UNITED STATES
SECURITIES AND     EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-Q


(Mark One)
☑     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended September 30, 20172023
OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __ to __
Commission File Number 001-08106


image0a15.jpg
MasTec, Inc.
(Exact Namename of Registrantregistrant as Specifiedspecified in Its Charter)
its charter)
Florida65-0829355
(State or Otherother jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
Incorporation or Organization)Identification No.)
800 S. Douglas Road, 12th Floor
Coral Gables, FLFlorida33134
(Address of Principal Executive Offices)principal executive offices)(Zip Code)
(305) 599-1800
(Registrant’s Telephone Number, Including Area Code)telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, $0.10 Par ValueMTZNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes þ☑  No ¨☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes þ☑  No ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerþ☑Accelerated filer¨☐
Non-accelerated filer¨☐(Do not check if a smaller reporting company)
Smaller reporting company¨☐
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ¨☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.)    Yes ¨☐   No þ☑
As of October 30, 2017,2023, MasTec, Inc. had 82,760,62478,823,118 shares of common stock $0.10 par value, outstanding.





MASTEC, INC.
FORM 10-Q
QUARTER ENDED SEPTEMBER 30, 20172023


TABLE OF CONTENTS
 
Page
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Item 1
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3
4
5
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Item 2
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Item 3
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Item 4
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4246
Item 1
4246
Item 1A
4246
Item 2
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Item 4
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Item 65
4246
SIGNATURESItem 6
47
48
 

2


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 September 30,For the Nine Months Ended September 30,
2023202220232022
Revenue$3,257,077 $2,513,484 $8,715,851 $6,769,677 
Costs of revenue, excluding depreciation and amortization2,857,118 2,187,835 7,701,392 5,949,262 
Depreciation115,033 91,291 325,318 263,487 
Amortization of intangible assets42,266 27,979 126,252 81,242 
General and administrative expenses180,640 125,068 520,709 404,243 
Interest expense, net62,556 26,885 174,664 62,313 
Equity in earnings of unconsolidated affiliates, net(6,787)(6,059)(23,434)(19,423)
Other (income) expense, net(16,623)174 (26,332)(1,897)
Income (loss) before income taxes$22,874 $60,311 $(82,718)$30,450 
(Provision for) benefit from income taxes(7,569)(11,089)34,231 68 
Net income (loss)$15,305 $49,222 $(48,487)$30,518 
Net income attributable to non-controlling interests1,009 326 2,215 388 
Net income (loss) attributable to MasTec, Inc.$14,296 $48,896 $(50,702)$30,130 
Earnings (loss) per share (Note 2):
Basic earnings (loss) per share$0.18 $0.66 $(0.65)$0.41 
Basic weighted average common shares outstanding77,640 73,936 77,418 74,386 
Diluted earnings (loss) per share$0.18 $0.65 $(0.65)$0.38 
Diluted weighted average common shares outstanding78,455 75,073 77,418 75,576 

 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 amortization1,726,173
 1,368,988
 4,323,642
 3,321,571
Depreciation and amortization50,101
 42,584
 138,384
 122,249
General and administrative expenses66,397
 67,131
 202,001
 195,031
Interest expense, net17,578
 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 interests449
 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 outstanding80,953
 80,462
 80,859
 80,323
        
Diluted earnings per share$0.77
 $0.69
 $2.27
 $0.96
Diluted weighted average common shares outstanding82,386
 81,545
 82,281
 81,241


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

3




MASTEC, INC.
CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited - in thousands)

For the Three Months Ended September 30,For the Nine Months Ended September 30,
2023202220232022
Net income (loss)$15,305 $49,222 $(48,487)$30,518 
Other comprehensive income:
Foreign currency translation (losses) gains, net of tax(863)(3,382)816 (4,212)
Unrealized gains on investment activity, net of tax3,649 10,070 4,048 31,667 
Comprehensive income (loss)$18,091 $55,910 $(43,623)$57,973 
Comprehensive income attributable to non-controlling interests1,009 326 2,215 388 
Comprehensive income (loss) attributable to MasTec, Inc.$17,082 $55,584 $(45,838)$57,585 
 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 tax641
 (1,454) 2,415
 4,417
Unrealized gains (losses) on equity investee activity, net of tax808
 (345) (1,287) (12,932)
Comprehensive income$65,650
 $54,731
 $189,288
 $69,571
Comprehensive income attributable to non-controlling interests449
 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.

4





MASTEC, INC.
CONDENSED UNAUDITED CONSOLIDATED BALANCE SHEETS
(unaudited - in thousands, except shares and per share amounts)information)

September 30,
2023		December 31,
2022
Assets
Current assets:
Cash and cash equivalents$214,174 $370,592 
Accounts receivable, net of allowance1,542,913 1,399,732 
Contract assets1,967,046 1,729,886 
Inventories, net129,146 117,969 
Prepaid expenses82,344 122,308 
Other current assets102,910 118,640 
Total current assets$4,038,533 $3,859,127 
Property and equipment, net1,729,840 1,754,101 
Operating lease right-of-use assets403,070 279,534 
Goodwill, net2,118,866 2,045,041 
Other intangible assets, net821,329 946,299 
Other long-term assets418,089 409,157 
Total assets$9,529,727 $9,293,259 
Liabilities and equity
Current liabilities:
Current portion of long-term debt, including finance leases$175,340 $171,916 
Current portion of operating lease liabilities131,781 96,516 
Accounts payable1,213,859 1,109,867 
Accrued salaries and wages248,458 181,888 
Other accrued expenses331,396 365,971 
Contract liabilities506,457 406,232 
Other current liabilities204,002 163,647 
Total current liabilities$2,811,293 $2,496,037 
Long-term debt, including finance leases3,029,939 3,052,193 
Long-term operating lease liabilities279,302 194,050 
Deferred income taxes455,009 571,401 
Other long-term liabilities240,463 238,391 
Total liabilities$6,816,006 $6,552,072 
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 - 98,638,673 and 98,615,105 (including 1,329,340 and 2,047,130 of unvested stock awards) as of September 30, 2023 and December 31, 2022, respectively9,864 9,862 
Capital surplus1,254,444 1,246,590 
Retained earnings2,145,040 2,195,742 
Accumulated other comprehensive loss(46,091)(50,955)
Treasury stock, at cost: 19,813,055 and 19,933,055 shares as of September 30, 2023 and December 31, 2022, respectively(659,913)(663,910)
Total MasTec, Inc. shareholders’ equity$2,703,344 $2,737,329 
Non-controlling interests$10,377 $3,858 
Total equity$2,713,721 $2,741,187 
Total liabilities and equity$9,529,727 $9,293,259 
 September 30,
2017		 December 31,
2016
Assets   
Current assets:   
Cash and cash equivalents$43,822
 $38,767
Accounts receivable, net1,534,790
 1,156,031
Inventories, net84,460
 111,031
Prepaid expenses53,832
 41,548
Other current assets30,843
 55,109
Total current assets$1,747,747
 $1,402,486
Property and equipment, net691,430
 549,084
Goodwill, net1,135,450
 995,874
Other intangible assets, net195,454
 179,711
Other long-term assets172,094
 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 payable457,213
 363,668
Accrued salaries and wages119,553
 67,126
Other accrued expenses128,769
 112,291
Billings in excess of costs and earnings111,898
 161,459
Other current liabilities98,171
 70,846
Total current liabilities$1,002,151
 $839,990
Long-term debt1,192,311
 961,379
Deferred income taxes274,465
 178,355
Other long-term liabilities170,203
 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, respectively9,084
 9,063
Capital surplus800,297
 788,914
Retained earnings696,331
 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.

5



MASTEC, INC.
CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWSEQUITY
(unaudited - in thousands)thousands, except shares)

Common StockTreasury StockCapital SurplusRetained EarningsAccumulated Other Comprehensive Loss
Total
MasTec, Inc. Shareholders’ Equity
Non-Controlling InterestsTotal Equity
SharesAmountSharesAmount
For the Three Months Ended September 30, 2023
Balance as of June 30, 202398,674,249 $9,867 (19,813,055)$(659,913)$1,247,231 $2,130,744 $(48,877)$2,679,052 $9,368 $2,688,420 
Net income14,296 14,296 1,009 15,305 
Other comprehensive income2,786 2,786 2,786 
Non-cash stock-based compensation7,246 7,246 7,246 
Forfeiture of restricted shares, net(35,183)(3)3 — — 
Shares withheld for taxes, net of other stock issuances(393)— (36)(36)(36)
Balance as of September 30, 202398,638,673 $9,864 (19,813,055)$(659,913)$1,254,444 $2,145,040 $(46,091)$2,703,344 $10,377 $2,713,721 
For the Three Months Ended September 30, 2022
Balance as of June 30, 202295,491,405 $9,549 (19,933,055)$(663,910)$1,049,576 $2,143,622 $(58,009)$2,480,828 $4,114 $2,484,942 
Net income48,896 48,896 326 49,222 
Other comprehensive income6,688 6,688 6,688 
Non-cash stock-based compensation5,698 5,698 5,698 
Forfeiture of restricted shares, net(23,312)(2)2 — — 
Shares withheld for taxes, net of other stock issuances(448)— (37)(37)(37)
Balance as of September 30, 202295,467,645 $9,547 (19,933,055)$(663,910)$1,055,239 $2,192,518 $(51,321)$2,542,073 $4,440 $2,546,513 
 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 amortization138,384
 122,249
Non-cash interest expense, net2,375
 2,209
Non-cash stock-based compensation expense10,551
 11,291
Provision for (benefit from) deferred income taxes92,188
 (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, net14,920
 1,951
Changes in assets and liabilities, net of acquisitions:   
Accounts receivable(334,383) (302,590)
Inventories33,579
 (18,900)
Other assets, current and long-term portion(61,900) 48,032
Accounts payable and accrued expenses132,963
 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 portion39,030
 (8,872)
Net cash provided by operating activities$178,625
 $127,141
Cash flows from investing activities:   
Cash paid for acquisitions, net of cash acquired(115,995) (4,102)
Capital expenditures(83,330) (89,050)
Proceeds from sale of property and equipment13,585
 6,824
Payments for other investments(77,105) (8,858)
Proceeds from other investments13,416
 1,125
Net cash used in investing activities$(249,429) $(94,061)
Cash flows from financing activities:   
Proceeds from credit facilities2,002,430
 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, net853
 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 cash237
 (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.

6


MASTEC, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited - in thousands, except shares)
Common StockTreasury StockCapital SurplusRetained EarningsAccumulated Other Comprehensive Loss
Total
MasTec, Inc. Shareholders’ Equity
Non-Controlling InterestsTotal Equity
SharesAmountSharesAmount
For the Nine Months Ended September 30, 2023
Balance as of December 31, 202298,615,105 $9,862 (19,933,055)$(663,910)$1,246,590 $2,195,742 $(50,955)$2,737,329 $3,858 $2,741,187 
Net (loss) income(50,702)(50,702)2,215 (48,487)
Other comprehensive income4,864 4,864 4,864 
Non-cash stock-based compensation24,336 24,336 24,336 
Issuance of restricted shares, net137,406 14 (14)— — 
Shares withheld for taxes, net of other stock issuances(117,950)(12)(5,398)(5,410)(5,410)
Issuance of shares in connection with acquisition4,112 — 403 403 403 
Purchase of non-controlling interests120,000 3,997 (11,473)(7,476)(2,524)(10,000)
Acquisition-related assumption of non-controlling interest— 6,828 6,828 
Balance as of September 30, 202398,638,673 $9,864 (19,813,055)$(659,913)$1,254,444 $2,145,040 $(46,091)$2,703,344 $10,377 $2,713,721 
For the Nine Months Ended September 30, 2022
Balance as of December 31, 202195,371,211 $9,537 (18,941,926)$(586,955)$1,033,615 $2,162,388 $(78,776)$2,539,809 $4,052 $2,543,861 
Net income30,130 30,130 388 30,518 
Other comprehensive income27,455 27,455 27,455 
Non-cash stock-based compensation18,870 18,870 18,870 
Issuance of restricted shares, net145,450 15 (15)— — 
Shares withheld for taxes, net of other stock issuances(49,016)(5)(4,117)(4,122)(4,122)
Issuance of shares in connection with acquisition133,157 4,336 6,886 11,222 11,222 
Acquisition of treasury stock, at cost(1,124,286)(81,291)(81,291)(81,291)
Balance as of September 30, 202295,467,645 $9,547 (19,933,055)$(663,910)$1,055,239 $2,192,518 $(51,321)$2,542,073 $4,440 $2,546,513 

The accompanying notes are an integral part of these consolidated financial statements.
7

MASTEC, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited - in thousands)
For the Nine Months Ended September 30,
20232022
Cash flows from operating activities:
Net (loss) income$(48,487)$30,518 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation325,318 263,487 
Amortization of intangible assets126,252 81,242 
Non-cash stock-based compensation expense24,336 18,870 
Benefit from deferred income taxes(77,781)(9,293)
Equity in earnings of unconsolidated affiliates, net(23,434)(19,423)
Gains on sales of assets, net(19,082)(21,914)
Non-cash interest expense, net4,354 2,574 
Other non-cash items, net3,827 1,601 
Changes in assets and liabilities, net of acquisitions:
Accounts receivable(118,448)(22,065)
Contract assets(244,340)(383,053)
Inventories24,569 (36,130)
Other assets, current and long-term portion76,234 34,060 
Accounts payable and accrued expenses104,755 293,899 
Contract liabilities70,976 (66,027)
Other liabilities, current and long-term portion(32,477)(49,675)
Net cash provided by operating activities$196,572 $118,671 
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired(68,817)(71,841)
Capital expenditures(157,369)(213,325)
Proceeds from sales of property and equipment55,936 47,195 
Payments for other investments(1,899)(3,723)
Proceeds from other investments425 — 
Other investing activities, net41 — 
Net cash used in investing activities$(171,683)$(241,694)
Cash flows from financing activities:
Proceeds from credit facilities3,256,200 2,578,000 
Repayments of credit facilities(3,268,763)(2,429,583)
Payments of finance lease obligations(120,198)(131,259)
Repurchases of common stock— (81,291)
Payments of acquisition-related contingent consideration(21,638)(35,149)
Payments for acquisition-related contingent assets— (17,636)
Payments to non-controlling interests, including acquisition of interests and distributions(11,660)— 
Payments for stock-based awards(10,293)(4,061)
Other financing activities, net(5,235)(18,499)
Net cash used in financing activities$(181,587)$(139,478)
Effect of currency translation on cash280 (2,559)
Net decrease in cash and cash equivalents$(156,418)$(265,060)
Cash and cash equivalents - beginning of period$370,592 $360,736 
Cash and cash equivalents - end of period$214,174 $95,676 
Supplemental cash flow information:
Interest paid$187,353 $69,327 
Income taxes paid, net of refunds$15,023 $1,827 
Supplemental disclosure of non-cash information:
Additions to property and equipment from finance leases$113,195 $184,700 

The accompanying notes are an integral part of these consolidated financial statements.
8

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 utilityother infrastructure, such as: power delivery services, including transmission, distribution, environmental planning and compliance; wireless, wireline/fiber install-to-the-home and customer fulfillment activities; petroleumpower generation, primarily from clean energy and renewable sources; pipeline distribution infrastructure, including natural gas, carbon capture sequestration, water and pipeline infrastructure; electrical utility transmission and distribution; power generation;integrity services; heavy civil; industrial infrastructure; and industrial infrastructure.environmental remediation services. MasTec’s customers are primarily in these industries. MasTec reports its results under 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.
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, 20162022 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, 20162022 contained in the Company’s 20162022 Annual Report on Form 10-K (the “2016“2022 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. CertainWhen appropriate, prior year amounts have beenare reclassified to conform towith the current period presentation. 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 investmentsInvestments in entities for which the Company does not have a controlling financial interest, but forover which it has the ability to exert significant influence, are accounted for usingunder 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. 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 accumulatedincluded 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 conformityaccordance with U.S. GAAP requires the use of estimates and assumptions that affect


the amounts reported in the consolidated financial statements and accompanying notes. KeyThese estimates include:are based on historical experience and various other assumptions that management believes to be reasonable under the recognitioncircumstances, including the potential future effects of revenuemacroeconomic trends and events, such as inflation and interest rate levels; uncertainty from potential market volatility; other market, industry and regulatory factors, including uncertainty related to the implementation and pace of governmental programs and initiatives and project profitpermitting issues, and other regulatory matters or loss (whichuncertainty; supply chain disruptions; climate-related matters; global events, such as military conflicts; and public health matters. These estimates form the Company defines as project revenue, less project costs of revenue, including project-related depreciation), in particular, on construction contracts accountedbasis for undermaking judgments about the percentage-of-completion method, for which the recorded amounts require estimates of costs to completeCompany’s operating results and the amount of probable contract price adjustments; allowances for doubtful accounts; estimated faircarrying values of goodwillassets 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 thosethese 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
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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 goodwill and intangible assets, long-lived and other assets, equity investments, acquisition-related liabilities, including contingent consideration, other liabilities and debt obligations; asset lives used in computing depreciation and amortization; fair values of financial instruments; allowances for credit losses; self-insurance liabilities; certain other accruals and allowances; income taxes; and the estimated effects of litigation and other contingencies.
General Economic, Market and Regulatory Conditions
The Company has experienced, and may continue to experience, direct and indirect negative effects on its business and operations from negative economic, market, and regulatory conditions, including the current level of market interest rates; continuing inflationary effects on the cost of fuel, labor and materials; supply chain disruptions; uncertainty related to the implementation and pace of spending under governmental programs and initiatives related to infrastructure and other industrial investment, delays and uncertainty related to project permitting and other regulatory matters or uncertainty; climate, environmental and sustainability-related matters; public health matters; changes in technology, tax and other incentives; and potential market volatility that could negatively affect demand for future projects, and/or delay existing project timing or cause increased project costs. The extent to which these conditions 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, and, therefore, any future impacts on the Company’s business, financial condition and/or results of operations cannot be quantified or predicted with specificity, including with respect to the effects of ongoing and recent geopolitical events, such as the political unrest and military conflicts in the Middle East and Ukraine, which could potentially increase volatility and uncertainty in the energy and capital markets.
Significant Accounting Policies
Revenue Recognition
RevenueThe Company recognizes revenue from contracts with customers when, or as, control of promised services and goods is derivedtransferred 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 underunder: (i) master service and other service agreements, as well as fromwhich 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 undersystem, which may be subject to one or 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%37% and 38%52% of consolidated revenue for the three month periods ended September 30, 20172023 and 2016,2022, respectively, and totaled 35%42% and 43%54% for the nine month periods ended September 30, 20172023 and 2016,2022, 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 certain other wireless services in the services are rendered. Revenue from fixed price contracts providesCompany’s Communications segment, and to a lesser extent, certain revenue in the Company’s Clean Energy and Infrastructure and Oil and Gas segments. Point in time revenue is recognized when the work order has been fulfilled, which, for a fixed amountthe majority of the Company’s point in time revenue, is the same day it is initiated. Point in time revenue accounted for approximately 2% and 3% of consolidated revenue for the entire project, subject to certain additionsthree and nine month periods ended September 30, 2023, respectively, and totaled approximately 4% for changed scope or specifications. Revenue from these contracts, as well as for certain projects pursuant to masterboth the three and other service agreements, 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.nine month periods ended September 30, 2022.

