially from ~~those~~these estimates.

Key estimates include: the recognition of revenue and project profit or loss, which the Company defines as project revenue, less project costs of revenue, including project-related depreciation, in particular, on construction contracts accounted for under the cost-to-cost method, for which the recorded amounts require estimates of costs to complete and the amount and probability of variable consideration included in the contract transaction price; fair value estimates, including those related to acquisitions, valuations of goodwill, intangible and other assets, acquisition-related contingent consideration and other liabilities, equity investments and long-lived assets; allowances for credit losses; asset lives used in computing depreciation and amortization; fair values of financial instruments; self-insurance liabilities; other accruals and allowances; income taxes; and the estimated effects of litigation and other contingencies.

COVID-19 Pandemic and General Economic Conditions

The COVID-19 pandemic has disrupted business activities and global economic conditions and negatively affected the Company’s operations since the first quarter of 2020, including from reduced crew productivity, the health and availability of work crews or other key personnel and subcontractors; supply chain disruptions; delayed project start dates; and lost productivity from governmental permitting approval delays, project shutdowns and/or cancellations, among other factors. While the adverse effects of the COVID-19 pandemic have begun to subside, its effects vary by region, and uncertainties arising from the COVID-19 pandemic could continue to disrupt economic conditions and business activities, particularly as new variants of COVID-19 arise. The extent to which the COVID-19 pandemic, including the recent and emerging variants, could affect the Company’s business, operations and financial results is uncertain as it will depend upon numerous evolving factors that management may not be able to accurately predict. The length and extent of any continuing economic and market disruptions are unknown, and therefore, any future impacts on the Company’s business, financial condition and/or results of operations cannot be quantified or predicted with specificity.

The Company believes that it has taken appropriate steps to mitigate the effects of the COVID-19 pandemic on its business, and the Company’s business model has, thus far, proven resilient. Notwithstanding moderation of the COVID-19 pandemic and related governmental and other restrictions, the Company may continue to experience direct and indirect negative effects on its business and operations from possible longer-term changes in consumer and customer behavior and/or from negative economic conditions, including recent inflationary effects, rising interest rates and supply chain disruptions, including limited availability of products.

The Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), which was enacted in response to the effects of the COVID-19 pandemic, permitted deferral and/or reduction of certain federal and payroll tax amounts, certain of which the Company pursued. As of March 31, 2022, payroll tax deferrals under the CARES Act, the amount of which is due by December 31, 2022, totaled approximately $42 million.

Significant Accounting Policies

Revenue Recognition

~~Revenue~~The Company recognizes revenue from contracts with customers when, or as, control of promised services and goods is ~~derived~~transferred to customers. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for the services and goods transferred. The Company primarily recognizes revenue over time utilizing the cost-to-cost measure of progress, which best depicts the continuous transfer of control of goods or services to the customer, and correspondingly, when performance obligations are satisfied for the related contracts.

Contracts. The Company derives revenue primarily from construction projects performed ~~under~~under: (i) master and other service agreements, ~~as well as from~~which generally provide a menu of available services in a specific geographic territory that are utilized on an as-needed basis, and are typically priced using either a time and materials or a fixed price per unit basis; and (ii) contracts for specific projects ~~or jobs~~ requiring the construction and installation of an entire infrastructure system, or specified units within an ~~entire~~ infrastructure ~~system. The Company frequently provides services under~~system, which are subject to multiple pricing options, including fixed price, unit price, ~~or fixed price master service or other service agreements. Revenue and related costs for master and other service agreements billed on a~~ time and materials, ~~basis are recognized as the services are rendered.~~or cost plus a markup. Revenue derived from projects performed under master service and other service agreements totaled ~~32%~~58% and ~~38%~~28% of consolidated revenue for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, respectively, and totaled 35% and 43% for the nine month periods ended September 30, 2017 and 2016,~~2021, respectively. ~~The Company also performs services under~~

For certain master service and other service agreements, ~~on a fixed fee basis, under which MasTec furnishes specified units of service for a fixed price per unit of service and~~ revenue is recognized asat a point in time, primarily for install-to-the-home and other wireless services in the ~~services are rendered. Revenue from fixed price contracts provides~~Company’s Communications segment. This is generally when the work order has been fulfilled, which is typically the same day the work is initiated. Point in time revenue accounted for ~~a fixed amount~~approximately 4% and 5% of consolidated revenue for the ~~entire project, subject to certain additions for changed scope or specifications. Revenue from these contracts, as well as for certain projects pursuant to master~~three month periods ended March 31, 2022 and 2021, respectively. Substantially all of the Company’s other ~~service agreements,~~revenue is recognized using the percentage-of-completion method, under which the percentage of revenue to be recognized for a given project is measured by the percentage of costs incurred to date on the contract to the total estimated costs for the contract. Such contracts provide that the customer accept completion of progress to date and compensate the Company for services rendered, which may be measured in terms of costs incurred, units installed, hours expended or some other measure of progress. Contract costs include all direct materials, labor and subcontracted costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and the operational costs of capital equipment. Much of the materials associated with the Company’s work are customer-furnished and are therefore not included in contract revenue and costs.over time.

The total contract transaction price and cost estimation ~~process~~processes used for recognizing revenue ~~recognized~~over time under the ~~percentage-of-completion~~cost-to-cost method is based on the professional knowledge and experience of the Company’s project managers, engineers and financial professionals. Management reviews estimates of total contract ~~revenue~~transaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected ~~contract settlements~~variable consideration are factors that influence estimates of the total contract ~~value and~~transaction price, total costs to complete those contracts and ~~therefore,~~ the Company’s profit recognition. Changes in these factors ~~may~~could result in revisions to ~~costs and income and their effects are recognized~~revenue in the period in which the revisions are determined, which could materially affect the Company’s consolidated results of operations for that period. Provisions for losses on uncompleted contracts are recorded in the period in which such ~~changes~~losses are ~~recognized.~~determined. For both the ~~nine~~three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, project profit was affected by less than 5% as a result of changes in contract estimates included in projects that were in process as of December 31, ~~2016~~2021 and ~~2015. Provisions for losses on uncompleted contracts are made~~2020. For the three month periods ended March 31, 2022 and 2021, revenue recognized as a result of changes in ~~the period~~total contract transaction price estimates, including from variable consideration, from performance obligations satisfied or partially satisfied in ~~which such losses are determined to be probable~~prior periods, totaled approximately $11.9 million and ~~the amount~~$13.8 million, respectively.

The Company may incur certain costs that can be ~~reasonably estimated.~~capitalized, such as initial set-up or mobilization costs. Such capitalized costs, which are amortized over the life of the respective projects, totaled $1.3 million and $1.4 million as of March 31, 2022 and December 31, 2021, respectively.

Performance Obligations.A performance obligation is a contractual promise to transfer a distinct good or service to a customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the performance obligation is satisfied. The vast majority of ~~fixed price contracts~~the Company’s performance obligations are completed within one year.

~~The~~Remaining performance obligations represent the amount of unearned transaction prices under contracts for which work is wholly or partially unperformed, including the Company’s share of unearned transaction prices from its proportionately consolidated non-controlled joint ventures. As of March 31, 2022, the amount of the Company’s remaining performance obligations was $4.8 billion. Based on current expectations, the Company anticipates it will recognize approximately $3.8 billion of its remaining performance obligations as revenue during 2022, with the vast majority of the remaining balance expected to be recognized in 2023.

Variable Consideration. Transaction prices for the Company’s contracts may ~~incur costs subject to~~include variable consideration, which comprises items such as change orders, ~~whether approved or unapproved by~~claims and incentives. Management estimates variable consideration for a performance obligation utilizing estimation methods that it believes best predict the ~~customer, and/or claims related~~amount of consideration to ~~certain contracts. Management determines~~which the ~~probability that such costs~~Company will be ~~recovered~~entitled. Management’s estimates of variable consideration and the determination of whether to include estimated amounts in transaction prices are based ~~upon~~largely on engineering studies and legal opinions, past practices with the customer, specific discussions, correspondence or preliminary negotiations with the ~~customer. The Company treats such costs as a cost~~customer and all other relevant information that is reasonably available at the time of ~~contract performance~~the estimate. To the extent unapproved change orders, claims and other variable consideration reflected in transaction prices are not resolved in the ~~period incurred if it is not probable that the costs will be recovered, and defers costs~~Company’s favor, or ~~recognizes revenue up~~ to the ~~amount~~extent incentives reflected in transaction prices are not earned, there could be reductions in, or reversals of, ~~the related cost if it is probable that the contract price will be adjusted and can be reliably estimated.~~ previously recognized revenue.

As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, the Company ~~had~~included approximately ~~$77~~$131 million and ~~$17~~$104 million, respectively, of change orders and/or claims ~~that had been included as contract price adjustments on~~in transaction prices for certain contracts that were in the process of being resolved in the ~~normal~~ordinary course of business, including through negotiation, arbitration and other proceedings. These ~~contract~~transaction price adjustments, ~~which~~when earned, are included within ~~costs and earnings in excess of billings~~contract assets or ~~billed~~ accounts receivable, net of allowance, as ~~appropriate, represent management’s best estimate of contract revenue that has been earned and that management believes is probable of collection.~~appropriate. As of both ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, these change orders ~~were~~and/or claims primarily related to ~~contracts~~certain projects in the ~~Oil~~Company’s Clean Energy and ~~Gas segment.~~Infrastructure and Power Delivery segments. The Company actively engages ~~in substantive meetings~~ with its customers to complete the final approval process and generally expects these processes to be completed within one year. ~~The amounts~~Amounts ultimately realized upon final ~~acceptance~~agreement by ~~its~~ customers could be higher or lower than such estimated amounts.

Billings In Excess of Costs and Earnings (“BIEC”) on uncompleted contracts is classified within current liabilities. Costs and Earnings In Excess of Billings (“CIEB”), which is also referred to as work in process, is classified within current assets. Work in process on contracts is based on work performed but not yet billed to customers as per individual contract terms.

Recently Issued Accounting Pronouncements

~~There have been no changes in~~The discussion below describes the ~~expected dates~~effects of ~~adoption or estimated effects on the Company’s consolidated financial statements of recently issued~~recent accounting pronouncements, as updated from ~~those disclosed~~the discussion in the Company’s ~~2016~~2021 Form 10-K. ~~See below for additional discussion of recently issued accounting pronouncements.~~

Recent Accounting Pronouncements ~~Not Yet Adopted~~

In ~~August 2017,~~October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)~~2017-12,~~ ~~Derivatives and Hedging~~ 2021-08, Business Combinations (Topic ~~815)~~805): ~~Targeted Improvements to~~ Accounting for ~~Hedging Activities~~Contract Assets and Contract Liabilities from Contracts with Customers (“ASU ~~2017-12”~~2021-08”)~~. ASU 2017-12 amends the hedge accounting model in Topic 815~~ to ~~enable entities to better portray the economics of their risk management activities~~improve consistency for revenue recognition in the ~~financial statements~~post-acquisition period for acquired contracts as compared to contracts entered into subsequent to acquisition. ASU 2021-08 requires an acquirer to recognize and ~~enhance the transparency~~measure contract assets and ~~understandability of hedge results. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change~~contract liabilities acquired in ~~the~~a business combination in accordance with Topic 606, Revenue from Contracts with Customers, rather than at fair ~~value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also simplifies certain documentation and assessment requirements.~~value. ASU ~~2017-12~~2021-08 is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. All transition requirements and elections should be applied to hedging relationships existing on the date of adoption and their effects should be reflected as of the beginning of the fiscal year of adoption. The presentation and disclosure requirements are effective on a prospective basis. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements.

~~In May 2017, FASB issued ASU 2017-09,~~ ~~Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting~~ (“ASU 2017-09”). ASU 2017-09 clarifies when a change to the terms or conditions of a share-based payment award must be accounted for as a modification. Limited and administrative modifications that do not change the value, vesting conditions, or classification of the award are exempt from following the modification guidance in Topic 718. ASU 2017-09 is effective on a prospective basis for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The Company does not expect the adoption of this ASU to have a material effect on its consolidated financial statements.

~~In February 2017, the FASB issued ASU 2017-05,~~ Other Income- Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets(“ASU 2017-05”). ASU 2017-05 clarifies certain guidance under Subtopic 610-20 that was issued as part of the new revenue standard, including the recognition of gains and losses on the sale or transfer of nonfinancial assets to noncustomers, and clarifies accounting for contributions of nonfinancial assets to joint ventures, among other requirements. ASU 2017-05 is effective on a retrospective basis for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2017,2022, with early adoption permitted. The Company is currently evaluating the potential effect of this ASU on its consolidated financial statements.

~~In May 2014, the FASB issued ASU 2014-09,~~ ~~Revenue from Contracts with Customers (Topic 606)~~ (“ASU 2014-09”). The core principle of this ASU is that a company will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. In doing so, companies will need to use judgment and make estimates when evaluating contract terms and other relevant facts and circumstances. Additionally, ASU 2014-09 requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. In August 2015, the FASB issued ASU 2015-14, ~~Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date~~, which delayed the effective date of ASU 2014-09 by one year. ASU 2014-09, as amended, is effective using either the full retrospective or modified retrospective transition approach for fiscal years, and for interim periods within those years, beginning after December 15, 2017. In 2016, the FASB issued several accounting standards updates to clarify certain topics within ASU 2014-09. The Company will adopt ASU 2014-09, and its related clarifying ASUs, as of January 1, 2018.

The Company has substantially completed its assessment of the potential effects of these ASUs on its consolidated financial statements, business processes, systems and controls. The Company’s assessment included a detailed review of representative contracts at each of the Company’s business units and a comparison of its historical accounting policies and practices to the new standard. Based on the Company’s review of various types of revenue arrangements, the Company expects to recognize revenue and earnings over time utilizing the cost-to-cost measure of progress for its fixed price contracts and certain master service and other service agreements, consistent with current practice. For these contracts, the cost-to-cost measure of progress best depicts the transfer of control of goods or services to the customer under the new standard. The Company has substantially completed its analysis of the information necessary to enable the preparation of the financial statements and related disclosures under the new standard. As part of this analysis, the Company evaluated its information technology capabilities and systems, and does not expect to incur significant information technology costs to modify systems currently in place. The Company will implement targeted changes to its internal reporting processes to facilitate gathering the data needed for reporting and disclosure under the new standard. The Company will also implement updates to its control processes and procedures, as necessary, based on changes resulting from the new standard. The Company does not expect any such updates to materially affect the Company’s internal controls over financial reporting.

The Company anticipates adopting the standard using the modified retrospective transition approach. Under this approach, the new standard would apply to all new contracts initiated on or after January 1, 2018. For existing contracts that have remaining obligations as of January 1, 2018, any difference between the recognition criteria in these ASUs and the Company’s current revenue recognition practices would be recognized using a cumulative effect adjustment to the opening balance of retained earnings. Any potential effect of adoption of these ASUs has not yet been quantified; however, based on the review of contracts across all of the Company’s business units to date, the adoption of these ASUs is not expected to have a material effect on the timing or amount of revenue recognized as compared to current practices. The Company is training its business units for the implementation of the new standard, and continues developing the disclosures required by the new standard. The Company is also reviewing certain contracts entered into by its business units subsequent to its initial assessment that are expected to have performance obligations remaining as of January 1, 2018 for any cumulative effect adjustments that may be required upon adoption.

~~Accounting Pronouncements Adopted as of January 1, 2017~~

~~The Company adopted ASU 2016-09,~~ ~~Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting~~ (“ASU 2016-09”) effective January 1, 2017. Under ASU 2016-09, excess tax benefits (“windfalls”) or tax deficiencies (“shortfalls”) are recognized in the income statement, rather than as additional paid-in-capital as under the previous guidance, and are presented as operating cash flows,

rather than as a financing activity. This ASU also increased the amount of tax that can be withheld by an employer for employee tax withholdings without resulting in liability classification of an award. Payments to taxing authorities for such employee withholdings are presented as financing activities. ASU 2016-09 also allows companies to account for forfeitures of share-based payments as they occur or to estimate such amounts. The provisions of ASU 2016-09 that were applicable to the Company were adopted on a prospective basis; the retrospective requirement to classify payments to taxing authorities for employee withholdings as a financing activity was consistent with the Company’s existing methodology, therefore did not result in a change. The adoption of ASU 2016-09 is expected to result in volatility in income tax expense given that windfalls or shortfalls are recognized in income tax expense in the periods in which they occur. The other components of this ASU did not have a material effect on the consolidated financial statements. See Note 2 - Earnings Per Share, Note 9 - Stock-Based Compensation and Other Employee Benefit Plans and Note 12 - Income Taxes for additional information.

Note 2 – Earnings Per Share

Basic earnings or loss per share is computed by dividing net income or loss attributable to MasTec by the weighted average number of common shares outstanding for the period, which excludes non-participating unvested restricted share awards. Diluted earnings per share is computed by dividing net income attributable to MasTec by the weighted average number of fully diluted shares, as calculated under the treasury stock method, which includes the potential effect of dilutive common stock equivalents, such as issued but unvested restricted shares. Basic and diluted shares ~~and/or outstanding but unexercised stock options. The Company has no remaining outstanding stock options; all options under~~for the ~~Company’s stock option grants were exercised in 2016.~~three month period ended March 31, 2022 also include the assumed effect of certain shares related to additional contingent payments to the former owners of an acquired business. SeeNote 3 – Acquisitions, Goodwill and Other Intangible Assets. If the Company reports a loss, rather than income, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be anti-dilutive.

~~As discussed in Note 1 - Business, Basis of Presentation and Significant Accounting Policies,~~ For the three month period ended March 31, 2022, the Company ~~adopted ASU 2016-09 effective January 1, 2017 on~~reported a prospective basis. ASU 2016-09 changed the recognition of excess tax benefits or tax deficiencies upon the vesting of share-based payment awards from additional paid-in capital, within equity, to income tax benefit or expense, within the statement of operations. As a result, excess tax benefits or deficiencies under ASU 2016-09 are excluded from assumed proceeds under the treasury stock method. Previously, excess tax benefits or tax deficiencies were included within assumed proceeds. For both the three and nine month periods ended September 30, 2017, thisnet loss, which resulted in the ~~inclusion~~exclusion of approximately ~~0.3 million incremental shares in the Company’s total~~1,321,000 weighted average common stock equivalents from the calculation of diluted ~~shares outstanding.~~net loss per share for the related period.

The following table provides details underlying the Company’s earnings per share calculations for the periods indicated (in thousands):


	For the Three Months Ended March 31,
	2022		2021
Net (loss) income attributable to MasTec:
Net (loss) income - basic and diluted (a)	$	(34,978)	$	65,649
Weighted average shares outstanding:
Weighted average shares outstanding - basic(b)	74,789		72,439
Dilutive common stock equivalents (c)(d)	—		1,407
Weighted average shares outstanding - diluted	74,789		73,846

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
Net income attributable to MasTec:
Net income - basic and diluted ^(a)
$ 63,752
$ 56,277
$ 186,390
$ 77,672
Weighted average shares outstanding:
Weighted average shares outstanding - basic 80,953
80,462
80,859
80,323
Dilutive common stock equivalents 1,433
1,083
1,422
918
Weighted average shares outstanding - diluted 82,386
81,545
82,281
81,241

Additional information:
Weighted average anti-dilutive common stock equivalents ^(b)
—
1
12
—
(a)Calculated as total net income or loss less amounts attributable to non-controlling interests.


~~(a)~~	~~Calculated as total net income less amounts attributable to non-controlling interests.~~


~~(b)~~	~~Represents anti-dilutive common stock equivalents as calculated under the treasury stock method.~~

(b)For the three month period ended March 31, 2022, basic shares include approximately 72,000 weighted average shares relating to additional contingent payments to the former owners of an acquired business. See Note 3 – Acquisitions, Goodwill and Other Intangible Assets.

(c)Weighted average anti-dilutive common stock equivalents totaled approximately 1,321,000 and 23,000, for the three month periods ended March 31, 2022, and 2021, respectively.

(d)For the three month period ended March 31, 2022, common stock equivalents, all of which are anti-dilutive, include approximately 63,000 weighted average shares relating to additional contingent payments to the former owners of an acquired business. See Note 3 – Acquisitions, Goodwill and Other Intangible Assets.

The Company repurchased 187,978 shares of its common stock during the three month period ended March 31, 2022, the effect of which on the Company’s weighted average shares outstanding was minimal. See Note 11 – Equity for details of the Company’s share repurchase transactions, including details of shares repurchased subsequent to March 31, 2022. Additionally, in December 2021, the Company issued 1,975,232 shares of its common stock in conjunction with an acquisition. See Note 3 – Acquisitions, Goodwill and Other Intangible Assets.

Note 3 -– Acquisitions, Goodwill and Other Intangible Assets

The following table provides ~~details~~a reconciliation of changes in goodwill by reportable segment ~~as of September 30, 2017 (in millions):~~

Communications Oil and Gas
Electrical
Transmission
Power Generation and Industrial Total Goodwill
Goodwill, gross $ 462.4
$ 461.6
$ 149.9
$ 137.0
$ 1,210.9
Accumulated impairment losses —
(75.4 ) —
—
(75.4 )
Goodwill, net $ 462.4
$ 386.2
$ 149.9
$ 137.0
$ 1,135.5

~~For~~for the ~~nine~~three month period ended ~~September 30, 2017, additions~~March 31, 2022 (in millions). Goodwill balances as of December 31, 2021 were recast in the first quarter of 2022 to reflect the change in segment reporting for the HMG acquisition, as discussed in Note 1 – Business, Basis of Presentation and Significant Accounting Policies. Goodwill was reallocated based on the estimated relative fair value of the respective HMG reporting units. See Note 13 – Segments and Related Information for additional information.


	Communications		Clean Energy and Infrastructure		Oil and Gas		Power Delivery		Total Goodwill
Goodwill, gross, as of December 31, 2021 (a)	$	614.5	$	166.1	$	561.3	$	303.4	$	1,645.3
Accumulated impairment loss (b)	—		0		(124.7)		—		(124.7)
Goodwill, net, as of December 31, 2021	$	614.5	$	166.1	$	436.6	$	303.4	$	1,520.6
Additions from new business combinations	—		—		3.0		—		3.0
Measurement period adjustments (c)	(5.4)		2.1		7.4		(23.6)		(19.5)
Currency translation adjustments	—		—		0.2		—		0.2
Goodwill, net as of March 31, 2022	$	609.1	$	168.2	$	447.2	$	279.8	$	1,504.3

(a) The change in segment reporting for the HMG acquisition resulted in a decrease in Power Delivery segment goodwill ~~from new business combinations totaled $135.3 million. Currency translation effects related to~~of $23.4 million and an increase in goodwill for the Communications and ~~accumulated~~Oil and Gas segments of $13.0 million and $10.4 million, respectively, as of December 31, 2021.

(b) Accumulated impairment losses ~~totaled approximately $9.8 million~~include the effects of ~~gains and $5.4 million of losses, respectively, for the nine month period ended September 30, 2017. For the nine month period ended~~ ~~September 30, 2016, additions to goodwill from accruals of acquisition-related contingent consideration totaled $5.8 million, and~~ currency translation ~~effects related~~gains and/or losses.

(c) Represents adjustments to ~~goodwill and accumulated impairment losses totaled $6.0 million~~preliminary estimates of ~~gains and $3.1 million~~fair value within the measurement period of ~~losses, respectively.~~

up to one year from the date of acquisition.

The following table provides a reconciliation of changes in other intangible assets, net, for the period indicated (in millions):


	Other Intangible Assets
	Non-Amortizing		Amortizing
	Trade Names			Customer Relationships and Backlog		Pre-Qualifications		Other (a)		Total
Other intangible assets, gross, as of December 31, 2021	$	34.5		$	763.1	$	73.9	$	124.6	$	996.1
Accumulated amortization				(278.0)		(21.4)		(26.4)		(325.8)
Other intangible assets, net, as of December 31, 2021	$	34.5		$	485.1	$	52.5	$	98.2	$	670.3
Additions from new business combinations	—			1.6		—		0.7		2.3
Measurement period adjustments (b)	—			55.8		—		(10.1)		45.7
Currency translation adjustments	—			—		0.3		—		0.3
Amortization expense				(20.3)		(2.2)		(3.1)		(25.6)
Other intangible assets, net, as of March 31, 2022	$	34.5		$	522.2	$	50.6	$	85.7	$	693.0

Other Intangible Assets
Non-Amortizing Amortizing
Trade Names Pre-Qualifications Customer Relationships and Backlog
Other ^(a)
Total
Other intangible assets, gross, as of December 31, 2016 $ 34.5
$ 74.6
$ 195.1
$ 19.1
$ 323.3
Accumulated amortization (131.9 ) (11.7 ) (143.6 )
Other intangible assets, net, as of December 31, 2016 $ 34.5
$ 74.6
$ 63.2
$ 7.4
$ 179.7
Additions from new business combinations —
—
24.4
2.4
26.8
Amortization expense (13.9 ) (1.1 ) (15.0 )
Currency translation adjustments —
3.4
0.5
0.1
4.0
Other intangible assets, net, as of September 30, 2017 $ 34.5
$ 78.0
$ 74.2
$ 8.8
$ 195.5


~~(a)~~	~~Consists principally of trade names and non-compete agreements.~~

(a)Consists principally of trademarks, trade names and non-compete agreements.

~~Amortization expense~~(b)Represents adjustments to preliminary estimates of fair value within the measurement period of up to one year from the date of acquisition.

Quarterly Assessment for Indicators of Impairment. During the first quarter of 2022, in conjunction with the Company’s quarterly review for indicators of impairment, management performed a quantitative assessment of the goodwill associated with 1 reporting unit within its Oil and Gas segment. Based on the results of this assessment, management determined that the estimated fair value of this reporting unit substantially exceeded its carrying value as of March 31, 2022. The Company’s first quarter 2022 review for indicators of impairment included consideration of its quarterly financial results, which reflected a net loss for the period. As of March 31, 2022, the Company determined that its first quarter 2022 results, together with its expectations of future results, were generally consistent with those anticipated when performing its annual impairment review in the fourth quarter of 2021, including consideration of the potential effects of shifts in timing for certain projects. The Company’s 2021 impairment assessment included quantitative testing for 8 reporting units, for which the estimated fair values of such reporting units were

determined to substantially exceed their carrying values, and a 100 basis point increase in the discount rate would not have resulted in any of the reporting units’ carrying values exceeding their fair values. Significant changes in the assumptions or estimates used in management’s assessment, such as a reduction in profitability and/or cash flows, changes in market conditions, including decreases in market activity levels or increases in interest rates due to rising inflation, could result in non-cash impairment charges to goodwill and indefinite-lived intangible assets ~~for~~in the ~~three month periods ended~~ ~~September 30, 2017~~future.

Recent Acquisitions

The Company seeks to grow and ~~2016~~ ~~totaled~~ ~~$6.0 million~~diversify its business both organically and ~~$5.2 million, respectively,~~through acquisitions and/or strategic arrangements in order to deepen its market presence, broaden its geographic reach and ~~for~~expand its service offerings.

2022 Acquisitions. In January 2022, MasTec acquired all of the ~~nine month periods ended~~ ~~September 30, 2017~~equity interests of an infrastructure construction company focusing on water, sewer and ~~2016, totaled $15.0 million~~utility projects and ~~$15.7 million, respectively.~~

~~2017 Acquisitions.During the nine month period ended~~ ~~September 30, 2017, MasTec completed three acquisitions, including (i) a wireline/fiber deployment construction contractor, which~~expertise in excavation and site work that is included in the Company’s Communications segment; (ii) a heavy civil construction services company, which is included in the Company’s Power Generation and Industrial segment, and (iii) an oil and gas pipeline equipment company, which is included inwithin the Company’s Oil and Gas ~~segment.~~segment for an aggregate purchase price composed of approximately $13.0 million in cash, net of cash acquired and an earn-out liability valued at approximately $1.7 million. Determination of the estimated fair values of ~~the~~ net assets acquired ~~and the estimated earn-out liabilities for these acquisitions is~~was preliminary as of ~~September 30, 2017, and~~March 31, 2022; as a result, further adjustments to ~~management’s preliminary~~these estimates may occur.

2021 Acquisitions.During 2021, MasTec completed 14 acquisitions, including all of the equity interests of the following:

(i) Within the Company’s Power Delivery segment: HMG, an industry-leading utility services firm providing critical infrastructure design, construction and maintenance services to the power and renewables, telecommunications, gas distribution and pipeline services end-markets, which acquisition was effective in December. In the first quarter of 2022, MasTec integrated and began reporting the results of HMG within its Power Delivery, Communications and Oil and Gas segments, as appropriate, and began reporting HMG’s corporate functions within its corporate results. See Note 13 – Segments and Related Information for additional details. During 2021, the Company also acquired an electric utility distribution contractor and a company specializing in vegetation management services for the electric and telecommunications industries, which acquisitions were effective in December; and Intren, LLC (“INTREN”), a premier specialty utility contractor primarily providing electrical distribution network services under various multi-year master service agreements to some of the nation’s largest utilities, municipalities and cooperatives, which acquisition was effective in May;

(ii) within the Company’s Clean Energy and Infrastructure segment: a heavy civil infrastructure construction company focusing on transportation projects; and a heavy industrial general contractor with concrete, piping and electrical capabilities, which acquisitions were effective in February and April, respectively;

(iii) within the Company’s Communications segment: a telecommunications company specializing in cabling, plant and other network services, which acquisition was effective in November; a telecommunications and utility technical services company focusing on outside plant telecommunications engineering; a telecommunications and cable services provider; and a utilities infrastructure company, providing power line construction and repair services, all of which acquisitions were effective in May; and business operations specializing in install-to-the-home services, which acquisition was effective in August; and

(iv) within the Company’s Oil and Gas segment: an infrastructure construction company focusing on water, sewer and utility projects, along with expertise in site work; and a company specializing in environmental services for energy infrastructure and heavy civil projects, both of which acquisitions were effective in December; and a pipeline contractor focusing on integrity and maintenance work related to gas distribution infrastructure, which acquisition was effective in February.

These acquisitions were funded with cash on hand, borrowings under the Company’s credit facility and with shares of the Company’s common stock, and are subject to customary purchase price adjustments.

The following table summarizes the estimated fair values of consideration paid and ~~identifiable~~net assets acquired ~~and liabilities assumed~~for the 2021 acquisitions, as ~~of the respective dates of acquisition~~adjusted (in millions).:

Acquisition consideration: 2017
Cash $ 118.8
Fair value of contingent consideration (earn-out liability) 89.6
Total consideration transferred $ 208.4
Identifiable assets acquired and liabilities assumed:
Current assets, primarily composed of accounts receivable and $2.8 million of cash acquired $ 42.7
Property and equipment 56.9
Amortizing intangible assets 26.8
Other long-term assets 0.5
Current liabilities, including current portion of capital lease obligations and long-term debt (28.4 )
Long-term debt, including capital lease obligations (9.9 )
Deferred income taxes (15.5 )
Total identifiable net assets $ 73.1
Goodwill $ 135.3
Total net assets acquired, including goodwill $ 208.4


Acquisition consideration(a):	HMG		All other		Total
Cash, net of cash acquired	$	416.9	$	872.2	$	1,289.1
Shares transferred	181.7		—		181.7

Estimated fair value of contingent consideration	—		99.7		99.7

Total consideration	$	598.6	$	971.9	$	1,570.5
Identifiable assets acquired and liabilities assumed:
Accounts receivable and contract assets	$	409.8	$	270.6	$	680.4
Current assets	14.6		27.7		42.3
Property and equipment	247.0		250.8		497.8
Long-term assets, primarily operating lease right-of-use assets	85.1		81.8		166.9
Amortizing intangible assets	164.6		444.2		608.8
Accounts payable	(108.0)		(49.3)		(157.3)
Current liabilities, including current portion of operating lease liabilities	(155.3)		(136.3)		(291.6)
Long-term debt, including finance lease obligations	(0.2)		(4.4)		(4.6)
Long-term liabilities, primarily operating lease liabilities and deferred income taxes	(150.0)		(76.5)		(226.5)
Total identifiable net assets	$	507.6	$	808.6	$	1,316.2
Goodwill	91.0		166.8		257.8
Total net assets acquired, including goodwill	$	598.6	$	975.4	$	1,574.0
Bargain purchase gain	—		(3.5)		(3.5)
Total consideration	$	598.6	$	971.9	$	1,570.5

(a) Acquisition consideration excludes approximately $65 million of measurement period adjustments for estimated payments that will be made to the sellers of HMG if certain acquired receivables are collected. Given the pass-through nature of these contingent payments, they have been excluded from total consideration and current assets in the table above. See below for related discussion.

Amortizing intangible assets related to the ~~2017~~HMG acquisition are primarily composed of customer relationships, and to a lesser extent, trade names and backlog. Customer relationship intangible assets totaled approximately $132 million, and had a weighted average life of approximately 12 years, based on HMG’s operational history and established relationships with, and the nature of, its customers, which are primarily in the utilities industry. The weighted average life of amortizing intangible assets in the aggregate for the HMG acquisition was 11 years. Amortizing intangible assets related to “All other” acquisitions are primarily composed of customer relationships ~~backlog~~ and ~~other~~trade names, which each had a weighted average life of approximately 17 years. The aggregate weighted average life related to “All other” amortizing intangible assets ~~which had weighted average~~was 17 years. INTREN’s acquired intangible assets included a customer relationship and a trade name intangible asset representing $281 million in the aggregate, having asset lives of approximately 1120 years ~~4 years~~each based on INTREN’s operational history and ~~7 years, respectively,~~established relationships with, and ~~10 years~~the nature of, its customers, which are primarily in ~~total, and will be~~the utilities industry. Amortizing intangible assets are amortized in a manner consistent with the pattern in which the related benefits are expected to be consumed.

The goodwill balances for each of the respective acquisitions, including approximately $49 million for INTREN, which is included within “All other” acquisitions, represent the estimated ~~value~~values of each acquired company’s geographic presence in key markets, ~~their~~ assembled workforce, ~~and~~ management ~~team~~team’s industry-specific project management expertise ~~as well as~~and synergies expected to be achieved from the combined operations of each of the acquired companies and MasTec. Approximately ~~$75~~$147 million of the ~~acquired~~ goodwill balance ~~as of September 30, 2017~~related to the 2021 acquisitions is expected to be tax ~~deductible.~~deductible as of March 31, 2022. One of the Company’s fourth quarter 2021 acquisitions in its Power Delivery segment resulted in the recognition of a bargain purchase gain of $3.5 million, which amount was included within other (income) expense, net, in the Company’s consolidated statements of operations.

The HMG purchase agreement provides for certain additional payments to be made to the sellers if certain acquired receivables are collected by the Company (the “Additional Payments”). Pursuant to the terms of the purchase agreement, a portion of the Additional Payments will be made in cash, with the remainder due in shares of MasTec common stock. The fair value of the Additional Payments as of March 31, 2022 was estimated to be approximately $65 million in the aggregate, which amount is included within other current liabilities in the consolidated balance sheet. Of this amount, approximately $27 million is to be paid in shares, or approximately 295,000 shares as of March 31, 2022, based upon the contractually agreed upon value of our common stock. The amount of Additional Payments due to the sellers as of March 31, 2022 from collections of acquired receivables totaled approximately $30 million, of which the amount due in shares totaled approximately $12 million, or 135,000 shares. See Note 2 – Earnings Per Share for the effect of the above referenced shares on the Company’s earnings per share calculations.

The estimated number of potential shares that could be issued related to such Additional Payments will be based on the amounts ultimately collected and the share price as defined within the purchase agreement. As of March 31, 2022, based on such share price, the total number of potential shares for the Additional Payments that could be issued is up to approximately 390,000 shares, or $36 million. In addition, the HMG purchase agreement provides for a customary net working capital adjustment, under which additional shares could be issued. Such shares would be determined in a manner consistent with the terms that apply to the Additional Payments. As of March 31, 2022, the amount of any potential net working capital adjustment cannot be quantified or predicted with specificity due to ongoing evaluation of the net assets acquired. Changes in the estimated fair value of the potential shares that could be issued under the terms of this agreement, which result from changes in MasTec’s share price as compared with the share price as defined within the purchase agreement will be reflected within other income or expense, as appropriate. For the

three month period ended March 31, 2022, unrealized fair value measurement activity related to these shares was not significant.

Included within “All other” acquisition consideration is approximately $452 million of consideration, including estimated earn-out liabilities, for INTREN. Total cash paid for acquisitions, net, includes approximately $78 million of cash acquired. The shares of MasTec common stock transferred in connection with the HMG acquisition consisted of approximately 2.0 million shares, as determined based on the terms of the purchase agreement, valued at approximately $182 million, based on the market price of the Company’s common stock on the date of closing.

The contingent consideration included in the table above ~~equals~~is composed of earn-out liabilities, which equal a portion of the acquired companies’ earnings before interest, taxes, depreciation and amortization (“EBITDA”) ~~above certain~~in excess of thresholds agreed upon with the sellers, if ~~applicable,~~applicable. The earn-out arrangements for ~~a period of five years,~~the 2021 acquisitions generally range from 1 to 5-year terms, as set forth in the respective purchase agreements, ~~which amounts~~and are valued at approximately $100 million in the aggregate. The earn-out arrangement for the INTREN acquisition included within “All other” acquisitions had a term of less than 1 year. Earn-outs are generally payable ~~annually. The~~annually and are recorded within other current and other long-term liabilities in the consolidated balance sheets. See Note 4 - Fair Value of Financial Instruments for details pertaining to fair value estimates for the Company’s earn-out arrangements. As of March 31, 2022, the range of remaining potential undiscounted earn-out liabilities for the 2021 acquisitions was estimated to be between $13 million and $133 million; however, there is no maximum payment amount. Determination of the estimated fair values of the net assets acquired and the estimated earn-out liabilities ~~were estimated using income approaches such as discounted cash flows or option pricing models~~ and incorporate significant inputs not observable in the market. Key assumptions in the estimated valuations include the discount rate and probability-weighted EBITDA projections. Significant changes in anyconsideration transferred for certain of these ~~assumptions could~~acquisitions was preliminary as of March 31, 2022; as a result, ~~in a significantly higher or lower potential earn-out liability.~~further adjustments to these estimates may occur.

Pro forma results. For the three ~~and nine~~ month periods ended ~~September 30, 2017,~~March 31, 2022 and 2021, unaudited supplemental pro forma revenue totaled approximately ~~$1,955.8~~$2.0 billion and $2.4 billion, respectively. For the three month period ended March 31, 2022, unaudited supplemental pro forma net loss totaled $34.4 million, and ~~$5,077.4 million, respectively, and~~for the three month period ended March 31, 2021, unaudited supplemental pro forma net income totaled ~~approximately $64.4 million and $192.0 million, respectively.~~$43.5 million.

Acquisition-related results. For the three ~~and nine~~ month ~~periods~~period ended ~~September 30, 2016, pro forma revenue totaled approximately $1,634.5 million and $3,934.6 million, respectively, and pro forma net income totaled approximately $59.0 million and $81.5 million, respectively.~~

The above indicated unaudited pro forma financial results, which represent the results of operations of the companies acquired as if the acquired companies had been consolidated as of January 1, 2016, are provided for illustrative purposes only and do not purport to be indicative of the actual results that would have been achieved by the combined companies for the periods indicated, or of the results that may be achieved by the combined companies in the future. The unaudited supplemental pro forma financial results have been prepared by adjusting the historical results of MasTec to include the historical results of the acquired businesses described above, and then adjusted (i) to remove acquisition costs; (ii) to increase amortization expense resulting from the acquired intangible assets; (iii) to increase interest expense as a result of the cash consideration paid; (iv) to reduce interest expense from debt repaid upon acquisition; and (iv) to eliminate the effect of intercompany transactions. Additionally, the unaudited supplemental pro forma financial results do not include adjustments to reflect other cost savings or synergies that may have resulted from these acquisitions. Future results may vary significantly due to future events and transactions, as well as other factors, many of which are beyond MasTec’s control.

~~For the three and nine month periods ended September 30, 2017, acquisition-related results included in~~March 31, 2022, the Company’s consolidated results of operations included acquisition-related revenue of approximately ~~$62.2~~$704.7 million, including a total of $548.1 million for HMG and INTREN. For the three month period ended March 31, 2021, the Company’s consolidated results of operations included acquisition-related revenue of approximately $86.8 million. Acquisition-related net losses totaled approximately $4.3 million for the three month period ended March 31, 2022, and for the three month period ended March 31, 2021, acquisition-related net income totaled approximately $1.2 million, based on the Company’s consolidated effective tax rates. These acquisition-related results include amortization of acquired intangible assets and acquisition integration costs, and exclude the effects of interest expense associated with consideration paid for the related acquisitions.

Acquisition and integration costs. The Company incurred certain acquisition and integration costs in connection with its fourth quarter 2021 acquisitions, which costs are included within general and administrative expenses in the Company’s consolidated statements of operations. Acquisition and integration costs include i) the costs of integrating acquired entities, such as: employee termination expenses, including employee compensation relating to the elimination of certain positions that were determined to be redundant, and other integration-type costs, including facility consolidation expenses, lease termination expenses, system migration expenses, training, operating cost redundancies and other integration costs, as well as ii) legal, professional and other fees associated with the consummation of an acquisition. The Company is currently in the process of integrating these acquisitions and expects to incur additional acquisition and integration expenses in 2022. Acquisition and integration costs for the three month period ended March 31, 2022 totaled approximately $13.6 million, and ~~$96.1~~as of March 31, 2022, approximately $1.1 million ~~respectively, and net income of approximately $3.2 million and $4.7 million, respectively.~~was included within current liabilities within the consolidated balance sheets related to such costs.

Note 4 – Fair Value of Financial Instruments

The Company’s financial instruments ~~include~~are primarily composed of cash and cash equivalents, accounts and notes receivable, cash collateral deposited with insurance carriers, life insurance assets, ~~cost and~~ equity ~~method~~ investments, ~~stock warrants,~~certain other investments, deferred compensation plan assets and liabilities, accounts payable and other current liabilities, acquisition-related contingent consideration ~~certain intangible assets~~ and ~~liabilities, including off-market contracts,~~additional contingent payments, mandatorily redeemable non-controlling interests and debt obligations.

Fair value is the price that would be received to sell an asset or the amount paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value guidance establishes a valuation hierarchy, which requires maximizing the use of observable inputs when measuring fair value. The three levels of inputs that may be used are: (i) Level 1 - quoted market prices in active markets for identical assets or liabilities; (ii) Level 2 - observable market-based inputs or other observable inputs; and (iii) Level 3 - significant unobservable inputs that cannot be corroborated by observable market data, which are generally determined using valuation models incorporating management estimates of market participant assumptions. In instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Management’s assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the

Acquisition-Related Contingent Consideration and Other Liabilities

Acquisition-related contingent consideration ~~of inputs specific to the asset or liability.~~

~~Fair values of financial instruments are estimated using public market prices, quotes from financial institutions~~ and other ~~available information. Due to their short-term maturity, the carrying amounts~~liabilities is composed of cash and cash equivalents, accounts receivable, accounts payable and other current liabilities approximate their fair values. Management believes the carrying values of notes and other receivables, cash collateral deposited with insurance carriers, deferred compensation plan assets and liabilities and outstanding balances on its credit facilities approximate their fair values.

~~Assets and Liabilities Measured at Fair Value on a Recurring Basis~~

~~As of September 30, 2017 and December 31, 2016, financial instruments required to be measured at fair value on a recurring basis consisted primarily of acquisition-related contingent consideration,~~earn-outs, which ~~represents~~represent the estimated fair value of future ~~earn-outs~~amounts payable for ~~acquisitions~~businesses, including for mandatorily redeemable non-controlling interests (together, “Earn-outs”), that are contingent upon the acquired business achieving certain levels of ~~businesses (“ASC 805 contingent consideration”). ASC 805 contingent consideration is based on management estimates and entity-specific assumptions and is evaluated on an ongoing basis.~~earnings in the future. As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, the estimated fair value of the Company’s ~~ASC 805 contingent consideration~~Earn-out liabilities totaled ~~$104.9~~$160.0 million and ~~$45.8~~$160.2 million, respectively, of which ~~$18.9~~$13.9 million ~~and $21.8 million, respectively, was~~related to mandatorily redeemable non-controlling interests as of both periods. Earn-out liabilities included within other current ~~liabilities.~~liabilities totaled approximately $39.1 million and $38.8 million as of March 31, 2022 and December 31, 2021, respectively. The fair ~~value~~values of the Company’s ~~ASC 805 contingent consideration is~~Earn-out liabilities are estimated using income approaches such as discounted cash flows or option pricing models, ~~and incorporates~~both of which incorporate significant inputs not observable in the ~~market.~~market (Level 3 inputs), including management’s estimates and entity-specific assumptions, and are evaluated on an ongoing basis. Key assumptions include the discount rate, which, as of March 31, 2022, ranged from 12.0% to 18.3%, with a weighted average rate of 13.3% based on the relative fair value of each instrument, and probability-weighted ~~EBITDA projections.~~projections of earnings before interest, taxes, depreciation and amortization (“EBITDA”). Significant changes in any of these assumptions could result in a significantly higher or lower potential ~~earn-out liability.~~Earn-out liabilities. The ultimate payment amounts for the Company’s Earn-out liabilities will be determined based on the actual results achieved by the acquired businesses. As of ~~September 30, 2017,~~March 31, 2022, the range of potential undiscounted ~~earn-out~~Earn-out liabilities was estimated to be between ~~$15~~$41 million and ~~$170~~$211 million; however,

there is no maximum payment amount.

~~ASC 805 contingent consideration~~Earn-out activity consists primarily of additions from new business ~~combinations, payments of earn-out liabilities,~~combinations; changes in the expected fair value of future ~~earn-out obligations,~~payment obligations; and for earn-out liabilities denominated in foreign currencies, translation gains or losses. Fair value adjustments are recorded within other income or expense, and foreign currency translation activity is recorded within other comprehensive income or loss, as appropriate. For the three and nine month periods ended September 30, 2017, additionspayments. Additions from new business combinations totaled ~~$64.6~~approximately $1.7 million ~~and $89.6 million, respectively. There were no payments of ASC 805 contingent consideration~~ for the three month period ended ~~September 30, 2017,~~March 31, 2022, and ~~payments~~for the three month period ended March 31, 2021, there were no additions. Measurement period adjustments totaled ~~$18.8~~a decrease of approximately $1.9 million for the ~~nine~~three month period ended ~~September 30, 2017.~~March 31, 2022 and related primarily to the Company’s Oil and Gas segment. There were no measurement period adjustments for the three month period ended March 31, 2021. For the three month period ended March 31, 2022, there were no fair value adjustments, and ~~nine~~for the three month period ended March 31, 2021, fair value adjustments across multiple segments totaled a net decrease of approximately $0.4 million. There were no Earn-out payments in either of the three month periods ended September 30, 2016, payments totaled $5.3 million and $15.8 million, respectively. Foreign currency translation activity was de minimis for both the three and nine month periods ended September 30, 2017 and September 30, 2016. March 31, 2022 or 2021.

Equity Investments

The ~~Company recognized reductions in the expected fair value~~Company’s equity investments as of future earn-out obligations totaling $3.0 million and $11.6 million for certain acquired businesses in the Communications and Electrical Transmission segments for the three and nine month periods ended September 30, 2017, respectively, and, during the first quarter of 2016, the Company recognized a net reduction in the expected fair value of future earn-out obligations of $2.3 million for certain ofMarch 31, 2022 include: (i) the Company’s ~~western Canadian oil and gas businesses.~~

~~Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis~~

Assets and liabilities recognized or disclosed at fair value on a non-recurring basis, for which remeasurement occurs in the event of an impairment or other measurement event, if applicable, include items such as cost and equity method investments, life insurance assets, long-lived assets, goodwill, other intangible assets and liabilities and debt.

As of both September 30, 2017 and December 31, 2016, the gross carrying amount of the Company’s 4.875% senior notes due 2023 (the “4.875% Senior Notes”) totaled $400 million. As of September 30, 2017 and December 31, 2016, the estimated fair value of the Company’s 4.875% Senior Notes, based on quoted market prices in active markets, a Level 1 input, totaled $407.0 million and $388.0 million, respectively.

~~Cost and Equity Investees.~~ ~~The Company’s cost and equity investees as of September 30, 2017 are primarily composed of: (i) the Company’s~~33% equity interests in Trans-Pecos Pipeline, LLC (“TPP”) and Comanche Trail Pipeline, LLC (“CTP,” and together with TPP, the “Waha JVs”); (ii) ~~the Company’s interests in~~ a ~~pre-acquisition~~15% equity ~~method investment of Pacer Construction Holdings Corporation and its affiliated operating companies (collectively, “Pacer”); (iii) a $15 million cost investment~~interest in Cross Country Infrastructure Services, Inc. (“~~CCI,” previously, Cross Country Pipeline Supply, Inc.~~CCI”); (iii) the Company’s 50% equity interests in each of FM Technology Holdings, LLC, FM USA Holdings, LLC and All Communications Solutions Holdings, LLC, collectively “FM Tech”; (iv) the Company’s equity interests in ~~its~~American Virtual Cloud Technologies, Inc. (“AVCT”); (v) the Company’s interests in certain proportionately consolidated non-controlled contractual joint ventures; ~~(v) the Company’s equity interests in Pensare Acquisition Corp. (“Pensare”);~~ and (vi) certain other ~~cost~~equity investments.

Investment Arrangements. From time to time, the Company may participate in selected investment or strategic arrangements, including equity interests in various business entities and participation in contractual joint ventures, some of which may involve the extension of loans or other types of financing arrangements. The Company has determined that certain of its investment arrangements are variable interest entities (“VIEs”). As of March 31, 2022, except for one individually insignificant VIE, the Company does not have the power to direct the primary activities that most significantly impact the economic performance of its VIEs nor is it the primary beneficiary. Accordingly, except for the previously mentioned VIE, the Company’s VIEs are not consolidated.

Equity investments, other than those accounted for as equity method ~~investments. See Note 15 - Related Party Transactions.~~

~~The~~investments or those that are proportionately consolidated, are measured at fair value if their fair values are readily determinable. Equity investments that do not have readily determinable fair values are measured at cost, adjusted for changes from observable market transactions, if any, less impairment (“adjusted cost basis”). As of March 31, 2022 and December 31, 2021, the aggregate carrying value of the Company’s cost and equity method investments are not readily observable. The Company is not aware of events or changes in circumstances that would have a significant adverse effect on the carrying values of its cost and/or equity investments, asincluding equity investments measured on an adjusted cost basis, totaled approximately $280 million and $267 million, respectively. As of ~~September 30, 2017 or~~both March 31, 2022 and December 31, ~~2016. Cumulative undistributed earnings from~~2021, equity ~~method investees~~investments measured on an adjusted cost basis, including the Company’s $15 million investment in CCI, totaled ~~$10.6 million as~~approximately $20 million. There were no impairments related to these investments in either of ~~September 30, 2017.~~the three month periods ended March 31, 2022 or 2021.

The Waha ~~JVs~~.JVs. The Waha JVs own and operate ~~two pipelines and a header system~~certain pipeline infrastructure that ~~transport~~transports natural gas to the Mexican border for export. These pipelines commenced operations in the first half of 2017. There were no equity or other contributions to these joint ventures for the three month period ended September 30, 2017, and for the nine month period ended September 30, 2017, equity and other contributions totaled $73.3 million. As collateral for its equity commitmentsThe Company’s investments in the Waha JVs ~~the Company has issued letters of credit (the “Equity LC Amount”), of which $19 million and $91 million, respectively, were outstanding~~are accounted for as ~~of September 30, 2017 and December 31, 2016.~~equity method investments. Equity in earnings related to the Company’s proportionate share of income from the Waha JVs, which is included within the Company’s Other segment, totaled approximately $7.4 million and ~~$15.1~~$7.7 million for the three ~~and nine~~ month periods ended ~~September 30, 2017,~~March 31, 2022 and 2021, respectively. ~~Equity in~~Distributions of earnings from the Waha JVs, which are included within operating cash flows, totaled $3.1 million for the ~~nine~~three month period ended ~~September 30, 2016 was de minimis.~~March 31, 2022. There were no distributions of earnings for the three month period ended March 31, 2021. Cumulative undistributed earnings from the Waha JVs, which represents cumulative equity in earnings for the Waha JVs less distributions of earnings, totaled $99.2 million as of March 31, 2022. The Company’s net investment in the Waha JVs, which differs from its proportionate share of the net assets of the Waha JVs due primarily to equity method goodwill associated with capitalized investment costs, totaled approximately $234 million and $216 million as of March 31, 2022 and December 31, 2021, respectively.

The Waha JVs are party to separate non-recourse financing facilities, each of which are secured by pledges of the equity interests in the respective entities, as well as a first lien security interest over virtually all of their assets. The Waha JVs are also party to certain interest rate ~~swaps.~~swaps (the “Waha JV swaps”), which are accounted for as qualifying cash flow hedges. The Company reflects its proportionate share of any unrealized fair market value gains or losses from fluctuations in interest rates associated with these swaps within other comprehensive income or loss, as appropriate. For the three month period ended ~~September 30, 2017,~~March 31, 2022, the Company’s proportionate share of unrecognized unrealized activity on ~~these interest rate~~the Waha JV swaps ~~was a gain~~totaled gains of approximately ~~$1.3~~$18.2 million, or $13.8 million, net of tax, and for the three month period ended March 31, 2021, totaled gains of approximately $17.3 million, or $13.1 million, net of tax.

Other Investments. As of March 31, 2022, the Company’s investments in AVCT, which are included within other current assets in the Company’s consolidated financial statements, include (i) shares of AVCT common stock, which are equity securities, and (ii) warrants for the purchase of AVCT common stock, which are derivative financial instruments. Previously, the Company’s investment in AVCT included debentures that were convertible into shares of AVCT common stock, which were available-for-sale securities. In the third quarter of 2021, the Company’s investment in AVCT convertible debentures was automatically converted into shares of AVCT common stock. As of March 31, 2022 and December 31, 2021, the Company’s ownership interest in AVCT’s common stock totaled approximately 3% for both periods, and its aggregate ownership interest, assuming the exercise of all legally exercisable warrants into AVCT common stock, totaled approximately 5% and 6%, respectively.

As of March 31, 2022 and December 31, 2021, the aggregate fair value of the Company’s investments in AVCT approximated $3 million and $8 million, respectively, with an aggregate cost approximating $6 million as of both periods. Unrealized fair value measurement activity related to the AVCT securities, which is based on the market price of identical securities, a Level 1 input, and is recorded within other income or expense, net, totaled losses of approximately $4.8 million for the three month period ended March 31, 2022, and totaled losses, net, of approximately $1.0 million for the three month period ended March 31, 2021. Unrealized fair value measurement activity related to the AVCT convertible debentures based on Level 3 inputs and recognized within other comprehensive income totaled gains of approximately $1.0 million, or $0.8 million, net of tax, ~~and~~ for the ~~nine~~three month period ~~this activity~~ended March 31, 2021.

During the first quarter of 2021, MasTec committed to fund up to $2.5 million for a 75% equity interest in Confluence Networks, LLC (“Confluence”), an undersea fiber-optic communications systems developer and VIE. As of March 31, 2022, a total of $1.7 million had been funded, of which $0.4 million was ~~a loss~~funded during the first quarter of ~~approximately $2.1 million, or $1.3 million, net of tax. For the three and nine month periods ended September 30, 2016,~~2021. Equity in losses related to the Company’s proportionate share of ~~unrecognized unrealized activity~~income from this investment totaled $0.2 million and $0.1 million for the three month periods ended March 31, 2022 and 2021, respectively. As of March 31, 2022, MasTec had less than a majority of the members on ~~these~~the board and determined that it did not have a controlling financial interest, ~~rate swaps was~~and therefore does not have the power to direct the primary activities that most significantly impact its economic performance, nor is it the primary beneficiary. The Company has the ability to exert significant influence over Confluence; and as a ~~loss~~result, accounts for its investment in Confluence as an equity method investment as of March 31, 2022.

The Company has equity interests in certain telecommunications entities that are accounted for as equity method investments. As of both March 31, 2022 and December 31, 2021, the Company had an aggregate investment of approximately ~~$0.6~~$20 million ~~and $21.1~~in these entities, including $17 million ~~respectively, or $0.3 million and $12.9 million, net of tax, respectively.~~

~~Certain subsidiaries of MasTec have provided pipeline construction services to the Waha JVs.~~for FM Tech. For the three months periods ended March 31, 2022 and ~~nine~~2021, the Company made equity contributions related to its investments in telecommunications entities totaling approximately $0.5 million and $2.0 million, respectively. Equity in losses, net, related to the Company’s proportionate share of income from these telecommunications entities totaled approximately $0.3 million for both the three month periods ended ~~September 30, 2017, revenue recognized in connection with work performed for~~March 31, 2022 and 2021. The difference between the ~~Waha JVs, including intercompany eliminations, totaled $3.6 million~~carrying amount of these investments and $255.2 million, respectively, and for the three and nine month periods ended September 30, 2016, totaled $80.9 million and $142.8 million, respectively. As of September 30, 2017 and December 31, 2016, related receivables, including retainage, net of BIEC, totaled $52.2 million and $71.2 million, respectively. As of September 30, 2017 and December 31, 2016, the Company’s ~~net investment~~underlying equity in ~~the Waha JVs represented an asset totaling approximately $115 million and $6 million, respectively. The Company’s net investment in the Waha JVs differs from its proportionate share of~~ the net assets of the ~~Waha JVs due~~respective entities relates primarily to ~~capitalized investment costs as well as the effect~~equity method goodwill associated with assembled workforce for each of ~~intercompany eliminations.~~these entities.

~~Other investments. In~~Certain of these telecommunications entities provide services to MasTec. Expense recognized in connection with services provided by these entities totaled $1.0 million and $1.8 million for the ~~2014 acquisition~~three month periods ended March 31, 2022 and 2021, respectively. As of ~~Pacer,~~March 31, 2022, related amounts payable to these entities were de minimis, and as of December 31, 2021, totaled $0.3 million. In addition, the Company ~~acquired~~had an employee leasing arrangement with one of these entities and has advanced certain amounts to these entities. For the three month period ended March 31, 2022, there were no employee lease expenses or advances, and for the three month period ended March 31, 2021, advances totaled approximately $0.2 million. As of March 31, 2022 and December 31, 2021, employee lease and advances receivable totaled approximately $0.7 million and $0.9 million, respectively.

The Company has 49% equity interests in ~~two joint ventures. There~~certain entities included within its Power Delivery segment that are ~~no remaining amounts expected~~accounted for as equity method investments, for which its aggregate investment as of both March 31, 2022 and December 31, 2021 totaled approximately $4 million. For the three month period ended March 31, 2022, equity in losses, net, related to ~~be advanced~~these entities totaled approximately $0.1 million. Certain of these entities provide construction services to MasTec. Expense recognized in connection with ~~these investments, and as of March 2016, all related project work had been completed. In the first quarter of 2016, revenue recognized~~construction services provided by ~~Pacer on behalf of~~ these entities totaled $0.6 million. One of these entities was liquidated in 2016, and the second, which is in the final stages of liquidation, is being managed by a receiver to assist with the orderly wind-down of its operations. In the first quarter of 2016,approximately $3.6 million for the three month period ended March 31, 2022. As of ~~income was recognized~~March 31, 2022, related amounts payable totaled approximately $0.1 million. In addition, the Company has line of credit arrangements with these investees, providing for up to ~~changes in expected recoveries from these investments. The Company received $12.1~~$8.5 million of ~~proceeds from the receiver in the first quarter~~borrowing availability, of ~~2017. The remaining investment, for~~ which the Company now has minimal involvement, is reviewed regularly by corporate management for potential changes in expected recovery estimates, and, during the second quarter of 2017, the Company recorded $5.8$0.4 million of expense related to changes in expected recovery amounts from this investment. The aggregate net carrying value of this investment, which represents expected recoveries under the receivership arrangement, totaled $14.8 million and $31.4 millionwas drawn as of ~~September 30, 2017~~both March 31, 2022 and December 31, ~~2016, respectively,~~2021, which amounts are included within other current ~~assets.~~

During the third quarter of 2017, the Company paid approximately $2.0 million for approximately 4% of the common stock of Pensare and warrants to purchase 2.0 million shares of Pensare common stock, which is a special purpose acquisition company focusing on transactions in the telecommunications industry. The shares of common stock purchased by MasTec are not transferable or salable until one year after Pensare successfully completes a business combination transaction, with limited exceptions, as specified in the agreement. The warrants purchased by MasTec are exercisable at a purchase price of $11.50 per share after Pensare successfully completes a business combination. Both the warrants and shares expire and/or are effectively forfeitable if Pensare does not successfully complete a business combination by February 1, 2019. The warrants, which are derivative financial instruments, and the shares, which are a cost method investment, are included within other long-term assets in the consolidated balance sheets.

Senior Notes

As of both March 31, 2022 and December 31, 2021, the gross carrying amount of the Company’s ~~consolidated financial statements as of September 30, 2017. The~~4.50% senior notes due August 15, 2028 (the “4.50% Senior Notes”) totaled $600 million, and their estimated fair value, ~~of the warrants, as determined~~ based on an exit price approach using Level 31 inputs, approximated their cost basis as of September 30, 2017. The fair value of the shares is not readily determinable due to the nature of the restrictions. José R. Mas, MasTec’s Chief Executive Officer, is a director of Pensare.

totaled $594.8 million and $619.5 million, respectively.

Note 5 -– Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities

The following table provides details of accounts receivable, net of allowance, and contract assets (together, “accounts receivable, net”) as of the dates indicated (in millions):


	March 31, 2022		December 31, 2021
Contract billings	$	910.4	$	1,027.1
Less allowance	(7.9)		(7.8)
Accounts receivable, net of allowance	$	902.5	$	1,019.3

Retainage	272.9		296.8
Unbilled receivables	1,051.4		931.1
Contract assets	$	1,324.3	$	1,227.9

September 30,
2017 December 31,
2016
Contract billings $ 626.7
$ 564.2
Retainage 287.6
268.6
Costs and earnings in excess of billings 629.5
331.6
Accounts receivable, gross $ 1,543.8
$ 1,164.4
Less allowance for doubtful accounts (9.0 ) (8.4 )
Accounts receivable, net $ 1,534.8
$ 1,156.0

Contract billings represent the amount of performance obligations that have been billed but not yet collected, whereas contract assets consist of unbilled receivables and retainage. Unbilled receivables represent the estimated value of unbilled work for projects with performance obligations recognized over time. Retainage ~~which~~represents a portion of the contract amount that has been billed, but ~~is not due~~for which the contract allows the customer to retain a portion of the billed amount until ~~completion~~final contract settlement (generally, from 5% to 10% of performance and acceptance by customers, is expected to be collected within one year. Receivables expected to be collected beyond one year are recorded within other long-term assets. Provisions for doubtful accounts for each ofcontract billings). For the three month ~~periods~~period ended ~~September 30, 2017 and 2016 totaled $0.4 million,~~March 31, 2022, provisions for credit losses were de minimis, and for the ~~nine~~three month ~~periods~~period ended ~~September 30, 2017~~March 31, 2021, provisions for credit losses totaled a recovery of $7.7 million resulting from successful collection of previously reserved amounts. Impairment losses on contract assets were not material in either period.