The total contract transaction price and cost estimation processprocesses used for recognizing revenue recognizedover time under the percentage-of-completioncost-to-cost method is primarily based on the professional knowledge and experience of the Company’s project managers, engineersoperational and financial professionals.professionals, and other professional expertise, as warranted. Management reviews estimates of total contract revenuetransaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected contract settlementsthe estimated amount and probability of variable consideration are factors that influence estimates of the total contract value andtransaction price, total costs to complete those contracts and therefore, the Company’s profit recognition. Changes in these factors maycould result in revisions to costs and income and their effects are recognizedrevenue in the period in which the revisions are determined, which revisions 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 changeslosses are recognized.expected based on management’s estimates. For both the nine month periods ended September 30, 20172023 and 2016,2022, 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, 20162022 and 2015. Provisions2021. Changes in recognized revenue, net, as a result of changes in total contract transaction price estimates, including from variable consideration, and/or changes in cost estimates, related to performance obligations satisfied or partially satisfied in prior periods, for losses on uncompletedthe three and nine month periods ended September 30, 2023 positively affected revenue by approximately 0.3% and 0.5%, respectively. For both the three and nine month periods ended September 30, 2022, such net changes positively affected revenue by approximately 0.2%.
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 Company’s contracts often require significant services to integrate complex activities and equipment into a single deliverable, and are made in the period in which such losses are determined to be probable and the amount can be reasonably estimated.therefore generally accounted for as a single performance obligation, even when delivering multiple distinct services. The majority of fixed price contractsthe Company’s performance obligations are completed within one year.
TheRemaining 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 September 30, 2023, the amount of the Company’s remaining performance obligations was $7.6 billion. Based on current
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expectations, the Company anticipates it will recognize approximately $2.6 billion of its remaining performance obligations as revenue during 2023, with the majority of the remaining balance expected to be recognized in 2024.
Variable Consideration. Transaction prices for the Company’s contracts may incur costs subject toinclude variable consideration, which comprises items such as change orders, whether approved or unapproved byclaims and incentives. Management estimates variable consideration for a performance obligation utilizing estimation methods that it believes best predict the customer, and/or claims relatedamount of consideration to certain contracts. Management determineswhich the probability that such costsCompany will be recoveredentitled. Management’s estimates of variable consideration and the determination of whether to include estimated amounts in transaction prices are based upon engineering studies and legal opinions, past practices with the customer,largely on specific discussions, correspondence or preliminary negotiations and past practices with the customer. The Company treats such costs as a costcustomer, engineering studies and legal advice and all other relevant information that is reasonably available at the time of contract performancethe 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 costsCompany’s favor, or recognizes revenue up to the amountextent 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, 20172023 and December 31, 2016,2022, the Company hadincluded in its contract transaction prices approximately $77$296 million and $17$271 million, respectively, of change orders and/or claims that had been included as contract price adjustments onfor certain contracts that were in the process of being resolved in the normalordinary course of its business, including through negotiation, arbitration and other proceedings. These contracttransaction price adjustments, whichwhen earned, are included within costs and earnings in excess of billingscontract 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, 20172023 and December 31, 2016,2022, these change orders wereand/or claims primarily related to contractscertain projects in the OilCompany’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 amountsAmounts ultimately realized upon final acceptanceagreement 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 IssuedRecent Accounting Pronouncements
There have been no changes inThe discussion below describes the expected dateseffects of adoption or estimated effects on the Company’s consolidated financial statements of recently issuedrecent accounting pronouncements, as updated from those disclosedthe discussion in the Company’s 20162022 Form 10-K. See below for additional discussion of recently issued accounting pronouncements.


Accounting Pronouncements Not Yet Adopted in 2023
In August 2017, theThe Company adopted 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 ActivitiesContract Assets and Contract Liabilities from Contracts with Customers (“ASU 2017-12”2021-08”). in the first quarter of 2023. ASU 2017-12 amends2021-08, which was issued to improve consistency for revenue recognition in the hedgepost-acquisition period for acquired contracts as compared to contracts entered into subsequent to acquisition, requires an acquirer to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers, rather than at fair value. The adoption of ASU 2021-08 did not have a material effect on the Company’s consolidated financial statements.
Recently Issued Accounting Pronouncements
In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements (“ASU 2023-01”) to improve the guidance for applying Topic 842, Leases, to arrangements between entities under common control. ASU 2023-01 improves current GAAP by clarifying the accounting modelfor leasehold improvements associated with common control leases, thereby reducing diversity in Topic 815practice. The provisions of this ASU that apply to enablepublic companies include a requirement for entities to better portrayamortize leasehold improvements associated with common control leases over the economicsuseful life of their risk management activities in the financial statements and enhance the transparency and understandability of hedge results. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the 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.common control group. ASU 2017-122023-01 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, 2017,2023, 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, 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 expected2023-01 to have a material effect on the timingCompany’s consolidated financial statements.
In August 2023, the FASB issued ASU 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement (“ASU 2023-05”). ASU 2023-05, which clarifies existing guidance to reduce diversity in practice, addresses the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. The provisions of this ASU require that a joint venture initially measure all contributions received upon its formation at fair value, largely consistent with Topic 805, Business Combinations. The amendments in this ASU are not applicable to the formation of proportionally consolidated joint ventures. ASU 2023-05 is effective prospectively for all joint ventures with a formation date on or amount of revenue recognized as compared to current practices.after January 1, 2025, with early adoption permitted on a retrospective basis for joint ventures formed before January 1, 2025. The Company is training its business units forcurrently evaluating 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 componentseffects 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.ASU.
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 primarily under the treasury stock method, which includes the potential effect of dilutive common stock equivalents, such as issued but unvested restricted shares and/or outstanding but unexercised stock options. The Company has no remaining outstanding stock options; all options under the Company’s stock option grants were exercised in 2016.shares. If the Company reports a loss, rather than income, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, asif their effect would be anti-dilutive.
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 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, this resulted in the inclusion of approximately 0.3 million incremental shares in the Company’s total weighted average diluted shares outstanding.
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The following table provides details underlying the Company’s earnings per share calculations for the periods indicated (in thousands):
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2023202220232022
Net income (loss) attributable to MasTec:
Net income (loss) - basic (a)
$14,296 $48,896 $(50,702)$30,130 
Fair value gain related to contingent payments (b)
$— $143 $— $1,459 
Net income (loss) - diluted (a)
$14,296 $48,753 $(50,702)$28,671 
Weighted average shares outstanding:
Weighted average shares outstanding - basic(c)
77,640 73,936 77,418 74,386 
Dilutive common stock equivalents (d)(e)
815 1,137 — 1,190 
Weighted average shares outstanding - diluted78,455 75,073 77,418 75,576 
 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 - basic80,953
 80,462
 80,859
 80,323
Dilutive common stock equivalents1,433
 1,083
 1,422
 918
Weighted average shares outstanding - diluted82,386
 81,545
 82,281
 81,241
        
Additional information:       
Weighted average anti-dilutive common stock equivalents (b)
—
 1
 12
 —
(a)Calculated as total net income less amounts attributable to non-controlling interests.
(b)Represents anti-dilutive common stock equivalents as calculated under the treasury stock method.
(a)Basic net income or loss is calculated as total net income or loss, less amounts attributable to non-controlling interests. Diluted net income or loss is calculated as total net income or loss, less amounts attributable to non-controlling interests, adjusted for the fair value gain or loss, if any, related to additional contingent payments to the former owners of an acquired business for which the contingency has been resolved as of the respective period. See Note 3 - Acquisitions, Goodwill and Other Intangible Assets, Net, for additional information.
The following table provides details of goodwill by reportable segment(b)For the three and nine month periods ended September 30, 2022, represents the fair value gain related to additional contingent payments, which were dilutive as of September 30, 2017 (in millions):2022. See Note 3 - Acquisitions, Goodwill and Other Intangible Assets, Net, for additional information.
(c)For the three month periods ended September 30, 2023 and 2022, basic shares include approximately 88,000 and 140,000 weighted average shares, respectively, related to additional contingent payments, and for the nine month periods ended September 30, 2023 and 2022, basic shares include approximately 88,000 and 114,000 of such weighted average shares, respectively.
 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
(d)For the three month period ended September 30, 2023, there were no weighted average anti-dilutive common stock equivalents, and for the three month period ended September 30, 2022, weighted average anti-dilutive common stock equivalents totaled approximately 8,000 shares. For the nine month periods ended September 30, 2023 and 2022, such shares totaled approximately 1,091,000 and 135,000, respectively.
(e)For the three and nine month periods ended September 30, 2023, there were no weighted average common stock equivalents related to additional contingent payments to the former owners of an acquired business, and for the three and nine month periods ended September 30, 2022, weighted average common stock equivalents related to such additional contingent payments totaled approximately 11,000 and 37,000, respectively.
Share repurchases. For the nine month period ended September 30, 2017, additions to2022, the Company repurchased approximately 1,124,000 shares of its common stock, the effect of which on the Company’s weighted average shares outstanding for the related period was a reduction of approximately 598,000 shares. See Note 11 - Equity for details of the Company’s share repurchase transactions.
Shares issued for acquisitions. In the fourth quarter of 2022, the Company issued approximately 2,758,000 shares of its common stock in conjunction with the October 2022 acquisition of Infrastructure and Energy Alternatives, Inc. (“IEA”). In the second quarter of 2022, the Company issued 133,000 shares in connection with the December 2021 acquisition of Henkels & McCoy Holdings, Inc., formerly known as Henkels & McCoy Group, Inc. (“HMG”). See Note 3 - Acquisitions, Goodwill and Other Intangible Assets, Net, for additional information.
Note 3 – Acquisitions, Goodwill and Other Intangible Assets, Net
The following table provides a reconciliation of changes in goodwill from new business combinations totaled $135.3 million. Currency translation effects related to goodwill and accumulated impairment losses totaled approximately $9.8 million of gains and $5.4 million of losses, respectively,by reportable segment for the nine month period ended September 30, 2017. For2023 (in millions):
CommunicationsClean Energy and InfrastructureOil and GasPower DeliveryTotal Goodwill
Goodwill, gross, as of December 31, 2022$606.1 $703.3 $582.2 $270.1 $2,161.7 
Accumulated impairment loss (a)
— — (116.7)— (116.7)
Goodwill, net, as of December 31, 2022$606.1 $703.3 $465.5 $270.1 $2,045.0 
Additions from new business combinations32.6 — — — 32.6 
Measurement period adjustments (b)
(0.6)40.5 0.8 0.6 41.3 
Currency translation adjustments— — (0.0)— (0.0)
Goodwill, net as of September 30, 2023$638.1 $743.8 $466.3 $270.7 $2,118.9 
(a)    Accumulated impairment losses include the effects of currency translation gains and/or losses.
(b)    Measurement period adjustments represent adjustments, net, to preliminary estimates of fair value within the measurement period of up to one year from the date of acquisition. Measurement period adjustments, net, for the nine month period ended September 30, 2016, additions2023 were primarily the result of updated valuations and estimated useful lives of certain fixed assets and updated estimates of certain assets and liabilities, including contract assets and contingent liabilities. As a result of the updates to goodwill from accrualsthe estimated useful lives of acquisition-related contingent consideration totaled $5.8certain fixed assets, depreciation expense decreased by approximately $6 million for the nine month period ended September 30, 2023, and as a result of the measurement period adjustments related to certain contract assets and liabilities, revenue increased by approximately $35 million and currency translation effects related to goodwillcosts of revenue, excluding depreciation and accumulated impairment losses totaled $6.0amortization, decreased by approximately $8 million. In addition, measurement period adjustments for the nine month period ended September 30, 2023 included a decrease in deferred tax liabilities of approximately $38 million, an increase in contingent liabilities of gainsapproximately $29 million, including for insurance, legal and $3.1other matters, and fair value increases of approximately $7 million of losses, respectively.for certain property and equipment.