Contract liabilities consist primarily of deferred revenue. Under certain contracts, the Company may be entitled to invoice the customer and ~~2016,~~receive payments in advance of performing the related contract work. In those instances, the Company recognizes a liability for advance billings

in excess of revenue recognized, which is referred to as deferred revenue. Contract liabilities also include the amount of any accrued project losses. Total contract liabilities, including accrued project losses, totaled ~~$1.1~~approximately $298.3 million and ~~$2.0~~$314.0 million as of March 31, 2022 and December 31, 2021, respectively, of which deferred revenue comprised approximately $286.3 million and $296.1 million, respectively.

For the three month period ended March 31, 2022, the Company recognized revenue of approximately $186.2 million related to amounts that were included in deferred revenue as of December 31, 2021, resulting primarily from advancement of physical progress on the related projects during the period.

The Company is party to non-recourse financing arrangements in the ordinary course of business, under which certain receivables are ~~purchased by~~settled with the customer’s bank in return for a nominal fee. ~~These~~Discount charges related to these arrangements, ~~under~~ which ~~amounts can vary based on levels of activity and changes in customer payment terms, improve the collection cycle time of the related receivables. The discount charge, which is~~are included within interest expense, net, totaled approximately ~~$2.1~~$1.0 million and $0.8 million ~~respectively,~~ for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, and totaled approximately $4.7 million and $1.7 million, respectively, for the nine month periods ended September 30, 2017 and 2016.~~2021, respectively.

Note 6 -– Property and Equipment, Net

The following table provides details of property and equipment, net, including property and equipment held under ~~capital~~finance leases as of the dates indicated (in millions):


	March 31, 2022		December 31, 2021
Land	$	40.0	$	40.0
Buildings and leasehold improvements	93.9		94.1
Machinery and equipment	2,495.7		2,411.0
Office furniture and equipment	270.7		262.6
Construction in progress	60.1		32.7
Total property and equipment	$	2,960.4	$	2,840.4
Less accumulated depreciation and amortization	(1,475.7)		(1,404.3)
Property and equipment, net	$	1,484.7	$	1,436.1

September 30,
2017 December 31,
2016
Land $ 4.6
$ 4.6
Buildings and leasehold improvements 25.7
24.2
Machinery and equipment 1,237.3
997.8
Office furniture and equipment 149.6
146.1
Construction in progress 8.9
9.5
Total property and equipment $ 1,426.1
$ 1,182.2
Less accumulated depreciation and amortization (734.7 ) (633.1 )
Property and equipment, net $ 691.4
$ 549.1

The gross amount of capitalized internal-use software, which is included within office furniture and equipment, totaled ~~$108.7~~$179.4 million and ~~$107.8~~$176.4 million as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. Capitalized internal-use software, net of accumulated amortization, totaled ~~$24.8~~$43.5 million and ~~$30.9~~$43.9 million as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. ~~Depreciation and amortization expense associated with property and equipment for the three month periods ended~~ ~~September 30, 2017~~ ~~and~~ ~~2016~~ ~~totaled~~ ~~$44.1 million~~ ~~and~~ ~~$37.4 million, respectively, and totaled $123.4 million and $106.5 million for the nine month periods ended September 30, 2017 and 2016, respectively.~~

Note 7 -– Debt

The following table provides details of the carrying values of debt as of the dates indicated (in millions):


Description		Maturity Date	September 30, 2017			December 31, 2016			Description	Maturity Date	March 31, 2022		December 31, 2021
Senior secured credit facility:		February 22, 2022
Senior credit facility:									Senior credit facility:	November 1, 2026
Revolving loans	Revolving loans		$	300.6		$	279.9		Revolving loans		$	690.5	$	772.3
Term loan	Term loan		400.0			237.5			Term loan		350.0		350.0
4.875% Senior Notes		March 15, 2023	400.0			400.0
Capital lease obligations, weighted average interest rate of 3.5%		In installments through September 1, 2022	179.9			98.6
Notes payable and other debt obligations		Varies	12.1			19.8
Total long-term debt obligations			$	1,292.6		$	1,035.8
4.50% Senior Notes									4.50% Senior Notes	August 15, 2028	600.0		600.0
Finance lease and other obligations									Finance lease and other obligations		299.8		310.3
Total debt obligations									Total debt obligations		$	1,940.3	$	2,032.6
Less unamortized deferred financing costs	Less unamortized deferred financing costs		(13.8		)	(9.8		)	Less unamortized deferred financing costs		(17.6)		(18.5)
Total debt, net of deferred financing costs	Total debt, net of deferred financing costs		$	1,278.8		$	1,026.0		Total debt, net of deferred financing costs		$	1,922.7	$	2,014.1
Current portion of long-term debt	Current portion of long-term debt		86.5			64.6			Current portion of long-term debt		134.0		137.9
Long-term debt	Long-term debt		$	1,192.3		$	961.4		Long-term debt		$	1,788.7	$	1,876.2

Senior ~~Secured~~ Credit Facility

~~The Company has a~~As of March 31, 2022, the Company’s senior ~~secured~~unsecured credit facility (the “Credit Facility”), which was amended and restated on February 22, 2017. The Company refers to its amended and restated credit facility as the “2017 Credit Facility,” and to its previous credit facility as the “2016 Credit Facility.” The 2017 Credit Facility increased the Company’s had aggregate borrowing commitments ~~from~~totaling approximately ~~$1.2 billion to $1.5~~$2.0 billion, which amount is composed of ~~$1.1~~$1.65 billion of revolving commitments and a term loan ~~in the aggregate~~with an original principal amount of ~~$400 million.~~$350 million (the “Term Loan”). The amended and restated credit facility also extended the Credit Facility’s maturity date to February 22, 2022. As of September 30, 2017, term loans in the aggregate principal amount of $400 million were drawn under the 2017 Credit Facility. The term loanTerm Loan is subject to amortization in quarterly principal installments ~~that commence~~of approximately $2.2 million commencing in ~~December 2017,~~March 2023, which ~~as of September 30, 2017, amounted~~quarterly installments increase to ~~$3.1~~approximately $4.0 million ~~which amount is~~in March 2025 until maturity. Quarterly principal installments on the Term Loan are subject to adjustment, ~~for additional term loans and,~~ if applicable, for certain prepayments. ~~As of December 31, 2016, term loans in the aggregate principal amount of $238 million were outstanding.~~

The 2017 Credit Facility also increased the amount the Company can borrow either in Canadian dollars and/or Mexican pesos up to an aggregate equivalent amount of $300 million. The maximum amount available for letters of credit under the 2017 Credit Facility is $650 million, of which up to $200 million can be denominated in either Canadian dollars and/or Mexican pesos. The Credit Facility also provides for swing line loans of up to $75 million, and, subject to certain conditions, the Company has the option to increase revolving commitments and/or establish additional term loan tranches up to an aggregate amount of $250 million. Subject to the terms and conditions described in the Credit Facility, these additional term loan tranches may rank equal or junior in respect of right of payment and/or collateral to the Credit Facility, and may have terms and pricing that differ from the 2017 Credit Facility. Borrowings under the Credit Facility are used for working capital requirements, capital expenditures and other corporate purposes, including investments in equity or other investees, potential acquisitions or other strategic arrangements, and the repurchase or prepayment of indebtedness.

Outstanding revolving loans and the term loan under the Credit Facility bear interest, at the Company’s option, at a rate equal to either (a) a Eurocurrency Rate, as defined in the 2017 Credit Facility, plus a margin of 1.25% to 2.00% (under the 2016 Credit Facility, the margin was from 1.00% to 2.00%), or (b) a Base Rate, as defined in the 2017 Credit Facility, plus a margin of 0.25% to 1.00% (under the 2016 Credit Facility, the margin was from 0.00% to 1.00%). The Base Rate equals the highest of (i) the Federal Funds Rate, as defined in the Credit Facility, plus 0.50%, (ii) Bank of America’s prime rate, and (iii) the Eurocurrency Rate plus 1.00%. Financial standby letters of credit and commercial letters of credit issued under the 2017 Credit Facility are subject to a letter of credit fee of 1.25% to 2.00% (under the 2016 Credit Facility, the letter of credit fee was from 1.00% to 2.00%), and performance standby letters of credit are subject to a letter of credit fee of 0.50% to 1.00% under the Credit Facility. The Company must also pay a commitment fee to the lenders of 0.20% to 0.40% on any unused availability under the Credit Facility. In each of the foregoing cases, the applicable margin or fee is based on the Company’s Consolidated Leverage Ratio, as defined in the Credit Facility, as of the then most recent fiscal quarter.

As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, outstanding revolving loans, which included ~~$171~~$0.5 million and ~~$119~~$32.3 million, respectively, of borrowings denominated in foreign currencies, accrued interest at weighted average rates of approximately ~~2.96%~~1.60% and ~~3.71%~~2.32% per annum, respectively. The ~~term loan~~Term Loan accrued interest at ~~a rate~~rates of ~~2.86%~~1.71% and ~~2.77%~~1.35% as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. Letters of credit of approximately ~~$189.1~~$198.6 million and ~~$314.3~~$166.3 million were issued as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. As of ~~September 30, 2017~~both March 31, 2022 and December 31, ~~2016, letters~~2021, letter of credit fees accrued at ~~0.750% and 1.00%~~0.4375% per annum ~~respectively,~~ for performance standby letters of credit and at ~~1.625% and 2.00%~~1.25% per annum ~~respectively,~~ for financial standby letters of credit. Outstanding letters of credit mature at various dates and most have automatic renewal provisions,

subject to prior notice of cancellation. As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, availability for revolving loans totaled ~~$610.3~~$760.9 million and ~~$405.9~~$711.5 million, respectively, or up to ~~$460.9~~$451.4 million and ~~$335.7~~$483.7 million, respectively, for new letters of credit. Revolving loan borrowing capacity included ~~$129.4~~$299.5 million and ~~$80.9~~$267.7 million of availability in either Canadian dollars or Mexican pesos as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. The unused facility fee as of ~~September 30, 2017~~both March 31, 2022 and December 31, ~~2016~~2021 accrued at a rate of ~~0.30% and 0.40%, respectively.~~0.175% per annum.

The Credit Facility is guaranteed by certain subsidiaries of the Company ~~(the “Guarantor Subsidiaries”)~~ and the obligations under the Credit Facility are secured by substantially all of the Company’s and the Guarantor Subsidiaries’ respective assets, subject to certain exceptions. The Credit Facility requires that the Company maintain a Maximum Consolidated Leverage Ratio, as defined in the Credit Facility, of 3.50 (subject to the Acquisition Adjustment described below). The Credit Facility also requires that the Company maintain a Minimum Consolidated Interest Coverage Ratio, as defined in the Credit Facility, of 3.00. The Credit Facility provides that, for purposes of calculating the Consolidated Leverage Ratio, certain cash charges may be added back to the calculation of Consolidated EBITDA, as defined in the Credit Facility, and funded indebtedness excludes undrawn standby performance letters of credit. Additionally, notwithstanding the terms discussed above, subject to certain conditions, if a permitted acquisition or series of permitted acquisitions having consideration exceeding $50 million occurs during a fiscal quarter, the Consolidated Leverage Ratio may be temporarily increased to up to 3.75 during such fiscal quarter and the subsequent two fiscal quarters. Such right may be exercised no more than two times during the term of the Credit Facility. Subject to customary exceptions, the Credit Facility limits the borrowers’ and the Guarantor Subsidiaries’ ability to engage in certain activities, including acquisitions, mergers and consolidations, debt incurrence, investments, capital expenditures, asset sales, debt prepayments, lien incurrence and the making of distributions or repurchases of capital stock. However, distributions payable solely in capital stock are permitted. The Credit Facility provides for customary events of default and carries cross-default provisions with the Company’s other significant debt instruments, including the Company’s indemnity agreement with its surety provider, as well as customary remedies, including the acceleration of repayment of outstanding amounts and other remedies with respect to the collateral securing the Credit Facility obligations.not secured.

Other Credit Facilities. The Company has other credit facilities that ~~support~~support: (i) the working capital requirements of its foreign ~~operations. Borrowings~~operations and (ii) certain letter of credit issuances. There were no outstanding borrowings under ~~these~~the Company’s other credit facilities as of March 31, 2022 or December 31, 2021. Additionally, the Company has a separate credit facility, under which ~~have varying dates~~it may issue performance standby letters of ~~maturity and are generally renewed on an annual basis, are denominated in Canadian dollars.~~credit. As ~~September 30, 2017~~of March 31, 2022 and December 31, ~~2016, maximum borrowing capacity~~2021, letters of credit issued under this facility totaled ~~Canadian $20.0~~$18.4 million and $40.0 million, respectively, or approximately $16.0 million and $29.8 million, respectively. As of September 30, 2017 and December 31, 2016, outstanding borrowings totaled approximately $5.4 million and $13.4$22.2 million, respectively, and accrued ~~interest~~fees at ~~a weighted average rate~~0.40% per annum as of approximately 4.0% and 3.6%, respectively. Outstanding borrowings that are not renewed are repaid with borrowings under the Company’s senior secured credit facility. Accordingly, the carrying amounts of the Company’s borrowings under its other credit facilities, which are included within notes payable and other debt obligations in the table above, are classified within long-term debt in the Company’s consolidated balance sheets.both periods. The Company’s other credit facilities are subject to customary provisions and covenants.

Debt Guarantees and Covenants

The ~~4.875%~~4.50% Senior Notes are senior unsecured unsubordinated obligations and rank equal in right of payment with existing and future unsubordinated debt, and rank senior in right of payment to existing and future subordinated debt and are fully and unconditionally guaranteed on ana senior unsecured, ~~unsubordinated,~~ joint and several basis by certain of the Company’s ~~existing and future 100%-owned direct and indirect~~wholly-owned domestic restricted subsidiaries that ~~are each guarantors of the Company’s Credit Facility or other outstanding indebtedness. See Note 16 - Supplemental Guarantor Condensed Unaudited Consolidating Financial Information.~~

guarantee its existing credit facilities. MasTec was in compliance with the provisions and covenants of its outstanding debt instruments as of ~~September 30, 2017~~both March 31, 2022 and December 31, ~~2016.~~2021.

Additional Information

As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, accrued interest payable, which is recorded within other accrued expenses in the consolidated balance sheets, totaled ~~$4.1~~$5.3 million and ~~$8.5~~$11.7 million, respectively. ~~Additionally, in connection with the 2017 Credit Facility amendment, the Company paid approximately $6 million in financing costs for the nine month period ended September 30, 2017.~~ For additional information pertaining to the Company’s debt instruments, ~~including its 4.875% Senior Notes,~~ see Note 7 - Debt in the Company’s ~~2016~~2021 Form 10-K.

Note 8 -– Lease Obligations

~~Capital Leases~~

MasTec enters into agreements that provide lease financing for machinery and equipment. The gross amount of assets held under capital leases as of September 30, 2017 and December 31, 2016, which are included within property and equipment, net, totaled $404.1 million and $294.9 million, respectively. Assets held under capital leases, net of accumulated depreciation, totaled $269.6 million and $177.5 million as of September 30, 2017 and December 31, 2016, respectively.

~~Operating Leases~~

In the ordinary course of business, the Company enters into ~~non-cancelable operating leases~~agreements that provide financing for ~~certain~~machinery and equipment and for other of its facility, vehicle and equipment needs, including related party leases. ~~See Note 15 - Related Party Transactions. Rent~~As of March 31, 2022, the Company’s leases have remaining lease terms of up to eleven years. Lease agreements may contain renewal clauses, which, if elected, generally extend the term of the lease for one to five years for both equipment and ~~related~~facility leases. Certain lease agreements may also contain options to purchase the leased property and/or options to terminate the lease. In addition, lease agreements may include periodic adjustments to payment amounts for inflation or other variables, or may require payments for taxes, insurance, maintenance or other expenses, which are generally referred to as non-lease components. The Company’s lease agreements do not contain significant residual value guarantees or material restrictive covenants.

Finance Leases

The gross amount of assets held under finance leases as of March 31, 2022 and December 31, 2021 totaled $651.1 million and $653.5 million, respectively. Assets held under finance leases, net of accumulated depreciation, totaled $458.3 million and $468.5 million as of March 31, 2022 and December 31, 2021, respectively. Depreciation expense associated with finance leases totaled $20.3 million and $19.0 million for the three month periods ended March 31, 2022 and 2021, respectively.

Operating Leases

Operating lease additions for the three month periods ended March 31, 2022 and 2021 totaled $26.9 million and $5.5 million, respectively. For the three month periods ended March 31, 2022 and 2021, rent expense for ~~operating~~ leases that have ~~non-cancelable~~ terms in excess of one year totaled approximately ~~$25.4~~$34.0 million and ~~$25.9~~$27.4 million, ~~for the three month periods ended September 30, 2017 and 2016,~~ respectively, ~~and totaled $77.6~~of which $3.0 million and ~~$74.8~~$2.2 million, ~~for the nine month periods ended September 30, 2017 and 2016, respectively.~~respectively, represented variable lease costs. The Company also incurred rent ~~and related~~ expense for ~~facilities, vehicles and equipment having original~~leases with terms of one year or less totaling approximately ~~$159.4~~$74.3 million and ~~$96.7~~$110.1 million for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, respectively,~~2021, respectively. Rent expense for operating leases is generally consistent with the amount of the related payments, which payments are included within operating activities in the consolidated statements of cash flows.

Additional Lease Information

Future minimum lease commitments as of March 31, 2022 were as follows (in millions):


	Finance Leases		Operating Leases
2022, remaining nine months	$	110.3	$	74.3
2023	102.6		71.9
2024	62.6		56.2
2025	32.1		36.1
2026	4.4		22.1
Thereafter	—		27.2
Total minimum lease payments	$	312.0	$	287.8
Less amounts representing interest	(13.2)		(14.0)
Total lease obligations, net of interest	$	298.8	$	273.8
Less current portion	133.2		92.1
Long-term portion of lease obligations, net of interest	$	165.6	$	181.7

As of March 31, 2022, finance leases had a weighted average remaining lease term of 2.7 years and ~~totaling $347.8 million~~a weighted average discount rate of 3.2%. Non-cancelable operating leases had a weighted average remaining lease term of 4.4 years and ~~$213.9 million~~a weighted average discount rate of 2.8% as of March 31, 2022. As of March 31, 2022, future lease obligations for ~~the nine month periods ended September 30, 2017 and 2016, respectively.~~leases that had not yet commenced totaled approximately $7.3 million. These leases commence in 2022 with lease terms ranging from 1 year to 11 years.

Note 9 – Stock-Based Compensation and Other Employee Benefit Plans

The Company has stock-based compensation plans, under which shares of the Company’s common stock are reserved for issuance. Under all stock-based compensation plans in effect as of ~~September 30, 2017, including employee stock purchase plans,~~March 31, 2022, there were approximately ~~4.9 million~~

3,408,000 shares available for future grant. InNon-cash stock-based compensation expense under all plans totaled $6.3 million and $5.5 million for the three month periods ended March ~~2017,~~31, 2022 and 2021, respectively. Income tax benefits associated with stock-based compensation arrangements totaled $2.2 million and $1.1 million for the ~~Company’s board~~three month periods ended March 31, 2022 and 2021, respectively, including net tax benefits related to the vesting of ~~directors adopted the Amended~~share-based payment awards totaling $0.9 million and Restated 2013 Incentive Compensation Plan (the “Amended 2013 ICP”), which was effective as of January 1, 2017 and changed the amount of tax the Company can withhold for employee tax withholdings on share-based awards, as provided under ASU 2016-09. The Company adopted ASU 2016-09 as of January 1, 2017, as discussed in Note 1 - Business, Basis of Presentation and Significant Accounting Policies.$0.1 million, respectively.

Restricted Shares

MasTec grants restricted stock awards and restricted stock units (together, “restricted shares”), to eligible participants, which are valued based on the closing market share price of MasTec common stock (the “market price”) on the date of grant. During the restriction period, holders of restricted stock awards are entitled to vote the shares. ~~Total~~As of March 31, 2022, total unearned compensation related to restricted shares ~~as ofSeptember 30, 2017~~was approximately ~~$15.8~~$50.6 million,, which amount is expected to be recognized over a weighted average period of approximately ~~1.1~~2.2 years. T~~he intrinsic~~The fair value of restricted shares that vested, which is based on the market price on the date of vesting, totaled ~~$0.1~~$19.0 million and $10.9 million for ~~both~~ the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, respectively.


Activity, restricted shares: (a)	Restricted Shares	Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2021	1,748,685	$	43.73
Granted	168,910	86.95
Vested	(226,335)	46.88
Canceled/forfeited	(3,400)	34.96
Non-vested restricted shares, as of March 31, 2022	1,687,860	$	47.66

(a) Includes 1,800 and ~~totaled $11.9 million~~1,300 restricted stock units as of March 31, 2022 and ~~$1.5 million for the nine month periods ended September 30, 2017 and 2016,~~December 31, 2021, respectively.

Activity, restricted shares: ^(a)
Restricted
Shares Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2016 1,970,586
$ 21.61
Granted 193,348
39.47
Vested (304,211 ) 40.72
Canceled/forfeited (30,041 ) 20.24
Non-vested restricted shares, as of September 30, 2017 1,829,682
$ 20.34


~~(a)~~	~~Includes 39,050 and 43,300 restricted stock units as of September 30, 2017~~ ~~and~~ ~~December 31, 2016, respectively.~~

~~Stock Options~~

The Company previously granted options to purchase its common stock to employees and members of the Board of Directors and affiliates under various stock option plans. During 2016, all stock options that were outstanding under previous stock option grants were exercised. The intrinsic value of options exercised, which is based on the difference between the exercise price and the market share price of the Company’s common stock on the date of exercise, totaled $0.5 million and $1.8 million for the three and nine month periods ended September 30, 2016, respectively. Net of shares withheld in cashless option exercises, there were no proceeds from option exercises for the three month period ended September 30, 2016, and for the nine month period ended September 30, 2016, proceeds totaled $1.9 million.

Employee Stock Purchase Plans

The Company has certain employee stock purchase plans (collectively, “ESPPs”), under which shares of the ~~Company's~~Company’s common stock are available for purchase by eligible ~~employees. The following table provides details pertaining~~participants. Under the ESPPs, eligible participants are permitted to purchase MasTec, Inc. common stock at 85% of the fair market value of the shares on the date of purchase, which occurs on the last trading day of each two week offering period. At the Company’s discretion, share purchases may be satisfied by delivering newly issued common shares or common shares reacquired on the open market or in privately negotiated transactions.

For the three month periods ended March 31, 2022 and 2021, 24,737 shares and 18,843 shares, respectively, were purchased by participants under the Company’s ESPPs for $1.9 million, and $1.4 million, respectively, which shares were reacquired by the Company on the open market. Compensation expense associated with the Company’s ESPPs totaled approximately $0.3 million for both the three month periods ~~indicated:~~ended March 31, 2022 and 2021, respectively.

For the Nine Months Ended September 30
2017 2016
Cash proceeds (in millions)
$ 2.4
$ 2.0
Common shares issued 68,789
115,556
Weighted average price per share $ 34.72
$ 16.88
Weighted average per share grant date fair value $ 9.00
$ 4.58

~~Non-CashStock-Based Compensation Expense~~

~~Details of non-cash stock-based compensation expense and related tax effects for the periods indicated were as follows (in millions):~~

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
Non-cash stock-based compensation expense $ 3.4
$ 3.9
$ 10.5
$ 11.3
Income Tax Effects:
Income tax effect of non-cash stock-based compensation $ 1.3
$ 1.7
$ 3.8
$ 5.6
Excess tax benefit from non-cash stock-based compensation ^(a)
$ 0.0
$ 0.3
$ 0.1
$ 1.4

~~(a)~~

~~Excess tax benefits represent cash flows from tax deductions in excess of the tax effect of compensation expense associated with share-based payment arrangements. For the nine~~month period ended September 30, 2017, the Company incurred a net tax deficiency of $0.1 million related to the vesting of share-based payment awards and excess tax benefits were de minimis. As discussed in Note 1 - Business, Basis of Presentation and Significant Accounting Policies, the Company adopted

ASU 2016-09 effective January 1, 2017 on a prospective basis. ASU 2016-09 changed the required presentation of excess tax benefits in the consolidated statement of cash flows from financing activities to operating activities. Excess tax benefits for the comparative prior year period are classified as cash flows from financing activities.

Note 10 – Other Retirement Plans

Multiemployer Plans. Certain of MasTec’s subsidiaries ~~including certain subsidiaries in Canada,~~ contribute amounts to multiemployer pension and other multiemployer benefit plans and trusts ~~which are recorded as a component of employee wages and salaries within costs of revenue, excluding depreciation and amortization.~~(“MEPPs”). Contributions are generally based on fixed amounts per hour per employee for employees covered under these plans. Multiemployer plan contribution rates are determined annually and assessed on a “pay-as-you-go” basis based on union employee payrolls. Union payrolls cannot be determined for future periods because the number of union employees employed at a given time, and the plans in which they ~~may~~ participate, vary depending upon the location and number of ongoing projects ~~at a given time~~ and the need for union resources in connection with those projects. Total contributions to multiemployer plans and the related number of employees covered by these plans ~~including with respect to the Company’s Canadian operations,~~ for the periods indicated were as follows:

Multiemployer Plans
Covered Employees
Contributions (in millions)
Low High Pension Other Multiemployer Total
For the Three Months Ended September 30:
2017 3,669
7,057
$ 36.7
$ 2.7
$ 39.4
2016 4,170
4,910
$ 26.4
$ 2.9
$ 29.3
For the Nine Months Ended September 30:
2017 550
7,057
$ 68.1
$ 8.0
$ 76.1
2016 1,112
4,910
$ 43.4
$ 7.6
$ 51.0


	Multiemployer Plans
	Covered Employees		Contributions (in millions)
	Low	High	Pension		Other Multiemployer		Total
For the Three Months Ended March 31:
2022	6,601	6,672	$	17.0	$	13.2	$	30.2
2021	2,412	2,532	$	22.5	$	2.2	$	24.7

The fluctuations in the ~~average~~ number of employees covered under multiemployer plans and related contributions in the table above ~~are~~related primarily ~~related~~ to ~~higher levels~~the timing of activity for the Company’s union resource-based projects. For the three month period ended March 31, 2022, multiemployer plan activity was driven primarily by acquisition-related project ~~activity~~work within the Company’s ~~oil~~Power Delivery operations, whereas for the three month period ended March 31, 2021, activity was driven primarily by projects within the Company’s Oil and ~~gas~~Gas operations.

Note 11 – Equity

Share Activity

The Company’s share repurchase programs provide for the repurchase of shares of MasTec common stock from time to time in open market transactions or in privately negotiated transactions in accordance with applicable securities laws. The Company’s share repurchase programs do not have an expiration date and may be modified or suspended at any time at the Company’s discretion. For the three month period ended March 31, 2022, the Company repurchased 0.2 million shares of its common stock for an aggregate purchase price totaling approximately $13.8 million, of which 0.1 million shares were repurchased for $8.6 million under the Company’s December 2018 $100 million share repurchase program, which completed the program. The remaining 0.1 million shares were repurchased for $5.2 million under the Company’s March 2020 $150 million share repurchase program. Subsequent to March 31, 2022, the Company repurchased an additional 0.5 million shares of its common stock for an aggregate purchase price of $35.8 million. There were no share repurchases under the Company’s share repurchase programs for the three month period ended March 31, 2021. As of March 31, 2022, $144.8 million was available for future share repurchases under the Company’s March 2020 share repurchase program.

Accumulated Other Comprehensive Loss

~~Accumulated other comprehensive loss is composed of~~For the three month periods ended March 31, 2022 and 2021, unrealized foreign currency translation gains and losses, which relate primarily to fluctuations in foreign currency exchange rates of the Company’s foreign subsidiaries with a functional currency other than the U.S. dollar, and unrealized gains and losses from certain investment activities. For both the three and nine month periods ended September 30, 2017 and 2016, unrealized foreign currency activity, ~~related primarily~~net, relates to the Company’s ~~Canadian~~ operations in Canada and ~~unrealized~~Mexico. Unrealized investment activity ~~related~~for the three month period ended March 31, 2022 relates to ~~interest rate swaps associated with~~unrealized gains on the Waha ~~JVs.~~JV swaps, and for the three month period ended March 31, 2021, includes unrealized gains on the Waha JV swaps and on the AVCT convertible debentures. See Note 4 - Fair Value of Financial Instruments for additional information.

~~Share Activity~~

~~No shares of the Company’s common stock have been repurchased under the Company’s 2016 share repurchase program.~~

Note 12 -– Income Taxes

In determining the quarterly provision for income taxes, management uses an estimated annual effective tax rate based on forecasted annual pre-tax income, permanent tax differences, statutory tax rates and tax planning opportunities in the various jurisdictions in which the Company operates. The effect of significant discrete items is separately recognized in the quarter(s) in which they occur. For the three month periods ended March 31, 2022 and 2021, the Company’s consolidated effective tax rates were 27.3% and 30.7%, respectively. The Company’s effective tax rate for the three month period ended ~~September 30, 2017, the Company recognized certain~~March 31, 2022 included a net tax ~~credits based upon the results~~benefit of a study that is currently underway, which amount was determined based on management’s estimates and currently available information. Further adjustments to the amount recognized may occur as the results of the study are finalized, which is expected to occur in the fourth quarter of 2017.

As discussed in Note 1 - Business, Basis of Presentation and Significant Accounting Policies, effective January 1, 2017, the Company adopted ASU 2016-09, which changed the recognition requirements for excess tax benefits (“windfalls”) or tax deficiencies (“shortfalls”) from share-based payment awards. ASU 2016-09 requires windfalls or shortfalls to be recognized within income tax expense in the interim periods in which they occur, rather than as additional paid-in capital. Given that windfalls or shortfalls are recognized in income tax expense in the periods in which they occur, they are not included when estimating annual effective tax rates. The tax effectapproximately $0.9 million related to the vesting of share-based payment awards, ~~did not have a significant effect on the Company’s consolidated effective tax rate~~and for the three ~~and nine~~ month ~~periods~~period ended ~~September 30, 2017.~~March 31, 2021, included the negative effect of $2.3 million related to non-deductible share-based compensation.

As of September 30, 2017, the Company had $274.5 million of long-term deferred tax liabilities. As of December 31, 2016, current deferred tax assets, net, totaled $11.8 million and long-term deferred tax liabilities, net, totaled $178.4 million. In addition, as of September 30, 2017 and December 31, 2016, accrued income and other taxes payable, which are included within other accrued expenses, totaled $19.8 million and $40.3 million, respectively. The Company adopted ~~Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes~~ ~~(“ASU 2015-17”), which changed the classification requirements for deferred tax assets and liabilities, effective January 1, 2017. ASU 2015-17 requires long-term classification of all deferred~~

tax assets and liabilities, rather than separately classifying deferred tax assets and liabilities based on their net current and non-current amounts, as was required under the previous guidance. The Company adopted ASU 2015-17 on a prospective basis, therefore prior periods were not adjusted to conform to the current period presentation. The adoption of ASU 2015-17 did not have had a material effect on the consolidated financial statements.

Note 13 -– Segments and Related Information

Segment Discussion

~~MasTec~~The Company manages its operations under ~~five~~5 operating segments, which represent ~~MasTec’s five~~its 5 reportable segments: (1) Communications; (2) Clean Energy and Infrastructure; (3) Oil and Gas; ~~(3) Electrical Transmission;~~ (4) Power ~~Generation and Industrial~~Delivery and (5) Other. This structure is generally focused on broad end-user markets for ~~MasTec’s~~the Company’s labor-based construction services. All ~~five~~5 reportable segments derive their revenue from the engineering, installation and maintenance of infrastructure, primarily in North America. In the first quarter of 2022, the Company began integration of HMG. The HMG

acquisition was completed on December 30, 2021, with its initial balance sheet reported within the Company’s Power Delivery segment. During the first quarter of 2022, the Company reported portions of HMG’s operations within its Power Delivery, Communications and Oil and Gas segments, as appropriate, and HMG’s corporate functions within its Corporate results. Accordingly, HMG’s December 31, 2021 balance sheet information was recast to conform with the new reporting structure.

The Communications segment performs engineering, construction, maintenance and customer fulfillment activities related to communications infrastructure, primarily for wireless and wireline/fiber communications and install-to-the-home customers, ~~and, to a lesser extent,~~as well as infrastructure for utilities, among others. ~~MasTec~~The Clean Energy and Infrastructure segment primarily serves energy, utility, government and other end-markets through the installation and construction of power generation facilities, primarily from clean energy and renewable sources, such as wind, solar, biomass, natural gas and hydrogen, as well as battery storage for renewable energy and various types of heavy civil and industrial infrastructure. The Company performs engineering, construction and maintenance services ~~on oil and natural gas~~for pipelines and processing facilities for the energy and utilities industries through its Oil and Gas segment. The ~~Electrical Transmission~~Power Delivery segment primarily serves the energy and utility industries through the engineering, construction and maintenance of power transmission and distribution infrastructure, including electrical and gas transmission lines, distribution network systems and substations. The Power Generation and Industrial segment primarily serves energy, utility and other end-markets through the installation and construction of conventional and renewable power facilities, related electrical transmission infrastructure, ethanol/biofuel facilities and various types of heavy civil and industrial infrastructure. The Other segment includes certain equity investees, the services of which vary from those provided by the Company’s ~~four~~ primary segments, as well as other small business units that perform construction and other services for ~~a variety of~~certain international end-markets.

Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is the measure of profitability used by management to manage its segments and, accordingly, in its segment reporting. As appropriate, the Company supplements the reporting of its consolidated financial information determined in accordance with U.S. GAAP with certain non-U.S. GAAP financial measures, including EBITDA. The Company believes these non-U.S. GAAP measures provide meaningful information and help investors understand the Company’s financial results and assess its prospects for future performance. The Company uses EBITDA to evaluate its performance, both internally and as compared with its peers, because it excludes certain items that may not be indicative of the Company’s core operating results for its reportable segments, as well as items that can vary widely across different industries or among companies within the same industry, and for non-cash stock-based compensation expense, can also be subject to volatility from changes in the market price per share of our common stock or variations in the value of shares granted.industry. Segment EBITDA is calculated in a manner consistent with consolidated EBITDA.

For the three and nine month periods ended September 30, 2017, Other segment EBITDA included project losses of $0.4 million and $7.4 million, respectively, from a proportionately consolidated non-controlled Canadian joint venture, which is managed by a third party, and for which we have minimal direct construction involvement. For both the three and nine month periods ended September 30, 2016, Other segment EBITDA included $5.1 million of project losses on this proportionately consolidated non-controlled Canadian joint venture. For the nine month period ended September 30, 2016, EBITDA for the Oil and Gas and Electrical Transmission segments included first quarter project losses of $13.5 million and $15.1 million, respectively.

Summarized financial information for MasTec’s reportable segments is presented and reconciled to consolidated financial information for total MasTec in the following tables, ~~(in millions):~~

For the Three Months Ended September 30 For the Nine Months Ended September 30
Revenue: 2017 2016 2017 2016
Communications ^(a)
$ 610.5
$ 624.3
$ 1,762.2
$ 1,728.0
Oil and Gas 1,161.0
736.0
2,757.2
1,454.3
Electrical Transmission 81.8
101.7
277.3
283.6
Power Generation and Industrial 96.9
123.6
204.1
324.7
Other 10.6
7.6
14.2
14.9
Eliminations (5.0 ) (7.0 ) (10.9 ) (12.7 )
Consolidated revenue $ 1,955.8
$ 1,586.2
$ 5,004.1
$ 3,792.8


~~(a)~~	Revenue generated primarily by utilities customers represented 13.0% and 11.1% of Communications segment revenue for the three month periods ended September 30, 2017 and 2016, respectively, and represented 12.6% and 10.9% for the nine month periods ended September 30, 2017 and 2016, respectively.

For the Three Months Ended September 30 For the Nine Months Ended September 30
EBITDA: 2017 2016 2017 2016
Communications $ 65.3
$ 62.8
$ 173.2
$ 190.9
Oil and Gas 108.1
117.8
356.1
187.6
Electrical Transmission 4.5
(8.3 ) 11.2
(42.0 )
Power Generation and Industrial 9.3
6.1
14.8
13.8
Other 10.1
(3.1 ) 11.6
(2.6 )
Corporate (22.0 ) (24.3 ) (69.2 ) (55.1 )
Consolidated EBITDA $ 175.3
$ 151.0
$ 497.7
$ 292.6

For the Three Months Ended September 30 For the Nine Months Ended September 30
Depreciation and Amortization: 2017 2016 2017 2016
Communications $ 13.8
$ 12.5
$ 39.4
$ 37.2
Oil and Gas 26.0
20.7
71.1
58.2
Electrical Transmission 5.8
6.1
17.3
17.1
Power Generation and Industrial 2.9
1.6
5.8
4.6
Other 0.0
0.0
0.1
0.0
Corporate 1.6
1.7
4.7
5.1
Consolidated depreciation and amortization $ 50.1
$ 42.6
$ 138.4
$ 122.2

~~The following table, which may contain slight summation differences due to rounding, presents~~including a reconciliation of consolidated income before income taxes to EBITDA, ~~(in millions):~~all of which are presented in millions. The tables below may contain slight summation differences due to rounding.


	For the Three Months Ended March 31,
Revenue:	2022		2021
Communications (a)	$	664.2	$	568.6
Clean Energy and Infrastructure	435.9		350.4
Oil and Gas	211.0		725.5
Power Delivery	650.5		133.5
Other	0.0		0.0
Eliminations	(7.2)		(2.6)
Consolidated revenue	$	1,954.4	$	1,775.4

(a) Revenue generated primarily by utilities customers represented 25.6% and 20.1% of Communications segment revenue for the three month periods ended March 31, 2022 and 2021, respectively.


	For the Three Months Ended March 31,
EBITDA:	2022		2021
Communications	$	40.3	$	48.9
Clean Energy and Infrastructure	10.9		10.9
Oil and Gas	21.5		167.6
Power Delivery	46.1		3.6
Other	6.9		7.4
Corporate	(47.0)		(40.0)
Consolidated EBITDA	$	78.7	$	198.4

For the three month period ended March 31, 2022, Power Delivery, Communications, Oil and Gas and Corporate EBITDA included $7.0 million, $0.8 million, $2.0 million and $3.8 million, respectively, of acquisition and integration costs related to the Company’s fourth quarter 2021 acquisitions.

For the Three Months Ended September 30 For the Nine Months Ended September 30
EBITDA Reconciliation: 2017 2016 2017 2016
Income before income taxes $ 107.6
$ 95.3
$ 314.3
$ 132.4
Plus:
Interest expense, net 17.6
13.1
45.0
37.9
Depreciation and amortization 50.1
42.6
138.4
122.2
Consolidated EBITDA $ 175.3
$ 151.0
$ 497.7
$ 292.6


	For the Three Months Ended March 31,
Depreciation and Amortization:	2022		2021
Communications	$	29.0	$	21.8
Clean Energy and Infrastructure	11.4		7.6
Oil and Gas	31.6		52.1
Power Delivery	35.7		6.1
Other	0.0		0.0
Corporate	3.1		2.9
Consolidated depreciation and amortization	$	110.8	$	90.5


Assets:	March 31, 2022		December 31, 2021 (a)
Communications	$	2,156.6	$	2,100.9
Clean Energy and Infrastructure	970.5		1,067.0
Oil and Gas	1,509.8		1,527.6
Power Delivery	2,038.6		2,017.2
Other	263.0		238.1
Corporate	149.5		170.6
Consolidated segment assets	$	7,088.0	$	7,121.4

(a) Segment assets as of December 31, 2021 were recast during the first quarter of 2022 to conform with the change in segment reporting for the HMG acquisition, the effect of which was a decrease in Power Delivery segment assets of $192.2 million, an increase in assets for the Communications and Oil and Gas segments of $69.4 million and $77.0 million, respectively, and an increase in Corporate assets of $45.8 million.


	For the Three Months Ended March 31,
EBITDA Reconciliation:	2022		2021
(Loss) income before income taxes	$	(48.1)	$	95.4
Plus:
Interest expense, net	16.0		12.5
Depreciation	85.2		79.3
Amortization of intangible assets	25.6		11.2
Consolidated EBITDA	$	78.7	$	198.4

Foreign ~~Operations.~~ Operations and Other. MasTec operates ~~in North America,~~ primarily in the United States and Canada, and, to a far lesser extent, in ~~Mexico. For~~Mexico, the Caribbean and India. Revenue derived from U.S. operations totaled $1.9 billion and $1.7 billion for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, revenue of $1.9 billion and $1.5 billion, respectively, was derived from U.S. operations, and revenue of $61.0 million and $73.8 million, respectively, was~~2021, respectively. Revenue derived from foreign operations totaled $24.5 million and $46.4 million for the ~~majority of~~three month periods ended March 31, 2022 and 2021, respectively, which was derived primarily from the Company’s Canadian ~~operations. For the nine month periods ended September 30, 2017~~operations in its Oil and ~~2016, revenue of $4.8 billion~~Gas segment, and, ~~$3.6 billion, respectively, was derived from U.S. operations, and revenue of $160.7 million and $222.8 million, respectively, was derived from foreign operations, the majority of which was~~to a lesser extent, from the Company’s ~~Canadian operations. The majority of the Company’s foreign~~ operations ~~during the three and nine month periods ended September 30, 2017 and 2016 were~~ in ~~the Company’s Oil and Gas segment.~~Mexico. Long-lived assets held in the U.S. included property and equipment, net, of ~~$629.2 million~~$1.5 billion and ~~$475.3 million~~$1.4 billion as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively, and, for the Company’s businesses in foreign countries, ~~the majority of which are in Canada,~~ totaled ~~$62.2~~$24.6 million and ~~$73.8~~$24.5 million, respectively. Intangible assets and goodwill, net, related to the Company’s U.S. operations totaled approximately ~~$1.2~~$2.2 billion and ~~$1.1~~$2.1 billion as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively, and for the Company’s businesses in foreign countries, ~~the majority of which are in Canada,~~ totaled approximately ~~$114.3~~$42.8 million and ~~$107.8~~$43.8 million as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. ~~Amounts~~Substantially all of the Company’s long-lived and intangible assets and goodwill in foreign countries relate to its Canadian operations. As of March 31, 2022 and December 31, 2021, amounts due from customers from which foreign revenue was derived accounted for approximately 6%1% and 8%2%, respectively, of the Company’s consolidated net accounts receivable position, ~~as of September 30, 2017 and December 31, 2016,~~ which represents accounts receivable, net, less ~~BIEC.~~

deferred revenue. Revenue from governmental entities for the three month periods ended March 31, 2022 and 2021 totaled approximately 6% and 4% of total revenue, respectively, substantially all of which was derived from the Company’s U.S. operations.

Significant Customers

~~Revenue concentration information for significant customers as a percentage~~For the three month period ended March 31, 2022, no customer represented greater than 10% of the Company’s total consolidated revenue, ~~was as follows:~~and for the three month period ended March 31, 2021, Enbridge, Inc. represented 25% of the Company’s total consolidated revenue. The Company’s relationship with Enbridge, Inc. is based upon various construction contracts for pipeline activities, for which the related revenue is included within the Oil and Gas segment.

For the Three Months Ended September 30 For the Nine Months Ended September 30
Customer: 2017 2016 2017 2016
Energy Transfer affiliates ^(a)
49% 35% 40% 26%
AT&T (including DIRECTV^®) ^(b)
21% 30% 25% 34%


~~(a)~~	The Company's relationship with Energy Transfer affiliates is based upon various construction contracts for pipeline activities with Energy Transfer Partners L.P., and their subsidiaries and affiliates, all of which are consolidated by Energy Transfer Equity, L.P. Revenue from Energy Transfer affiliates is included in the Oil and Gas segment.

~~(b)~~

The Company’s relationship with AT&T is based upon multiple separate master service and other service agreements, including for installation and maintenance services, as well as construction/installation contracts for AT&T’s: (i) wireless business; (ii) wireline/fiber businesses; and (iii) various install-to-the-home businesses, including DIRECTV®. Revenue from AT&T is included in the Communications segment.

Note 14 -– Commitments and Contingencies

MasTec is subject to a variety of legal cases, claims and other disputes that arise from time to time in the ordinary course of its ~~business. See Note 14 - Commitments~~business, including project contract price disputes, other project-related liabilities and ~~Contingencies in the Company’s 2016 Form 10-K for additional information.~~acquisition purchase price disputes. MasTec cannot provide assurance that it will be successful in recovering all or any of the potential damages it has claimed or in defending claims against the Company. The outcome of such cases, claims and disputes cannot be predicted with certainty and an unfavorable resolution of one or more of them could have a material adverse effect on the Company’s business, financial condition, results of operations and cash flows. In the third quarter of 2021, a settlement was finalized in favor of MasTec for approximately $25 million. As of March 31, 2022, $19 million remained outstanding, which amount is due in 2022.

Other Commitments and Contingencies

~~Leases.~~ Leases. In the ordinary course of business, the Company enters into non-cancelable operating leases for certain of its facility, vehicle and equipment needs, including related party leases. See Note 8 - Lease Obligations and Note 15 - Related Party Transactions.

Letters of Credit. In the ordinary course of business, the Company is required to post letters of credit for its insurance carriers and surety bond providers and in support of performance under certain contracts as well as certain obligations associated with the Company’s ~~cost~~equity investments and ~~equity investees,~~other strategic arrangements, including its variable interest entities. Such letters of credit are generally issued by a bank or similar financial institution. The letter of credit commits the issuer to pay specified amounts to the holder of the letter of credit under certain conditions. If this were to occur, the Company would be required to reimburse the issuer of the letter of credit, which, depending upon the circumstances, could result in a charge to earnings. As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, there were ~~$189.1~~$217.0 million and ~~$314.3~~$188.5 million, respectively, of letters of credit issued under the Company’s ~~Credit Facility.~~credit facilities. The Company is not aware of any material claims relating to its outstanding letters of credit as of ~~September 30, 2017~~March 31, 2022 or December 31, ~~2016.~~2021.

Performance and Payment Bonds. In the ordinary course of business, MasTec is required by certain customers to provide performance and payment bonds for contractual commitments related to ~~projects in process.~~its projects. These bonds provide a guarantee to the customer that the Company will perform under the terms of a contract and that the Company will pay its subcontractors and vendors. If the Company fails to perform under a contract or to pay its subcontractors and vendors, the customer may demand that the surety make payments or provide services under the bond. The Company must reimburse the surety for expenses or outlays it incurs. As of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, outstanding performance and payment bonds ~~totaled $119.2~~approximated $2,230.2 million and ~~$72.9~~$2,155.2 million, respectively, and estimated costs to complete projects secured by these bonds totaled ~~$51.3~~$780.1 million and ~~$9.5~~$768.8 million as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. ~~These amounts do not include~~Included in these balances as of both March 31, 2022 and December 31, 2021 are $115.0 million of outstanding performance and payment bonds ~~associated with~~issued on behalf of the Company’s ~~equity investees.~~

~~Cost and Equity Investees and Other Entities.~~ ~~The Company holds a 35% undivided interest in a~~ proportionately consolidated non-controlled ~~Canadian~~ contractual joint ~~venture that was underway when~~ventures, representing the Company acquired Pacer in 2014, whose sole activity involves the construction of a bridge, a business in which the Company does not otherwise engage. This joint venture, which is managed by a third party, and for which the Company has minimal direct construction involvement, automatically terminates upon completionCompany’s proportionate share of the ~~project.~~ total bond obligation for the related projects.

Investment and Strategic Arrangements.The Company ~~also~~ holds undivided interests, ranging from 85% to 90%, in ~~seven~~multiple proportionately consolidated non-controlled contractual joint ventures that provide infrastructure construction services for electrical transmission projects, as well as undivided interests ranging from 30% to 50% in 3 civil construction projects. Income and/or losses incurred by these joint ventures are generally shared proportionally by the respective joint venture members, with the members of the joint ventures jointly and severally liable for all of the obligations of the joint venture. The respective joint venture agreements provide that each joint venture partner indemnify the other party for any liabilities incurred by such joint venture in excess of its ratable portion of such liabilities. Thus, it is possible that the Company could be required to pay or perform obligations in excess of its share if the other joint venture partners fail or refuse to pay or perform their respective share of the obligations. As of ~~September 30, 2017,~~March 31, 2022, the Company was not aware of ~~circumstances that would reasonably lead to~~ material future claims against it in connection with these arrangements. Included in the Company’s cash balances as of March 31, 2022 and December 31, 2021 are amounts held by entities that are proportionately consolidated totaling $26.8 million and $14.6 million, respectively. These amounts are available to support the operations of those entities, but are not available for the Company’s other operations.

The Company has other investment and strategic arrangements, ~~as discussed in~~under which it may incur costs or provide financing, performance, financial and/or other guarantees. See Note 4 - Fair Value of Financial Instruments and Note 15 - Related Party ~~Transactions. From time~~Transactions for additional information pertaining to ~~time,~~ the ~~Company may incur costs or provide financing, performance, financial and/or other guarantees to or in connection with its investees.~~Company’s investment and strategic arrangements.

~~Self-Insurance.~~Self-Insurance. MasTec maintains insurance policies for workers’ compensation, general liability and automobile liability, which are subject to per claim deductibles. The Company is self-insured up to the amount of the deductible. The Company also maintains excess umbrella coverage. AsThe Company manages certain of ~~September 30, 2017~~its insurance liabilities indirectly through its wholly-owned captive insurance company, which reimburses claims up to the applicable insurance limit. Cash balances held by the Company’s captive insurance company, which totaled approximately $0.3 million as of both March 31, 2022 and December 31, ~~2016,~~2021, are generally not available for use in the Company’s other operations.

As of March 31, 2022 and December 31, 2021, MasTec’s estimated liability for unpaid claims and associated expenses, including incurred but not reported losses related to ~~these~~its insurance policies, totaled ~~$98.5~~$186.2 million and ~~$85.8~~$189.8 million, respectively, of which ~~$67.5~~$119.5 million and ~~$55.2~~$126.5 million, respectively, were reflected within other long-term liabilities in the consolidated balance sheets.

MasTec also maintains an insurance policy with respect to employee group medical claims, which is subject to annual per employee maximum losses. MasTec’s estimated liability for employee group medical claims totaled ~~$2.6~~$4.6 million and $4.2 million as of ~~both September 30, 2017~~March 31, 2022 and December 31, ~~2016.~~2021, respectively.

The Company is required to post collateral, generally in the form of letters of credit, surety bonds and ~~provide~~ cash ~~collateral~~ to certain of its insurance ~~carriers and to provide surety bonds in certain states.~~carriers. Insurance-related letters of credit for the Company’s workers’ compensation, general liability and automobile liability policies amounted to ~~$84.6~~$154.3 million and ~~$85.1~~$125.7 million as of ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016,~~2021, respectively. ~~In addition, cash collateral deposited with insurance carriers, which is included within other long-term assets, amounted to $1.5 million for these policies as~~As of both ~~September 30, 2017~~March 31, 2022 and December 31, ~~2016. Outstanding~~2021, outstanding surety bonds related to ~~workers’ compensation~~ self-insurance programs amounted to ~~$13.7 million and $13.5 million as of September 30, 2017 and December 31, 2016, respectively.~~$52.9 million.

~~Employment Agreements.~~ The Company has employment agreements with certain executives and other employees, which provide for compensation and certain other benefits and for severance payments under certain circumstances. Certain employment agreements also contain clauses that become effective upon a change in control of the Company. Upon the occurrence of any of the defined events in the various employment agreements, the Company would be obligated to pay certain amounts to the relevant employees, which vary with the level of the employees’ respective responsibility.

Collective Bargaining Agreements and Multiemployer Plans. As discussed in Note 10 - Other Retirement Plans, certain of MasTec’s subsidiaries are party to various collective bargaining agreements with unions representing certain of their employees, which require the Company to pay specified wages, provide certain benefits ~~to their union employees~~ and contribute certain amounts to ~~multiemployer pension and other multiemployer benefits plans and trusts.~~MEPPs. The Employee Retirement Income Security Act of 1974, as

amended by the Multiemployer Pension Plan Amendments Act of 1980 (collectively, “ERISA”), which governs U.S.-registered ~~multiemployer pension plans,~~MEPPs, subjects employers to substantial liabilities in the event of ~~the~~an employer’s complete or partial withdrawal from, or upon termination of, such plans.

The Company currently contributes, and in the past, has contributed to, plans that are underfunded, and, therefore, could have potential liability associated with a voluntary or involuntary withdrawal from, or termination of, these plans. As ~~described in the Company’s 2016 Form 10-K, the Company, along with other members~~ of the Pipe Line Contractors Association (the “PLCA”), voluntarily withdrew from the Central States Southeast and Southwest Areas Pension Fund (“Central States”) in November 2011, for which the Company established and paid a $6.4 million withdrawal liability. The Company is in arbitration to determine if there is any remaining amount owed on this withdrawal liability, and during the third quarter of 2017, the Company recognized $0.6 million of expense in connection with the expected settlement of this matter.

~~Other than the Company’s 2011 withdrawal from Central States and certain other underfunded plans, as described in the Company’s 2016 Form 10-K,~~March 31, 2022, the Company does not have plans to withdraw from, and is not aware of circumstances that would reasonably lead to material claims against it, in connection with ~~these plans. However, there~~the MEPPs in which it participates. There can be no assurance, however, that the Company will not be assessed liabilities in the ~~future.~~

Based upon the information available to the Company from plan administrators as of September 30, 2017, several of the multiemployer pension plans in which it participates are underfunded and, as a result, the Company could be required to increase its contributions,future, including in the form of a surcharge on future benefit ~~contributions.~~contributions or increased contributions on underfunded plans. The amount ~~of additional funds~~ the Company ~~may~~could be obligated to pay or contribute in the future cannot be estimated, as these amounts are based on future levels of work of the union employees covered by these plans, investment returns, which could be negatively affected by economic and market conditions, and the level of underfunding of such plans. In connection with the HMG acquisition, the Company assumed an obligation related to HMG’s 2016 withdrawal from a multiemployer pension plan, under which HMG is obligated to make quarterly payments of approximately $74,000 through 2036. As of March 31, 2022 and December 31, 2021, a withdrawal liability of approximately $3.3 million and $3.4 million, respectively, was recorded within other current and other long-term liabilities within the consolidated balance sheets related to this obligation.

Indemnities. The Company generally indemnifies its customers for the services it provides under its contracts, as well as other specified liabilities, which may subject the Company to indemnity claims, liabilities and related litigation. As of ~~September 30, 2017~~both March 31, 2022 and December 31, ~~2016,~~2021, the Company ~~was~~had accrued project close-out liabilities of approximately $40 million. The Company is not aware of any other material asserted or unasserted claims in connection with ~~these~~its potential indemnity obligations.

Other Guarantees. In From time to time in the ordinary course of its business, ~~from time to time,~~ MasTec guarantees the obligations of its subsidiaries, including obligations under certain contracts with customers, certain lease obligations, and in some states, obligations in connection with obtaining contractors’ licenses. MasTec has also issued performance and other guarantees in connection with certain of its equity ~~investees.~~investments. MasTec also generally warrants the work it performs ~~for a one to two year period~~ following substantial completion of a project. Much of the work performed by the Company is evaluated for defects shortly after the work is completed. ~~Accrued warranty claims are, and historically have been, de minimis. However, if~~If warranty claims occur, the Company could be required to repair or replace warrantied items, or, if customers elect to repair or replace the warrantied item using the services of another provider, the Company could be required to pay for the cost of the repair or replacement. Warranty claims have historically not been material.

Concentrations of Risk.~~The~~ In the third quarter of 2021, DIRECTV® was spun off from AT&T. As a result, for customer reporting purposes, AT&T and DIRECTV® are reported separately and all prior periods have been updated to give retroactive effect to the spin-off of DIRECTV® from AT&T. For the three month period ended March 31, 2022, the Company had approximately ~~455~~850 customers. There were no customers ~~for the nine month period ended~~ ~~September 30, 2017. As of~~ ~~September 30, 2017~~ ~~and~~ ~~December 31, 2016, one customer accounted for approximately 44% and 24%, respectively,~~that represented greater than 10% of the Company’s consolidated net accounts receivable position, which represents accounts receivable, net, less ~~BIEC. As~~deferred revenue, as of ~~September 30, 2017 and~~ either March 31, 2022 or December 31, ~~2016~~,2021. For the three month periods ended March 31, 2022 and 2021, the Company derived approximately 42% a ~~separate customer accounted for approximately 13% and 17%~~nd 66%, respectively, of ~~the Company’s consolidated net accounts receivable position. In addition, the Company derived 83% and 80%, respectively, of~~ its revenue from its top ten ~~customers for the three month periods ended~~ ~~September 30, 2017~~ ~~and 2016, and derived 80% and 76% of its revenues, respectively, from its top ten customers for the nine month periods ended~~ ~~September 30, 2017~~ ~~and 2016.~~customers.

Note 15 -– Related Party Transactions

For the three month periods ended September 30, 2017 and 2016, revenue recognized by the Company’s Pacer subsidiary for work performed for a contractual joint venture in which it holds a 35% undivided interest totaled $0.6 million and $0.2 million, respectively, and for the nine month periods ended September 30, 2017 and 2016, totaled $0.9 million and $0.8 million, respectively. As of September 30, 2017 and December 31, 2016, receivables from this contractual joint venture totaled $0.9 million and $0.7 million, respectively. Related performance guarantees, which are based on the original full contract value, as of both September 30, 2017 and December 31, 2016, totaled Canadian $132.1 million (or approximately $105.9 million and $98.3 million, respectively). In connection with this contractual joint venture, the Company provided project-related financing of $2.7 million and $5.9 million, respectively, for the three and nine month periods ended September 30, 2017, and $0.8 million and $5.6 million, respectively, for the three and nine month periods ended September 30, 2016. As of September 30, 2017, there were no additional amounts committed to this entity.

In connection with an April 2017 acquisition, the Company acquired a 40% interest in an entity, valued at $0.4 million, which is accounted for as an equity method investment. The Company has a subcontracting arrangement with this entity. For the nine month period ended September 30, 2017, the Company incurred $0.2 million of expenses under this subcontracting arrangement, and there were no amounts outstanding as of September 30, 2017. During the nine month period ended September 30, 2017, the Company advanced $0.3 million to this entity, net, of which $0.3 million was outstanding as of September 30, 2017. The acquired company had a vendor financing arrangement with an entity that was owned by a member of subsidiary management, which arrangement was completed in the third quarter of 2017. The payments made under this arrangement for the three and nine month periods ended September 30, 2017 totaled $1.4 million and $5.3 million, respectively, and no amounts were outstanding as of September 30, 2017.

MasTec purchases, rents and leases equipment and purchases various types of supplies and services used in its business, including ancillary construction services, project-related site restoration and marketing and business development activities, from a number of different vendors on a non-exclusive basis, ~~including CCI,~~and from time to time, rents equipment to, sells certain supplies, or performs construction services on behalf of, entities in which members of subsidiary management have ownership or commercial interests. For the three month periods ended March 31, 2022 and 2021, such payments to related party entities totaled approximately $6.8 million and $20.5 million, respectively. Payables associated with such arrangements totaled approximately $0.9 million and $0.6 million as of March 31, 2022 and December 31, 2021, respectively. Revenue from such related party arrangements totaled approximately $3.8 million and $1.1 million for the three month periods ended March 31, 2022 and 2021, respectively. Related amounts receivable, net, totaled approximately $3.3 million and $0.4 million as of March 31, 2022 and December 31, 2021, respectively.

The Company ~~has a cost method investment.~~rents and leases equipment and purchases certain supplies and servicing from CCI. Juan Carlos Mas, who is the brother of Jorge Mas, Chairman of MasTec’s Board of Directors, and José R. Mas, MasTec’s Chief Executive Officer, serves as the chairman of ~~CCI. For~~CCI, and a member of management of a MasTec subsidiary and an entity that is owned by the Mas family are minority owners. MasTec paid CCI $1.0 million and $5.0 million, net of rebates, for the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, MasTec paid~~2021, respectively, related to this activity. Amounts payable to CCI, net of rebates receivable, totaled approximately ~~$22.9~~$0.6 million and ~~$10.0~~$0.8 million respectively, for equipment supplies, rentals, leases and servicing. For the nine month periods ended September 30, 2017 and 2016, MasTec paid CCI approximately $34.9 million and $13.7 million, respectively, netas of ~~rebates. As of September 30, 2017~~March 31, 2022 and December 31, ~~2016, related payables totaled approximately $6.1 million and $1.5 million,~~2021, respectively.

MasTec has a subcontracting arrangement with an entity for the performance of construction services, the minority owners of which include an entity controlled by Jorge Mas and José R. Mas, along with ~~two~~2 members of management of a MasTec subsidiary. For the three month ~~periods~~period ended ~~September 30, 2017 and 2016, MasTec incurred $39.2 million and $5.6 million, respectively, of~~March 31, 2022, subcontracting expenses under ~~this subcontracting arrangement,~~these arrangements were de minimis, and for the ~~nine~~three month period ended March 31, 2021, MasTec incurred subcontracting expenses of approximately $29.0 million. As of March 31, 2022, related amounts payable were de minimis, and as of December 31, 2021, totaled approximately $0.5 million.

MasTec has a leasing arrangement for an aircraft that is owned by an entity that Jorge Mas owns. For both the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016,~~2021, MasTec paid approximately $0.6 million related to this leasing arrangement.

MasTec has performed construction services on behalf of a professional Miami soccer franchise (the “Franchise”) in which Jorge Mas and José R. Mas are majority owners. Services provided by MasTec have included the construction of a soccer facility and stadium as well as wireless infrastructure services. MasTec may perform additional construction services for the Franchise in the future. For the three month period ended March 31, 2022 and 2021, charges under these arrangements were de minimis. Payments for other expenses related to the Franchise for both the three month periods ended March 31, 2022 and 2021 totaled approximately $0.1 million.

In connection with a fourth quarter 2021 acquisition, MasTec has a subcontracting arrangement to perform construction services for an entity, of which José R. Mas bought a minority interest, and of which a member of management of a MasTec subsidiary owns the remaining interest.

For the three month period ended March 31, 2022, revenue recognized by MasTec under this arrangement totaled approximately $28.8 million, and as of March 31, 2022, related amounts receivable totaled approximately $13.7 million. There were no amounts receivable as of December 31, 2021. MasTec pays a management fee to this entity in connection with the subcontracting arrangement. MasTec incurred ~~$54.8~~approximately $0.2 million ~~and $8.8 million, respectively. During the third quarter~~ of ~~2016, the Company sold equipment totaling $0.3 million~~management fee expense related to this ~~entity. As~~arrangement for the three month period ended March 31, 2022, which amount was payable as of ~~September 30, 2017 and December~~March 31, ~~2016, related amounts payable totaled $20.1 million and $0.1 million, respectively.~~2022.