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The following table provides a reconciliation of changes in other intangible assets, net, for the period indicated (in millions):
Other Intangible Assets, Net
Customer Relationships and Backlog
Trade Names (a)
Other (b)
Total
Other intangible assets, gross, as of December 31, 2022$1,089.4 $228.9 $86.6 $1,404.9 
Accumulated amortization(388.8)(28.9)(40.9)(458.6)
Other intangible assets, net, as of December 31, 2022$700.6 $200.0 $45.7 $946.3 
Additions from new business combinations1.2 0.1 — 1.3 
Currency translation adjustments— — (0.0)(0.0)
Amortization expense(104.5)(15.6)(6.2)(126.3)
Other intangible assets, net, as of September 30, 2023$597.3 $184.5 $39.5 $821.3 
 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)Includes approximately $34.5 million of non-amortizing trade names as of both September 30, 2023 and December 31, 2022.
Amortization expense(b)Consists principally of pre-qualifications and non-compete agreements.
Quarterly Assessment for Indicators of Impairment. During the third quarter of 2023, the Company performed a quarterly review for indicators of impairment, which considered its results for the ninemonth period ended September 30, 2023, together with its expectations of future results, including consideration of the potential effects of shifts in timing for projects, regulatory uncertainty and other matters, and macroeconomic factors, including interest rate levels. In conjunction with this quarterly review, management performed a quantitative assessment of the goodwill associated with two reporting units within the Clean Energy and Infrastructure segment.
For the selected reporting units, management estimated their fair values using a combination of market and income approaches using Level 3 inputs. Under the market approach, fair values were estimated using published market multiples for comparable companies and applying them to revenue and EBITDA. Under the income approach, a discounted cash flow methodology was used, considering: (i) management estimates, such as projections of revenue, operating costs and cash flows, taking into consideration historical and anticipated financial results; (ii) general economic, market and regulatory conditions; and (iii) the impact of planned business and operational strategies. Management believes the assumptions used in its quantitative goodwill impairment tests are reflective of the risks inherent in the business models of the applicable reporting units and within the units’ industry. Estimated discount rates were determined using the weighted average cost of capital for each reporting unit at the time of the analysis, taking into consideration the risks inherent within each reporting unit individually.
Based on the results of these assessments, management determined that, as of September 30, 2023, the estimated fair value of one of these reporting units substantially exceeded its carrying value. The estimated fair value of the second reporting unit, consisting of the IEA component (the “IEA reporting unit”), which had approximately $571 million of goodwill, exceeded its carrying value by approximately 7% as of September 30, 2023. Significant assumptions used in testing this reporting unit included terminal values based on a terminal growth rate of 3%, six years of discounted cash flows prior to the terminal value, and a discount rate of 12%.  Significant changes in the assumptions or estimates used in management’s assessment as of September 30, 2023, such as a reduction in profitability and/or cash flows, changes in market, regulatory or other conditions, including decreases in project activity levels and/or the effects of elevated levels of inflation, market interest rates or other market disruptions, including from geopolitical events, could result in non-cash impairment charges to goodwill and indefinite-lived intangible assets in the future.
Recent Acquisitions
The Company seeks to grow and diversify its business both organically and through acquisitions and/or strategic arrangements in order to deepen its market presence and customer base, broaden its geographic reach and expand its service offerings. In 2021, the Company initiated a significant transformation of its end-market business operations to focus on the nation’s transition to low-carbon energy sources and position the Company for expected future opportunities. This transformation has included significant business combination activity, including expansion of the three month periods ended September 30, 2017Company’s scale and 2016 totaled $6.0 millioncapacity in renewable energy, power delivery, heavy civil and $5.2 million, respectively,telecommunications services, which activity has resulted in significant acquisition and integration costs, both in the Company’s existing and recently acquired operations. Acquisitions are funded with cash on hand, borrowings under the Company’s senior unsecured credit facility and other debt financing and, for certain recent acquisitions, with shares of the nine month periods ended September 30, 2017Company’s common stock, and 2016, totaled $15.0 million and $15.7 million, respectively.are generally subject to customary purchase price adjustments.
2017
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2023 Acquisitions.During For the nine month period ended September 30, 2017,2023, MasTec completed three acquisitions, including (i)acquired certain of the assets of a wireline/fiber deploymenttelecommunications company specializing in wireless services that is included within the Company’s Communications segment, which acquisition was effective in January; and, effective in July, MasTec acquired all of the equity interests of a telecommunications construction contractor,company specializing in broadband and fiber-to-the-home initiatives in the New England area, which is included inwithin 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 in the Company’s Oil and Gas segment. Determination of the estimated fair values of the net assets acquired and consideration transferred for these acquisitions, which have been accounted for as business combinations under ASC 805, “Business Combinations” (“ASC 805”), was preliminary as of September 30, 2023; as a result, further adjustments to these estimates may occur. Additionally, MasTec acquired 68% and 42% of the estimatedequity interests of two equipment companies, both of which are accounted for as asset acquisitions under ASC 805, and were effective in May and included within the Company’s Oil and Gas segment. Based on an evaluation of the respective entities’ operating agreements, under which the Company has voting control with respect to the entities’ operating management, the Company determined that it has control over these entities, and, therefore, has consolidated these entities within the Company’s results of operations, with the other parties’ interests accounted for as non-controlling interests. The aggregate purchase price of the Company’s 2023 acquisitions was composed of approximately $69 million in cash, net of cash acquired, and an earn-out liability valued at approximately $1 million. As of September 30, 2023, the range of remaining potential undiscounted earn-out liabilities for thesethe 2023 acquisitions was estimated to be up to $3 million; however, there is no maximum payment amount. See Note 4 - Fair Value of Financial Instruments for details pertaining to fair value estimates for the Company’s earn-out arrangements.
The goodwill balances for the respective acquisitions represent the estimated values of the acquired companies’ geographic presence in key markets, assembled workforce, synergies expected to be achieved from the combined operations of each of the acquired companies and MasTec. Approximately $1 million of the goodwill balance related to the 2023 acquisitions is preliminaryexpected to be tax deductible as of September 30, 2017,2023.
2022 Acquisitions. During 2022, MasTec completed five acquisitions, which included all of the equity interests of the following: (i) within the Company’s Clean Energy and Infrastructure segment: IEA, a leading utility-scale infrastructure solutions provider in North America, with expertise in renewable energy and heavy civil projects, as well as rail and environmental remediation services, which acquisition was effective in October; and a company specializing in the production of concrete and aggregate products, which acquisition was effective in August; (ii) within the Company’s Oil and Gas segment: an infrastructure construction company focusing on water, sewer and utility projects and with expertise in excavation and site work, which acquisition was effective in January; (iii) within the Company’s Communications segment: a telecommunications company specializing in wireline services, which acquisition was effective as of the end of May; and (iv) within the Company’s Power Delivery segment: a company specializing in the construction of overhead high voltage transmission lines, which acquisition was effective in July.
As of September 30, 2023, the Company is finalizing certain valuation and contingency-related estimates for the IEA acquisition; as a result, further adjustments to management’s preliminarysuch estimates may occur.

The following table summarizes, as of September 30, 2023, the estimated fair values of the consideration paid and identifiablenet assets acquired, and liabilities assumed as ofadjusted, for the respective dates of acquisitionCompany’s 2022 acquisitions (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 equipment56.9
Amortizing intangible assets26.8
Other long-term assets0.5
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:IEAAll otherTotal
Cash, net of cash acquired$564.5 $48.7 $613.2 
Shares transferred173.7 — 173.7 
Estimated fair value of warrants10.3 — 10.3 
Estimated fair value of contingent consideration— 2.8 2.8 
Total consideration$748.5 $51.5 $800.0 
Identifiable assets acquired and liabilities assumed:
Accounts receivable and contract assets$570.0 $6.1 $576.1 
Current assets34.5 1.6 36.1 
Property and equipment220.5 30.0 250.5 
Long-term assets, primarily operating lease right-of-use assets40.6 0.3 40.9 
Amortizing intangible assets362.2 5.9 368.1 
Accounts payable(136.5)(4.6)(141.1)
Contract liabilities(151.3)(1.5)(152.8)
Current liabilities, primarily accrued expenses(327.1)(1.4)(328.5)
Long-term debt, including finance lease obligations(330.8)(0.2)(331.0)
Long-term liabilities, primarily operating lease liabilities and deferred income taxes(104.1)(0.2)(104.3)
Total identifiable net assets$178.0 $36.0 $214.0 
Goodwill570.5 15.5 586.0 
Total net assets acquired, including goodwill$748.5 $51.5 $800.0 
Amortizing intangible assets related to the 2017IEA acquisition are primarily composed of customer relationships, and to a lesser extent, trade names and backlog. Customer relationship and trade name intangible assets for IEA, in the aggregate, totaled approximately $321 million, which each had a weighted average life of approximately 14 years based on IEA’s operational history and established relationships with, and the nature of, its customers, which are primarily in the renewable energy and specialty civil industries. Backlog intangible assets for IEA totaled approximately $42 million with a weighted average life of approximately 1 year based on estimated cash flows expected to be derived from future work on acquired contracts with customers. The weighted average life of amortizing intangible assets in the aggregate for the IEA acquisition was 13 years.
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Amortizing intangible assets related to “All other” acquisitions are primarily composed of customer relationships backlog and other amortizingwith an aggregate weighted average life of 9 years. Amortizing intangible assets which had weighted average lives of approximately 11 years, 4 years and 7 years, respectively, and 10 years in total, and will beare 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 represent the estimated valuevalues of each acquired company’s geographic presence in key markets, their assembled workforce and management team industry-specific project management expertise, as well as synergies expected to be achieved from the combined operations of each of the acquired companies and MasTec.MasTec and the acquired company’s industry-specific project management expertise. Approximately $75$37 million of the acquired goodwill balance as of September 30, 2017related to the 2022 acquisitions is expected to be tax deductible.

deductible as of September 30, 2023.
The contingentshares of MasTec common stock included in consideration transferred for IEA in the table above consist of approximately 2.7 million shares, valued at approximately $174 million based on the market price of MasTec common stock on the date of closing. Total cash paid for acquisitions, net, includes approximately $44 million of cash acquired. Long-term debt in the table above includes $300 million aggregate principal balance of 6.625% senior unsecured notes that were assumed in connection with the acquisition of IEA. See Note 7 - Debt for additional information.
Consideration transferred for IEA includes the value of certain warrants that were originally issued by IEA, for which the remaining outstanding warrants as of December 31, 2022 had an estimated fair value of $3.1 million. Under the terms of the IEA merger agreement, holders of the IEA warrants became entitled to receive an amount in cash and shares of MasTec common stock upon exercise of the IEA warrants. The number of MasTec shares issued in connection with exercises of such IEA warrants in the first quarter of 2023 was de minimis, and all remaining IEA warrants expired unexercised on March 26, 2023. Fair value gains related primarily to the expired warrants totaled approximately $2.6 million for the nine month period ended September 30, 2023, which amount is reflected in other income.
Contingent consideration included in the table above equalsis composed of earn-out liabilities, which generally equal a portion of the acquired companies’ earnings before interest, taxes, depreciation and amortization (“EBITDA”) above certainin excess of thresholds agreed upon with the sellers, if applicable,applicable. The earn-out arrangements for a period of five years,the 2022 acquisitions are payable annually and have five-year terms, as set forth in the respective purchase agreements, and were valued at approximately $3 million in the aggregate. Earn-outs are recorded within other current and other long-term liabilities, as appropriate, 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 September 30, 2023, the range of remaining potential undiscounted earn-out liabilities for the 2022 acquisitions was estimated to be up to $2 million; however, there is no maximum payment amount. Current liabilities reflected in the table above also include operating lease liabilities and contingent liabilities for insurance, legal and other matters.
HMG Additional Payments. The HMG purchase agreement, for which amountsthe subject acquisition was effective in December 2021, provides for certain additional payments to be made to the sellers if certain acquired receivables are payable annually. The fair valuescollected by the Company (the “Additional Payments”). Pursuant to the terms of the earn-out liabilities werepurchase agreement, a portion of the Additional Payments will be made in cash, with the remainder due in shares of MasTec common stock. The estimated using income approachesnumber 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 discounted cash flows or option pricing models and incorporate significant inputs not observable indefined within the market. Key assumptionspurchase agreement. Changes in the estimated valuations include the discount rate and probability-weighted EBITDA projections. Significantfair value of potential shares that could be issued, which result from changes in any of these assumptions could result in a significantly higherMasTec’s share price as compared with the share price as defined within the purchase agreement, are reflected within other income or lower potential earn-out liability.