MasTec leases employees and provides satellite communication services to a customer in which Jorge Mas and José R. Mas own a majority interest. ~~For~~Charges to this customer under these arrangements totaled approximately $0.3 million for both the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, MasTec charged~~2021. As of both March 31, 2022 and December 31, 2021, related amounts receivable totaled approximately ~~$0.2~~$0.8 million.

The Company has advanced amounts on behalf of an entity that was acquired in 2021. Amounts outstanding for such advances, which are expected to be settled under customary terms associated with the related purchase agreement, totaled approximately $1.8 million and $0.5 million as of March 31, 2022 and December 31, 2021, respectively. Additionally, in 2021, the Company advanced amounts to the former owner of an acquired business. There were no remaining amounts outstanding as of March 31, 2022, and as of December 31, 2021, approximately $1.0 million of such advances was outstanding. In addition, the Company, through a 2020 acquisition, has a 25% interest in an entity, under which the acquired business and the 25% owned entity have a subcontracting arrangement. The Company’s interest in this entity, for which post acquisition operating activity is de minimis, is accounted for as an equity method investment. For the three month period ended March 31, 2022, the Company made equity contributions to this ~~customer, and for both the nine month periods ended September 30, 2017 and 2016, charged $0.6~~entity of approximately $0.5 million. As of ~~both September 30, 2017~~March 31, 2022 and December 31, ~~2016, outstanding receivables from employee leasing~~2021, the Company’s net investment in this entity was a liability of approximately $1.1 million and $1.6 million, respectively, which net amounts each included approximately $2.3 million of accounts receivable, net, less deferred revenue, related to the subcontracting arrangement. Additionally, the Company has certain arrangements with an entity in which members of management have an ownership interest, including a fee arrangement in conjunction with a $15.0 million letter of credit issued by the Company on behalf of this ~~customer totaled $0.2 million. The Company also provides satellite communication services to this customer.~~entity. For both the three month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016, revenue from satellite communication services provided to this customer totaled~~2021, approximately $0.2 million of income was recognized in connection with these arrangements. As of March 31, 2022 and ~~for the nine month periods ended September 30, 2017 and 2016, satellite communication revenues~~December 31, 2021, related amounts receivable totaled $0.6 million and ~~$0.7 million, respectively. As of September 30, 2017 and December 31, 2016, receivables from this arrangement totaled approximately $0.3 million and~~ $0.4 million, respectively.

MasTec has a leasing arrangement with an independent third party that leases an aircraft from a Company owned by Jorge Mas. For the three month periods ended September 30, 2017 and 2016, MasTec paid $0.5 million and $0.7 million, respectively, under this leasing arrangement, and for the nine month periods ended September 30, 2017 and 2016, MasTec paid $1.5 million and $2.0 million, respectively. As of both September 30, 2017 and December 31, 2016, related amounts payable were de minimis.

For the three month periods ended September 30, 2017 and 2016, related party lease payments for operational facilities and equipment, which are primarily associated with members of subsidiary management, totaled approximately $11.3 million and $12.5 million, respectively, and for the nine month periods ended September 30, 2017 and 2016, related party lease payments totaled approximately $38.4 million and $31.6 million, respectively. Payables associated with related party leases totaled approximately $0.6 million and $0.3 million as of September 30, 2017 and December 31, 2016, respectively. Additionally, payments for various types of supplies and services, including ancillary construction services, project-related site restoration and marketing and business development activities associated with members of subsidiary management totaled approximately $26.4 million and $7.4 million for the three month periods ended September 30, 2017 and 2016, respectively, and totaled $41.0 million and $14.2 million for the nine month periods ended September 30, 2017 and 2016, respectively. As of September 30, 2017 and December 31, 2016, associated amounts payable totaled approximately $0.8 million and $3.7 million, respectively. In addition, MasTec performs construction services for an entity associated with a member of subsidiary management. Revenue from this arrangement totaled $1.0 million for the three month period ended September 30, 2017, and related receivables totaled $0.5 million as of September 30, 2017. The oil and gas pipeline equipment company that was acquired by MasTec in the third quarter of 2017 was formerly owned by a member of subsidiary management. MasTec previously leased equipment from this company. The Company paid $40.6 million in cash and $57.3 million of contingent consideration in connection with this acquisition.

Non-controlling interests in entities consolidated by the Company represent ownership interests held by certain members of management of several of the Company’s subsidiaries, primarily in our Oil and Gas segment, and the Company has a subcontracting arrangement with one of these entities for the performance of ancillary oil and gas construction services, which transactions are eliminated in consolidation. The Company made distributions of earnings of $1.3 million in the first quarter of 2017 to holders of its non-controlling interests.

Split Dollar Agreements

MasTec has split dollar life insurance agreements with ~~each~~trusts, for one of which Jorge Mas is a trustee and for the other of which José R. Mas ~~and Jorge Mas. In~~is a trustee. There were no payments made in connection with ~~the split dollar agreement for José R. Mas, the Company made no payments~~these agreements in either of the three month periods ended ~~September 30, 2017~~March 31, 2022 or 2021, and 2016, and paid $0.7 million in each of the nine month periods ended September 30, 2017 and 2016. In connection with the split dollar agreement for Jorge Mas, the Company paid $0.6 million for both the three month periods ended September 30, 2017 and 2016, and paid $1.1 million for both the nine month periods ended September 30, 2017 and 2016. As of September 30, 2017 and December 31, 2016, life insurance assets associated with these agreements totaled ~~$16.6~~approximately $24.0 million as of both March 31, 2022 and ~~$14.8 million, respectively, which amount is included within other long-term assets.~~

~~Note 16 – Supplemental Guarantor Condensed Unaudited Consolidating Financial Information~~

The 4.875% Senior Notes are fully and unconditionally guaranteed on an unsecured, unsubordinated, joint and several basis by certain of the Company’s existing and future 100%-owned direct and indirect domestic subsidiaries that are each guarantors of the Credit Facility or other outstanding indebtedness (the “Guarantor Subsidiaries”). The Company’s subsidiaries organized outside of the United States and certain domestic subsidiaries (collectively, the “Non-Guarantor Subsidiaries”) do not guarantee these notes. A Guarantor Subsidiary’s guarantee is subject to release in certain customary circumstances, including upon the sale of a majority of the capital stock or substantially all of the assets of such Guarantor Subsidiary; if the Guarantor Subsidiary’s guarantee under the Company’s Credit Facility and other indebtedness is released or discharged (other than due to payment under such guarantee); or when the requirements for legal defeasance are satisfied or the obligations are discharged in accordance with the related indentures.

The following supplemental financial information sets forth the condensed unaudited consolidating balance sheets and the condensed unaudited consolidating statements of operations and comprehensive income (loss) and cash flows for MasTec, Inc., the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis and the eliminations necessary to arrive at the information for the Company as reported on a consolidated basis. Eliminations represent adjustments to eliminate investments in subsidiaries and intercompany balances and transactions between or among MasTec, Inc., the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries. Investments in subsidiaries are accounted for using the equity method for this presentation.

~~CONDENSED UNAUDITED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in millions)~~December 31, 2021.

For the Three Months Ended September 30, 2017 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Revenue $ —
$ 1,860.3
$ 130.3
$ (34.8 ) $ 1,955.8
Costs of revenue, excluding depreciation and amortization —
1,640.3
120.7
(34.8 ) 1,726.2
Depreciation and amortization —
41.1
9.0
—
50.1
General and administrative expenses 0.5
61.7
4.2
—
66.4
Interest expense (income), net —
33.2
(15.6 ) —
17.6
Equity in earnings of unconsolidated affiliates —
—
(7.4 ) —
(7.4 )
Other income, net —
(4.6 ) (0.1 ) —
(4.7 )
(Loss) income before income taxes $ (0.5 ) $ 88.6
$ 19.5
$ —
$ 107.6
Benefit from (provision for) income taxes 0.2
(33.8 ) (9.9 )
—
(43.4 )
Net (loss) income before equity in income from subsidiaries $ (0.3 ) $ 54.8
$ 9.6
$ —
$ 64.2
Equity in income from subsidiaries, net of tax 64.1
—
—
(64.1 ) —
Net income (loss) $ 63.8
$ 54.8
$ 9.6
$ (64.1 ) $ 64.2
Net income attributable to non-controlling interests —
—
0.4
—
0.4
Net income (loss) attributable to MasTec, Inc. $ 63.8
$ 54.8
$ 9.2
$ (64.1 ) $ 63.8
Comprehensive income (loss) $ 65.2
$ 54.9
$ 11.1
$ (65.5 ) $ 65.7

For the Three Months Ended September 30, 2016 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Revenue $ —
$ 1,493.9
$ 112.7
$ (20.4 ) $ 1,586.2
Costs of revenue, excluding depreciation and amortization —
1,282.3
107.2
(20.4 ) 1,369.0
Depreciation and amortization —
33.7
8.9
—
42.6
General and administrative expenses 0.6
60.6
5.9
—
67.1
Interest expense (income), net —
28.6
(15.5 ) —
13.1
Equity in losses of unconsolidated affiliates —
—
—
—
—
Other (income) expense, net —
(3.4 ) 2.3
—
(1.0 )
(Loss) income before income taxes $ (0.6 ) $ 92.1
$ 3.9
$ —
$ 95.3
Benefit from (provision for) income taxes 0.2
(33.4 ) (5.6 ) —
(38.8 )
Net (loss) income before equity in income from subsidiaries $ (0.4 ) $ 58.7
$ (1.7 ) $ —
$ 56.5
Equity in income from subsidiaries, net of tax 56.7
—
—
(56.7 ) —
Net income (loss) $ 56.3
$ 58.7
$ (1.7 ) $ (56.7 ) $ 56.5
Net income attributable to non-controlling interests —
—
0.3
—
0.3
Net income (loss) attributable to MasTec, Inc. $ 56.3
$ 58.7
$ (2.0 ) $ (56.7 ) $ 56.3
Comprehensive income (loss) $ 54.5
$ 58.7
$ (3.6 ) $ (54.9 ) $ 54.7

~~CONDENSED UNAUDITED CONSOLIDATING STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in millions)~~

For the Nine Months Ended September 30, 2017 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Revenue $ —
$ 4,763.4
$ 347.4
$ (106.7 ) $ 5,004.1
Costs of revenue, excluding depreciation and amortization —
4,097.7
332.6
(106.7 ) 4,323.6
Depreciation and amortization —
112.2
26.2
—
138.4
General and administrative expenses 1.7
187.7
12.6
—
202.0
Interest expense (income), net —
91.5
(46.5 ) —
45.0
Equity in earnings of unconsolidated affiliates —
—
(15.1 ) —
(15.1 )
Other (income) expense, net —
(9.9 ) 5.8
—
(4.1 )
(Loss) income before income taxes $ (1.7 ) $ 284.2
$ 31.8
$ —
$ 314.3
Benefit from (provision for) income taxes 0.6
(104.9 ) (21.9 ) —
(126.2 )
Net (loss) income before equity in income from subsidiaries $ (1.1 ) $ 179.3
$ 9.9
$ —
$ 188.2
Equity in income from subsidiaries, net of tax 187.5
—
—
(187.5 ) —
Net income (loss) $ 186.4
$ 179.3
$ 9.9
$ (187.5 ) $ 188.2
Net income attributable to non-controlling interests —
—
1.8
—
1.8
Net income (loss) attributable to MasTec, Inc. $ 186.4
$ 179.3
$ 8.1
$ (187.5 ) $ 186.4
Comprehensive income (loss) $ 187.5
$ 179.3
$ 11.1
$ (188.6 ) $ 189.3

For the Nine Months Ended September 30, 2016 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Revenue $ —
$ 3,521.5
$ 302.2
$ (30.9 ) $ 3,792.8
Costs of revenue, excluding depreciation and amortization —
3,054.5
298.0
(30.9 ) 3,321.6
Depreciation and amortization —
96.6
25.6
—
122.2
General and administrative expenses 1.7
172.1
21.2
—
195.0
Interest expense (income), net —
83.8
(45.9 ) —
37.9
Equity in earnings of unconsolidated affiliates —
—
(3.5 ) —
(3.5 )
Other income, net —
(12.7 ) (0.1 ) —
(12.8 )
(Loss) income before income taxes $ (1.7 ) $ 127.2
$ 6.9
$ —
$ 132.4
Benefit from (provision for) income taxes 0.6
(47.3 ) (7.6 ) —
(54.3 )
Net (loss) income before equity in income from subsidiaries $ (1.1 ) $ 79.9
$ (0.7 ) $ —
$ 78.1
Equity in income from subsidiaries, net of tax 78.8
—
—
(78.8 ) —
Net income (loss) $ 77.7
$ 79.9
$ (0.7 ) $ (78.8 ) $ 78.1
Net income attributable to non-controlling interests —
—
0.4
—
0.4
Net income (loss) attributable to MasTec, Inc. $ 77.7
$ 79.9
$ (1.1 ) $ (78.8 ) $ 77.7
Comprehensive income (loss) $ 69.2
$ 79.9
$ (9.2 ) $ (70.3 ) $ 69.6

~~CONDENSED UNAUDITED CONSOLIDATING BALANCE SHEETS (in millions)~~

As of September 30 2017 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Assets
Total current assets $ —
$ 1,576.0
$ 259.8
$ (88.1 ) $ 1,747.7
Property and equipment, net —
600.8
90.6
—
691.4
Goodwill and other intangible assets, net —
1,187.9
143.0
—
1,330.9
Investments in and advances to consolidated affiliates, net 1,279.7
848.0
710.2
(2,837.9 ) —
Other long-term assets 15.8
25.7
130.6
—
172.1
Total assets $ 1,295.5
$ 4,238.4
$ 1,334.2
$ (2,926.0 ) $ 3,942.2
Liabilities and equity
Total current liabilities $ —
$ 982.5
$ 107.7
$ (88.1 ) $ 1,002.2
Long-term debt —
1,181.1
11.2
—
1,192.3
Other long-term liabilities —
432.0
12.7
—
444.7
Total liabilities $ —
$ 2,595.6
$ 131.6
$ (88.1 ) $ 2,639.1
Total equity $ 1,295.5
$ 1,642.8
$ 1,202.6
$ (2,837.9 ) $ 1,303.0
Total liabilities and equity $ 1,295.5
$ 4,238.4
$ 1,334.2
$ (2,926.0 ) $ 3,942.2

As of December 31, 2016 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Assets
Total current assets $ —
$ 1,256.3
$ 175.8
$ (29.6 ) $ 1,402.5
Property and equipment, net —
456.6
92.5
—
549.1
Goodwill and other intangible assets, net —
1,037.4
138.2
—
1,175.6
Investments in and advances to consolidated affiliates, net 1,083.9
625.9
861.2
(2,571.0 ) —
Other long-term assets 12.6
25.3
18.0
—
55.9
Total assets $ 1,096.5
$ 3,401.5
$ 1,285.7
$ (2,600.6 ) $ 3,183.1
Liabilities and equity
Total current liabilities $ —
$ 759.7
$ 109.9
$ (29.6 ) $ 840.0
Long-term debt —
938.7
22.7
—
961.4
Other long-term liabilities —
256.2
21.9
—
278.1
Total liabilities $ —
$ 1,954.6
$ 154.5
$ (29.6 ) $ 2,079.5
Total equity $ 1,096.5
$ 1,446.9
$ 1,131.2
$ (2,571.0 ) $ 1,103.6
Total liabilities and equity $ 1,096.5
$ 3,401.5
$ 1,285.7
$ (2,600.6 ) $ 3,183.1

~~CONDENSED UNAUDITED CONSOLIDATING STATEMENTS OF CASH FLOWS (in millions)~~

For the Nine Months Ended September 30, 2017 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Net cash provided by (used in) operating activities $ —
$ 222.0
$ (43.4 ) $ —
$ 178.6
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired —
(116.0 ) —
—
(116.0 )
Capital expenditures —
(70.0 ) (13.3 ) —
(83.3 )
Proceeds from sale of property and equipment —
12.5
1.1
—
13.6
Payments for other investments —
(3.8 ) (73.3 ) —
(77.1 )
Proceeds from other investments —
1.2
12.2
—
13.4
Net cash used in investing activities $ —
$ (176.1 ) $ (73.3 ) $ —
$ (249.4 )
Cash flows from financing activities:
Proceeds from credit facilities —
1,988.1
14.3
—
2,002.4
Repayments of credit facilities —
(1,817.4 ) (23.0 ) —
(1,840.4 )
Repayments of other borrowings and capital lease obligations —
(52.6 ) (8.3 ) —
(60.8 )
Payments of acquisition-related contingent consideration —
(18.8 ) —
—
(18.8 )
Distributions to non-controlling interests —
—
(1.3 ) —
(1.3 )
Proceeds from stock-based awards, net 0.9
—
—
—
0.9
Other financing activities, net —
(6.3 ) —
—
(6.3 )
Net financing activities and advances (to) from consolidated affiliates (0.9 ) (131.9 ) 132.8
—
—
Net cash (used in) provided by financing activities $ —
$ (38.9 ) $ 114.5
$ —
$ 75.6
Effect of currency translation on cash —
—
0.2
—
0.2
Net increase (decrease) in cash and cash equivalents $ —
$ 7.0
$ (2.0 ) $ —
$ 5.1
Cash and cash equivalents - beginning of period $ —
$ 28.3
$ 10.5
$ —
$ 38.8
Cash and cash equivalents - end of period $ —
$ 35.3
$ 8.5
$ —
$ 43.8

For the Nine Months Ended September 30, 2016 MasTec, Inc.
Guarantor
Subsidiaries

Non-Guarantor
Subsidiaries
Eliminations
Consolidated
MasTec, Inc.
Net cash provided by operating activities $ —
$ 87.2
$ 39.9
$ —
$ 127.1
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired —
(4.1 ) —
—
(4.1 )
Capital expenditures —
(84.0 ) (5.1 ) —
(89.1 )
Proceeds from sale of property and equipment —
3.1
3.7
—
6.8
Payments for other investments —
(3.8 ) (5.0 ) —
(8.9 )
Proceeds from other investments —
—
1.1
—
1.1
Net cash used in investing activities $ —
$ (88.8 ) $ (5.3 )
$ —

$ (94.1 )
Cash flows from financing activities:
Proceeds from credit facilities —
1,093.8
93.0
—
1,186.8
Repayments of credit facilities —
(1,056.1 ) (93.8 ) —
(1,149.9 )
Repayments of other borrowings and capital lease obligations —
(37.6 ) (12.4 ) —
(50.0 )
Payments of acquisition-related contingent consideration —
(16.5 ) (3.3 ) —
(19.8 )
Proceeds from stock-based awards, net 3.4
—
0.5
—
3.9
Other financing activities, net 1.4
—
—
—
1.4
Net financing activities and advances (to) from consolidated affiliates (4.8 ) 15.1
(10.3 ) —
—
Net cash used in financing activities $ —
$ (1.3 ) $ (26.3 ) $ —
$ (27.6 )
Effect of currency translation on cash —
—
(1.0 ) —
(1.0 )
Net (decrease) increase in cash and cash equivalents $ —
$ (2.9 ) $ 7.3
$ —
$ 4.4
Cash and cash equivalents - beginning of period $ —
$ 4.7
$ 0.3
$ —
$ 5.0
Cash and cash equivalents - end of period $ —
$ 1.8
$ 7.6
$ —
$ 9.4

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not historical facts but are the intent, belief, or current expectations of our business and industry and the assumptions upon which these statements are based. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All comments concerning our expectations for future ~~revenues~~revenue and operating results are based on our forecasts for our existing operations and do not include the potential impact of any future acquisitions, dispositions or ~~dispositions.~~other strategic arrangements. Words such as “anticipates,” “expects,” “intends,” “will,” “could,” “would,” “should,” “may,” “plans,” “believes,” “seeks,” “estimates,” “forecasts,” “targets” and variations of these words and negatives thereof and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond our control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Additionally, many of these risks and uncertainties could be amplified by the ongoing COVID-19 pandemic.

These risks and uncertainties include those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this report and in our ~~2016~~2021 Form 10-K, including those described under “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors,” as updated by Item 1A, “Risk Factors” in this report and other filings we make with the SEC. Forward-looking statements that were true at the time made may ultimately prove to be incorrect or false. Readers are cautioned to not place undue reliance on forward-looking statements, which reflect management’s view only as of the date of this report. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following is a discussion and analysis of our business, financial ~~position~~condition and results of operations as of and for the three ~~and nine~~ month periods ended ~~September 30, 2017~~March 31, 2022 and ~~2016~~.2021. This discussion and analysis should be read in conjunction with our consolidated financial statements and notes thereto in Item 1 of this Quarterly Report on Form 10-Q (this “Form 10-Q”), and the audited consolidated financial statements, accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) contained in our ~~2016~~2021 Form 10-K. In this MD&A, “$” means U.S. dollars unless specified otherwise.

Impact of the COVID-19 Pandemic and General Economic Conditions

The COVID-19 pandemic has disrupted business activities and global economic conditions since 2020, and has negatively affected our operations during the same period. While the adverse effects of the COVID-19 pandemic have begun to subside, its effects vary by region, and uncertainties arising from the COVID-19 pandemic could continue to disrupt economic conditions and business activities, particularly as new variants of COVID-19 arise. The extent to which the COVID-19 pandemic, including the recent and emerging variants, could affect our business, operations and financial results is uncertain as it will depend upon numerous evolving factors that we may not be able to accurately predict. The length and extent of any continuing economic and market disruptions are unknown, and therefore, any future impacts on our business, financial condition and/or results of operations cannot be quantified or predicted with specificity.

We believe that we have taken appropriate steps to mitigate the effects of the COVID-19 pandemic on our business, and our business model has, thus far, proven resilient. We continue to actively monitor the effects of the COVID-19 pandemic on our operations and to the extent that future business activities are adversely affected by the pandemic, we intend to take appropriate actions designed to mitigate these impacts. Notwithstanding moderation of the COVID-19 pandemic and related governmental and other restrictions, we may continue to experience direct and indirect negative effects on our business and operations from possible longer-term changes in consumer and customer behavior and/or from negative economic conditions, including recent inflationary effects, rising interest rates and supply chain disruptions, including limited availability of products.

As of March 31, 2022, we maintained a strong balance sheet, have strong relationships with our banking partners and had ample liquidity totaling approximately $1.0 billion, comprising $0.8 billion of availability under our Credit Facility and $233 million of cash. We believe that our financial position, strong cash flows and operational strengths will enable us to manage the current uncertainties resulting from the COVID-19 pandemic. Our business operations typically generate significant cash flow, affording us the flexibility to invest strategically in our efforts to maximize shareholder value through mergers and acquisitions, share repurchases and capital expenditures. We carefully manage our liquidity and will continue to monitor any potential effects from the pandemic and changing economic conditions on our financial results, cash flows and/or working capital and intend to take appropriate actions in efforts to mitigate any impacts.

Business Overview

We are a leading infrastructure construction company operating mainly throughout North America across a range of industries. Our primary activities include the engineering, building, installation, maintenance and upgrade of communications, energy, utility and ~~utility~~other infrastructure, such as: power delivery services, including transmission and distribution, wireless, wireline/fiber ~~install-to-the-home~~ and customer fulfillment activities; ~~petroleum~~power generation, primarily from clean energy and renewable sources; pipeline infrastructure, including natural gas pipeline and distribution infrastructure; ~~electrical utility transmission and distribution; conventional and renewable power generation;~~ heavy ~~civil~~civil; and industrial infrastructure. Our customers are primarily in these industries. Including our predecessor companies, we have been in business for ~~almost~~over 90 years. For the twelve month period ended March 31, 2022, we had an average of approximately 660 locations and approximately 27,000 employees, and as of March 31, 2022, we had approximately 750 locations and 28,000 employees. We offer our services ~~primarily~~ under the MasTec® and other service ~~mark and, as of September 30, 2017, we had approximately 21,500 employees and 415 locations.~~marks. We have been consistently ranked among the top specialty contractors by Engineering News-Record for the past several years.

We provide our services to a diversified base of customers. We often provide services under master service and other service agreements, which are generally multi-year agreements. The remainder of our work is generated pursuant to contracts for specific projects or jobs that require the

construction or installation of an entire infrastructure system or specified units within an infrastructure system. Revenue from non-recurring, project specific work may experience greater variability than master service and other service agreement work due to the need to replace the revenue as projects are completed. If we are not able to replace work from completed projects with new project work, we may not be able to maintain our current revenue levels or our current level of capacity and resource utilization. We actively review our backlog of project work and take appropriate action to minimize such exposure.

We manage our operations under five operating segments, which represent our five reportable segments: (1) Communications; (2) Clean Energy and Infrastructure; (3) Oil and Gas; ~~(3) Electrical Transmission;~~ (4) Power ~~Generation and Industrial~~Delivery and (5) Other. This structure is generally focused on broad end-user markets for our labor-based construction services. In the first quarter of 2022, we began integration of HMG. The HMG acquisition was completed on December 30, 2021, with its initial balance sheet reported within our Power Delivery segment. During the first quarter of 2022, we reported portions of HMG’s operations within our Power Delivery, Communications and Oil and Gas segments, as appropriate, and HMG’s corporate functions within our Corporate results. Accordingly, HMG’s December 31, 2021 balance sheet information was recast to conform with the new reporting structure. See Note 13 - Segments and Related Information and Note 14 - Commitments and Contingencies in the notes to the ~~condensed unaudited~~ consolidated financial statements, which are incorporated by reference, for additional information regarding our segment ~~related information as well as operating results by segment~~reporting and significant customer concentrations.

Backlog

Estimated backlog represents the amount of revenue we expect to realize over the next 18 months from future work on uncompleted construction contracts, including new contracts under which work has not begun, as well as revenue from change orders and renewal options. Our estimated backlog also includes amounts under master service and other service agreements and includes our proportionate share of estimated revenue from proportionately consolidated non-controlled contractual joint ventures. Estimated backlog for work under master service and other service agreements is determined based on historical trends, anticipated seasonal impacts, experience from similar projects and estimates of customer demand based on communications with our customers. ~~We expect to~~Based on current expectations of our customers’ requirements, we anticipate that we will realize approximately ~~25%~~62% of our ~~September 30, 2017~~ estimated March 31, 2022 backlog in ~~2017.~~2022. The following table presents 18-month estimated backlog by reportable segment as of the dates indicated:


Reportable Segment (in millions):	March 31, 2022		December 31, 2021 (a)		March 31, 2021
Communications	$	4,920	$	4,583	$	3,751
Clean Energy and Infrastructure	1,693		1,543		1,386
Oil and Gas	1,382		1,171		2,211
Power Delivery	2,650		2,642		516
Other	—		—		—
Estimated 18-month backlog	$	10,645	$	9,939	$	7,864

(a) Backlog as of December 31, 2021 was recast during the first quarter of 2022 to conform with the change in segment reporting for the HMG acquisition, the effect of which was a decrease in Power Delivery segment backlog of $223.0 million, and an increase in backlog for the Communications and Oil and Gas segments of $79.0 million and $144.0 million, respectively.

Reportable Segment (in millions): September 30,
2017 June 30,
2017 September 30,
2016
Communications $ 3,505
$ 3,375
$ 3,125
Oil and Gas 907
1,506
1,134
Electrical Transmission 268
295
269
Power Generation and Industrial 331
85
116
Other 3
4
7
Estimated 18-month backlog $ 5,014
$ 5,265
$ 4,651

~~Approximately~~As of March 31, 2022, 65% of our backlog ~~as of September 30, 2017~~ is attributable to amounts under master service or other service agreements, pursuant to which our customers are not contractually committed to purchase a minimum amount of services. Most of these agreements can be canceled on short or no advance notice. Timing of revenue for construction and installation projects included in our backlog can be subject to change as a result of customer, regulatory or other delays ~~regulatory factors~~or cancellations, including from economic or other conditions, including supply chain disruptions, inflationary and/or COVID-19 effects, climate-related matters, political unrest, such as the ongoing military conflict in Ukraine, and/or other project-related factors. These ~~changes~~effects, among others, could cause estimated revenue to be realized in periods later than originally expected, or not at all. ~~In the past, we have~~We occasionally ~~experienced~~experience postponements, cancellations and reductions in expected future work from master service agreements and/or construction projects due to changes in our customers’ spending plans, ~~as well as on construction projects due to~~ market volatility, ~~and~~changes in governmental permitting, regulatory delays and/or other factors. There can be no assurance as to our customers’ requirements or if actual results will be consistent with the ~~accuracy of~~estimates included in our ~~estimates.~~forecasts. As a result, our backlog as of any particular date is an uncertain indicator of future revenue and earnings.

Subsequent to September 30, 2017, we were granted a large pipeline construction project award with an expected contract value of over $1.5 billion, which is expected to be reflected in backlog at year-end 2017.

Backlog ~~is not a term recognized under U.S. GAAP; however, it~~ is a common measurement used in our industry. Our methodology for determining backlog may not, however, be comparable to the methodologies used by others. Backlog differs from the amount of our remaining performance obligations, which are described in Note 1 - Business, Basis of Presentation and Significant Accounting Policies in the notes to the consolidated financial statements, which is incorporated by reference. As of March 31, 2022, total 18-month backlog differed from the amount of our remaining performance obligations due primarily to the inclusion of $6.9 billion of estimated future revenue under master service and other service agreements within our backlog estimates, as described above, and the exclusion of approximately $1.1 billion of remaining performance obligations and estimated future revenue under master service and other service agreements in excess of 18 months, which amount is not included in the backlog estimates above. Backlog expected to be realized in 2022 differs from the amount of our remaining performance obligations expected to be recognized for the same period due primarily to the inclusion of approximately $2.7 billion of estimated future revenue under master service and other service agreements that is included within the related backlog estimate.

Economic, Industry and Market Factors

We closely monitor the effects ~~that~~of changes in economic and market conditions ~~may have~~ on our ~~customers. General~~customers, including the potential effects of climate-related matters, the COVID-19 pandemic and the ongoing military conflict in Ukraine. Changes in general economic and market conditions can ~~negatively~~ affect demand for our customers’ products and services, which can ~~lead to rationalization of~~increase or decrease our customers’ planned capital and maintenance budgets in certain end-markets. ~~Fluctuations~~Market, regulatory and industry factors could affect demand for our services, or the cost to provide such services, including (i) changes to our customers’ capital spending plans, including any potential effects from public health issues, supply chain or inflationary issues, or rising interest rates; (ii) new or changing regulatory requirements, governmental policy changes, and customer or industry initiatives, including with respect to climate change, sustainability and related environmental concerns, and changes in governmental permitting; (iii) economic, political or other market developments or uncertainty, such as the ongoing military conflict in Ukraine and/or access to capital for customers in the industries we

serve; (iv) changes in technology, tax and other incentives; and (v) mergers, acquisitions or other business transactions among the customers we serve.

Changes in demand for, and fluctuations in market prices for, oil, gas and other ~~fuel~~energy sources can affect demand for our services. In particular, such changes can affect the level of activity in energy generation projects, including from renewable energy sources, as well as pipeline construction and carbon capture projects. The availability of transportation and transmission capacity can also affect demand for our services, ~~in particular, on~~including energy generation, electric grid and pipeline ~~and power generation~~ construction ~~services.~~projects. These fluctuations, as well as the highly competitive nature of our industry, can result ~~and~~in changes in the ~~past, have resulted, in lower bids and lower profit on~~levels of activity, the project mix, and/or the profitability of the services we provide. In the face of increased pricing pressure or other market developments, we strive to maintain our profit margins through productivity improvements, ~~and~~ cost reduction programs. Other market, regulatory and industry factors, such as (i) changes to our customers’ capital spending plans; (ii) mergers and acquisitions among the customers we serve; (iii) access to capital for customers in the industries we serve; (iv) new programs and/or changing regulatory requirements or other governmental policy uncertainty; (v) economic, market or political developments; and (vi) changes in technology, tax and other incentives could also increase or reduce demand for our services.business streamlining efforts. While we actively monitor economic, industry and market factors that could affect our business, we cannot predict the effect that changes in such factors may have on our future results of operations, liquidity and cash flows, and we may be unable to fully mitigate, or benefit from, such changes.

~~Impact~~Effect of Seasonality and Cyclical Nature of Business

Our revenue and results of operations can be subject to seasonal and other variations. These variations are influenced by weather, customer spending patterns, bidding seasons, project schedules, ~~and~~holidays, regulatory matters and/or timing, in particular, for large non-recurring projects, and ~~holidays.~~the effects of market uncertainty or disruptions, including from public health matters or political unrest, such as the ongoing military conflict in Ukraine. Typically, our revenue is lowest inat the ~~first quarter~~beginning of the year and during the winter months because cold, snowy or wet conditions ~~cause project delays.~~can delay projects. Revenue is generally higher during the summer and fall months due to increased demand for our services when favorable weather conditions exist in many of the ~~second quarter is typically higher than~~regions in ~~the first quarter, as some projects begin,~~which we operate, but continued cold and wet weather can often ~~impact~~affect second quarter productivity. ~~The third and fourth quarters are typically the most productive quarters of the year, as a greater number of projects are underway and weather is normally more accommodating to construction projects.~~ In the fourth quarter, many projects tend to be completed by customers seeking to spend their capital budgets before the end of the year, which generally has a positive ~~impact~~effect on our revenue. However, the holiday season and inclement weather can cause delays, which can reduce revenue and increase costs on affected projects. Any quarter may be positively or negatively affected by adverse or unusual weather patterns, including warm winter weather, excessive rainfall, flooding or natural catastrophes such as wildfires, hurricanes or other severe weather, making it difficult to predict quarterly revenue and margin variations.

Additionally, our industry can be highly cyclical. Fluctuations in end-user demand within the industries we serve, or in the supply of services within those industries, can ~~impact~~affect demand for our services. As a result, our business may be adversely affected by industry declines or by delays in new projects. Variations in project schedules or unanticipated changes in project schedules, in particular, in connection with large construction and installation projects, can create fluctuations in revenue, which may adversely affect us in a given ~~period,~~quarter, even if not ~~in total.~~for the full year. In addition, revenue from master service and other service agreements, while generally predictable, can be subject to volatility. The financial condition of our customers and their access to capital; variations in project margins; regional, national and global economic, political and market conditions; regulatory or environmental ~~influences;~~influences, including climate-related matters; and acquisitions, dispositions or strategic ~~investments/other~~ arrangements can also materially affect quarterly results in a given period. Accordingly, our operating results in any particular period may not be indicative of the results that can be expected for any other period.

Critical Accounting Estimates

This discussion and analysis of our financial condition and results of operations is based upon our ~~condensed unaudited~~ consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our consolidated financial statements requires the use of estimates and assumptions that affect the amounts reported in our ~~condensed unaudited~~ consolidated financial statements and the accompanying notes.

We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, including the ~~results~~potential future effects of ~~which~~public health matters, such as the COVID-19 pandemic, climate-related matters and macroeconomic trends and events, such as inflation and interest rate levels, as well as global events, such as the ongoing military conflict in Ukraine. These estimates form the basis offor making judgments about our operating results ~~including the results of percentage-of-completion projects,~~ and the carrying values of assets and liabilities, that are not readily apparent from other sources. Given that management estimates, by their nature, involve judgments regarding future uncertainties, actual results ~~may~~could differ materially from these estimates if conditions change or if certain key assumptions used in making these estimates ultimately prove to be inaccurate. Our accounting policies and critical accounting estimates are reviewed periodically by the Audit Committee of the Board of Directors. Refer to Note 1 - Business, Basis of Presentation and Significant Accounting Policies in the notes to our condensed unaudited consolidated financial statements, which is incorporated by reference, and to our ~~2016~~ Form 10-K for discussion of our significant accounting policies. During the third quarter of 2017, we performed a quantitative assessment of the goodwill and an indefinite-lived pre-qualification intangible asset associated with certain of our operating segments in conjunction with our quarterly review of reporting units for indicators of impairment. Based on the results of these assessments, we determined that the estimated fair value of our Electrical Transmission operating segment exceeded its carrying value by approximately 10%, and that the fair values of two of our reporting units and the indefinite-lived pre-qualification intangible asset in our Oil and Gas segment, for which the carrying values totaled approximately $130 million, exceeded their carrying values by approximately 10% for each. Significant changes in assumptions or estimates, such as a reduction in profitability and/or cash flows, could result in non-cash goodwill and indefinite-lived intangible asset impairment charges in the future.

We believe that our accounting estimates pertaining to: the recognition of revenue ~~recognition for percentage-of-completion projects, including~~and project profit or loss, which we define as project revenue, less project costs of revenue, including project-related ~~depreciation; allowances~~depreciation, in particular, on construction contracts accounted for ~~doubtful accounts;~~under the cost-to-cost method, for which the recorded amounts require estimates of costs to complete and the amount and probability of variable consideration included in the contract transaction price; fair value estimates, including those related to ~~business~~ acquisitions, valuations of goodwill, intangible assets and ~~indefinite-lived intangible assets; estimated liabilities for future earn-out obligations; fair values of financial instruments;~~acquisition-related contingent consideration; equity investments; income taxes; self-insurance liabilities; and litigation and other contingencies, are the most critical in the preparation of our consolidated financial statements as they are important to the portrayal of our financial condition and require significant or complex judgment and estimates on the part of management. Actual results could, however, vary materially from these accounting estimates.

Refer to Note 1 - Business, Basis of Presentation and Significant Accounting Policies in the notes to the consolidated financial statements, which is incorporated by reference, and to our 2021 Form 10-K for a more detailed discussion of our significant accounting policies and critical accounting estimates. As described in more detail in Note 1 - Business, Basis of Presentation and Significant Accounting Policies, our consolidated financial statements include certain reclassifications of prior period amounts to conform with the current period presentation. For details of our first quarter 2022 quarterly review for indicators of impairment, refer to Note 3 - Acquisitions, Goodwill and Other Intangible Assets in the notes to the consolidated financial statements, which is incorporated by reference.

Results of Operations

Comparison of Quarterly Results

The following table, which may contain slight summation differences due to rounding, reflects our consolidated results of operations in dollar and percentage of revenue terms for the periods indicated (dollar amounts in millions). Our consolidated results of operations are not necessarily comparable from period to period due to the ~~impact~~effect of recent acquisitions and certain other items, which are described in the comparison of results section below. In this discussion, “acquisition” results are defined as results from acquired businesses for the first twelve months following the dates of the respective acquisitions, with the balance of results for a particular item attributed to “organic” activity.


	For the Three Months Ended September 30										For the Nine Months Ended September 30												For the Three Months Ended March 31,
	2017					2016					2017						2016						2022				2021
Revenue	$	1,955.8		100.0	%	$	1,586.2		100.0	%	$	5,004.1			100.0	%	$	3,792.8		100.0	%	Revenue	$	1,954.4	100.0	%	$	1,775.4	100.0	%
Costs of revenue, excluding depreciation and amortization	1,726.2			88.3	%	1,369.0			86.3	%	4,323.6				86.4	%	3,321.6			87.6	%	Costs of revenue, excluding depreciation and amortization	1,733.3		88.7	%	1,513.9		85.3	%
Depreciation and amortization	50.1			2.6	%	42.6			2.7	%	138.4				2.8	%	122.2			3.2	%
Depreciation																						Depreciation	85.2		4.4	%	79.3		4.5	%
Amortization of intangible assets																						Amortization of intangible assets	25.6		1.3	%	11.2		0.6	%
General and administrative expenses	66.4			3.4	%	67.1			4.2	%	202.0				4.0	%	195.0			5.1	%	General and administrative expenses	145.4		7.4	%	70.6		4.0	%
Interest expense, net	17.6			0.9	%	13.1			0.8	%	45.0				0.9	%	37.9			1.0	%	Interest expense, net	16.0		0.8	%	12.5		0.7	%
Equity in earnings of unconsolidated affiliates	(7.4		)	(0.4	)%	—			—	%	(15.1		)		(0.3	)%	(3.5		)	(0.1	)%	Equity in earnings of unconsolidated affiliates	(6.8)		(0.3)	%	(7.3)		(0.4)	%
Other income, net	(4.7		)	(0.2	)%	(1.0		)	(0.1	)%	(4.1		)		(0.1	)%	(12.8		)	(0.3	)%
Income before income taxes	$	107.6		5.5	%	$	95.3		6.0	%	$	314.3		��	6.3	%	$	132.4		3.5	%
Provision for income taxes	(43.4		)	(2.2	)%	(38.8		)	(2.4	)%	(126.2		)		(2.5	)%	(54.3		)	(1.4	)%
Net income	$	64.2		3.3	%	$	56.5		3.6	%	$	188.2			3.8	%	$	78.1		2.1	%

Other expense (income), net																						Other expense (income), net	3.8		0.2	%	(0.1)		0.0	%
(Loss) income before income taxes																						(Loss) income before income taxes	$	(48.1)	(2.5)	%	$	95.4	5.4	%
Benefit from (provision for) income taxes																						Benefit from (provision for) income taxes	13.1		0.7	%	(29.3)		(1.7)	%
Net (loss) income																						Net (loss) income	$	(35.0)	(1.8)	%	$	66.1	3.7	%
Net income attributable to non-controlling interests	0.4			0.0	%	0.3			0.0	%	1.8				0.0	%	0.4			0.0	%	Net income attributable to non-controlling interests	0.0		0.0	%	0.5		0.0	%
Net income attributable to MasTec, Inc.	$	63.8		3.3	%	$	56.3		3.5	%	$	186.4			3.7	%	$	77.7		2.0	%
Net (loss) income attributable to MasTec, Inc.																						Net (loss) income attributable to MasTec, Inc.	$	(35.0)	(1.8)	%	$	65.6	3.7	%

We review our operating results by reportable segment. See Note 13 - Segments and Related Information in the notes to the ~~condensed unaudited~~ consolidated financial statements, which is incorporated by reference. Our reportable segments are: (1) Communications; (2) Clean Energy and Infrastructure; (3) Oil and Gas; ~~(3) Electrical Transmission;~~ (4) Power ~~Generation and Industrial~~Delivery; and (5) Other. Management’s review of reportable segment results includes analyses of trends in revenue, EBITDA and EBITDA margin. ~~We calculate~~ EBITDA for segment reporting purposes ~~consistent~~is calculated consistently with our consolidated EBITDA calculation. See the discussion of our non-U.S. GAAP financial measures, including certain adjusted non-U.S. GAAP measures, as described, following the comparison of results discussion below. The following table presents revenue, EBITDA and EBITDA margin by reportable segment for the periods indicated (dollar amounts in millions):


	Revenue					EBITDA and EBITDA Margin
	For the Three Months Ended March 31,				For the Three Months Ended March 31,
Reportable Segment:	2022		2021			2022 (a)				2021
Communications	$	664.2	$	568.6		$	40.3	6.1	%	$	48.9	8.6	%
Clean Energy and Infrastructure	435.9		350.4			10.9		2.5	%	10.9		3.1	%
Oil and Gas	211.0		725.5			21.5		10.2	%	167.6		23.1	%
Power Delivery	650.5		133.5			46.1		7.1	%	3.6		2.7	%
Other	0.0		0.0			6.9		NM		7.4		NM
Eliminations	(7.2)		(2.6)			—		—		—		—
Corporate	—		—			(47.0)		—		(40.0)		—
Consolidated Results	$	1,954.4	$	1,775.4		$	78.7	4.0	%	$	198.4	11.2	%

NM - Percentage is not meaningful

Revenue EBITDA and EBITDA Margin
For the Three Months Ended September 30 For the Nine Months Ended September 30 For the Three Months Ended September 30 For the Nine Months Ended September 30
Reportable Segment: 2017 2016 2017 2016 2017 2016 2017 2016
Communications $ 610.5
$ 624.3
$ 1,762.2
$ 1,728.0
$ 65.3
10.7 % $ 62.8
10.1 % $ 173.2
9.8 % $ 190.9
11.0 %
Oil and Gas 1,161.0
736.0
2,757.2
1,454.3
108.1
9.3 % 117.8
16.0 % 356.1
12.9 % 187.6
12.9 %
Electrical Transmission 81.8
101.7
277.3
283.6
4.5
5.5 % (8.3 ) (8.1 )% 11.2
4.0 % (42.0 ) (14.8 )%
Power Generation and Industrial 96.9
123.6
204.1
324.7
9.3
9.6 % 6.1
4.9 % 14.8
7.3 % 13.8
4.3 %
Other 10.6
7.6
14.2
14.9
10.1
95.2 % (3.1 ) (40.6 )% 11.6
81.7 % (2.6 ) (17.4 )%
Eliminations (5.0 ) (7.0 ) (10.9 ) (12.7 ) —
—
—
—
—
—
—
—
Corporate —
—
—
—
(22.0 ) NA (24.3 ) NA (69.2 ) NA (55.1 ) NA
Consolidated Results $ 1,955.8
$ 1,586.2
$ 5,004.1
$ 3,792.8
$ 175.3
9.0 % $ 151.0
9.5 % $ 497.7
9.9 % $ 292.6
7.7 %

The following discussion and analysis of our results of operations should be read in conjunction with our condensed unaudited consolidated financial statements and notes thereto in Item 1 of this Quarterly Report on Form 10-Q (this “Form 10-Q”).

~~Three Months Ended September 30, 2017 Compared to Three Months Ended September 30, 2016~~

~~Revenue~~.(a) For the three month period ended ~~September 30, 2017,~~March 31, 2022, Power Delivery, Communications, Oil and Gas and Corporate EBITDA included $7.0 million, $0.8 million, $2.0 million and $3.8 million, respectively, of acquisition and integration costs related to our fourth quarter 2021 acquisitions.

Three Months Ended March 31, 2022 Compared to Three Months Ended March 31, 2021

Revenue. For the three month period ended March 31, 2022, consolidated revenue ~~increased to $1,956~~totaled $1,954 million ~~from $1,586~~as compared with $1,775 million for the same period in 2021, an increase of ~~$370~~$179 million, or ~~23%~~10%. Revenue increased in our Power Delivery segment by $517 million, or 387%, in our Communications segment by $96 million, or 17%, and in our Clean Energy and Infrastructure segment by $86 million, or 24%, whereas revenue in our Oil and Gas segment decreased by $515 million, or 71%. Acquisitions contributed $705 million in increased revenue for the three month period ended March 31, 2022, whereas organic revenue decreased by approximately $526 million, or 30%, as compared with the same period in 2016, driven largely by our Oil and Gas segment, for which revenue increased by $425 million, or 58%, offset, in part by lower revenue in our Power Generation and Industrial, Electrical Transmission and Communications segments, of $61 million in total, or 7%. Organic revenue increased by approximately $308 million, or 19%, and acquisitions contributed $62 million in revenue.2021.

Communications Segment. Communications revenue was ~~$610~~$664 million for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared

with ~~$624~~$569 million for the same period in ~~2016, a decrease~~2021, an increase of ~~$14~~$96 million, or 2%17%. Acquisitions contributed ~~$38~~$63 million of revenue which was offset by a decrease in organic revenue of $51 million, or 8%. The decrease in organic revenue was primarily driven by lower levels of install-to-the-home and customer fulfillment revenue in 2017, as previously disclosed.

~~Oil and Gas Segment~~. ~~Oil and Gas revenue was $1,161 million~~ for the three month period ended ~~September 30, 2017,~~March 31, 2022, and organic revenue increased by approximately $33 million, or 6%, as compared with ~~$736 million for~~ the same period in ~~2016, an increase of $425 million, or 58%.~~2021. The increase in ~~Oil and Gas~~organic revenue was driven primarily by ~~an increase in multiple large long-haul pipeline construction projects.~~higher levels of project activity.

~~Electrical Transmission~~Clean Energy and Infrastructure Segment. ~~Electrical Transmission~~Clean Energy and Infrastructure revenue was ~~$82~~$436 million for the three month period ended ~~September 30, 2017,~~March 31, 2022 as compared with ~~$102~~$350 million for the same period in ~~2016,~~2021, an increase of $86 million, or 24%. Acquisitions contributed $47 million of revenue for the three month period ended March 31, 2022, and organic revenue increased by $39 million, or 11%, as compared with the same period in 2021, due primarily to higher levels of project activity and mix.

Oil and Gas Segment. Oil and Gas revenue was $211 million for three month period ended March 31, 2022, as compared with $726 million for the same period in 2021, a decrease of ~~$20~~$515 million, or ~~20%~~71%. For the three month period ended March 31, 2022, acquisitions contributed $55 million of revenue, whereas organic revenue decreased by $570 million, or 79%, ~~driven~~as compared with the same period in 2021, primarily bydue to a project timing-related decrease in large diameter project activity ~~and timing.~~as well as lower levels of activity for other projects.

Power ~~Generation and Industrial~~Delivery Segment. Power ~~Generation and Industrial~~Delivery revenue was ~~$97~~$651 million for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with ~~$124~~$134 million for the same period in ~~2016, a decrease~~2021, an increase of ~~$27~~$517 million, or ~~22%~~387%. Acquisitions contributed $25 million of revenue, which was offset by a decrease in organic revenue of $51 million, or 42%. The decrease in organic revenue was driven primarily by lower levels of renewable power project activity and timing.

~~Other Segment~~. ~~Other segment revenue totaled $11 million for~~For the three month period ended ~~September 30, 2017,~~March 31, 2022, acquisitions contributed $540 million of revenue, whereas organic revenue decreased by approximately $23 million, or 17%, as compared with ~~$8 million for~~ the same period in ~~2016, an increase~~2021, primarily due to timing and mix of approximately $3 million, or 40%, driven primarily by increased levels of activity from our oil and gas operations in Mexico, offset by a decrease in revenue from a proportionately consolidated non-controlled Canadian joint venture.project activity.

Costs of revenue, excluding depreciation and amortization. Costs of revenue, excluding depreciation and amortization, increased by ~~$357~~approximately $219 million, or ~~26%~~14%, to ~~$1,726~~$1,733 million for the three month period ended ~~September 30, 2017, as compared with $1,369~~March 31, 2022 from $1,514 million for the same period in ~~2016.~~2021. Higher levels of revenue contributed ~~$319 million of~~ an increase of $153 million in costs of revenue, excluding depreciation and amortization, ~~whereas decreased~~and reduced productivity ~~resulted in~~contributed an increase of approximately ~~$38~~$67 million. Costs of revenue, excluding depreciation and amortization, as a percentage of revenue increased by approximately ~~200~~340 basis points, from ~~86.3%~~85.3% of revenue for the three month period ended ~~September 30, 2016~~March 31, 2021, to ~~88.3%~~88.7% of revenue for the same period in ~~2017.~~2022. The basis point increase was ~~driven by reduced project efficiencies and~~due primarily to segment revenue mix, ~~in our Oil and Gas segment, offset, in part, by improved project efficiencies and mix in our Communications, Electrical Transmission and Power Generation and Industrial segments. Additionally, costs~~including lower levels of revenue ~~excluding depreciation~~for our oil and ~~amortization, improved in our Other segment for the three month period ended September 30, 2017~~gas operations, as ~~compared with the same period in 2016 due to a reduction in~~well as project losses on a proportionately consolidated non-controlled Canadian joint venture, which totaled $0.4 million for the three month period ended September 30, 2017 as compared with $5 million in the prior year period. Thisinefficiencies and project ~~which is managed by a third party and for which we have minimal direct construction involvement, has experienced delays, which has extended the timeline and resulted in project losses.~~start-up costs.

Depreciation.Depreciation ~~and amortization.~~ ~~Depreciation and amortization~~ was ~~$50~~$85 million, or ~~2.6%~~4.4% of revenue, for the three month period ended ~~September 30, 2017~~March 31, 2022, as compared with ~~$43~~$79 million, or ~~2.7%~~4.5% of revenue, for the same period in ~~2016,~~2021, an increase of $8$6 million, or ~~18%~~7%. Acquisitions contributed $4$27 million of ~~incremental~~ depreciation ~~and amortization~~ for the three month period ended ~~September 30, 2017 as compared with the same period~~March 31, 2022 and organic depreciation decreased by $21 million, or 27%, due primarily to a reduction in ~~2016.~~capital investments related to large diameter pipeline project activity. As a percentage of revenue, depreciation ~~and amortization~~ decreased ~~slightly due primarily to higher levels~~by approximately 10 basis points.

Amortization of ~~revenue.~~

~~General and administrative expenses~~. ~~General and administrative expenses were $66~~intangible assets. Amortization of intangible assets was $26 million, or ~~3.4%~~1.3% of revenue, for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with ~~$67~~$11 million, or ~~4.2%~~0.6% of revenue, for the same period in ~~2016, a decrease~~2021, an increase of $1approximately $14 million, or 1%128%. Acquisitions contributed $6$18 million of ~~incremental~~amortization for the three month period ended March 31, 2022 and organic amortization decreased by approximately $3 million, or 29% due to the effects of timing of amortization for certain intangible assets. As a percentage of revenue, amortization of intangible assets increased by approximately 70 basis points.

General and administrative expenses. General and administrative expenses totaled $145 million, or 7.4% of revenue, for the three month period ended March 31, 2022 as compared with $71 million, or 4.0% of revenue, for the same period in 2021, for an increase of $75 million, or 106%. Acquisitions contributed $57 million of general and administrative expenses for the three month period ended ~~September 30, 2017, whereas~~March 31, 2022. For the three month period ended March 31, 2022, general and administrative expenses ~~in the prior year period included certain restructuring charges of approximately $5 million~~not related to our efforts to streamline our western Canadian oil and gas and our electrical transmission operations, which efforts were substantially completed in 2016. Excluding the effects of the above mentioned items, administrative expenses decreasedacquisitions increased by $2approximately $18 million, or approximately 25%, as compared with the same period in the prior year, primarily due ~~primarily~~ to ~~the timing of legal matters~~increases in travel and information technology and other ~~settlements.~~administrative expenses, as well as the effect of prior year recoveries of provisions for credit losses. Overall, general and administrative expenses, including approximately $14 million of acquisition and integration costs, increased by approximately 350 basis points as a percentage of revenue decreased by 80 basis points for the three month period ended September 30, 2017 as compared with the same period in the prior year, due primarily to improvements in overhead cost utilization from higher levels of revenue.

~~Interest expense, net.~~ ~~Interest expense, net of interest income, was $18 million, or 0.9%~~ of revenue for the three month period ended ~~September 30, 2017~~March 31, 2022 as compared with ~~$13~~the same period in 2021.

Interest expense, net. Interest expense, net of interest income, was approximately $16 million, or approximately 0.8% of revenue, for the three month period ended March 31, 2022, as compared with approximately $12 million, or 0.7% of revenue, for the same period in ~~2016.~~2021, an increase of $4 million, or approximately 29%. The increase in interest expense ~~was~~resulted primarily from credit facility activity, which increased due to higher ~~levels of financing costs,~~average balances, including ~~discount charges on financing arrangements, as well as an increase~~from indebtedness incurred in ~~interest expense on~~connection with our ~~Credit Facility in the third quarter of 2017~~2021 acquisitions, as compared with ~~2016.~~the same period in 2021.

Equity in earnings of unconsolidated ~~affiliates.~~ affiliates, net. Equity in earnings or losses of unconsolidated affiliates includes our share of income or losses from equity investees. For the both three month ~~period~~periods ended ~~September 30, 2017,~~March 31, 2022 and 2021, equity in earnings from unconsolidated affiliates, ~~was~~net, totaled approximately $7 million and related primarily to our investments in the Waha JVs, ~~which commenced operations~~partially offset by equity in ~~2017.~~losses from investments in certain telecommunications and other entities.

Other ~~income,~~expense (income), net. Other ~~income,~~expense (income), net, consists primarily of gains or losses from ~~sales of,~~changes to estimated Earn-out accruals, certain legal/other settlements, gains or losses, or changes in estimated recoveries from, certain assets and investments, ~~certain legal/~~and other ~~settlements, gains~~miscellaneous income or ~~losses from changes to estimated earn-out accruals, and certain restructuring charges related to losses on disposal of excess fixed assets.~~expense. For the three month period ended ~~September 30, 2017,~~March 31, 2022, other ~~income,~~expense, net, ~~was~~included approximately $5 million ~~as compared with $1 million for the same period~~of expense, net, from changes in the ~~prior year. Other~~fair value of certain investments and income ~~net, for~~from strategic arrangements. For the three month period ended ~~September 30, 2017~~March 31, 2021, other income, net, included approximately $3$1 million, net, of expense from certain investments and income from ~~changes to estimated earn-out accruals. Gains on sales of equipment, net, totaled $2 million and $1 million for the three month periods ended September 30, 2017 and 2016, respectively.~~strategic arrangements, offset by miscellaneous other income.

~~Provision for~~Benefit from (provision for) income taxes. Income tax ~~expense~~benefit was ~~$43~~$13 million for the three month period ended ~~September 30, 2017 as compared with $39~~March 31, 2022. Income tax expense for the three month period ended March 31, 2021 was $29 million. Pre-tax losses totaled $48 million for the ~~same~~three month period ~~in the prior year. In the third quarter of 2017, we had~~ended March 31, 2022 whereas pre-tax income ~~of $108 million as compared with~~totaled $95 million for the same period in ~~the prior year. Our effective tax rate for~~2021. For the three month period ended ~~September 30, 2017~~March 31, 2022, our effective tax rate decreased ~~versus~~to 27.3% from 30.7% for the same period in ~~2016, primarily due to~~2021. Our effective tax ~~credits that were recognized during~~rate in the ~~third~~first quarter of ~~2017, offset by~~2022 included a net tax benefit of approximately $0.9 million related to the vesting of share-based payment awards, whereas in the first quarter of 2021, included the negative effect of ~~losses in foreign jurisdictions.~~$2.3 million related to non-deductible share-based compensation.

Analysis of EBITDA by Segment

Communications Segment. EBITDA for our Communications segment was ~~$65~~$40 million, or ~~10.7%~~6.1% of revenue, for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with ~~$63~~$49 million, or ~~10.1%~~8.6% of revenue, for the same period in ~~2016,~~2021, a decrease of approximately $9 million, or 17%. As a percentage of revenue, EBITDA decreased by approximately 250 basis points, or approximately $17 million, due primarily to project timing delays and inefficiencies, as well as the effects of project start-up costs and acquisition and integration costs. Higher levels of revenue contributed an increase in EBITDA of $8 million.

Clean Energy and Infrastructure Segment. EBITDA for our Clean Energy and Infrastructure segment was $11 million, or 2.5% of revenue, for the three month period ended March 31, 2022, as compared with EBITDA of $11 million, or 3.1% of revenue, for the same period in 2021. As a percentage of revenue, EBITDA decreased by approximately 60 basis points, or $3 million, due to project inefficiencies, including from project timing delays. Higher levels of revenue contributed an increase in EBITDA of approximately $3 ~~million, or 4%. The increase was primarily due to production efficiencies.~~million.

Oil and Gas Segment. EBITDA for our Oil and Gas segment was ~~$108~~$22 million, or ~~9.3%~~10.2% of revenue, for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with ~~$118~~$168 million, or ~~16.0%~~23.1% of revenue, for the same period in ~~2016,~~2021, a decrease of $146 million, or 87%. Lower levels of revenue contributed a decrease in EBITDA of ~~$10~~$119 million, ~~or approximately 8%. Higher revenue~~while reduced productivity contributed ~~an increase in EBITDA of $68 million, which was offset by~~ a decrease in EBITDA of approximately $27 million. EBITDA margins decreased by approximately 1,290 basis points due primarily to inefficiencies resulting from lower ~~EBITDA margins due to reduced~~levels of revenue, including from project ~~efficiencies~~timing delays as well as project mix and ~~mix.~~the effects of acquisition and integration costs.

~~Electrical Transmission~~Power Delivery Segment. EBITDA for our ~~Electrical Transmission~~Power Delivery segment was $5$46 million, or ~~5.5%~~7.1% of revenue, for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with EBITDA of ~~negative $8~~$4 million, or ~~negative 8.1%~~2.7% of revenue, for the same period in ~~2016, for~~2021, an ~~improvement~~increase in EBITDA of ~~$13 million. The improvement in Electrical Transmission EBITDA was due primarily to a combination of project efficiencies and mix, the non-recurrence of~~ approximately ~~$4 million of restructuring charges for the three month period ended September 30, 2016, and improved cost and overhead utilization.~~

~~Power Generation and Industrial Segment.~~ ~~EBITDA for our Power Generation and Industrial segment was $9~~$43 million, or 9.6% of revenue, for the three month period ended September 30, 2017, as compared with EBITDA of $6 million, or 4.9% of revenue, for the same period in 2016, an improvement in EBITDA of $3 million, or 52%1,194%. As a percentage of revenue, ~~segment~~ EBITDA ~~improved~~increased by approximately ~~470~~440 basis points, ~~as compared with the same period in the prior year~~or $29 million due primarily to ~~improved~~ project efficiencies resulting from higher levels of revenue and project mix, partially offset by the effects of acquisition and integration costs. Higher levels of revenue contributed an increase in ~~part, by reduced cost and overhead utilization due to lower revenue.~~EBITDA of $14 million.

Other Segment. EBITDA from Other businesses was ~~$10~~approximately $7 million for both the three month periods ended March 31, 2022 and 2021, respectively, and related primarily to equity in earnings from our investments in the Waha JVs, partially offset by equity in losses from other investments.

Corporate. Corporate EBITDA was negative $47 million for the three month period ended ~~September 30, 2017,~~March 31, 2022, as compared with EBITDA of negative $3$40 million for the same period in ~~2016, an improvement~~2021, for a decrease in EBITDA of ~~$13~~approximately $7 million. ~~Other segment EBITDA~~Acquisitions, including certain acquisition and integration costs, contributed $10 million of Corporate expenses for the three month period ended ~~September 30, 2017 included $7 million of equity in earnings from unconsolidated affiliates related to our investments in the Waha JVs, which commenced operations in the first half of 2017, and, for~~March 31, 2022. For the three month ~~periods~~period ended ~~September 30, 2017 and 2016,~~March 31, 2022, Corporate EBITDA also included ~~losses of $0.4 million and~~approximately $5 million ~~respectively, on a proportionately consolidated non-controlled Canadian joint venture. The remaining improvement~~of expense, net, from changes in ~~Other segment EBITDA was driven by an increase in EBITDA~~the fair value of certain investments and income from ~~our oil and gas operations in Mexico.~~

~~Corporate.~~ ~~Corporate EBITDA was negative $22 million~~strategic arrangements, whereas for the three month period ended ~~September 30, 2017, as compared with EBITDA of negative $24 million for the same period in 2016, for an increase in EBITDA of $2 million.~~March 31, 2021, Corporate EBITDA ~~for the three month period ended September 30, 2017~~ included approximately $3$1 million of ~~income~~expense, net from ~~changes to estimated earn-out accruals.~~fair value changes. For the three month period ended ~~September 30, 2017, other corporate~~March 31, 2022, Corporate expenses ~~increased as compared with the prior year period primarily as a result of costs~~not related to the ~~timing of legal matters and other settlements.~~

~~Nine Months Ended September 30, 2017 Compared to Nine Months Ended September 30, 2016~~

~~Revenue~~. For the nine month period ended September 30, 2017, consolidated revenue increased to $5,004 million from $3,793 million, an increase of $1,211 million, or 32%, as compared with the same period in 2016. Oil and Gas revenue increased by $1,303 million, or 90%, Communications revenue increased by $34 million, or 2%, whereas Power Generation and Industrial revenue decreased by $121 million, or 37%, Electrical Transmission revenue decreased by $6 million, or 2%, and Other segment revenue decreased by $1 million, or 4%. Organic revenue increased by approximately $1,115 million, or 29%, and acquisitions contributed $96 million in revenue.