expense, as appropriate. For the three and nine month periods ended September 30, 2017, pro forma revenue2023, unrealized fair value measurement activity related to the contingent shares totaled gains of approximately $1,955.8$7.4 million and $5,077.4$2.1 million, respectively, and pro forma net income totaled approximately $64.4 million and $192.0 million, respectively. Forfor the three and nine month periods ended September 30, 2016,2022, such activity totaled gains of approximately $1.3 million and $4.5 million, respectively. An Additional Payment of approximately $29.4 million was made in May 2022, which payment was composed of approximately $18 million in cash and 133,157 shares of MasTec common stock, and for which a realized gain of approximately $1 million was recognized within other income, net, in the related period.
As of September 30, 2023 and December 31, 2022, the estimated fair value of remaining Additional Payments totaled approximately $33 million and $37 million, respectively, which amounts are included within other current liabilities in the consolidated balance sheet. For the nine month period ended September 30, 2023, the estimated fair value of remaining Additional Payments included the effect of unrealized fair value gains related to the contingent shares of approximately $2.1 million and a reduction of approximately $2.4 million from changes in collections attributed to acquired balances. The estimated number of shares that would be paid in connection with the remaining Additional Payment liability totaled approximately 160,000 and 170,000 shares as of September 30, 2023 and December 31, 2022, respectively. Of the total remaining Additional Payments as of September 30, 2023, the amount due to the sellers, based on amounts collected as of September 30, 2023, totaled approximately $19.4 million, of which the amount due in shares totaled approximately $6.3 million, or 87,900 shares. See Note 2 - Earnings Per Share for the effect of the above referenced shares on the Company’s earnings per share calculations.
Pro forma results. For the three month periods ended September 30, 2023 and 2022, unaudited supplemental pro forma revenue totaled approximately $1,634.5 million$3.2 billion and $3,934.6 million,$3.3 billion, respectively, and unaudited supplemental pro forma net income totaled approximately $59.0$2.3 million and $81.5$40.0 million, respectively.
The above indicated unaudited pro forma financial results, which represent For 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 onlynine month periods ended September 30, 2023 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. The2022, 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,revenue totaled approximately $8.7 billion 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;$8.6 billion, respectively, and (iv) to eliminate the effect of intercompany transactions. Additionally, the unaudited supplemental pro forma financial results donet loss totaled approximately $65.6 million and $6.9 million, respectively. Supplemental pro forma information for the Company’s first quarter 2023 acquisition has not include adjustments to reflect other cost savings or synergies that may have resulted from these acquisitions. Future results may vary significantlybeen presented for the pre-acquisition periods due to future events and transactions, as well as other factors, manythe impracticability of which are beyond MasTec’s control.obtaining accurate or reliable historical financial information for the assets of the entity that was acquired.
Acquisition-related results. For the three and nine month periods ended September 30, 2017, acquisition-related results included in2023, the Company’s consolidated results of operations included acquisition-related revenue of approximately $62.2$533.2 million and $96.1$1,503.5 million, respectively, including a total of approximately $483.9 million and $1,374.6 million, respectively, for IEA. For the three and nine month periods ended September 30, 2022, the Company’s consolidated results of operations included acquisition-related revenue of approximately $569.7 million and $1,876.6 million, respectively, including approximately $429.3 million for HMG for the three month period ended September 30, 2022, and $1,457.7 million in the aggregate for HMG and INTREN, LLC for the nine month period ended September 30, 2022. For the three and nine month periods ended September 30, 2023, the Company’s consolidated results of operations included acquisition-related net losses of approximately $2.8 million and
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$42.7 million, respectively, based on the Company’s consolidated effective tax rates, and for the three and nine month periods ended September 30, 2022, the Company’s consolidated results of operations included acquisition-related net income of approximately $3.2$18.4 million and $4.7$37.7 million, respectively.respectively, based on the Company’s consolidated effective tax rates. These acquisition-related results include amortization of acquired intangible assets and certain acquisition integration costs, and exclude the effects of interest expense associated with consideration paid for the related acquisitions.
Acquisition and integration costs. The Company has incurred certain acquisition and integration costs in connection with its recent acquisitions, which costs are included within general and administrative expenses, costs of revenue, excluding depreciation and amortization, and other expense, as appropriate. 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 operating cost redundancies, facility consolidation expenses, lease termination expenses, losses on disposal of identified assets, system migration expenses, training and other integration costs; and ii) legal, professional and other fees associated with the consummation of these acquisitions, including fees paid in connection with certain transaction-related financing commitments, including, in the second half of 2022, bridge financing related to the IEA acquisition. These integration efforts are ongoing and the Company expects to incur any remaining acquisition and integration expenses in the fourth quarter of 2023. For the three and nine month periods ended September 30, 2023, such acquisition and integration costs totaled approximately $21.1 million and $60.9 million, respectively, of which $18.3 million and $53.3 million, respectively, was included within general and administrative expenses, and of which $2.8 million and $7.6 million, respectively, was included within costs of revenue, excluding depreciation and amortization. Acquisition and integration costs for the three and nine month periods ended September 30, 2022 totaled approximately $33.3 million and $59.4 million, respectively, of which $9.2 million and $35.3 million, respectively, was included within general and administrative expenses, and of which $21.4 million was included within costs of revenue, excluding depreciation and amortization, for both periods, and of which $2.7 million was included within other expense for both periods. As of September 30, 2023 and December 31, 2022, approximately $6.7 million and $5.5 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 includeare primarily composed of cash and cash equivalents, accounts and notes receivable, cash collateral deposited with insurance carriers, life insurance assets, costequity investments, certain other assets and equity method investments, stock warrants, deferred compensation plan assets and liabilities, accounts payable and other current liabilities, acquisition-related contingent consideration certain intangible assets and other liabilities, including off-market contracts, 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)also referred to as the “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 amountsliabilities 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 representsrepresent the estimated fair value of future earn-outsamounts payable for acquisitionsbusinesses, 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, 20172023 and December 31, 2016,2022, the estimated fair value of the Company’s ASC 805 contingent considerationEarn-out liabilities totaled $104.9$83.0 million and $45.8$127.4 million, respectively,respectively. As of which $18.9 millionSeptember 30, 2023, there were no estimated liabilities related to the mandatorily redeemable non-controlling interests, and $21.8 million, respectively, wasas of December 31, 2022, the fair value of such liabilities totaled $13.9 million. Earn-out liabilities included within other current liabilities.liabilities totaled approximately $29.5 million and $37.7 million as of September 30, 2023 and December 31, 2022, respectively. The fair valuevalues of the Company’s ASC 805 contingent consideration isEarn-out liabilities are estimated using income approaches such as discounted cash flows or option pricing models, and incorporatesboth 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 was 14.0% as of September 30, 2023, 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, 2017,2023, the range of potential undiscounted earn-outEarn-out liabilities was estimated to be between $15$12 million and $170$98 million; however, there is no maximum payment amount.
ASC 805 contingent considerationEarn-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 payments. For both the three and nine month periods ended September 30, 2023, additions from new business combinations totaled approximately $1.4 million, and for earn-out liabilities denominatedthe three and nine month periods ended September 30, 2022, such additions totaled approximately $2.1 million and $3.8 million, respectively. There were no measurement period adjustments in foreign currencies, translation gainseither the three or losses. Fairnine month periods ended September 30, 2023. There were no measurement period adjustments for the three month period ended September 30, 2022, and for the nine month period ended September 30, 2022, measurement period adjustments totaled an increase, net, of approximately $1.5 million and related to a net increase in the Company’s Oil and Gas segment, partially offset by a decrease in its Communications segment. For the three month period ended September 30, 2023, fair value adjustments are recordedtotaled a decrease, net, of approximately $4.9 million and related to net decreases primarily within other income or expense,the Company’s Communications and foreign currency translation activity is recordedOil and Gas segments. For the nine month period ended September 30, 2023, fair value adjustments totaled a decrease, net, of approximately $7.0 million and related to a net decrease in the Company’s Communications segment, partially offset by a net increase, primarily within other comprehensive income or loss, as appropriate.the Company’s Clean Energy and Infrastructure and Oil and Gas segments. The decrease in the Communications segment for the nine month period ended September 30, 2023 included a reduction of approximately $12.3 million related to mandatorily redeemable non-controlling interests. For the three and nine month periods ended September 30, 2017, additions from new business combinations2022, fair value adjustments totaled $64.6an increase of approximately $0.1 million and $89.6a
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decrease, net, of approximately $1.2 million, respectively. There were no payments of ASC 805 contingent considerationrespectively, and for both periods, related primarily to the three month period ended September 30, 2017, and payments totaled $18.8 million for the nine month period ended September 30, 2017.Company’s Communications segment. For the three and nine month periods ended September 30, 2016,2023, Earn-out payments totaled $5.3approximately $12.7 million and $15.8$38.8 million, respectively. Foreign currency translation activity was de minimisrespectively, which included approximately $1.7 million related to mandatorily redeemable non-controlling interests for boththe nine month period ended September 30, 2023. For the three and nine month periods ended September 30, 2017 and September 30, 2016. The Company recognized reductions in the expected fair value of future earn-out obligations totaling $3.02022, Earn-out payments totaled approximately $11.0 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 of 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$37.8 million, respectively.
Cost and Equity Investees.Investments
The Company’s cost and equity investeesinvestments as of September 30, 2017 are primarily composed of:2023 include: (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-acquisition15% equity method investment of Pacer Construction Holdings Corporation and its affiliated operating companies (collectively, “Pacer”); (iii) a $15 million cost investmentinterest 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 interests in itscertain proportionately consolidated non-controlled contractual joint ventures; and (v) certain other equity investments.
Investment Arrangements. From time to time, the Company’sCompany may participate in selected investment or strategic arrangements, including equity interests in Pensare Acquisition Corp.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 (“Pensare”VIEs”); and (vi) certain other cost and equity method investments. See Note 15 - Related Party Transactions.
. As of September 30, 2023, 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. The faircarrying values of the Company’s costVIEs totaled approximately $23 million 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 as of September 30, 2017 or December 31, 2016. Cumulative undistributed earnings from equity method investees totaled $10.6$24 million as of September 30, 2017.2023 and December 31, 2022, respectively, which amounts are recorded within other long-term assets in the consolidated balance sheets. Management believes that the Company’s maximum exposure to loss for its VIEs, inclusive of additional financing commitments, approximated $35 million and $37 million as of September 30, 2023 and December 31, 2022, respectively.
Equity investments, other than those accounted for as equity method 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, which is referred to as the “adjusted cost basis.” As of September 30, 2023 and December 31, 2022, the aggregate carrying value of the Company’s equity investments, including equity investments measured on an adjusted cost basis, totaled approximately $325 million and $306 million, respectively. As of September 30, 2023 and December 31, 2022, equity investments measured on an adjusted cost basis, including the Company’s $15 million investment in CCI, totaled approximately $18 million and $20 million, respectively. Except for one investment for which the Company recorded an impairment loss totaling approximately $3 million in the third quarter of 2023, there were no impairments related to these investments in any of the three or nine month periods ended September 30, 2023 or 2022.
The Waha JVs. The Waha JVs own and operate two pipelines and a header systemcertain pipeline infrastructure that transporttransports 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 outstandingare 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$7.7 million and $15.1$23.1 million for the three and nine month periods ended September 30, 2017,2023, respectively, and totaled approximately $5.8 million and $20.8 million for the three and nine month periods ended September 30, 2022, respectively. Equity inDistributions of earnings from the Waha JVs, which are included within operating cash flows, totaled approximately $4.7 million and $10.5 million for the three and nine month periodperiods ended September 30, 2016 was de minimis.2023, respectively, and totaled approximately $4.4 million and $12.1 million for the three and nine month periods ended September 30, 2022, respectively. Cumulative undistributed earnings from the Waha JVs, which represents cumulative equity in earnings for the Waha JVs less distributions of earnings, totaled $123.3 million as of September 30, 2023. 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 $280 million and $263 million as of September 30, 2023 and December 31, 2022, 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 and nine month periodperiods ended September 30, 2017,2023, the Company’s proportionate share of unrecognized unrealized activity on these interest ratethe Waha JV swaps was a gaintotaled gains of approximately $1.3$4.9 million and $5.4 million, respectively, or $0.8$3.7 million and $4.0 million, net of tax, and for the nine month period, this activity was a loss of approximately $2.1 million, or $1.3 million, net of tax.respectively. For the three and nine month periods ended September 30, 2016,2022, unrecognized unrealized activity related to the Waha JV swaps totaled gains of approximately $13.4 million and $42.0 million, respectively, or $10.1 million and $31.7 million, net of tax, respectively.
Other Investments. The Company has equity interests in certain telecommunications entities that are accounted for as equity method investments. As of both September 30, 2023 and December 31, 2022, the Company had an aggregate investment of approximately $21 million in these entities, including $18 million for FM Tech as of both periods. The Company made no equity contributions related to its investments in these telecommunications entities in either of the three or nine month periods ended September 30, 2023. For the three month period ended September 30, 2022, the Company made no equity contributions related to its investments in these telecommunications entities, and for the nine month period ended September 30, 2022, equity contributions related to these entities totaled approximately $1.1 million. The Company’s proportionate share of results from these telecommunications entities totaled equity in losses, net, of approximately $0.7 million for the three month period ended September 30, 2023, and for the nine month period ended September 30, 2023, totaled equity in earnings, net, of approximately $0.3 million. For the three month period ended September 30, 2022, the Company’s proportionate share of unrecognized unrealized activity onresults from these interest rate swaps was a lossentities totaled equity in earnings, net, of approximately $0.6$0.4 million, and $21.1 million, respectively, or $0.3for the nine month period ended September 30, 2022, totaled equity in losses, net, of approximately $0.5 million.
Certain of these telecommunications entities provide services to MasTec. Expense recognized in connection with services provided by these entities totaled approximately $0.4 million and $12.9$1.3 million netfor the three and nine month periods ended September 30, 2023, respectively, and totaled approximately $2.6 million and $5.1 million for the three and nine month periods ended September 30, 2022, respectively. As of tax, respectively.both
Certain subsidiaries
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September 30, 2023 and December 31, 2022, related amounts payable to these entities totaled approximately $0.2 million. In addition, the Company had an employee leasing arrangement with one of MasTec have provided pipeline construction servicesthese entities and has advanced certain amounts to the Waha JVs.these entities. For the three and nine month periods ended September 30, 2017, revenue recognized in connection with work performed for the Waha JVs, including intercompany eliminations,2023, advances to these entities totaled $3.6approximately $0.2 million and $255.2$0.7 million, respectively, and for both the three and nine month periods ended September 30, 2022, such advances totaled approximately $2.0 million. As of September 30, 2023 and December 31, 2022, receivables related to these arrangements totaled approximately $4.2 million and $3.8 million, respectively.
The Company has 49% equity interests in certain entities included within its Communications and Power Delivery segments that are accounted for as equity method investments, for which its aggregate investment as of both September 30, 2023 and December 31, 2022 totaled approximately $3 million. For the three and nine month periods ended September 30, 2023, equity in losses, net, related to these entities totaled approximately $0.2 million and $0.1 million, respectively, and for the three and nine month periods ended September 30, 2016,2022, equity in losses, net, totaled $80.9approximately $0.1 million and $142.8$0.4 million, respectively. The above described entities provide construction services to MasTec. Expense recognized in connection with construction services provided by these entities totaled approximately $0.2 million and $0.8 million for the three and nine month periods ended September 30, 2023, respectively, and totaled approximately $0.8 million and $5.8 million for the three and nine month periods ended September 30, 2022, respectively. As of both September 30, 2023 and December 31, 2022, related amounts payable were de minimis. In addition, the Company provides line of credit arrangements to these entities, which, as of September 30, 2023 and December 31, 2022, provide for up to $3.0 million and $4.5 million, respectively, of borrowing availability. There were no borrowings as of September 30, 2023, and as of December 31, 2022, $0.6 million was drawn, which amount was included within other current assets in the consolidated balance sheets.
The Company has a 75% equity interest in Confluence Networks, LLC (“Confluence”), an undersea fiber-optic communications systems developer and VIE, which is accounted for as an equity method investment. As of September 30, 20172023, a total of $2.1 million of the $2.5 million initial commitment had been funded, of which $0.2 million was funded during both the nine month periods ended September 30, 2023 and December 31, 2016,2022. Equity in losses related receivables, including retainage, net of BIEC,to this entity were de minimis for both the three month periods ended September 30, 2023 and 2022, and for the nine month periods ended September 30, 2023 and 2022, totaled $52.2approximately $0.1 million and $71.2$0.3 million, respectively. As of September 30, 2017 and December 31, 2016, the Company’s net investment
The Company also has certain equity investments in the Waha JVs represented an asset totaling approximately $115 million and $6 million, respectively. The Company’s net investmentAmerican Virtual Cloud Technologies, Inc. (“AVCT”), in the Waha JVs differs from its proportionate share of the net assets of the Waha JVs due to capitalized investment costs as well as the effect of intercompany eliminations.
Other investments. In connection with the 2014 acquisition of Pacer,which the Company acquired equity interests in two joint ventures. There arehas no remaining amounts expected to be advanced 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 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, $3.6 million of income was recognized related to changes in expected recoveries from these investments. The Company received $12.1 million of proceeds from the receiveractive involvement. AVCT filed for bankruptcy in the first quarter of 2017. The remaining investment, for2023, during which period the Company now has minimal involvement, is reviewed regularly by corporate managementwrote-off its remaining $0.2 million investment.
Senior Notes
As of both September 30, 2023 and December 31, 2022, the gross carrying amount of the Company’s 4.50% senior notes due August 15, 2028 (the “4.50% Senior Notes”) totaled $600.0 million, and their estimated fair value totaled approximately $539.5 million and $534.0 million for potential changes in expected recovery estimates,the respective periods. As of September 30, 2023 and duringDecember 31, 2022, the second quartergross carrying amount of 2017, the Company recorded $5.8Company’s 6.625% senior notes due August 15, 2029 totaled $283.5 million and $281.2 million, respectively, which notes are composed of expense related to changes in expected recovery amounts from this investment.$225.1 million aggregate principal amount of 6.625% IEA senior notes (the “6.625% IEA Senior Notes”) and $74.9 million aggregate principal amount of 6.625% MasTec senior notes (the “6.625% MasTec Senior Notes”), collectively, the “6.625% Senior Notes”). The aggregate net carryingestimated fair value of this investment, which represents expected recoveries under the receivership arrangement,6.625% Senior Notes totaled $14.8approximately $268.3 million and $31.4$280.5 million as of September 30, 20172023 and December 31, 2016, respectively, which amounts are included within other current assets.

During the third quarter of 2017, the Company paid approximately $2.0 million for approximately 4%2022, respectively. The estimated fair values of the common stock of PensareCompany’s 4.50% Senior Notes 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 Company’s consolidated financial statements as of September 30, 2017. The fair value of the warrants, as6.625% Senior Notes were determined based on an exit price approach using Level 3 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.

1 inputs.


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):
September 30,
2023		December 31,
2022
Contract billings$1,551.8 $1,408.1 
Less allowance(8.9)(8.4)
Accounts receivable, net of allowance$1,542.9 $1,399.7 
Retainage351.0 401.9 
Unbilled receivables1,616.0 1,328.0 
Contract assets$1,967.0 $1,729.9 
 September 30,
2017		 December 31,
2016
Contract billings$626.7
 $564.2
Retainage287.6
 268.6
Costs and earnings in excess of billings629.5
 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. Unbilled receivables, which are included in contract assets, include amounts for work performed for which the Company has an unconditional right to receive payment and that are not subject to the completion of any other specific task, other than the billing itself. Retainage whichrepresents a portion of the contract amount that has been billed, but is not due until completion of performance and acceptance by customers, is expectedfor which the contract allows the customer 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 eachretain a portion of the threebilled amount until final contract settlement, which is generally, from 5% to 10% of contract billings. The increase in unbilled receivables as of September 30, 2023 was driven, in large part, by ordinary course project activity associated with higher levels of revenue in the Company’s Oil and Gas segment, as well as timing of billings across the Company’s segments. For the nine month periodsperiod ended September 30, 2017 and 20162023, provisions for credit losses totaled $0.4a recovery of approximately $0.1 million, and for the nine month periodsperiod ended September 30, 20172022, provisions for credit losses totaled approximately $0.7 million. Impairment losses on contract assets were not material in either period.
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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 $1.1approximately $506.5 million and $2.0$406.2 million as of September 30, 2023 and December 31, 2022, respectively, of which deferred revenue comprised approximately $496.0 million and $390.3 million, respectively. The increase in contract liabilities as of September 30, 2023 was driven primarily by ordinary course project activity, including in connection with new project starts within the Company’s Clean Energy and Infrastructure segment. For the nine month period ended September 30, 2023, the Company recognized revenue of approximately $355.3 million related to amounts that were included in deferred revenue as of December 31, 2022, resulting primarily from the advancement of physical progress on the related projects during the period, including amounts from recently acquired businesses.

The Company is party to non-recourse financing arrangements in the ordinary course of business, under which certain receivables are purchased by the customer’s banksold to a financial institution in return for a nominal fee. TheseIn certain instances, the Company continues to service the transferred receivable, for which the corresponding servicing assets or liabilities are not material. For the nine month period ended September 30, 2023, the Company sold approximately $50 million of receivables under this program, and as of September 30, 2023, the Company had approximately $47 million of outstanding sold receivables, which are excluded from Accounts Receivable, net of Allowance, in the consolidated balance sheets. The servicing of such receivables is not considered to constitute significant continuing involvement and the receivables are correspondingly accounted for as sales under ASC Topic 860, “Transfers and Servicing.” Cash collections from such financing arrangements underare reflected within operating activities in the consolidated statements of cash flows. The Company is also party to an arrangement with a customer, which amounts can vary based on levelsallows for early collection of activity and changes in customer payment terms, improvereceivables for a nominal fee, at the collection cycle time of theCompany’s option. Discount charges related receivables. The discount charge,to these arrangements, which isare included within interest expense, net, totaled approximately $2.1$3.8 million and $0.8$2.4 million respectively, for the three month periods ended September 30, 20172023 and 2016,2022, respectively, and totaled approximately $4.7$11.8 million and $1.7$4.9 million, respectively, for the nine month periods ended September 30, 20172023 and 2016.2022.
Note 6 -– Property and Equipment, Net
The following table provides details of property and equipment, net, including property and equipment held under capitalfinance leases as of the dates indicated (in millions):
September 30,
2023		December 31,
2022
Land$73.5 $73.5 
Buildings and leasehold improvements91.4 86.7 
Machinery, equipment and vehicles3,033.0 2,797.0 
Office equipment, furniture and internal-use software324.3 286.8 
Construction in progress43.7 67.4 
Total property and equipment$3,565.9 $3,311.4 
Less accumulated depreciation and amortization(1,836.1)(1,557.3)
Property and equipment, net$1,729.8 $1,754.1 
 September 30,
2017		 December 31,
2016
Land$4.6
 $4.6
Buildings and leasehold improvements25.7
 24.2
Machinery and equipment1,237.3
 997.8
Office furniture and equipment149.6
 146.1
Construction in progress8.9
 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
TheAs of September 30, 2023 and December 31, 2022, the gross amount of capitalized internal-use software which is included within office furniture and equipment, totaled $108.7$208.9 million and $107.8$186.6 million, as of September 30, 2017respectively, and, December 31, 2016, respectively. Capitalized internal-use software, net of accumulated amortization, totaled $24.8$49.8 million and $30.9$39.9 million, asrespectively. During the second quarter of September 30, 20172023, the depreciable lives of certain assets were updated on a prospective basis to better align the respective assets’ lives with their expected useful lives, based on management’s assessment of the physical and December 31, 2016, respectively. Depreciationeconomic factors of the related assets. The effect of this update was a decrease in depreciation expense of approximately $2 million and amortization expense associated with property and equipment$4 million for the three month periods ended September 30, 2017and2016 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 2016,2023, respectively.


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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		DescriptionMaturity DateSeptember 30,
2023		December 31,
2022
Senior secured credit facility: February 22, 2022    
Senior credit facility:Senior credit facility:November 1, 2026
Revolving loansRevolving loans $300.6
 $279.9
Revolving loans$890.0 $896.0 
Term loanTerm loan 400.0
 237.5
Term loan343.4 350.0 
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 Notes4.50% Senior NotesAugust 15, 2028600.0 600.0 
6.625% Senior Notes6.625% Senior NotesAugust 15, 2029283.5 281.2 
2022 Term Loan Facility2022 Term Loan FacilityOctober 7, 2025 and October 7, 2027700.0 700.0 
Finance lease and other obligationsFinance lease and other obligations402.8 414.5 
Total debt obligationsTotal debt obligations$3,219.7 $3,241.7 
Less unamortized deferred financing costsLess unamortized deferred financing costs (13.8) (9.8)Less unamortized deferred financing costs(14.5)(17.6)
Total debt, net of deferred financing costsTotal debt, net of deferred financing costs $1,278.8
 $1,026.0
Total debt, net of deferred financing costs$3,205.2 $3,224.1 
Current portion of long-term debtCurrent portion of long-term debt 86.5
 64.6
Current portion of long-term debt175.3 171.9 
Long-term debtLong-term debt $1,192.3
 $961.4
Long-term debt$3,029.9 $3,052.2 
Senior Secured Credit Facility
The Company has aAs of September 30, 2023, the Company’s senior securedunsecured 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’shad aggregate borrowing commitments fromtotaling approximately $1.2$2.25 billion to $1.5 billion,, which amount is composed of $1.1$1.9 billion of revolving commitments and a term loan in the aggregatewith 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 in December 2017, which as of September 30, 2017, amounted to $3.1approximately $2.2 million, which amount isquarterly installments increase to approximately $4.4 million 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 September 30, 2023 and December 31, 2016, term loans in2022, the aggregate principal amountfair values 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,Term Loan, 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 isestimated based on the Company’s Consolidated Leverage Ratio, as defined in the Credit Facility, as of the then most recent fiscal quarter.an income approach utilizing significant unobservable Level 3 inputs including discount rate assumptions, approximated their carrying values.
As of September 30, 2017 and December 31, 2016, outstanding revolvingRevolving loans which included $171 million and $119 million, respectively, of borrowings denominated in foreign currencies, accrued interest at weighted average rates of approximately 2.96%7.05% and 3.71%5.82% per annum as of September 30, 2023 and December 31, 2022, respectively. The term loanTerm Loan accrued interest at a rate of 2.86%7.04% and 2.77%5.80% as of September 30, 20172023 and December 31, 2016,2022, respectively. Letters of credit of approximately $189.1$65.0 million and $314.3$143.1 million were issued as of September 30, 20172023 and December 31, 2016,2022, respectively. As of September 30, 20172023 and December 31, 2016, letters2022, letter of credit fees accrued at 0.750%0.6875% and 1.00%0.5625% per annum, respectively, for performance standby letters of credit, and at 1.625% and 2.00% per annum, respectively, for financial standby letters of credit.credit, accrued at 1.625% and 1.375% per annum, respectively. Outstanding letters of credit mature at various dates and most have automatic renewal provisions, subject to prior notice of cancellation. As of September 30, 20172023 and December 31, 2016,2022, availability for revolving loans totaled $610.3$945.0 million and $405.9$860.9 million, respectively, or up to $460.9$585.0 million and $335.7$506.9 million, respectively, for new letters of credit. There were no borrowings denominated in foreign currencies as of either September 30, 2023 or December 31, 2022. Revolving loan borrowing capacity included $129.4 million and $80.9$300.0 million of availability in either Canadian dollars or Mexican pesos as of both September 30, 20172023 and December 31, 2016, respectively.2022. The unused facility fee as of September 30, 20172023 and December 31, 20162022 accrued at a rate of 0.30%0.225% and 0.40%,0.200% per annum, respectively.


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.
Other Credit Facilities.
The Company has other credit facilities that support the working capital requirements of its foreign operations. Borrowingsoperations and certain letter of credit issuances. There were no outstanding borrowings under thesethe Company’s other credit facilities which have varying datesas of maturity and are generally renewed on an annual basis, are denominated in Canadian dollars. Aseither September 30, 2017 and2023 or December 31, 2016, maximum borrowing capacity totaled Canadian $20.0 million and $40.0 million, respectively, or approximately $16.0 million and $29.8 million, respectively.2022. Additionally, the Company has a separate credit facility, under which it may issue performance standby letters of credit.  As of September 30, 20172023 and December 31, 2016, outstanding borrowings2022, letters of credit issued under this facility totaled approximately $5.4$17.2 million and $13.4$23.6 million, respectively, which accrued fees at 0.90% and 0.75% per annum, respectively.
2022 Term Loan Facility
As of September 30, 2023, the Company has $700.0 million of unsecured term loans entered into in connection with the acquisition of IEA, composed of a three-year term loan of $400.0 million in principal amount (the “Three-Year Tranche”) maturing on October 7, 2025, and a five-year term loan of $300.0 million in principal amount (the “Five-Year Tranche”) maturing on October 7, 2027 (together, the “2022 Term Loan Facility”). The Three-Year Tranche is not subject to amortization. The Five-Year Tranche is subject to amortization in quarterly principal installments of approximately $3.75 million commencing on March 31, 2024, which installment will increase to $7.5 million on March 31, 2026 until maturity, subject to the application of certain prepayments. As of September 30, 2023, the Three- and Five-Year Tranches accrued interest at a weighted average raterates of approximately 4.0%6.809% and 3.6%6.934%, respectively, and as of December 31, 2022, the Three- and Five-Year Tranches accrued interest at rates of 5.692% and 5.817%, respectively. Outstanding borrowings that are not renewed are repaid with borrowings underAs of September 30, 2023 and December 31, 2022, the Company’s senior secured credit facility. Accordingly, the carrying amountsfair value of the Company’s borrowings under2022 Term Loan Facility, as estimated based on an income approach, utilizing significant unobservable Level 3 inputs including discount rate assumptions, approximated 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. The Company’s other credit facilities are subject to customary provisions and covenants.carrying value.
Debt Guarantees and Covenants
The 4.875% 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 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 Company’s Credit Facility or other outstanding indebtedness. See Note 16 - Supplemental Guarantor Condensed Unaudited Consolidating Financial Information.
MasTec was in compliance with the provisions and covenants of its outstanding debt instruments as of both September 30, 20172023 and December 31, 2016.2022.
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Additional Information
As of September 30, 20172023 and December 31, 2016,2022, accrued interest payable, which is recorded within other accrued expenses in the consolidated balance sheets, totaled $4.1$14.0 million and $8.5$24.8 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 20162022 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 leasesagreements that provide financing for certainmachinery and equipment and for other of its facility, vehicle and equipment needs, including certain related party leases. See NoteAs of September 30, 2023, the Company’s leases have remaining lease terms of up to 15 - Related Party Transactions. Rentyears. Lease agreements may contain renewal clauses, which, if elected, generally extend the term of the lease for 1 to 5 years for both equipment and related expensefacility 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 operatinginflation 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 that have non-cancelable terms in excessas of one yearSeptember 30, 2023 and December 31, 2022 totaled approximately $25.4$690.1 million and $25.9$720.1 million, respectively. Assets held under finance leases, net of accumulated depreciation, totaled $483.5 million and $535.3 million as of September 30, 2023 and December 31, 2022, respectively. Depreciation expense associated with finance leases totaled $26.8 million and $22.8 million for the three month periods ended September 30, 20172023 and 2016,2022, respectively, and totaled $77.6$79.3 million and $74.8$63.2 million for the nine month periods ended September 30, 20172023 and 2016,2022, respectively.
Operating Leases
Operating lease additions for the three month periods ended September 30, 2023 and 2022 totaled $75.1 million and $12.7 million, respectively, and for the nine month periods ended September 30, 2023 and 2022, totaled $198.6 million and $58.1 million, respectively. For the three month periods ended September 30, 2023 and 2022, rent expense for leases that have terms in excess of one year totaled approximately $44.0 million and $30.6 million, respectively, of which $3.9 million and $2.3 million, respectively, represented variable lease costs. For the nine month periods ended September 30, 2023 and 2022, rent expense for such leases totaled approximately $116.7 million and $98.5 million, respectively, of which $11.5 million and $7.8 million, respectively, represented variable lease costs. The Company also incurred rent and related expense for facilities, vehicles and equipment having originalleases with terms of one year or less totaling approximately $159.4$169.9 million and $96.7$98.8 million for the three month periods ended September 30, 20172023 and 2016,2022, respectively, and totaling $347.8approximately $411.7 million and $213.9$258.1 million for the nine month periods ended September 30, 20172023 and 2016,2022, 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 September 30, 2023 were as follows (in millions):
 Finance
Leases
Operating
Leases
2023, remaining three months$43.4 $38.6 
2024151.5 140.8 
2025114.8 115.7 
202657.3 79.5 
202717.8 36.7 
Thereafter3.1 38.2 
Total minimum lease payments$387.9 $449.5 
Less amounts representing interest(21.8)(38.4)
Total lease obligations, net of interest$366.1 $411.1 
Less current portion
146.6 131.8 
Long-term portion of lease obligations, net of interest
$219.5 $279.3 
As of September 30, 2023, finance leases had a weighted average remaining lease term of 2.8 years, with a weighted average discount rate of 4.5%, and non-cancelable operating leases had a weighted average remaining lease term of 3.9 years, with a weighted average discount rate of 4.6%.
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,2023, there were approximately 4.9 million


2,752,000 shares available for future grant. In March 2017,Non-cash stock-based compensation expense under all plans totaled $7.2 million and $5.7 million for the Company’s boardthree month periods ended September 30, 2023 and 2022, respectively, and totaled $24.3 million and $18.9 million for the nine month periods ended September 30, 2023 and 2022, respectively.
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Income tax benefits associated with stock-based compensation arrangements totaled $1.1 million and $0.9 million for the three month periods ended September 30, 2023 and 2022, respectively. For the nine month periods ended September 30, 2023 and 2022, such income tax benefits totaled $12.9 million and $4.3 million, respectively, including net tax benefits related to the vesting of directors adopted the Amendedshare-based payment awards totaling $8.8 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.$0.9 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. TotalAs of September 30, 2023, total unearned compensation related to restricted shares as ofSeptember 30, 2017was approximately $15.8$49.1 million,, which amount is expected to be recognized over a weighted average period of approximately 1.11.9 years. The intrinsicThe fair value of restricted shares that vested, which is based on the market price on the date of vesting, totaled $0.1approximately $0.3 million for both the three month periods ended September 30, 20172023 and 2016,2022, and totaled $11.9approximately $78.3 million and $1.5$19.5 million for the nine month periods ended September 30, 20172023 and 2016,2022, respectively.
Activity, restricted shares: (a)
Restricted
Shares		Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 20222,049,280 $52.33 
Granted204,215 95.99 
Vested(855,196)27.89 
Canceled/forfeited(67,959)46.86 
Non-vested restricted shares, as of September 30, 20231,330,340 $75.03 
Activity, restricted shares: (a)
Restricted
Shares		 Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 20161,970,586
 $21.61
Granted193,348
 39.47
Vested(304,211) 40.72
Canceled/forfeited(30,041) 20.24
Non-vested restricted shares, as of September 30, 20171,829,682
 $20.34
(a)
Includes 39,050 and 43,300(a)    Includes 1,000 and 2,150 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, 2016,2023 and December 31, 2022, 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'sCompany’s common stock are available for purchase by eligible employees. The following table provides details pertainingparticipants. 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 either newly issued common shares, or common shares reacquired on the open market or in privately negotiated transactions.
For the three month periods ended September 30, 2023 and 2022, 22,824 shares and 25,495 shares, respectively, were purchased by participants under the Company’s ESPPs for the periods indicated:
 For the Nine Months Ended September 30
 2017 2016
Cash proceeds (in millions)
$2.4
 $2.0
Common shares issued68,789
 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$1.9 million and related tax effects$1.7 million, respectively, and for the nine month periods indicatedended September 30, 2023 and 2022, 69,475 shares and 82,121 shares, respectively, were as follows (in millions):purchased for $5.7 million and $5.3 million, respectively. Shares purchased by participants under the Company’s ESPPs in each of the three and nine month periods ended September 30, 2023 and 2022 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 ended September 30, 2023 and 2022, and totaled approximately $1.0 million for both the nine month periods ended September 30, 2023 and 2022.
 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 ninemonth 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 are 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)
LowHighPensionOther MultiemployerTotal
For the Three Months Ended September 30:
20237,760 11,025 $34.8 $15.2 $50.0 
20226,774 7,136 $23.0 $14.5 $37.5 
For the Nine Months Ended September 30:
20236,806 11,025 $77.9 $45.1 $123.0 
20226,601 7,136 $62.3 $41.6 $103.9 
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 Multiemployer Plans
 Covered Employees 
Contributions (in millions)
 Low High Pension Other Multiemployer Total
For the Three Months Ended September 30:         
20173,669
 7,057
 $36.7
 $2.7
 $39.4
20164,170
 4,910
 $26.4
 $2.9
 $29.3
For the Nine Months Ended September 30:         
2017550
 7,057
 $68.1
 $8.0
 $76.1
20161,112
 4,910
 $43.4
 $7.6
 $51.0

The fluctuations in the average number of employees covered under multiemployer plans and relatedassociated contributions in the table above arerelated primarily related to higher levelsthe timing of activity for the Company’s union resource-based project activity withinprojects, as well as the Company’s oil and gas operations.
Note 11 – Equity
Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss is composed of unrealized foreign currency translation gains and losses, which relate primarily to fluctuations in foreign currency exchange rateseffects 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.recent acquisitions. For both the three and nine month periods ended September 30, 20172023, multiemployer plan activity was driven primarily by project work within the Company’s Power Delivery and 2016, unrealizedOil and Gas operations, and, to a lesser extent, by acquisition-related project work within the Company’s Clean Energy and Infrastructure operations, whereas for the three and nine month periods ended September 30, 2022, activity was driven primarily by acquisition-related project work within the Company’s Power Delivery operations, and, to a lesser extent, project work within its Oil and Gas operations.
Note 11 – Equity
Share Activity
The Company’s share repurchase programs provide for the repurchase, from time to time, of MasTec common shares in open market transactions or in privately negotiated transactions, in each case, in accordance with applicable securities laws. The Company’s share repurchase programs, under which the Company undertakes share repurchases for strategic purposes, including when management believes that the market price of the Company’s stock is undervalued, such repurchases will enhance long-term shareholder value, the Company has adequate liquidity and such repurchases are appropriate uses of capital, do not have an expiration date and may be modified or suspended at any time at the Company’s discretion. There were no share repurchases under the Company’s share repurchase programs in either of the three or nine month periods ended September 30, 2023. For the three month period ended September 30, 2022, there were no share repurchases under the Company’s share repurchase programs, and for the nine month period ended September 30, 2022, the Company repurchased 1.1 million shares of its common stock for an aggregate purchase price of approximately $81.3 million. Of the total repurchased shares, 0.1 million shares were repurchased in the first quarter of 2022 for $8.6 million under the Company’s December 2018 $100 million share repurchase program, which completed the program. The remaining 1.0 million shares were repurchased for $72.7 million under the Company’s March 2020 $150 million share repurchase program. As of September 30, 2023, $77.3 million was available for future share repurchases under the Company’s March 2020 share repurchase program.
Accumulated Other Comprehensive Income (Loss)
Unrealized foreign currency translation activity, relatednet, in each of the three and nine month periods ended September 30, 2023 and 2022 relates primarily to the Company’s Canadian operations in Canada and unrealizedMexico. Unrealized investment activity relatedin each of the three and nine month periods ended September 30, 2023 and 2022 relates to interest rate swapsunrealized fair value gains associated with the Waha JVs.JV interest rate swaps. 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 September 30, 2023 and 2022, the Company’s consolidated effective tax rates were an expense of 33.1% and 18.4%, respectively, and for the nine month periods ended September 30, 2023 and 2022 were benefits of 41.4% and 0.2%, respectively. The Company’s effective tax rate for the nine month period ended September 30, 2017,2023 included the Company recognized certain tax credits based upon the resultseffects of a study that is currently underway, which amount was determined based on management’s estimatesnet tax benefit of approximately $8.8 million related to share-based payment awards and currently available information. Furthera benefit of approximately $6 million related to adjustments to the amount recognized may occur as the resultsfrom finalization of the study are finalized, which is expected to occurCompany’s 2022 tax returns, offset, in part, by an increase in non-deductible expenses. For the fourth quarter of 2017.

As discussed in Note 1 - Business, Basis of Presentation and Significant Accounting Policies, effective January 1, 2017,nine month period ended September 30, 2022, 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 annualCompany’s effective tax rates. Therate included a benefit of approximately $15 million related to adjustments resulting from finalization of the Company’s 2021 tax effectreturns and a net tax benefit of approximately $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 for the three and nine month periods ended September 30, 2017.awards.