~~Communications Segment~~. Communications revenue was $1,762 million for the nine month period ended September 30, 2017, as compared with $1,728 million for the same period in 2016, an increase of $34 million, or 2%. Acquisitions contributed $71 million of revenue, which was offset by a decrease in organic revenue of $37 million. The decrease in organic revenue was primarily driven by lower levels of install-to-the-home and customer fulfillment revenue in 2017, as previously disclosed.

~~Oil and Gas Segment~~. Oil and Gas revenue was $2,757 million for nine month period ended September 30, 2017, as compared with $1,454 million for the same period in 2016, an increase of $1,303 million, or 90%. The increase in Oil and Gas revenue was driven primarily by an increase in multiple large long-haul pipeline construction projects.

~~Electrical Transmission Segment~~. Electrical Transmission revenue was $277 million for the nine month period ended September 30, 2017, as compared with $284 million for the same period in 2016, a decrease of $6 million, or 2%, due primarily to project activity and timing.

~~Power Generation and Industrial Segment~~. Power Generation and Industrial revenue was $204 million for the nine month period ended September 30, 2017, as compared with $325 million for the same period in 2016, a decrease of $121 million, or 37%. Acquisitions contributed $25 million of revenue, which was offset by a decrease in organic revenue of $145 million. The decrease in organic revenue was driven primarily by lower levels of renewable power project activity and timing.

~~Other Segment~~. Other segment revenue totaled $14 million for the nine month period ended September 30, 2017, as compared with $15 million for the same period in 2016, a decrease of approximately $1 million, or 4%, driven by a reduction in revenue from a proportionately consolidated non-controlled Canadian joint venture, offset, in part, by increased levels of activity from our oil and gas operations in Mexico.

~~Costs of revenue, excluding depreciation and amortization.~~ Costs of revenue, excluding depreciation and amortization increased by approximately $1,002 million, or 30%, to $4,324 million for the nine month period ended September 30, 2017, as compared with $3,322 million for the same period in 2016. Higher revenue contributed $1,061 million of an increase in costs of revenue, excluding depreciation and amortization, whereas improved productivity resulted in a decrease of approximately $59 million. Costs of revenue, excluding depreciation and amortization, as a percentage of revenueabove-described items decreased by approximately 120 basis points, from 87.6% of revenue for the nine month period ended September 30, 2016 to 86.4% of revenue for the same period in 2017. This basis point improvement was driven primarily by our Electrical Transmission and Power Generation and Industrial segments, which benefited from improved project efficiencies, close-outs and mix, as well as the non-recurrence of certain first quarter 2016 project losses. These improvements were offset, in part, by reduced project efficiencies and mix in our Oil and Gas and Communications segments. Additionally, project losses on a proportionately consolidated non-controlled Canadian joint venture in our Other segment totaled $7 million ~~for the nine month period ended September 30, 2017 as compared with $5 million for the same period in the prior year.~~

~~Depreciation and amortization.~~ Depreciation and amortization was $138 million, or 2.8% of revenue, for the nine month period ended September 30, 2017 as compared with $122 million, or 3.2% of revenue, in 2016, an increase of $16 million, or 13%. Acquisitions contributed $6 million of incremental depreciation and amortization for the nine month period ended September 30, 2017 as compared with the same period in 2016. As a percentage of revenue, depreciation and amortization decreased by approximately 50 basis points, due primarily to higher levels of revenue.

~~General and administrative expenses~~. General and administrative expenses were $202 million, or 4.0% of revenue, for the nine month period ended September 30, 2017, as compared with $195 million, or 5.1% of revenue, for the same period in 2016, an increase of $7 million, or 4%. Acquisitions contributed $10 million of incremental general and administrative expenses for the nine month period ended September 30, 2017, whereas general and administrative expenses for the same period in the prior year included certain restructuring charges of approximately $11 million related to our efforts to streamline our western Canadian oil and gas and our electrical transmission operations, which efforts were substantially completed in 2016. Excluding the effects of the above mentioned items, various administrative expenses increased by approximately $8 million for the nine month period ended September 30, 2017, driven primarily by costs related to the timing of legal matters and other settlements as well as costs associated with growth initiatives. Overall, for the nine month period ended September 30, 2017, general and administrative expenses as a percentage of revenue improved 110 basis points as compared with the same period in the prior year, due primarily to ~~improvements in overhead cost utilization from higher levels~~the effects of ~~revenue.~~

~~Interest expense, net.~~ Interest expense, net of interest income, was $45 million, or 0.9% of revenue, for the nine month period ended September 30, 2017 as compared with $38 million, or 1.0% of revenue, in 2016. The increase was primarily due to higher levels of financing costs, including discount charges on financing arrangements, as well as an increase in interest expense on our Credit Facility for the nine month period ended September 30, 2017 as compared with the same period in 2016.

~~Equity in earnings of unconsolidated affiliates.~~ Equity in earnings or losses of unconsolidated affiliates includes our share of income or losses from equity investees. For the nine month period ended September 30, 2017, equity in earnings from unconsolidated affiliates was $15 million, and related primarily to our investments in the Waha JVs, which commenced operations in 2017. Equity in earnings from unconsolidated affiliates for the nine month period ended September 30, 2016 was approximately $4 million and related to expected recoveries from our interests in certain pre-acquisition equity method investments of Pacer, of which the remaining investment as of September 30, 2017 is in the final stages of liquidation and is being managed by a receiver.

~~Other income, net.~~ Other income, net, consists primarily of gains or losses from sales of, or changes in estimated recoveries from, assets and investments, certain legal/other settlements, gains or losses from changes to estimated earn-out accruals, and certain restructuring charges related to losses on disposal of excess fixed assets. For the nine month period ended September 30, 2017, other income, net, was $4 million. Other income, net, for the nine month period ended September 30, 2017 included $12 million of expenses related to changes in expected recovery amounts for an investment that is in the final stages of liquidation, as well as reduced recovery expectations on a long-term note receivable due to recent bankruptcy proceedings for a former customer, offset by $12 million of income from changes to estimated earn-out accruals. Other income, net, for the nine month period ended September 30, 2016 totaled $13 million, and included approximately $10 million related to a settlement in connection with a previously acquired business, $3 million of restructuring charges related to estimated losses on the planned disposal of fixed assets held-for-sale and $3 million of income from changes to estimated earn-out accruals. Gains on sales of equipment, net, totaled approximately $4 million and $3 million for the nine month periods ended September 30, 2017 and 2016, respectively.

~~Provision for income taxes.~~ Income tax expense was $126 million for the nine month period ended September 30, 2017 as compared with $54 million for the same period in the prior year. For the nine month period ended September 30, 2017, we had pre-tax income of $314 million as compared with $132 million for the same period in the prior year. Our effective tax rate for the nine month period ended September 30, 2017 decreased versus the same period in 2016, primarily due to tax credits that were recognized during the third quarter of 2017, offset by the effect of losses in foreign jurisdictions.

~~Analysis of EBITDA by Segment~~

~~Communications Segment.~~ EBITDA for our Communications segment was $173 million, or 9.8% of revenue, for the nine month period ended September 30, 2017, as compared with $191 million, or 11.0% of revenue, for the same period in 2016, a decrease of approximately $18 million, or 9%. This decrease was primarily due to: (i) the non-recurrence of a first quarter 2016 gain from a settlement in connection with a previously acquired business; (ii) production inefficiencies; (iii) certain other expense reduction efforts, as well as timing of legal ~~matters~~ and ~~other settlements; (iv)~~settlement matters, offset, in part, by ~~a benefit from higher revenue.~~

~~Oil and Gas Segment.~~ ~~EBITDA for our Oil and Gas segment was $356 million, or 12.9% of revenue, for the nine month period ended September 30, 2017, as compared with $188 million, or 12.9% of revenue, for the same period~~increases in 2016, an increase of $168 million, or approximately 90%, driven primarily by higher revenue. As a percentage of revenue, segment EBITDA was flat for the nine month periods ended September 30, 2017 as compared with the same period in 2016. The effect of reduced project efficiencies and mix for the nine month period ended September 30, 2017 was partially offset by the non-recurrence of a first quarter 2016 project loss of approximately $13 million on a western Canadian oil and gas project and the non-recurrence of approximately $7 million of 2016 restructuring charges related to efforts to streamline our western Canadian oil and gas operations.

~~Electrical Transmission Segment.~~ EBITDA for our Electrical Transmission segment was $11 million, or 4.0% of revenue, for the nine month period ended September 30, 2017, as compared with EBITDA of negative $42 million, or negative 14.8% of revenue, for the same period in 2016, an increase in EBITDA of $53 million. The improvement in Electrical Transmission EBITDA was due to a combination of project efficiencies and mix, improved cost and overhead utilization due to higher levels of revenue, the non-recurrence of a first quarter 2016 project loss of approximately $15 million on a large transmission project, and the non-recurrence of approximately $7 million of 2016 restructuring charges related to efforts to streamline our operations.

~~Power Generation and Industrial Segment.~~ ~~EBITDA for our Power Generation and Industrial segment was $15 million, or 7.3% of revenue, for the nine month period ended September 30, 2017, as compared with EBITDA of $14 million, or~~ 4.3% of revenue, for the same period in 2016, an increase in EBITDA of $1 million, or 7% As a percentage of revenue, segment EBITDA improved by approximately 300 basis points for the nine month period ended September 30, 2017 as compared with the same period in the prior year due to improved project efficiencies and mix, offset, in part, by reduced cost and overhead utilization due to lower revenue.

~~Other Segment.~~ EBITDA from Other businesses was approximately $12 million for the nine month period ended September 30, 2017, as compared with EBITDA of negative $3 million for the same period in 2016, an increase in EBITDA of $14 million. Other segment EBITDA for the nine month period ended September 30, 2017 included $15 million of equity in earnings from unconsolidated affiliates related to our investments in the Waha JVs, which commenced operations in the first half of 2017. For the nine month periods ended September 30, 2017 and 2016, Other segment EBITDA included losses of $7 million and $5 million, respectively, on a proportionately consolidated non-controlled Canadian joint venture. The remaining improvement in Other segment EBITDA was driven by an increase in EBITDA from our oil and gas operations in Mexico.

~~Corporate.~~ Corporate EBITDA was negative $69 million for the nine month period ended September 30, 2017, as compared with EBITDA of negative $55 million for the same period in 2016, for a decrease in EBITDA of $14 million. Corporate EBITDA for the nine month period ended September 30, 2017 included approximately $12 million of expenses related to changes in expected recovery amounts for an investment that is in the final stages of liquidation, as well as reduced recovery expectations on a long-term note receivable due to recent bankruptcy proceedings for a former customer, offset by approximately $12 million of income from changes to estimated earn-out accruals. For the nine month period ended September 30, 2017, other corporate expenses increased as compared with the same period in the prior year, due primarily to costs related to the timing of legal matterscompensation and other ~~settlements, as well as costs associated with growth initiatives, including incentive and compensation expense.~~administrative expenses.

Foreign Operations

Our foreign operations are primarily in ~~Canada.~~Canada and, to a far lesser extent, in Mexico, the Caribbean and India. See Note 13 - Segments and Related Information in the notes to the ~~condensed unaudited~~ consolidated financial statements, which is incorporated by reference.

Non-U.S. GAAP Financial Measures

As appropriate, we supplement our reported U.S. GAAP financial information with certain non-U.S. GAAP financial measures, including earnings before interest, income taxes, depreciation and amortization (“EBITDA”)~~. In addition, we have presented “Adjusted~~, adjusted EBITDA~~” as well as~~ (“Adjusted EBITDA”), adjusted net income (“Adjusted Net Income”) and adjusted diluted earnings per share (“Adjusted Diluted Earnings Per Share”). ~~The~~These “adjusted” non-U.S. GAAP measures exclude, as applicable to the particular periods, non-cash stock-based compensation expense, certain restructuring charges, project results, which for the periods presented, were losses, from a proportionately consolidated non-controlled Canadian joint venture that was underway when we acquired Pacer in 2014,expense; acquisition and whose sole activity involves the construction of a bridge, a business in which we do not otherwise engage, is managed by a third party, and for which we have minimal direct construction involvement and automatically terminates upon completion of the project, and charges or recoveries from multi-employer pension plan withdrawals,integration costs related to our 2021 acquisitions; and, for Adjusted Net Income and Adjusted Diluted Earnings Per Share, amortization of intangible assets, the effects of changes in statutory tax rates and the tax effects of the adjusted ~~items, including non-cash stock based compensation. The~~items. These definitions of EBITDA and Adjusted EBITDA ~~above~~ are not the same as in our Credit Facility or in the indenture governing our senior notes; therefore, EBITDA and Adjusted EBITDA as presented in this discussion should not be used for purposes of determining our compliance with the covenants contained in our debt instruments.

We use EBITDA and Adjusted EBITDA, as well as Adjusted Net Income and Adjusted Diluted Earnings Per Share to evaluate our performance, both internally and as compared with our peers, because these measures exclude certain items that may not be indicative of our core operating results, as well as items that can vary widely across different industries or among companies within the same ~~industry, and,~~industry. We believe that these adjusted measures provide a baseline for ~~non-cash~~analyzing trends in our underlying business. Non-cash stock-based compensation expense can ~~also~~ be subject to volatility from changes in the market price per share of our common stock or variations in the value and number of shares ~~granted. Additionally,~~granted, and amortization of intangible assets is subject to acquisition activity, which varies from period to period. In addition, beginning with the fourth quarter of 2021, due to the extent of the acquisition costs related to our fourth quarter 2021 acquisitions, and the costs of the integration efforts that have been, and will continue to be, required in connection with such acquisitions, we are excluding acquisition and integration costs in calculating Adjusted EBITDA and Adjusted Net Income for these acquisitions, and we intend to exclude such costs for future acquisitions requiring substantial integration efforts. We exclude intangible asset amortization and acquisition costs from our adjusted measures ~~provide a baseline for analyzing trends~~due to their non-operational nature and inherent volatility, as acquisition activity varies from period to period. We also believe that this presentation is common practice in our ~~underlying business.~~industry and improves comparability of our results with those of our peers, although each company’s definitions of these adjusted measures may vary as they are not standardized and should be used in light of the provided reconciliations.

We believe that these non-U.S. GAAP financial measures provide meaningful information and help investors understand our financial results and assess our prospects for future performance. Because non-U.S. GAAP financial measures are not standardized, it may not be possible to

compare these financial measures with other companies’ non-U.S. GAAP financial measures having the same or similar names. These financial measures should not be considered in isolation from, as substitutes for, or alternative measures of, reported net income or diluted earnings per share, and should be viewed in conjunction with the most comparable U.S. GAAP financial measures and the provided reconciliations thereto. We believe these non-U.S. GAAP financial measures, when viewed together with our U.S. GAAP results and related reconciliations, provide a more complete understanding of our business. We strongly encourage investors to review our consolidated financial statements and publicly filed reports in their entirety and not rely on any single financial measure.

The following table presents a reconciliation of net income to EBITDA and Adjusted EBITDA in dollar and percentage of revenue terms, for the periods ~~indicated~~indicated. The tables below (dollar amounts in millions)~~. The tables below~~ may contain slight summation differences due to rounding.


	For the Three Months Ended March 31,
	2022				2021
Net (loss) income	$	(35.0)	(1.8)	%	$	66.1	3.7	%
Interest expense, net	16.0		0.8	%	12.5		0.7	%
(Benefit from) provision for income taxes	(13.1)		(0.7)	%	29.3		1.7	%
Depreciation	85.2		4.4	%	79.3		4.5	%
Amortization of intangible assets	25.6		1.3	%	11.2		0.6	%
EBITDA	$	78.7	4.0	%	$	198.4	11.2	%
Non-cash stock-based compensation expense	6.3		0.3	%	5.5		0.3	%


Acquisition and integration costs	13.6		0.7	%	—		—	%
Adjusted EBITDA	$	98.7	5.0	%	$	203.9	11.5	%

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
Net income $ 64.2
3.3 % $ 56.5
3.6 % $ 188.2
3.8 % $ 78.1
2.1 %
Interest expense, net 17.6
0.9 % 13.1
0.8 % 45.0
0.9 % 37.9
1.0 %
Provision for income taxes 43.4
2.2 % 38.8
2.4 % 126.2
2.5 % 54.3
1.4 %
Depreciation and amortization 50.1
2.6 % 42.6
2.7 % 138.4
2.8 % 122.2
3.2 %
EBITDA $ 175.3
9.0 % $ 151.0
9.5 % $ 497.7
9.9 % $ 292.6
7.7 %
Non-cash stock-based compensation expense 3.4
0.2 % 3.9
0.2 % 10.5
0.2 % 11.3
0.3 %
Restructuring charges —
— % 4.7
0.3 % 0.6
0.0 % 13.8
0.4 %
Project results from non-controlled joint venture 0.4
0.0 % 5.1
0.3 % 7.4
0.1 % 5.1
0.1 %
Charges (recoveries) from multi-employer pension plan withdrawals 0.6
0.0 % —
— % 0.6
0.0 % —
— %
Adjusted EBITDA $ 179.6
9.2 %
$ 164.8

10.4 % $ 516.7
10.3 % $ 322.8
8.5 %

A reconciliation of EBITDA and EBITDA margin to Adjusted EBITDA and Adjusted EBITDA margin by reportable segment for the periods indicated is as follows:


	For the Three Months Ended March 31,
	2022				2021
EBITDA	$	78.7	4.0	%	$	198.4	11.2	%
Non-cash stock-based compensation expense (a)	6.3		0.3	%	5.5		0.3	%


Acquisition and integration costs (b)	13.6		0.7	%	—		—	%
Adjusted EBITDA	$	98.7	5.0	%	$	203.9	11.5	%
Reportable Segment:
Communications	$	41.1	6.2	%	$	48.9	8.6	%
Clean Energy and Infrastructure	10.9		2.5	%	10.9		3.1	%
Oil and Gas	23.5		11.1	%	167.6		23.1	%
Power Delivery	53.2		8.2	%	3.6		2.7	%
Other	6.9		NM		7.4		NM
Corporate	(36.9)		—		(34.5)		—
Adjusted EBITDA	$	98.7	5.0	%	$	203.9	11.5	%

NM - Percentage is not meaningful

(a) Non-cash stock-based compensation expense is included within Corporate results.

For the Three Months Ended September 30 For the Nine Months Ended September 30
2017 2016 2017 2016
EBITDA $ 175.3
9.0 % $ 151.0
9.5 % $ 497.7
9.9 % $ 292.6
7.7 %
Non-cash stock-based compensation expense 3.4
0.2 % 3.9
0.2 % 10.5
0.2 % 11.3
0.3 %
Restructuring charges —
— % 4.7
0.3 % 0.6
0.0 % 13.8
0.4 %
Project results from non-controlled joint venture 0.4
0.0 % 5.1
0.3 % 7.4
0.1 % 5.1
0.1 %
Charges (recoveries) from multi-employer pension plan withdrawals 0.6
0.0 % —
— % 0.6
0.0 % —
— %
Adjusted EBITDA $ 179.6
9.2 % $ 164.8
10.4 % $ 516.7
10.3 % $ 322.8
8.5 %
Reportable Segment:
Communications $ 65.5
10.7 % $ 63.0
10.1 % $ 173.6
9.9 % $ 191.4
11.1 %
Oil and Gas 108.1
9.3 % 118.0
16.0 % 356.1
12.9 % 194.1
13.3 %
Electrical Transmission 4.5
5.5 % (3.8 ) (3.7 )% 11.8
4.3 % (34.7 ) (12.2 )%
Power Generation and Industrial 9.3
9.6 % 6.1
4.9 % 14.8
7.3 % 13.9
4.3 %
Other 10.5
98.9 % 2.1
27.2 % 19.0
133.3 % 2.6
17.2 %
Corporate (18.3 ) NA (20.6 ) NA (58.6 ) NA (44.4 ) NA
Adjusted EBITDA $ 179.6
9.2 % $ 164.8
10.4 % $ 516.7
10.3 % $ 322.8
8.5 %

~~Adjusted Net Income~~(b) For the three month period ended March 31, 2022, acquisition and ~~Adjusted Diluted Earnings Per Share~~integration costs of $7.0 million, $0.8 million, $2.0 million and $3.8 million are included within Power Delivery, Communications, Oil and Gas and Corporate results, respectively.

The ~~tables~~table below, which may contain slight summation differences due to rounding, ~~reconcile~~reconciles reported net income and reported diluted earnings per share, the most directly comparable U.S. GAAP financial measures, to Adjusted Net Income and Adjusted Diluted Earnings Per Share.


	For the Three Months Ended September 30													For the Three Months Ended March 31,
	2017						2016							2022				2021
	Net Income (in millions)			Diluted Earnings Per Share			Net Income (in millions)			Diluted Earnings Per Share				Net Loss (in millions)		Diluted Loss Per Share		Net Income (in millions)		Diluted Earnings Per Share
Reported U.S. GAAP measure	$	64.2		$	0.77		$	56.5		$	0.69		Reported U.S. GAAP measure	$	(35.0)	$	(0.47)	$	66.1	$	0.89
Adjustments:													Adjustments:
Non-cash stock-based compensation expense	3.4			0.04			3.9			0.05			Non-cash stock-based compensation expense	6.3		0.08		5.5		0.07
Restructuring charges	—			—			4.7			0.06
Project results from non-controlled joint venture	0.4			0.00			5.1			0.06
Charges (recoveries) from multi-employer pension plan withdrawals	0.6			0.01			—			—
Amortization of intangible assets													Amortization of intangible assets	25.6		0.34		11.2		0.15

Acquisition and integration costs													Acquisition and integration costs	13.6		0.18		—		—
Total adjustments, pre-tax	$	4.4		$	0.05		$	13.7		$	0.17		Total adjustments, pre-tax	$	45.5	$	0.61	$	16.8	$	0.23
Income tax effect of adjustments ^(a)	(0.6		)	(0.01		)	(4.0		)	(0.05		)	Income tax effect of adjustments (a)	(12.5)		(0.17)		(1.3)		(0.02)
Statutory tax rate effects (b)													Statutory tax rate effects (b)	—		—		0.5		0.01
Adjusted non-U.S. GAAP measure	$	68.0		$	0.82		$	66.3		$	0.81		Adjusted non-U.S. GAAP measure	$	(2.0)	$	(0.03)	$	82.0	$	1.10

(a) Represents the tax effect of the adjusted items that are subject to tax, including the tax effects of non-cash stock-based compensation expense, which, for the three month periods ended March 31, 2022 and 2021, included net tax benefits of $0.9 million and $0.1 million, respectively, from the vesting of share-based payment awards. Tax effects are determined based on the tax treatment of the related item, the incremental statutory tax rate of the jurisdictions pertaining to the adjustment, and their effect on pre-tax income. For the three month periods ended March 31, 2022 and 2021, our consolidated effective tax rates, as reported, were 27.3% and 30.7%, respectively, and as adjusted, were 23.4% and 26.9%, respectively.

For the Nine Months Ended September 30
2017 2016
Net Income
(in millions) Diluted Earnings Per Share Net Income
(in millions) Diluted Earnings Per Share
Reported U.S. GAAP measure $ 188.2
$ 2.27
$ 78.1
$ 0.96
Adjustments:
Non-cash stock-based compensation expense 10.5
0.13
11.3
0.14
Restructuring charges 0.6
0.01
13.8
0.17
Project results from non-controlled joint venture 7.4
0.09
5.1
0.06
Charges (recoveries) from multi-employer pension plan withdrawals 0.6
0.01
—
—
Total adjustments, pre-tax $ 19.1
$ 0.23
$ 30.3
$ 0.37
Income tax effect of adjustments ^(a)
(4.1 ) (0.05 ) (10.6 ) (0.13 )
Adjusted non-U.S. GAAP measure $ 203.1
$ 2.45
$ 97.7
$ 1.20
(b) For the three month period ended March 31, 2021, includes the effect of changes in certain state tax rates.

~~(a)~~

Represents the tax effect of the adjusted items that are subject to tax, including the tax effects of share-based compensation expense. Tax effects are determined based on the tax treatment of the related items, the incremental statutory tax rate of the jurisdictions pertaining to each adjustment, and taking into consideration their effect on pre-tax income. For both the three and nine month periods ended September 30, 2017, our consolidated effective tax rate, as reported, was 40%, and as adjusted, was 39%. For the three and nine~~month periods ended September 30, 2016, our consolidated effective tax rate, as reported, was 41% for both, and as adjusted, was 39% and 40%, respectively.~~

Financial Condition, Liquidity and Capital Resources

Our primary sources of liquidity are cash flows from operations, availability under our Credit Facility and our cash balances. Our primary liquidity needs are for working capital, capital expenditures, insurance and performance collateral in the form of cash and letters of credit, earn-out obligations, ~~cost and~~ equity ~~investee~~investment funding requirements, debt service and income ~~taxes and share repurchase programs.~~taxes. We also evaluate opportunities for strategic acquisitions, investments and ~~investments~~other arrangements from time to time, and we may consider opportunities to borrow additional funds, which may include borrowings under our Credit Facility or debt issuances, or to ~~repurchase,~~ refinance or retire outstanding debt, or to repurchase additional shares of our outstanding common stock ~~in the future,~~under share repurchase authorizations, any of which may require our use of cash.

Capital Expenditures. For the ~~nine~~three month period ended ~~September 30, 2017,~~March 31, 2022, we spent approximately $83 million on capital expenditures, or ~~$70~~$79 million, net of asset disposals, and incurred approximately ~~$131~~$49 million of equipment purchases under ~~capital lease and other financing arrangements.~~finance leases. We estimate that we will spend approximately ~~$105~~$230 million on capital expenditures, or approximately ~~$90~~$150 million, net of asset disposals, in ~~2017,~~2022, and expect to incur approximately ~~$155~~$200 million to $220 million of equipment purchases under ~~capital lease or other financing arrangements.~~finance leases. Actual capital expenditures may increase or decrease in the future depending upon business activity levels, as well as ongoing assessments of equipment lease versus ~~buy~~purchase decisions based on short and long-term equipment requirements.

Acquisitions and ~~Acquisition-Related Contingent Consideration~~.Earn-Out Liabilities. We typically utilize cash for ~~our~~business acquisitions and other strategic ~~acquisitions of other businesses,~~arrangements, and for the ~~nine~~three month period ended ~~September 30, 2017,~~March 31, 2022, we used ~~$116~~$22 million of cash for this purpose. In addition, in most of our acquisitions, we have agreed to make future ~~earn-out~~ payments to the sellers ~~which~~that are contingent upon the future earnings performance of the acquired ~~businesses. Certain earn-out~~businesses, which we also refer to as “Earn-out” payments. Earn-out payments may be paid in ~~either~~ cash or, under specific circumstances, MasTec common stock, or a combination thereof, at our option. Potential future earn-out obligations are measured at their estimated fair value as of the date of acquisition, with subsequent changes in fair value recorded in earnings as a component of other income or expense. The estimated total value of ~~earn-out obligations recorded as~~future Earn-out liabilities as of ~~September 30,~~

~~2017~~March 31, 2022 was approximately ~~$105~~$160 million. Of this amount, ~~$15~~$41 million represents the liability for ~~earn-out obligations that have been earned.~~earned amounts. The remainder ~~approximately $90 million,~~ is management’s estimate of ~~potential earn-out obligations~~Earn-out liabilities that are contingent upon future performance. ~~There were~~For the three month periods ended March 31, 2022 and 2021, we made no Earn-out payments. In addition, one of our acquisitionsprovides for certain additional payments ~~related~~ to ~~earn-out obligations~~be made to the sellers if certain acquired receivables are collected, which we refer to as the Additional Payments. Pursuant to the terms of the purchase agreement, a portion of the Additional Payments will be made in cash, with the remainder due in shares of MasTec common stock. The fair value of the Additional Payments as of March 31, 2022 was estimated to be approximately $65 million in the aggregate, which amount is included within other current liabilities in the consolidated balance sheet. Of this amount, approximately $27 million is to be paid in shares, or approximately 295,000 shares as of March 31, 2022, based upon the contractually agreed upon value of our common stock. The amount of Additional Payments due to the sellers as of March 31, 2022 from collections of acquired receivables totaled approximately $30 million, of which the amount due in shares totaled approximately $12 million, or 135,000 shares. In addition, this acquisition provides for a customary net working capital adjustment, under which additional shares could be issued. As of March 31, 2022, the amount of any potential net working capital adjustment cannot be quantified or predicted with specificity due to factors requiring the future resolution of certain items.

Income Taxes.For the three month period ended March 31, 2022, tax refunds, net of tax payments, totaled approximately $1 million, and for the three month period ended September 30, 2017, and for the nine month period ended September 30, 2017, we made payments of $19 million. For the three and nine month periods ended September 30, 2016, we made payments of $5 million and $20 million, respectively, related to earn-out obligations.

~~Income Taxes.~~ ~~Tax~~March 31, 2021, tax payments, net of tax refunds, were ~~approximately $78 million and $15 million, respectively, for the nine month periods ended September 30, 2017 and 2016. Tax~~de minimis. Our tax payments ~~which are made quarterly,~~ vary with changes in taxable income and earnings based on estimates of full year taxable income activity and estimated tax rates.

Working Capital. We need working capital to support seasonal variations in our business, primarily due to the effect of weather conditions on external construction and maintenance work and the spending patterns of our customers, both of which influence the timing of associated spending to support related customer demand. Working capital needs are generally higher during the summer and fall months due to increased demand for our services when favorable weather conditions exist in many of the regions in which we operate. Conversely, working capital needs are typically converted to cash during the winter months. These seasonal trends, however, can be offset by changes in the timing of projects, which can be affected by project delays or accelerations and/or other factors that may affect customer spending.

Working capital requirements also tend to increase when we commence multiple projects or particularly large projects because labor, including subcontractor costs, and certain other costs, including inventory, typically become payable before the receivables resulting from work performed are collected. The timing of ~~billing milestones~~billings and project close-outs can contribute to changes in unbilled revenue. As of ~~September 30, 2017,~~March 31, 2022, we expect that substantially all of our ~~CIEB~~unbilled receivables will be billed to customers in the normal course of business within the next 12twelve months. ~~Accounts~~Total accounts receivable, ~~balances,~~ which ~~consist~~consists of contract billings, ~~as well as CIEB~~unbilled receivables and retainage, ~~increased to $1.5~~net of allowance, were generally flat at approximately $2.2 billion as of ~~September 30, 2017 from $1.2 billion as of~~both March 31, 2022 and December 31, ~~2016 due~~2021. See below for discussion of our days sales outstanding, net of contract liabilities, which we refer to ~~higher levels of quarterly revenue,~~ as ~~well as the ramp-up of various projects, primarily in our oil and gas business.~~days sales outstanding, or “DSO.”