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
MasTecThe Company manages its operations under five operating segments, which represent MasTec’sits five reportable segments: (1) Communications; (2) Clean Energy and Infrastructure; (3) Oil and Gas; (3) Electrical Transmission; (4) Power Generation and IndustrialDelivery and (5) Other. This structure is generally focused on broad end-user markets for MasTec’sthe Company’s labor-based construction services. All five reportable segments derive their revenue primarily from the engineering, installation and maintenance of infrastructure, primarily in North America.
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. MasTecThe 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 systems for renewable energy; various types of heavy civil and industrial infrastructure, including roads, bridges and rail; and environmental remediation services. The Oil and Gas segment performs engineering, construction, maintenance and maintenanceother services on oil andfor pipeline infrastructure, including natural gas, pipelinescarbon capture sequestration, water and processing facilitiespipeline integrity and other services for the energy and utilities industries through its Oil and Gas segment.industries. The Electrical TransmissionPower 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 Generationsubstations; and Industrial segment primarily serves energy, utilityenvironmental planning 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.compliance services. The Other segment includes certain equity investees, the services of which may 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 ofcertain 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
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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 Gas1,161.0
 736.0
 2,757.2
 1,454.3
Electrical Transmission81.8
 101.7
 277.3
 283.6
Power Generation and Industrial96.9
 123.6
 204.1
 324.7
Other10.6
 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 Gas108.1
 117.8
 356.1
 187.6
Electrical Transmission4.5
 (8.3) 11.2
 (42.0)
Power Generation and Industrial9.3
 6.1
 14.8
 13.8
Other10.1
 (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 Gas26.0
 20.7
 71.1
 58.2
Electrical Transmission5.8
 6.1
 17.3
 17.1
Power Generation and Industrial2.9
 1.6
 5.8
 4.6
Other0.0
 0.0
 0.1
 0.0
Corporate1.6
 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, presentsincluding 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 September 30,For the Nine Months Ended September 30,
Revenue:2023202220232022
Communications (a)
$824.4 $888.9 $2,499.6 $2,375.1 
Clean Energy and Infrastructure1,099.9 563.2 2,894.5 1,493.5 
Oil and Gas672.3 375.8 1,270.6 927.9 
Power Delivery665.0 688.4 2,077.1 1,985.4 
Other— — — — 
Eliminations(4.5)(2.8)(25.9)(12.2)
Consolidated revenue$3,257.1 $2,513.5 $8,715.9 $6,769.7 
(a)    Revenue generated primarily by utilities customers represented 25.0% and 21.8% of Communications segment revenue for the three month periods ended September 30, 2023 and 2022, respectively, and represented 24.1% and 23.7% for the nine month periods ended September 30, 2023 and 2022, respectively.
For the Three Months Ended September 30,For the Nine Months Ended September 30,
EBITDA:2023202220232022
Communications$73.4 $109.9 $215.7 $234.5 
Clean Energy and Infrastructure42.4 24.6 80.9 30.2 
Oil and Gas97.3 49.2 188.9 133.4 
Power Delivery56.5 63.1 161.0 150.6 
Other4.4 5.6 18.2 20.0 
Segment EBITDA$274.0 $252.4 $664.7 $568.7 
For the three month period ended September 30, 2023, Communications, Clean Energy and Infrastructure and Power Delivery EBITDA included $4.8 million, $15.3 million and $0.5 million, respectively, of acquisition and integration costs related to the Company’s recent acquisitions, and Corporate EBITDA included $0.5 million of such costs. For the nine month period ended September 30, 2023, $18.3 million, $36.9 million, $2.5 million and $3.2 million of such costs were included in EBITDA of the segments and Corporate, respectively. For the three month period ended September 30, 2022, Communications, Oil and Gas, Power Delivery and Corporate EBITDA included $0.5 million, $1.1 million, $20.4 million and $11.2 million of such acquisition and integration costs, respectively, and for the nine month period ended September 30, 2022, $2.4 million, $4.5 million, $34.5 million and $18.0 million of such costs were included in EBITDA of the segments and Corporate, respectively. Additionally, for the nine month period ended September 30, 2023, Corporate EBITDA included fair value losses related to an investment of $0.2 million, and for the three and nine month periods ended September 30, 2022, Corporate EBITDA included $0.1 million and $7.2 million of such fair value losses, respectively.
For the Three Months Ended September 30,For the Nine Months Ended September 30,
EBITDA Reconciliation:2023202220232022
Income (loss) before income taxes$22.9 $60.3 $(82.7)$30.5 
Plus:
Interest expense, net62.6 26.9 174.7 62.3 
Depreciation115.0 91.3 325.3 263.5 
Amortization42.3 28.0 126.3 81.2 
Corporate EBITDA31.3 45.9 121.2 131.2 
Segment EBITDA$274.0 $252.4 $664.7 $568.7 
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 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, net17.6
 13.1
 45.0
 37.9
Depreciation and amortization50.1
 42.6
 138.4
 122.2
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:2023202220232022
Communications$37.0 $32.5 $105.6 $92.1 
Clean Energy and Infrastructure37.1 12.4 107.3 35.5 
Oil and Gas40.7 34.1 111.6 97.9 
Power Delivery39.9 37.7 119.4 110.1 
Other— — — — 
Corporate2.6 2.6 7.7 9.1 
Consolidated depreciation and amortization$157.3 $119.3 $451.6 $344.7 
Assets:September 30,
2023		December 31,
2022
Communications$2,449.7 $2,378.6 
Clean Energy and Infrastructure2,902.6 2,979.9 
Oil and Gas1,908.3 1,544.2 
Power Delivery1,877.7 1,967.9 
Other312.9 297.3 
Corporate78.5 125.4 
Consolidated assets$9,529.7 $9,293.3 
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. ForMexico, the Caribbean and India. Revenue derived from U.S. operations totaled $3.2 billion and $2.5 billion for the three month periods ended September 30, 20172023 and 2016, revenue of $1.92022, respectively, and totaled $8.6 billion and $1.5$6.6 billion respectively, was derived from U.S. operations, and revenue of $61.0 million and $73.8 million, respectively, was derived from foreign operations,for the majority of which was from the Company’s Canadian operations. For the nine month periods ended September 30, 2017 2023 and 2016, revenue of $4.8 billion and $3.6 billion, respectively, was derived from U.S. operations, and revenue of $160.7 million and $222.8 million, respectively, was2022, respectively. Revenue derived from foreign operations totaled $18.8 million and $49.4 million for the majority of which was from the Company’s Canadian operations. The majority of the Company’s foreign operations during the three and nine month periods ended September 30, 20172023 and 2016 were2022, respectively, and totaled $68.4 million and $125.2 million for the nine month periods ended September 30, 2023 and 2022, respectively. Revenue from foreign operations was derived primarily from the Company’s Canadian operations in the Company’sits Oil and Gas segment. Long-lived assets held in the U.S. included property and equipment, net, of $629.2 million and $475.3 million$1.7 billion as of both September 30, 20172023 and December 31, 2016, respectively,2022, and for the Company’s businesses in foreign countries, the majority of which are in Canada, totaled $62.2$18.0 million and $73.8$21.0 million respectively.for the respective periods. Intangible assets and goodwill, net, related to the Company’s U.S. operations totaled approximately $1.2$2.9 billion and $1.1$3.0 billion as of September 30, 20172023 and December 31, 2016,2022, respectively, and for the Company’s businesses in foreign countries, the majority of which are in Canada, totaled approximately $114.3$32.8 million and $107.8$35.5 million, asrespectively. Substantially all of the Company’s long-lived and intangible assets and goodwill in foreign countries relate to its Canadian operations. As of September 30, 2017 and December 31, 2016, respectively. Amounts2023, amounts due from customers from which foreign revenue was derived accounted for approximately 6% and 8%, respectively,less than 1% of the Company’s consolidated net accounts receivable position, as of September 30, 2017 and December 31, 2016, which representsis calculated as accounts receivable, net, less BIEC.


deferred revenue. As of December 31, 2022, such amounts accounted for approximately 1% of the Company’s consolidated net accounts receivable position. Revenue from governmental entities for the three month periods ended September 30, 2023 and 2022 totaled approximately 12% and 6% of total revenue, respectively, and for the nine month periods ended September 30, 2023 and 2022, totaled approximately 11% and 7% of total revenue, respectively. Substantially all of the Company’s revenue from governmental entities was derived from its U.S. operations.
Significant Customers
Revenue concentration information for significant customers as a percentageFor the three month period ended September 30, 2023, Equitrans Midstream Corporation represented 11% of the Company’s total consolidated revenue, was as follows:and for the three month period ended September 30, 2022, no customer represented greater than 10% of the Company’s total consolidated revenue. For the nine month periods ended September 30, 2023 and 2022, no customer represented greater than 10% of the Company’s total consolidated revenue. The Company's relationship with Equitrans Midstream Corporation and its affiliates is based upon various construction contracts for pipeline activities, for which the related revenue is included in 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 - Commitmentsbusiness, including project contract price and Contingencies in the Company’s 2016 Form 10-K for additional information.other project disputes, other project-related liabilities and 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.
Acquired Legacy Solar Matter. On April 28, 2023, a jury found IEA and its subsidiary, IEA Constructors, LLC (“IEAC” and, together with IEA, the “IEA Entities”), liable to plaintiffs H&L Farms LLC (“H&L Farms”), Shaun Harris and Amie Harris following a trial in the U.S. District Court for the Middle District of Georgia, Columbus Division (the “Court”), against the IEA Entities, IEAC’s customer, Silicon Ranch Corporation (“SRC”) and engineering firm Westwood Professional Services, Inc. The suit, filed in August 2021, arose out of a project that commenced in 2021 involving the construction by IEAC of a solar farm for SRC. The project was constructed on SRC’s property located adjacent to a 1,400 acre tract of land that plaintiffs purchased in March 2021 for approximately $3.3 million.
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The plaintiffs brought various causes of action under Georgia law, including trespass, nuisance and negligence, arising out of the defendants’ alleged failure to exercise appropriate efforts to prevent and remediate soil erosion and sedimentary run-off that flowed from SRC’s property into a 21-acre lake on plaintiffs’ property. Following trial, the jury awarded Mr. and Mrs. Harris $4.5 million each for loss of use and enjoyment of the lake and awarded H&L Farms (the legal owner) another $1.5 million in remediation costs. These damages were apportioned 30% to SRC, 40% to IEA and 30% to IEAC. The jury also awarded $25 million in punitive damages against SRC and $50 million in punitive damages against each of the IEA Entities. The Court entered judgment on the verdict and issued an injunction requiring IEAC to remediate the sedimentary run-off as quickly as possible.
Subsequently, the IEA Entities and SRC filed post-trial motions seeking multiple avenues of relief from the verdict. Plaintiffs filed oppositions to both motions.
Following trial, Mr. and Mrs. Harris also filed a motion for damages under the Georgia frivolous claim/defense statute, seeking $1 million in damages for each of them in compensation for their ostensible stress in pursuing their claims in litigation and an unspecified amount of attorneys’ fees, which they implied could be as much as 45% of any amount of damages remaining after post-verdict review. The IEA Entities and SRC opposed this motion.
On October 23, 2023, the Court issued an order resolving the parties’ post-trial motions. The Court first ruled that the compensatory damages for restoration of the lake are unsupported by the evidence and that the compensatory damages for loss of use and enjoyment are excessive. It ordered a new trial on the amount of compensatory damages unless Mr. and Mrs. Harris agree to a remittitur of their damages for loss of use and enjoyment to approximately $0.5 million each and H&L Farms agrees to a remittitur of its damages for restoration of the lake to approximately $0.3 million. The Court also ordered a new trial on the amount of punitive damages unless plaintiffs agree to a remittitur of the punitive damages against SRC to approximately $1.1 million and a remittitur of the punitive damages against the IEA Entities to approximately $2.7 million in total. The plaintiffs have until November 13, 2023 to notify the Court whether they agree to the remittiturs. If they do not agree to the remittiturs, the Court intends to hold a new trial on the amount of compensatory and punitive damages in March 2024. Finally, the Court denied the plaintiffs’ request for damages and attorneys’ fees under the Georgia frivolous claims/defenses statute.
On October 31, 2023, the plaintiffs filed a motion for reconsideration of the Court’s order, seeking, among other things, that the Court permit a higher amount of damages and defer any retrial to a later time, accompanied by a request that the Court certify its order for an immediate appeal and to seek the Georgia Supreme Court’s answers to various ostensible issues of Georgia law.
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 certain 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 costequity 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, 20172023 and December 31, 2016,2022, there were $189.1$82.1 million and $314.3$166.7 million, respectively, of letters of credit issued under the Company’s Credit Facility.credit facilities. Letter of credit claims have historically not been material. The Company is not aware of any material claims relating to its outstanding letters of credit as of September 30, 20172023 or December 31, 2016.2022.
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, 20172023 and December 31, 2016,2022, outstanding performance and payment bonds totaled $119.2approximated $5,552.1 million and $72.9$4,855.5 million, respectively, and estimated costs to complete projects secured by these bonds totaled $51.3$1,693.7 million and $9.5$1,739.9 million, respectively. Included in these balances as of September 30, 20172023 and December 31, 2016, respectively. These amounts do not include2022 are $329.0 million and $115.8 million, respectively, of outstanding performance and payment bonds associated withissued 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 whenventures, 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 sevenmultiple proportionately consolidated non-controlled contractual joint ventures that provide infrastructure construction services for electrical transmission projects.projects, as well as undivided interests, ranging from 25% to 50%, in each of four civil construction projects, and one 49% undivided interest in pipeline project work. 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, 2017,2023, the Company was not aware of circumstances that would reasonably lead to material future claims against it in connection with these arrangements. For the nine month period ended September 30, 2023, the Company provided $0.5 million of project-related financing to its contractual joint ventures, which amount was outstanding as of September 30, 2023. Included in the Company’s cash balances as of September 30, 2023 and December 31, 2022 are amounts held by entities that are proportionately consolidated totaling $26.5 million and $25.7 million, respectively. These amounts are available to support the operations of those entities, but are not available for the Company’s other operations.
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The Company has other investment and strategic arrangements, as discussed inunder 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 timeTransactions 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. The Company manages certain of its insurance liabilities indirectly through its wholly-owned captive insurance company, which reimburses claims up to the applicable insurance limits. Captive insurance-related cash balances totaled approximately $0.8 million and $1.1 million as of September 30, 2023 and December 31, 2022, respectively, which amounts are generally not available for use in the Company’s other operations.
As of September 30, 20172023 and December 31, 2016,2022, MasTec’s estimated liability for unpaid claims and associated expenses, including incurred but not reported losses related to these policies, totaled $98.5$201.1 million and $85.8$176.7 million, respectively, of which $67.5$131.5 million and $55.2$109.3 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$4.8 million and $4.1 million as of both September 30, 20172023 and December 31, 2016.2022, 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$9.6 million and $85.1$95.6 million as of September 30, 20172023 and December 31, 2016,2022, 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 of both September 30, 2017 and December 31, 2016. Outstanding surety bonds related to workers’ compensation self-insurance programs amounted to $13.7$204.8 million and $13.5$110.9 million as of September 30, 20172023 and December 31, 2016,2022, respectively.
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 thean 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,September 30, 2023, 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, therethe 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 maycould 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 IEA acquisition, the Company assumed a multiemployer pension plan withdrawal liability, under which IEA is currently obligated to make monthly payments of approximately $10,000. As of September 30, 2023 and December 31, 2022, the remaining obligation approximated $1.8 million and $1.9 million, respectively.
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, 20172023 and December 31, 2016,2022, the Company washad accrued project close-out liabilities of approximately $20 million and $40 million, respectively. The Company is not aware of any other material asserted or unasserted claims in connection with theseits 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, ifIf 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 Company had approximately 4551,425 customers for the ninemonth period ended September 30, 2017. As of September 30, 2017 and December 31, 2016, one2023. No customer accounted for approximately 44% and 24%, respectively,represented greater than 10% of the Company’s consolidated net accounts receivable position, which representsis calculated as accounts receivable, net, less BIEC. Asdeferred revenue, as of either September 30, 2017 and 2023 or December 31, 2016,2022. The Company derived approximately 40% a separate customer accounted for approximately 13% and 17%nd 41%, 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, 20172023 and 2016,2022, and derived 80%approximately 37% and 76%42% of its revenues, respectively, from its top ten customerssuch revenue for the nine month periods ended September 30, 20172023 and 2016.2022, respectively.
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, business development and administrative 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 September 30, 2023 and 2022, such payments to related party entities totaled approximately $7.1 million and $8.0 million, respectively, and for the nine month periods ended September 30, 2023 and 2022, such payments totaled approximately $33.9 million and $22.7 million, respectively. Payables associated with such arrangements totaled approximately $2.6 million as of both September 30, 2023 and December 31, 2022. Revenue from such related party arrangements totaled approximately $3.5 million and $2.4 million for the three month periods ended September 30, 2023 and 2022,
27

respectively, and for the nine month periods ended September 30, 2023 and 2022, totaled approximately $10.9 million and $7.4 million, respectively. Related amounts receivable totaled approximately $1.0 million and $3.2 million as of September 30, 2023 and December 31, 2022, 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.CCI, and a member of management of a MasTec subsidiary and an entity that is owned by the Mas family are minority owners. For the three month periods ended September 30, 20172023 and 2016,2022, MasTec paid CCI approximately $22.9$1.2 million and $10.0$1.1 million, respectively, for equipment supplies, rentals, leasesrelated to this activity, and servicing. Forfor the nine month periods ended September 30, 2017 2023 and 2016,2022, MasTec paid CCI approximately $34.9$2.5 million and $13.7$2.9 million, respectively, net of rebates. Asrespectively. Amounts payable to CCI totaled approximately $4.6 million and $0.6 million as of September 30, 20172023 and December 31, 2016, related payables2022, respectively. The Company has also rented equipment to CCI. Revenue from equipment rentals to CCI totaled approximately $6.1$0.2 million for both the three and $1.5 million, respectively.nine month periods ended September 30, 2022. As of December 31, 2022, related amounts receivable were de minimis.
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 members of management of a MasTec subsidiary. For the three month periods ended September 30, 20172023 and 2016,2022, MasTec incurred $39.2subcontracting expenses in connection with this arrangement of approximately $2.7 million and $5.6 million, respectively, of expenses under this subcontracting arrangement, and for the nine month periods ended September 30, 2017 and 2016, MasTec incurred $54.8 million and $8.8 million, respectively. During the third quarter of 2016, the Company sold equipment totaling $0.3 million to this entity. As of September 30, 2017 and December 31, 2016, related amounts payable totaled $20.1 million and $0.1 million, respectively.
MasTec leases employees to a customer in which Jorge Mas and José R. Mas own a majority interest. For both three month periods ended September 30, 2017 and 2016, MasTec charged approximately $0.2 million to this customer, and for both the nine month periods ended September 30, 2017 and 2016, charged $0.6 million. As of both September 30, 2017 and December 31, 2016, outstanding receivables from employee leasing arrangements with this customer totaled $0.2 million. The Company also provides satellite communication services to this customer. For both the three month periods ended September 30, 2017 and 2016, revenue from satellite communication services provided to this customer totaled approximately $0.2 million, and for the nine month periods ended September 30, 2017 and 2016, satellite communication revenues 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, 20172023 and 2016, related party lease payments2022, MasTec incurred approximately $3.1 million and $0.2 million, respectively, of such subcontracting expenses. Related amounts payable totaled approximately $38.4 million and $31.6 million, respectively. Payables associated with related party leases totaled approximately $0.6 million and $0.3$2.5 million as of September 30, 20172023, and as of December 31, 2016,2022, such payables were de minimis.
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, 2023 and 2022, MasTec paid approximately $0.7 million related to this leasing arrangement, and for the nine month periods ended September 30, 2023 and 2022, such payments totaled approximately $2.0 million and $1.9 million, respectively. Additionally, payments for various types of supplies and services, including ancillary
MasTec has performed construction services project-relatedon 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. Construction services related to site restorationpreparation for a new soccer complex began in the third quarter of 2023. For the three and marketingnine month periods ended September 30, 2023, MasTec charged approximately $4.6 million and business development activities associated with members of subsidiary management$4.8 million, respectively, under these arrangements, and related amounts receivable totaled approximately $26.4$4.8 million and $7.4 millionas of September 30, 2023. Payments for other expenses related to the Franchise for the three month periods ended September 30, 20172023 and 2016, respectively, and2022 totaled $41.0approximately $0.3 million and $14.2$0.1 million, respectively, and for the nine month periods ended September 30, 20172023 and 2016,2022, totaled approximately $0.9 million and $0.4 million, respectively.
MasTec has a subcontracting arrangement to perform construction services for an entity, in which José R. Mas has a minority interest, and of which a member of management of a MasTec subsidiary owns the remaining interest. For the three month periods ended September 30, 2023 and 2022, revenue recognized by MasTec under this arrangement totaled approximately $42.7 million and $38.0 million, respectively, and totaled approximately $120.6 million and $98.7 million, respectively, for the nine month periods ended September 30, 2023 and 2022. As of September 30, 2023 and December 31, 2022, related amounts receivable totaled approximately $59.1 million and $42.0 million, respectively. MasTec also pays a management fee to this entity in connection with this subcontracting arrangement. Under a separate arrangement, this entity performs certain construction services for MasTec. For the three month periods ended September 30, 2023 and 2022, MasTec incurred approximately $1.7 million and $0.4 million, respectively, for management fees and subcontracting expenses under these arrangements, and incurred approximately $2.9 million and $0.9 million, respectively, under these arrangements for the nine month periods ended September 30, 2023 and 2022. As of September 30, 2023 and December 31, 2022, related amounts payable totaled approximately $0.6 million and $0.3 million, respectively.
From time to time, the Company pays amounts on behalf of or to the former owners of acquired businesses, which, under the provisions of the related purchase agreements, the former owners are obligated to repay. The Company paid $0.1 million of such amounts during both the three month periods ended September 30, 2023 and 2022. For the nine month periods ended September 30, 2023 and 2022, such payments totaled approximately $0.2 million and $1.5 million, respectively. Amounts receivable for such payments, which are expected to be settled under customary terms associated with the related purchase agreement, totaled approximately $2.2 million and $2.0 million as of September 30, 2023 and December 31, 2022, respectively.
In addition, the Company has a subcontracting arrangement with an entity in which it has a 25% interest. The Company’s interest in this entity is accounted for as an equity method investment. For the three and nine month periods ended September 30, 2023, the Company made equity contributions of approximately $0.1 million and $3.7 million, respectively, to this entity, of which $0.1 million and $0.3 million, respectively, were paid in cash. For the three and nine month periods ended September 30, 2022, the Company made equity contributions to this entity of approximately $0.1 million and $0.6 million, respectively. As of September 30, 20172023 and December 31, 2016, associated amounts payable totaled2022, the Company’s net investment in this entity was a liability of approximately $0.8$1.1 million and $3.7$0.2 million, respectively. In addition, MasTec performs construction services for an entity associated with a memberrespectively, which net amount included approximately $1.1 million 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 milliondeferred revenue as of September 30, 2017. The oil2023, and gas pipeline equipment company that$2.3 million of accounts receivable, net, less deferred revenue, as of December 31, 2022, related to the subcontracting arrangement as of the respective periods. 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 entity. Income recognized in connection with these arrangements totaled approximately $0.2 million for both the three month periods ended September 30, 2023 and 2022, and totaled approximately $0.6 million for both the nine month periods ended September 30, 2023 and 2022. As of September 30, 2023 and December 31, 2022, related amounts receivable totaled $0.2 million and $0.4 million, respectively.
In 2018, the Company acquired a construction management firm specializing in steel building systems, of which Juan Carlos Mas was acquired by MasTec ina minority owner at the thirdtime of acquisition. In the second quarter of 2017 was formerly owned by a member of subsidiary management. MasTec previously leased equipment from this company. The2023, the Company paid $40.6 million in cash and $57.3$16.1 million of contingent consideration in connection with the finalization of the earn-out arrangement related to this acquisition.acquisition, as calculated under the terms of the purchase agreement. Approximately 25% of this earn-out payment was paid to Juan Carlos Mas, consistent with the terms of the purchase agreement.
Non-controlling interests in entities consolidated by the Company represent ownership interests held by certain members of management of severalcertain of the Company’s subsidiaries, primarily in ourthe Company’s Oil and Gas segment, andincluding the ownership interests in two entities that the Company has a subcontracting arrangement with one
28

acquired in the second quarter of these entities2023. See Note 3 - Acquisitions, Goodwill and Other Intangible Assets, Net 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 inadditional information. In the first quarter of 2017 to holders2023, the Company acquired the remaining 15% equity interests in one of its subsidiaries, which interests were previously accounted for as non-controlling interests.interests, from two members of subsidiary management for $10.0 million in cash, plus 120,000 shares of MasTec common stock, valued at approximately $11.6 million.
Split Dollar Agreements
MasTec has split dollar life insurance agreements with eachtrusts, for one of which Jorge Mas is a trustee, and for the other of which José R. Mas is a trustee. For the three month periods ended September 30, 2023 and Jorge Mas. In2022, the Company paid $0.2 million and $0.6 million, respectively, in connection with the split dollar agreementagreements for Jorge Mas, and no payments were made in connection with such agreements for José R. Mas the Company made no payments in either of the three month periods ended September 30, 2017 and 2016, and paid $0.7 million in each of2023 or 2022. For the nine month periods ended September 30, 20172023 and 2016. In2022, the Company paid $0.7 million and $1.1 million, respectively, in connection with the split dollar agreementagreements 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, 20172023 and 2016.2022, paid $0.7 million in connection with such agreements for José R. Mas. As of September 30, 20172023 and December 31, 2016,2022, life insurance assets associated with these agreements totaled $16.6approximately $27.2 million and $14.8$25.8 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)respectively.
29
For the Three Months Ended September 30, 2017MasTec, Inc. 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 Eliminations 
Consolidated
MasTec, Inc.
Revenue$—
 $1,860.3
 $130.3
 $(34.8) $1,955.8
Costs of revenue, excluding depreciation and amortization—
 1,640.3
 120.7
 (34.8) 1,726.2
Depreciation and amortization—
 41.1
 9.0
 —
 50.1
General and administrative expenses0.5
 61.7
 4.2
 —
 66.4
Interest expense (income), net—
 33.2
 (15.6) —
 17.6
Equity in earnings of unconsolidated affiliates—
 —
 (7.4) —
 (7.4)
Other income, net—
 (4.6) (0.1) —
 (4.7)
(Loss) income before income taxes$(0.5) $88.6
 $19.5
 $—
 $107.6
Benefit from (provision for) income taxes0.2
 (33.8) (9.9)
—
 (43.4)
Net (loss) income before equity in income from subsidiaries$(0.3) $54.8
 $9.6
 $—
 $64.2
Equity in income from subsidiaries, net of tax64.1
 —
 —
 (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, 2016MasTec, Inc. 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 Eliminations 
Consolidated
MasTec, Inc.
Revenue$—
 $1,493.9
 $112.7
 $(20.4) $1,586.2
Costs of revenue, excluding depreciation and amortization—
 1,282.3
 107.2
 (20.4) 1,369.0
Depreciation and amortization—
 33.7
 8.9
 —
 42.6
General and administrative expenses0.6
 60.6
 5.9
 —
 67.1
Interest expense (income), net—
 28.6
 (15.5) —
 13.1
Equity in losses of unconsolidated affiliates—
 —
 —
 —
 —
Other (income) expense, net—
 (3.4) 2.3
 —
 (1.0)
(Loss) income before income taxes$(0.6) $92.1
 $3.9
 $—
 $95.3
Benefit from (provision for) income taxes0.2
 (33.4) (5.6) —
 (38.8)
Net (loss) income before equity in income from subsidiaries$(0.4) $58.7
 $(1.7) $—
 $56.5
Equity in income from subsidiaries, net of tax56.7
 —
 —
 (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, 2017MasTec, Inc. 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 Eliminations 
Consolidated
MasTec, Inc.
Revenue$—
 $4,763.4
 $347.4
 $(106.7) $5,004.1
Costs of revenue, excluding depreciation and amortization—
 4,097.7
 332.6
 (106.7) 4,323.6
Depreciation and amortization—
 112.2
 26.2
 —
 138.4
General and administrative expenses1.7
 187.7
 12.6
 —
 202.0
Interest expense (income), net—
 91.5
 (46.5) —
 45.0
Equity in earnings of unconsolidated affiliates—
 —
 (15.1) —
 (15.1)
Other (income) expense, net—
 (9.9) 5.8
 —
 (4.1)
(Loss) income before income taxes$(1.7) $284.2
 $31.8
 $—
 $314.3
Benefit from (provision for) income taxes0.6
 (104.9) (21.9) —
 (126.2)
Net (loss) income before equity in income from subsidiaries$(1.1) $179.3
 $9.9
 $—
 $188.2
Equity in income from subsidiaries, net of tax187.5
 —
 —
 (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, 2016MasTec, Inc. 
Guarantor
Subsidiaries
 
Non-Guarantor
Subsidiaries
 Eliminations 
Consolidated
MasTec, Inc.
Revenue$—
 $3,521.5
 $302.2
 $(30.9) $3,792.8
Costs of revenue, excluding depreciation and amortization—
 3,054.5
 298.0
 (30.9) 3,321.6
Depreciation and amortization—
 96.6
 25.6
 —
 122.2
General and administrative expenses1.7
 172.1
 21.2
 —
 195.0
Interest expense (income), net—
 83.8
 (45.9) —
 37.9
Equity in earnings of unconsolidated affiliates—
 —
 (3.5) —
 (3.5)
Other income, net—
 (12.7) (0.1) —
 (12.8)
(Loss) income before income taxes$(1.7) $127.2
 $6.9
 $—
 $132.4
Benefit from (provision for) income taxes0.6
 (47.3) (7.6) —
 (54.3)
Net (loss) income before equity in income from subsidiaries$(1.1) $79.9
 $(0.7) $—
 $78.1
Equity in income from subsidiaries, net of tax78.8
 —
 —
 (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 2017MasTec, 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, net1,279.7
 848.0
 710.2
 (2,837.9) —
Other long-term assets15.8
 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, 2016MasTec, 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, net1,083.9
 625.9
 861.2
 (2,571.0) —
Other long-term assets12.6
 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, 2017MasTec, 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) $—
 $(249.4)
Cash flows from financing activities:         
Proceeds from credit facilities—
 1,988.1
 14.3
 —
 2,002.4
Repayments of credit facilities—
 (1,817.4) (23.0) —
 (1,840.4)
Repayments of other borrowings and capital lease obligations—
 (52.6) (8.3) —
 (60.8)
Payments of acquisition-related contingent consideration—
 (18.8) —
 —
 (18.8)
Distributions to non-controlling interests—
 —
 (1.3) —
 (1.3)
Proceeds from stock-based awards, net0.9
 —
 —
 —
 0.9
Other financing activities, net—
 (6.3) —
 —
 (6.3)
Net financing activities and advances (to) from consolidated affiliates(0.9) (131.9) 132.8
 —
 —
Net cash (used in) provided by financing activities$—
 $(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, 2016MasTec, 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)
$—

$(94.1)
Cash flows from financing activities:         
Proceeds from credit facilities—
 1,093.8
 93.0
 —
 1,186.8
Repayments of credit facilities—
 (1,056.1) (93.8) —
 (1,149.9)
Repayments of other borrowings and capital lease obligations—
 (37.6) (12.4) —
 (50.0)
Payments of acquisition-related contingent consideration—
 (16.5) (3.3) —
 (19.8)
Proceeds from stock-based awards, net3.4
 —
 0.5
 —
 3.9
Other financing activities, net1.4
 —
 —
 —
 1.4
Net financing activities and advances (to) from consolidated affiliates(4.8) 15.1
 (10.3) —
 —
Net cash used in financing activities$—
 $(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 revenuesrevenue 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 potential effects of general economic and market conditions, including levels of inflation and market interest rates, geopolitical events, market uncertainty and/or volatility.
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 20162022 Annual Report on Form 10-K (“2022 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 positioncondition and results of operations as of and for the three and nine month periods ended September 30, 20172023 and 2016.2022. 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 20162022 Form 10-K. In this MD&A, “$” means U.S. dollars unless specified otherwise.
General Economic, Market and Regulatory Conditions
We have experienced, and may continue to experience, direct and indirect negative effects on our business and operations from negative economic, market and regulatory conditions, including the current level of market interest rates, continuing inflationary effects on the cost of fuel, labor and materials; supply chain disruptions; uncertainty related to the implementation and pace of spending under governmental programs and initiatives related to infrastructure and other industrial investment, delays and uncertainty related to project permitting and other regulatory matters or uncertainty; climate, environmental and sustainability-related matters; public health matters; changes in technology, tax and other incentives; and potential market volatility that could negatively affect demand for future projects, and/or delay existing project timing or cause increased project costs.
We expect the remainder of 2023 and the foreseeable future to continue to be a dynamic macroeconomic environment, with elevated market interest rates and continuing, but moderating levels of cost inflation and potential market volatility, any or all of which could adversely affect our costs and customer demand. These conditions could affect the cost of capital of both us and our customers, as well as our customers’ plans for capital investments and ongoing maintenance expenditures, which could negatively affect demand for our services. The extent to which general economic, market and regulatory conditions could affect our business, operations and financial results is uncertain as it will depend upon numerous evolving factors that we may neither be able to accurately predict nor quantify with specificity, including with respect to the effects of ongoing and recent geopolitical events, such as the political unrest and military conflicts in the Middle East and Ukraine, which could potentially increase volatility and uncertainty in the energy and capital markets.
We believe that our financial position, cash flows and operational strengths will enable us to manage the current uncertainties resulting from general economic, market and regulatory conditions. We carefully manage our liquidity and monitor any potential effects from changing economic, market and regulatory conditions on our financial results, cash flows and/or working capital and will 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 utilityother infrastructure, such as: power delivery services, including transmission, distribution, environmental planning and compliance; wireless, wireline/fiber install-to-the-home and customer fulfillment activities; petroleumpower generation, primarily from clean energy and renewable sources; pipeline infrastructure, including natural gas, carbon capture sequestration, water and pipeline infrastructure; electrical utility transmissionintegrity services; heavy civil; industrial infrastructure, including roads, bridges and distribution; conventionalrail; and renewable power generation; heavy civil and industrial infrastructure.environmental remediation services. Our customers are primarily in these industries. Including our predecessor companies, we have been in business for almostover 90 years. We offer our services primarily underFor the MasTec service marktwelve month period ended September 30, 2023, we had an average of approximately 830 locations and 34,000 employees, respectively, and as of September 30, 2017,2023, we had approximately 21,500850 locations and 37,000 employees, respectively. We offer our services under the MasTec® and 415 locations. We have been consistentlyother service marks and are ranked among the top specialty contractorsTop 400 Contractors by Engineering News-Record for the past several years.News-Record.
We provide our services to a diversified base of customers. We often providecustomers and a significant portion of our services are provided 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
30