Our payment billing terms are generally net 30 days, and some of our contracts allow our customers to retain a portion of the contract amount (generally, from 5% to 10% of billings) until the job is completed. As part of our ongoing working capital management practices, we evaluate opportunities to improve our working capital cycle time through contractual provisions and certain financing arrangements. For certain customers, we maintain inventory to meet the materials requirements of the contracts. Occasionally, certain of our customers pay us in advance for a portion of the materials we purchase for their projects or allow us to pre-bill them for materials purchases up to specified amounts. Vendor terms are generally 30 days. Our agreements with subcontractors often contain a “pay-if-paid” provision, whereby our payments to subcontractors are made only after we are paid by our customers.

Summary of Financial Condition, Liquidity and Capital Resources

WeIncluding our current assessment of general economic conditions on our results of operations and capital resource requirements, we anticipate that funds generated from operations, borrowings under our ~~Credit Facility~~credit facilities and our cash balances will be sufficient to meet our working capital requirements, anticipated capital expenditures, debt service obligations, insurance and performance collateral requirements, letter of credit needs, earn-out obligations, required income tax payments, acquisition, strategic arrangement and ~~other~~ investment funding requirements, share repurchase activity and other liquidity needs for ~~at least~~ the next ~~12 months.~~twelve months and the foreseeable future.

Sources and Uses of Cash

As of ~~September 30, 2017,~~March 31, 2022, we had ~~$746~~approximately $918 million in working capital, defined as current assets less current liabilities, as compared with ~~$562~~$1,089 million as of December 31, ~~2016, an increase~~2021, a decrease of approximately ~~$183~~$171 million. ~~Total cash~~Cash and cash equivalents ~~of $44~~totaled approximately $233 million and $361 million as of ~~September 30, 2017 increased by $5 million from total cash~~March 31, 2022 and ~~cash equivalents of $39 million as of~~ December 31, ~~2016.~~2021, respectively, for a decrease of $128 million, due, in part, to a decrease in net income.

Sources and uses of cash are summarized below (in millions):


	For the Three Months Ended March 31,
	2022		2021
Net cash provided by operating activities	$	131.5	$	257.2
Net cash used in investing activities	$	(101.4)	$	(134.6)
Net cash used in financing activities	$	(158.0)	$	(33.2)

For the Nine Months Ended September 30
2017 2016
Net cash provided by operating activities $ 178.6
$ 127.1
Net cash used in investing activities $ (249.4 ) $ (94.1 )
Net cash provided by (used in) financing activities $ 75.6
$ (27.6 )

Operating Activities.Cash flow from operations is primarily influenced by changes in the timing of demand for our services and operating margins, but can also be affected by working capital needs associated with the various types of services we provide. Working capital is affected by changes in total accounts receivable, ~~CIEB,~~prepaid expenses and other current assets, accounts payable and payroll tax payments, accrued expenses and ~~BIEC,~~contract liabilities, all of which tend to be related. These working capital items are affected by changes in revenue resulting from ~~both~~ the timing and ~~the~~ volume of work performed, by variability in the timing of customer billings and collections of receivables, as well as settlement of payables and other obligations. Net cash provided by operating activities for the ~~nine~~three month period ended ~~September 30, 2017~~March 31, 2022 was ~~$179~~$132 million, as compared with approximately ~~$127~~$257 million ~~of net~~for the same period in 2021, for a decrease in cash provided by operating activities ~~for the same period in 2016. The increase in cash flow from operating activities was driven by an increase~~of approximately $126 million, due primarily to a decrease in net income, ~~of $110 million due to growth in revenue and an increase in~~as well as the effect of ~~non-cash adjustments of $107 million, partially offset by a decrease in the effect of net~~working capital changes in assets and liabilities, ~~of $165 million.~~net, including from acquisitions, partially offset by increases in certain expenses that reconcile net income to operating cash flows, including depreciation and amortization expense.

Our days sales outstanding, ~~(“DSO”),~~ net of ~~BIEC,~~contract liabilities (“DSO”) was 6789 as of ~~September 30, 2017, as compared with 68 as~~March 31, 2022. As of December 31, ~~2016~~2021, our DSO was 98, and 61 as ~~of September 30, 2016.~~adjusted for December 2021 acquisitions, was 77. DSO ~~net of BIEC,~~ is calculated as total accounts receivable, net of allowance, less ~~BIEC,~~contract liabilities, divided by average daily revenue for the most recently completed quarter as of the balance sheet date. Our DSOs can fluctuate from period to period due to ~~the~~ timing of billings, billing terms, collections and settlements, timing of project close-outs and retainage collections, changes in project and customer mix and the effect of working capital initiatives. To provide a representative comparison of our DSOs across periods, for December 31, 2021, we calculated DSO as adjusted for our December 2021 acquisitions. This calculation for December 31, 2021 excludes revenue and accounts receivable, net of allowance, less contract liabilities for our December 2021 acquisitions, given that our consolidated results for the related period do not reflect the full quarter’s revenue for these acquisitions, but our consolidated balance sheet as of December 31, 2021 includes the full amount of related accounts receivable, net of allowance, less contract liabilities. The increase in DSO as of March 31, 2022, as compared with DSO as of December 31, 2021, as adjusted for our December 2021 acquisitions, was due to timing of ordinary course billing and collection activities, as well as the effect of our recent acquisitions, some of which have a higher DSO than the DSO of our organic operations, and lower levels of organic revenue with fixed amounts of project retainage. Other than matters subject to litigation, we do not anticipate material collection issues related to our outstanding accounts receivable balances, nor do we believe that we have material amounts due from customers experiencing financial difficulties. WeBased on current information, we expect to collect substantially all of our outstanding accounts receivable ~~net,~~balances within the next twelve months.

Investing Activities.Net cash used in investing activities ~~increased~~decreased by ~~$155~~approximately $33 million to ~~$249~~$101 million for the ~~nine~~three month period ended ~~September 30, 2017~~March 31, 2022 from ~~$94~~$135 million for the ~~nine~~three month period ended ~~September 30, 2016.~~March 31, 2021. For the ~~nine~~three month period ended ~~September 30, 2017, payments for~~March 31,

2022, we completed one acquisition and paid $22 million in cash related to acquisitions, net of cash acquired, totaled $116 million due to our 2017 acquisitions, an increase of $112 million as compared with the same period in 2016. Payments for other investments, net, which relates primarily to activity associated with cost and equity investees, was $64 million for the nine month period ended September 30, 2017, as compared with $8 millionwhereas for the same period in ~~2016, representing~~2021, we completed two acquisitions and paid $89 million in cash related to acquisitions, a decrease of approximately $67 million. These acquisitions were funded with cash on hand and borrowings under our senior credit facility. Capital expenditures for the three month period ended March 31, 2022 totaled $83 million, or $79 million, net of asset disposals, as compared with $48 million, or $42 million, net of asset disposals, for the same period in 2021, for an increase in cash used in investing activities of approximately ~~$56~~$37 million. Payments for other investments, which relate primarily to investments in certain equity investees, decreased from $4 million for the ~~nine~~three month period ended ~~September 30, 2017 related~~March 31, 2021 to our equity investment in the Waha JVs, for which we have $19 million in letters of credit issued as collateral as of September 30, 2017, as described in Note 4 - Fair Value of Financial Instruments in the notes to the condensed unaudited consolidated financial statements, which is incorporated by reference. Proceeds from other investments for the nine month period ended September 30, 2017 related to recoveries from an equity method investment that is in the final stages of liquidation and is being managed by a receiver. Additionally, for the nine month period ended September 30, 2017, we spent $83 million on capital expenditures, or $70 million, net of asset disposals, as compared with capital expenditures, net of asset disposals, of $82$1 million for the same period in ~~the prior year, for a decrease in cash used in investing activities of $12 million.~~2022.

Financing Activities.Net ~~cash provided by financing activities for the nine month period ended September 30, 2017 was $76 million, as compared with $28 million of net~~ cash used in financing activities for the ~~nine~~three month period ended ~~September 30, 2016,~~March 31, 2022 was $158 million, as compared with $33 million for the same period in 2021, for an increase in cash ~~provided by~~used in financing activities of ~~$103~~$125 million. The increase in cash used in financing activities was driven primarily by Credit ~~facility related~~Facility (as defined below) activity. Credit Facility activity, net, totaled $82 million of repayments, net of borrowings for the ~~nine~~three month period ended ~~September 30, 2017, totaled $162~~March 31, 2022, as compared with $9 million of borrowings, net of repayments, ~~as compared to $37~~for the three month period ended March 31, 2021. Additionally, payments of finance lease obligations increased by approximately $3 million for the ~~nine~~three month period ended September 30, 2016, for an increase in cash provided by credit facility-related activities, net, of $125 million, which increase was partially offset by payments of $6 million for Credit Facility-related financing costs. Payments of acquisition-related contingent consideration for the nine month periods ended September 30, 2017 and 2016 were generally flat, totaling $19 million in 2017March 31, 2022 as compared with ~~$20~~the same period in 2021. Other financing activities for the three month period ended March 31, 2022 included share repurchases, which totaled $14 million, whereas for the same period in ~~2016.~~2021, there were no share repurchases. Subsequent to March 31, 2022, we repurchased an additional 0.5 million shares of our common stock for an aggregate purchase price of $36 million. Payments for other financing activities, net, totaled $17 million for the three month period ended March 31, 2022, and included payments for other borrowing activities, whereas payments for other financing activities for the three month period ended March 31, 2021 totaled $1 million.

Senior ~~Secured~~ Credit Facility

We have a senior ~~secured~~unsecured credit facility ~~that we refer to as our~~(the “Credit ~~Facility,”~~Facility”), which ~~was amended~~matures on November 1, 2026 and ~~restated in February 2017. As of September 30, 2017, the Credit Facility~~ has aggregate borrowing commitments ~~of approximately $1.5~~totaling $2.0 billion, which amount is composed of ~~$1.1~~$1.65 billion of revolving commitments and ana Term Loan totaling $350 million in original principal amount. Aggregate outstanding ~~term loan in~~borrowings under the ~~aggregate principal amount~~Credit Facility as of ~~$400 million.~~March 31, 2022 totaled approximately $1.0 billion. Borrowings under the Credit Facility are used for working capital requirements, capital expenditures and other corporate purposes, including ~~investments in~~acquisitions, equity ~~or other investees, potential acquisitions~~investments or other strategic arrangements, share repurchases and the repurchase or prepayment of ~~indebtedness.~~indebtedness, including repayment of term loans.

We are dependent upon borrowings and letters of credit under ~~the~~our Credit Facility to fund our operations. Should we be unable to comply with the terms and conditions of ~~the~~our Credit Facility, we would be required to obtain modifications to the Credit Facility or obtain an alternative source of financing to continue to operate, neither of which may be available to us on commercially reasonable terms, or at all. The Credit Facility is subject to certain provisions and covenants, as more fully described in Note 7 - Debt in the notes to the ~~condensed unaudited~~audited consolidated financial statements ~~which is incorporated by reference.~~included in our 2021 Form 10-K.

~~4.875%~~4.50% Senior Notes

We have ~~outstanding $400~~$600 million of ~~4.875% senior notes~~4.50% Senior Notes due ~~March~~August 15, ~~2023 (our “4.875%~~2028 (the “4.50% Senior Notes”)~~, which were issued in 2013 in a registered public offering.~~. The ~~4.875%~~4.50% Senior Notes are fully and unconditionally guaranteed on a senior unsecured, joint and several basis by certain of our ~~subsidiaries and~~wholly-owned domestic restricted subsidiaries. The 4.50% Senior Notes are subject to certain provisions and covenants, as more fully described in Note 7 - Debt ~~and Note 17 - Supplemental Guarantor Condensed Consolidating Financial Information~~ in the notes to the audited consolidated financial statements included in our ~~2016~~2021 Form 10-K. Also see Note 16 - Supplemental Guarantor Condensed Unaudited Consolidating Financial Information in the notes to the condensed unaudited consolidated financial statements in this Form 10-Q, which are incorporated by reference.

Debt Covenants

We were in compliance with the provisions and covenants contained in our outstanding debt instruments as of ~~September 30, 2017.~~March 31, 2022.

Additional Information

For detailed discussion and additional information pertaining to our debt instruments, see Note 7 - Debt in the notes to the audited consolidated financial statements included in our ~~2016~~2021 Form 10-K. Also see Note 7 - Debt in the notes to the ~~condensed unaudited~~ consolidated financial statements in this Form 10-Q for current period balances and discussion, which is incorporated by reference.

Off-Balance Sheet Arrangements

As is common in our industry, we have entered into certain off-balance sheet arrangements in the ordinary course of business. Our significant off-balance sheet transactions include liabilities associated with non-cancelable operating leases with durations of less than twelve months, letter of credit obligations, surety and performance and payment bonds entered into in the normal course of business, self-insurance liabilities, liabilities associated with multiemployer pension plans, liabilities associated with ~~certain~~potential funding obligations and indemnification ~~and~~and/or guarantee arrangements ~~and obligations~~ relating to our ~~cost~~equity and ~~equity investees,~~other investment arrangements, including our

variable interest entities. However, these off-balance sheet arrangements have not, and are not reasonably likely to have, a material impact on our financial condition, revenues or expenses, results of operations, liquidity, cash requirements or capital resources in the next twelve months or in the foreseeable future. Refer to Note 14 - Commitments and Contingencies, Note 4 - Fair Value of Financial Instruments and Note 15 - Related Party Transactions in the notes to the ~~condensed unaudited~~ consolidated financial statements, which are incorporated by reference.

Impact of Inflation

The primary inflationary factors directly affecting our operations are labor, ~~and~~ fuel ~~costs,~~ and ~~to a lesser extent,~~ material costs. In times of low unemployment, our labor costs may increase due to shortages in the supply of skilled ~~labor. Additionally,~~labor and increases in compensation rates generally. Although most project materials are provided by our customers, increases in the ~~prices~~cost of ~~oil~~materials could negatively affect the economic viability of our customers’ projects, and ~~gas~~accordingly, demand for our services. Material and commodity prices are subject to unexpected fluctuations due to events outside of our control, including geopolitical events, such as the ongoing conflict in Ukraine, climate-related effects and fluctuations in global supply and demand, which events have recently caused market volatility, particularly in the oil ~~markets.~~and gas markets, among others. Such market volatility can affect our customers’ investment decisions and subject us to project cancellations, deferrals or unexpected changes in the timing of project work. Market prices for goods

can also be affected by supply chain disruptions, such as those arising from the effects of the COVID-19 pandemic. We closely monitor inflationary factors, including the current rise in the rate of inflation, and any ~~impact~~potential effects they may have on our business operations, operating results and/or financial condition.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

As of ~~September 30, 2017,~~March 31, 2022, our variable interest rate debt was primarily related to our Credit Facility. Interest on outstanding revolving loans and our Term Loan under our Credit Facility accrues at variable rates based, at our option, on a Eurocurrency rate, as defined in the Credit Facility, plus a margin, or a base rate, as defined in the Credit Facility, plus a margin. As of ~~September 30, 2017,~~March 31, 2022, we had ~~$301~~$691 million aggregate principal amount of outstanding revolving loans under our Credit Facility with a weighted average interest rate of ~~2.96%~~1.60% and a ~~term loan~~Term Loan with a balance of ~~$400~~$350 million ~~with~~and an interest rate of ~~2.86%~~1.71%. Our variable rate interest debt subjects us to risk from increases in prevailing interest rates, particularly in an inflationary environment as central banks seek to increase interest rates. A 100 basis point increase in the applicable interest rates under our credit facilities would have increased our interest expense by approximately $5$3 million for the ~~nine~~three month period ended ~~September 30, 2017.~~March 31, 2022. While our material financing arrangements indexed to LIBOR have procedures for determining an alternative base rate, the upcoming expected phase-out of LIBOR could lead to volatility in interest rates for our variable rate debt, as the alternative base rate could perform differently than the current LIBOR-indexed rate, which could result in an increase in the cost of our variable rate indebtedness.

As of ~~September 30, 2017,~~March 31, 2022, our fixed interest rate debt primarily included ~~$400~~$600 million aggregate principal amount of ~~4.875%~~4.50% Senior Notes and ~~an aggregate $187~~$299 million of ~~capital~~finance lease obligations, ~~and notes payable,~~ which accrued interest at a weighted average interest rate of approximately ~~3.4% as of September 30, 2017.~~3.2%. None of this debt subjects us to interest rate risk, but we may be subject to changes in interest rates if and when we refinance this debt at maturity or otherwise.

Foreign Currency Risk

Certain of our consolidated revenue and operating expenses are in foreign currencies. Our foreign operations are primarily in Canada. Revenue generated from foreign operations represented 3%1% of our total revenue for the ~~nine~~three month period ended ~~September 30, 2017.~~March 31, 2022. Revenue and expense related to our foreign operations are, for the most part, denominated in the functional currency of the foreign operation, which minimizes the impact that fluctuations in exchange rates would have on net income or loss. We are, however, subject to fluctuations in foreign currency exchange rates when transactions are denominated in currencies other than the functional ~~currencies.~~currencies and for our foreign operations with a functional currency other than the local currency. Such ~~transactions were~~activity was not material to our operations for the three ~~or nine~~ month ~~periods~~period ended ~~September 30, 2017.~~March 31, 2022. Translation gains or losses, which are recorded in other comprehensive income or loss, result from translation of the assets and liabilities of our foreign subsidiaries into U.S. dollars. For the three ~~and nine~~ month ~~periods~~period ended ~~September 30, 2017,~~March 31, 2022, foreign currency translation ~~effects~~gains, net, totaled approximately ~~$0.6~~$1 million and ~~$2.4 million of gains, respectively, and~~ related ~~primarily~~ to our ~~Canadian operations.~~operations in Canada and Mexico.

Our exposure to fluctuations in foreign currency exchange rates could increase in the future if we continue to expand our operations outside of the United States. We seek to manage foreign currency exposure by minimizing our consolidated net asset and liability positions in currencies other than the functional currency, which exposure was not significant to our consolidated financial position as of ~~September 30, 2017.~~March 31, 2022. We may enter into foreign currency derivative contracts in the future to manage such exposure.

Other Market Risk

As discussed in Note 4 - Fair Value of Financial Instruments in the notes to the ~~condensed unaudited~~ consolidated financial statements, which is incorporated by reference, we have certain investments that may be subject to market risk and could be subject to volatility based on market conditions.


~~ITEM 4.~~	~~CONTROLS AND PROCEDURES~~

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported within time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on management’s evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of ~~September 30, 2017.~~March 31, 2022.

Changes in Internal Control ~~over~~Over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting during the quarter ended ~~September 30, 2017~~March 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION


~~ITEM 1.~~	ITEM 1. LEGAL PROCEEDINGS

~~Legacy Litigation~~

Refer to Note 14 –- Commitments and Contingencies in the notes to our ~~condensed unaudited~~ consolidated financial statements included in this Quarterly Report on Form 10-Q, which is incorporated by reference in this Item 1, for a discussion of any recent material developments related to our legal proceedings since the filing of our ~~2016~~2021 Form 10-K.

ITEM 1A. RISK FACTORS

~~There~~Subject the potential effects of inflation, rising interest rates and the ongoing military conflict in Ukraine on certain of the risks we normally face in operating our business, including those disclosed in our 2021 Form 10-K, there have been no material changes to either the cautionary statement regarding forward-looking statements or to any of the risk factors disclosed in our ~~2016~~2021 Form 10-K, as updated by our Quarterly Report on Form ~~10-Q.~~10-Q and other filings we make with the SEC.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The following table provides information about repurchases of our common stock during the quarter ended ~~September 30, 2017~~:March 31, 2022:


Period	Total Number of Shares Purchased (a)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program (b)	Approximate Dollar Value of Shares that May Yet be Purchased under the Program (c)
January 1 through January 31	7,866	$	89.64	—	$	158,617,588
February 1 through February 28	8,234	$	89.28	—	$	158,617,588
March 1 through March 31	196,843	$	73.79	187,978	$	144,826,541
Total	212,943			187,978

(a)Includes 7,866, 8,006 and 8,865 shares reacquired by the Company on the open market pursuant to the Amended ESPPs in January, February and March of 2022, respectively, 228 shares withheld for income tax purposes in connection with shares issued under compensation and benefit programs in February of 2022, and 187,978 of repurchases under share repurchase programs in March of 2022.

(b)Includes 117,054 shares repurchased under our $100 million December 2018 share repurchase program, which was publicly announced on December 21, 2018 and which completed the program, and 70,924 shares repurchased under our $150 million March 2020 share repurchase program, which was publicly announced on March 19, 2020.

(c)As of March 31, 2022, the remaining amount available for share repurchases under our March 2020 $150 million share repurchase program totaled $144.8 million.



Florida		65-0829355
(State or ~~Other~~other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
~~Incorporation or Organization)~~		~~Identification No.)~~

800 S. Douglas Road, 12th Floor
Coral Gables, FL	Florida	33134
(Address of ~~Principal Executive Offices)~~principal executive offices)		(Zip Code)


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.10 Par Value	MTZ	New York Stock Exchange



	For the Three Months Ended September 30						For the Nine Months Ended September 30
	2017			2016			2017			2016
Revenue	$	1,955,752		$	1,586,181		$	5,004,116		$	3,792,811
Costs of revenue, excluding depreciation and amortization	1,726,173			1,368,988			4,323,642			3,321,571
Depreciation and amortization	50,101			42,584			138,384			122,249
General and administrative expenses	66,397			67,131			202,001			195,031
Interest expense, net	17,578			13,097			44,966			37,895
Equity in (earnings) losses of unconsolidated affiliates	(7,399		)	6			(15,105		)	(3,549		)
Other income, net	(4,677		)	(971		)	(4,102		)	(12,803		)
Income before income taxes	$	107,579		$	95,346		$	314,330		$	132,417
Provision for income taxes	(43,378		)	(38,816		)	(126,170		)	(54,331		)
Net income	$	64,201		$	56,530		$	188,160		$	78,086
Net income attributable to non-controlling interests	449			253			1,770			414
Net income attributable to MasTec, Inc.	$	63,752		$	56,277		$	186,390		$	77,672

Earnings per share (Note 2):
Basic earnings per share	$	0.79		$	0.70		$	2.31		$	0.97
Basic weighted average common shares outstanding	80,953			80,462			80,859			80,323

Diluted earnings per share	$	0.77		$	0.69		$	2.27		$	0.96
Diluted weighted average common shares outstanding	82,386			81,545			82,281			81,241



Supplemental cash flow information:
Interest paid	$	47,163	$	40,433
Income taxes paid, net of refunds	$	77,533	$	15,141
Supplemental disclosure of non-cash information:
Acquisition-related contingent consideration, new business combinations	$	89,614	$	—
Equipment acquired under capital lease and financing arrangements	$	129,567	$	13,015
Accrued capital expenditures	$	1,345	$	4,119



	Communications		Oil and Gas			Electrical Transmission		Power Generation and Industrial		Total Goodwill
Goodwill, gross	$	462.4	$	461.6		$	149.9	$	137.0	$	1,210.9
Accumulated impairment losses	—		(75.4		)	—		—		(75.4		)
Goodwill, net	$	462.4	$	386.2		$	149.9	$	137.0	$	1,135.5



Acquisition consideration:	2017
Cash	$	118.8
Fair value of contingent consideration (earn-out liability)	89.6
Total consideration transferred	$	208.4
Identifiable assets acquired and liabilities assumed:
Current assets, primarily composed of accounts receivable and $2.8 million of cash acquired	$	42.7
Property and equipment	56.9
Amortizing intangible assets	26.8
Other long-term assets	0.5
Current liabilities, including current portion of capital lease obligations and long-term debt	(28.4		)
Long-term debt, including capital lease obligations	(9.9		)
Deferred income taxes	(15.5		)
Total identifiable net assets	$	73.1
Goodwill	$	135.3
Total net assets acquired, including goodwill	$	208.4



Activity, restricted shares: ^(a)	Restricted Shares		Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2016	1,970,586		$	21.61
Granted	193,348		39.47
Vested	(304,211	)	40.72
Canceled/forfeited	(30,041	)	20.24
Non-vested restricted shares, as of September 30, 2017	1,829,682		$	20.34



	For the Three Months Ended September 30		For the Nine Months Ended September 30
Customer:	2017	2016	2017	2016
Energy Transfer affiliates ^(a)	49%	35%	40%	26%
AT&T (including DIRECTV^®) ^(b)	21%	30%	25%	34%



For the Three Months Ended September 30, 2017	MasTec, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated MasTec, Inc.
Revenue	$	—		$	1,860.3		$	130.3		$	(34.8	)	$	1,955.8
Costs of revenue, excluding depreciation and amortization	—			1,640.3			120.7			(34.8		)	1,726.2
Depreciation and amortization	—			41.1			9.0			—			50.1
General and administrative expenses	0.5			61.7			4.2			—			66.4
Interest expense (income), net	—			33.2			(15.6		)	—			17.6
Equity in earnings of unconsolidated affiliates	—			—			(7.4		)	—			(7.4		)
Other income, net	—			(4.6		)	(0.1		)	—			(4.7		)
(Loss) income before income taxes	$	(0.5	)	$	88.6		$	19.5		$	—		$	107.6
Benefit from (provision for) income taxes	0.2			(33.8		)	(9.9		)	—			(43.4		)
Net (loss) income before equity in income from subsidiaries	$	(0.3	)	$	54.8		$	9.6		$	—		$	64.2
Equity in income from subsidiaries, net of tax	64.1			—			—			(64.1		)	—
Net income (loss)	$	63.8		$	54.8		$	9.6		$	(64.1	)	$	64.2
Net income attributable to non-controlling interests	—			—			0.4			—			0.4
Net income (loss) attributable to MasTec, Inc.	$	63.8		$	54.8		$	9.2		$	(64.1	)	$	63.8
Comprehensive income (loss)	$	65.2		$	54.9		$	11.1		$	(65.5	)	$	65.7



As of September 30 2017	MasTec, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated MasTec, Inc.
Assets
Total current assets	$	—	$	1,576.0	$	259.8	$	(88.1	)	$	1,747.7
Property and equipment, net	—		600.8		90.6		—			691.4
Goodwill and other intangible assets, net	—		1,187.9		143.0		—			1,330.9
Investments in and advances to consolidated affiliates, net	1,279.7		848.0		710.2		(2,837.9		)	—
Other long-term assets	15.8		25.7		130.6		—			172.1
Total assets	$	1,295.5	$	4,238.4	$	1,334.2	$	(2,926.0	)	$	3,942.2
Liabilities and equity
Total current liabilities	$	—	$	982.5	$	107.7	$	(88.1	)	$	1,002.2
Long-term debt	—		1,181.1		11.2		—			1,192.3
Other long-term liabilities	—		432.0		12.7		—			444.7
Total liabilities	$	—	$	2,595.6	$	131.6	$	(88.1	)	$	2,639.1
Total equity	$	1,295.5	$	1,642.8	$	1,202.6	$	(2,837.9	)	$	1,303.0
Total liabilities and equity	$	1,295.5	$	4,238.4	$	1,334.2	$	(2,926.0	)	$	3,942.2



As of December 31, 2016	MasTec, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated MasTec, Inc.
Assets
Total current assets	$	—	$	1,256.3	$	175.8	$	(29.6	)	$	1,402.5
Property and equipment, net	—		456.6		92.5		—			549.1
Goodwill and other intangible assets, net	—		1,037.4		138.2		—			1,175.6
Investments in and advances to consolidated affiliates, net	1,083.9		625.9		861.2		(2,571.0		)	—
Other long-term assets	12.6		25.3		18.0		—			55.9
Total assets	$	1,096.5	$	3,401.5	$	1,285.7	$	(2,600.6	)	$	3,183.1
Liabilities and equity
Total current liabilities	$	—	$	759.7	$	109.9	$	(29.6	)	$	840.0
Long-term debt	—		938.7		22.7		—			961.4
Other long-term liabilities	—		256.2		21.9		—			278.1
Total liabilities	$	—	$	1,954.6	$	154.5	$	(29.6	)	$	2,079.5
Total equity	$	1,096.5	$	1,446.9	$	1,131.2	$	(2,571.0	)	$	1,103.6
Total liabilities and equity	$	1,096.5	$	3,401.5	$	1,285.7	$	(2,600.6	)	$	3,183.1



Reportable Segment (in millions):	September 30, 2017		June 30, 2017		September 30, 2016
Communications	$	3,505	$	3,375	$	3,125
Oil and Gas	907		1,506		1,134
Electrical Transmission	268		295		269
Power Generation and Industrial	331		85		116
Other	3		4		7
Estimated 18-month backlog	$	5,014	$	5,265	$	4,651



Period	Total Number of Shares Purchased ^(a)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Program ^(b)	Approximate Dollar Value of Shares that May Yet be Purchased under the Program
July 1 through July 31	—	$	—	—	$	100,000,000
August 1 through August 31	462	$	40.00	—	$	100,000,000
September 1 through September 30	—	$	—	—	$	100,000,000
Total	462			—


~~(a)~~	~~Reflects share repurchases associated with certain employee elections under compensation and benefit programs.~~


~~(b)~~	No shares were purchased for the three months ended September 30, 2017 under the Company’s $100 million 2016 share repurchase program, which was publicly announced on February 26, 2016 and does not have an expiration date.


Exhibit No.						Description

10.1*						Amendment to the MasTec, Inc. Amended and Restated Bargaining Units ESPP.
10.2*						Amendment to the MasTec, Inc. Amended and Restated 2011 Employee Stock Purchase Plan .
31.1*						Certifications required by Section 302(a) of the Sarbanes-Oxley Act of 2002.
31.2*						Certifications required by Section 302(a) of the Sarbanes-Oxley Act of 2002.
32.1**						Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**						Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002.
95.1*						Mine Safety Disclosure.
101.INS						Inline XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
101.SCH						Inline XBRL Taxonomy Extension Schema
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase
104						The cover page of MasTec, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022, formatted in Inline XBRL (included with the Exhibit 101 attachments).


				MASTEC, INC.
Date:			May 5, 2022
				/s/ JOSÉ R. MAS
				José R. Mas
				Chief Executive Officer
				(Principal Executive Officer)

				~~MASTEC, INC.~~
~~Date:~~	~~November 2, 2017~~
		/s/ ~~JOSÉ R. MAS~~GEORGE L. PITA
				~~José R. Mas~~
		~~Chief Executive Officer~~
		~~(Principal Executive Officer)~~

		~~/s/~~ ~~GEORGE L. PITA~~
		George L. Pita
				Executive Vice President and Chief Financial Officer
				(Principal Financial and Accounting Officer)



~~Exhibit No.~~		~~Description~~
4.1*		~~Eighteenth Supplemental Indenture, dated as of November 1, 2017, by and among MasTec Inc., MasTec, Inc.’s subsidiary parties thereto, as guarantors, and U.S. Bank National Association, as trustee.~~
12.1*		~~Computation of Ratio of Earnings to Fixed Charges~~
31.1*		~~Certifications required by Section 302(a) of the Sarbanes-Oxley Act of 2002~~
31.2*		~~Certifications required by Section 302(a) of the Sarbanes-Oxley Act of 2002~~
32.1**		~~Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002~~
32.2**		~~Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002~~
101.INS*		~~XBRL Instance Document~~
101.SCH*		~~XBRL Taxonomy Extension Schema~~
101.CAL*		~~XBRL Taxonomy Extension Calculation Linkbase~~
101.DEF*		~~XBRL Taxonomy Extension Definition Linkbase~~
101.LAB*		~~XBRL Taxonomy Extension Label Linkbase~~
101.PRE*		~~XBRL Taxonomy Extension Presentation Linkbase~~