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 IndustrialDelivery; and (5) Other. This structure is generally focused on broad end-user markets for our labor-based construction services. 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 segmentreporting 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 toBased on current expectations of our customers’ requirements, we anticipate that we will realize approximately 25%26% of our estimated September 30, 2017 estimated2023 backlog in 2017.2023. The following table presents 18-month estimated backlog by reportable segment as of the dates indicated:

Reportable Segment (in millions):September 30,
2023		June 30,
2023		September 30,
2022
Communications$5,299 $5,420 $5,024 
Clean Energy and Infrastructure3,073 3,324 1,933 
Oil and Gas1,681 2,042 1,513 
Power Delivery2,437 2,656 2,757 
Other— — — 
Estimated 18-month backlog$12,490 $13,442 $11,227 

Reportable Segment (in millions):September 30,
2017		 June 30,
2017		 September 30,
2016
Communications$3,505
 $3,375
 $3,125
Oil and Gas907
 1,506
 1,134
Electrical Transmission268
 295
 269
Power Generation and Industrial331
 85
 116
Other3
 4
 7
Estimated 18-month backlog$5,014
 $5,265
 $4,651
Approximately 65%As of September 30, 2023, 56% of our backlog as of September 30, 2017 is estimated to be 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, delays, regulatory factors and/or other project-related factors.delays or cancellations, including from factors discussed above in “General Economic, Market and Regulatory Conditions.” These changeseffects, among others, could cause estimated revenue to be realized in periods later than originally expected, or not at all. In the past, we haveWe occasionally experiencedexperience postponements, cancellations and reductions in expected future work from master service agreements due to changes in our customers’ spending plans, as well as on construction projects due to market volatility and regulatorythese effects and/or other factors. There can be no assurance as to our customers’ requirements or that actual results will be consistent with the accuracy ofestimates 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 September 30, 2023, total 18-month backlog differed from the amount of our remaining performance obligations due primarily to the inclusion of $7.1 billion of estimated future revenue under master service and other service agreements within our backlog estimates, as described above, and the exclusion of approximately $2.2 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 2023 differs from the amount of remaining performance obligations expected to be recognized for the same period due primarily to the inclusion of approximately $0.7 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 thatof changes in economic, industry and market conditions may have on our customers. General economiccustomers, including the potential effects of the factors discussed above in “General Economic, Market and market conditionsRegulatory Conditions,” which can negatively affect demand for our customers’ products and services whichand can lead to rationalization ofincrease or decrease our customers’ planned capital and maintenance budgets in certain end-markets. FluctuationsAny of these factors and effects, as well as mergers and acquisitions or other business transactions among the customers we serve, could affect demand for our services, or the cost to provide such services and our profitability.
Changes in demand in our customers’ businesses and fluctuations in market prices for energy sources, including oil and gas and other fuel sourcesproducts, 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, onincluding energy generation, electric grid and pipeline and power generation construction services.projects. These fluctuations,factors, as well as the highly competitive nature of our industry, can result and in changes in levels of activity, project mix, and/or the past, have resulted, in lower bids and lower profit onprofitability 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. Otherprograms and/or business streamlining efforts. Market developments, including rising market regulatoryinterest rates and industry factors, such as (i) changesinflationary effects on fuel, labor and materials costs, have had, and could continue to have, a negative effect on our profitability to the extent that we have not been, and in the future are not able, to pass these costs through 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 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.customers. While we actively monitor economic, industry and market factors that could affect
31

our business, we cannot predict the effect that changes in such factors maycould have on our future results of operations, liquidity and cash flows, and we may be unable to fully mitigate, or benefit from, such changes.
ImpactEffect of Seasonality and Cyclical Nature of Business
Our revenue and results of operations are cyclical and can be subject to seasonal and other variations. These variations are influenced by weather, customer spending patterns, bidding seasons, project schedulesFor additional information regarding the effects of seasonality and timing, in particular, for large non-recurring projects and holidays. Typically, our revenue is lowest in the first quartercyclical nature of the year because cold, snowy or wet conditions cause project delays. Revenue in the second quarter is typically higher than in the first quarter, as some projects begin, but continued cold and wet weather can often impact 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 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 or natural catastrophes such as 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 demand for our services. As a result, our business, may be adversely affected by industry declines or by delayssee Management’s Discussion and Analysis of Financial Condition and Results of Operations contained 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, even if not in total. 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; 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.2022 Form 10-K.
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.


A summary of our critical accounting estimates is included in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our 2022 Form 10-K. We baseare required to make estimates and judgments in the preparation of our estimates on historical experience and on various other assumptionsfinancial statements that we believe to be reasonable underaffect the circumstances, the results of which form the basis of making judgments about our operating results, including the results of percentage-of-completion projects, and the carrying valuesreported amounts 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 differ fromrevenues and expenses and related disclosures. We continually review these estimates if conditions change or if certain keyand their underlying assumptions usedto ensure they are appropriate for the circumstances. Changes in making thesethe estimates ultimately prove to be inaccurate. Our accounting policies and assumptions we use could have a material impact on our financial results. During the three and nine month periods ended September 30, 2023, there were no material changes in our critical accounting estimates are reviewed periodically byor policies.
For details of our third quarter 2023 quarterly review for indicators of impairment, and the Audit Committee ofdiscussion relating to the Board of Directors. ReferIEA reporting unit, refer to Note 13 - Business, Basis of PresentationAcquisitions, Goodwill and Significant Accounting PoliciesOther Intangible Assets, Net, in the notes to our condensed unauditedthe 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.reference. Based on our assessment as of September 30, 2023, the results of these assessments, we determined that the estimated fair value of our Electrical Transmission operating segmentIEA reporting unit exceeded its carrying value by approximately 10%, and that7%. The most significant assumptions used in our analysis to determine the fair valuesvalue of two of ourthe IEA reporting unitsunit are the discount rate, revenue and profitability assumptions and the indefinite-lived pre-qualification intangible assetterminal growth rate. As of September 30, 2023, a 50 basis point increase in our Oil and Gas segment, forthe discount rate would reduce the amount by which the IEA reporting unit exceeded its carrying values totaledvalue to approximately $130 million, exceeded their carrying values by4%; a 50 basis point decrease in the terminal growth rate would reduce this amount to approximately 10% for each. Significant changes in assumptions or estimates, such as5%; and a 1% reduction in the profitability and/or cash flows, could result in non-cash goodwill and indefinite-lived intangible asset impairment charges in the future.assumption for all forecast years would reduce this amount to approximately 6%.
We believe that our accounting estimates pertaining to: revenue recognition for percentage-of-completion projects, including project profit or loss, which we define as project revenue less project costs of revenue, including project-related depreciation; allowances for doubtful accounts; fair value estimates, including those related to business acquisitions, valuations of goodwill and indefinite-lived intangible assets; estimated liabilities for future earn-out obligations; fair values of financial instruments; 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.
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 impacteffect 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,
2023202220232022
Revenue$3,257.1 100.0 %$2,513.5 100.0 %$8,715.9 100.0 %$6,769.7 100.0 %
Costs of revenue, excluding depreciation and amortization2,857.1 87.7 %2,187.8 87.0 %7,701.4 88.4 %5,949.3 87.9 %
Depreciation115.0 3.5 %91.3 3.6 %325.3 3.7 %263.5 3.9 %
Amortization of intangible assets42.3 1.3 %28.0 1.1 %126.3 1.4 %81.2 1.2 %
General and administrative expenses180.6 5.5 %125.1 5.0 %520.7 6.0 %404.2 6.0 %
Interest expense, net62.6 1.9 %26.9 1.1 %174.7 2.0 %62.3 0.9 %
Equity in earnings of unconsolidated affiliates, net(6.8)(0.2)%(6.1)(0.2)%(23.4)(0.3)%(19.4)(0.3)%
Other (income) expense, net(16.6)(0.5)%0.2 0.0 %(26.3)(0.3)%(1.9)(0.0)%
Income (loss) before income taxes$22.9 0.7 %$60.3 2.4 %$(82.7)(0.9)%$30.5 0.4 %
(Provision for) benefit from income taxes(7.6)(0.2)%(11.1)(0.4)%34.2 0.4 %0.1 0.0 %
Net income (loss)$15.3 0.5 %$49.2 2.0 %$(48.5)(0.6)%$30.5 0.5 %
Net income attributable to non-controlling interests1.0 0.0 %0.3 0.0 %2.2 0.0 %0.4 0.0 %
Net income (loss) attributable to MasTec, Inc.$14.3 0.4 %$48.9 1.9 %$(50.7)(0.6)%$30.1 0.4 %
32
 
For the Three Months Ended
September 30
 
For the Nine Months Ended
September 30
 2017 2016 2017 2016
Revenue$1,955.8
 100.0 % $1,586.2
 100.0 % $5,004.1
 100.0 % $3,792.8
 100.0 %
Costs of revenue, excluding depreciation and amortization1,726.2
 88.3 % 1,369.0
 86.3 % 4,323.6
 86.4 % 3,321.6
 87.6 %
Depreciation and amortization50.1
 2.6 % 42.6
 2.7 % 138.4
 2.8 % 122.2
 3.2 %
General and administrative expenses66.4
 3.4 % 67.1
 4.2 % 202.0
 4.0 % 195.0
 5.1 %
Interest expense, net17.6
 0.9 % 13.1
 0.8 % 45.0
 0.9 % 37.9
 1.0 %
Equity in earnings of unconsolidated affiliates(7.4) (0.4)% —
 — % (15.1) (0.3)% (3.5) (0.1)%
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 %
Net income attributable to non-controlling interests0.4
 0.0 % 0.3
 0.0 % 1.8
 0.0 % 0.4
 0.0 %
Net income attributable to MasTec, Inc.$63.8
 3.3 % $56.3
 3.5 % $186.4
 3.7 % $77.7
 2.0 %


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 IndustrialDelivery; 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 consistentis 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 below, following the comparison of results discussion below.discussion. The following table presents revenue, EBITDA and EBITDA margin by reportable segment for the periods indicated (dollar amounts in millions):

RevenueEBITDA 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,
Segment:2023202220232022
2023 (a)
2022 (a)
2023 (a)
2022 (a)
Communications$824.4 $888.9 $2,499.6 $2,375.1 $73.4 8.9 %$109.9 12.4 %$215.7 8.6 %$234.5 9.9 %
Clean Energy and Infrastructure1,099.9 563.2 2,894.5 1,493.5 42.4 3.9 %24.6 4.4 %80.9 2.8 %30.2 2.0 %
Oil and Gas672.3 375.8 1,270.6 927.9 97.3 14.5 %49.2 13.1 %188.9 14.9 %133.4 14.4 %
Power Delivery665.0 688.4 2,077.1 1,985.4 56.5 8.5 %63.1 9.2 %161.0 7.8 %150.6 7.6 %
Other— — — — 4.4 NM5.6 NM18.2 NM20.0 NM
Eliminations(4.5)(2.8)(25.9)(12.2)— — — — — — — — 
Segment Total$3,257.1 $2,513.5 $8,715.9 $6,769.7 $274.0 8.4 %$252.4 10.0 %$664.7 7.6 %$568.7 8.4 %
Corporate— — — — (31.3)— (45.9)— (121.2)— (131.2)— 
Consolidated Total$3,257.1 $2,513.5 $8,715.9 $6,769.7 $242.7 7.5 %$206.5 8.2 %$543.5 6.2 %$437.5 6.5 %
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 Gas1,161.0
 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 Transmission81.8
 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 Industrial96.9
 123.6
 204.1
 324.7
 9.3
 9.6% 6.1
 4.9 % 14.8
 7.3% 13.8
 4.3 %
Other10.6
 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, 2017,2023, Communications, Clean Energy and Infrastructure and Power Delivery EBITDA included $4.8 million, $15.3 million and $0.5 million, respectively, of acquisition and integration costs related to our recent acquisitions, and Corporate EBITDA included $0.5 million of such costs, and, for the nine month period ended September 30, 2023, $18.3 million, $36.9 million, $2.5 million and $3.2 million, of such costs were included in EBITDA of the segments and Corporate, respectively. For the three month period ended September 30, 2022, Communications, Oil and Gas, Power Delivery and Corporate EBITDA included $0.5 million, $1.1 million, $20.4 million and $11.2 million, of such acquisition and integration costs, respectively, and for the nine month period ended September 30, 2022, $2.4 million, $4.5 million, $34.5 million, and $18.0 million of such costs were included in EBITDA of the segments and Corporate, respectively.
Three Months Ended September 30, 2023 Compared to Three Months Ended September 30, 2022
Revenue. For the three month period ended September 30, 2023, consolidated revenue increased to $1,956totaled $3,257 million from $1,586as compared with $2,514 million for the same period in 2022, an increase of $370$744 million, or 23%30%. Acquisitions contributed $533 million of increased revenue for the three month period ended September 30, 2023 and organic revenue increased by approximately $210 million, or 8%, as compared with the same period in 2016, driven largely2022. See below for details of revenue 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.segment.
Communications Segment. Communications revenue was $610$824 million for the three month period ended September 30, 2017,2023 as compared with $624$889 million for the same period in 2016,2022, a decrease of $14$65 million, or 2%7%. Acquisitions contributed $38contributed $48 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 three month period ended September 30, 2017, as compared with $736 million for the same period in 2016, an increase of $425 million, or 58%. 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 $82 million for the three month period ended September 30, 2017,2023, whereas organic revenue decreased by approximately $113 million, or 13%, as compared with $102 million for the same period in 2016, a decrease of $20 million, or 20%, driven primarily by project activity and timing.
Power Generation and Industrial Segment. Power Generation and Industrial revenue was $97 million for the three month period ended September 30, 2017, as compared with $124 million for the same period in 2016, a decrease of $27 million, or 22%. Acquisitions contributed $25 million of revenue, which was offset by a decrease in organic revenue of $51 million, or 42%.2022. The decrease in organic revenue was driven primarily by lower levels of renewable powerwireless, wireline and install-to-the-home project activity due, in part, to the effect of macroeconomic conditions on project activity levels, reflecting delays driven, in part, by customers’ higher financing costs, offset, in part, by an increase in utility project work.
Clean Energy and timing.
OtherInfrastructure Segment. Other segmentClean Energy and Infrastructure revenue totaled $11was $1,100 million for the three month period ended September 30, 2017,2023 as compared with $8$563 million for the same period in 2016,2022, an increase of approximately $3$537 million, or 40%95%. Acquisitions contributed $485 million of revenue for the three month period ended September 30, 2023 and organic revenue increased by approximately $52 million, or 9%, drivenas compared with the same period in 2022, due primarily by increasedto higher levels of renewable and heavy civil project activity from our oildue to timing of project work, offset, in part, by lower levels of certain industrial infrastructure project work.
Oil and gas operationsGas Segment. Oil and Gas revenue was $672 million for the three month period ended September 30, 2023, as compared with $376 million for the same period in Mexico,2022, an increase of $297 million, or 79%, primarily due to higher levels of project activity, including large-diameter pipeline project work, offset, in part, by certain facilities and other infrastructure-related project work.
Power Delivery Segment. Power Delivery revenue was $665 million for the three month period ended September 30, 2023, as compared with $688 million for the same period in 2022, a decrease of $23 million, or 3%, primarily due to lower levels of project activity, including for storm restoration services, certain facilities and other infrastructure-related project work, offset, in revenue from a proportionately consolidated non-controlled Canadian joint venture.part, by an increase in transmission and substation-related project work.
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Costs of revenue, excluding depreciation and amortization. Costs of revenue, excluding depreciation and amortization, increased by $357approximately $669 million, or 26%31%, to $1,726$2,857 million for the three month period ended September 30, 2017, as compared with $1,3692023 from $2,188 million for the same period in 2016.2022. Higher levels of revenue contributed $319 million of an increase of $647 million in costs of revenue, excluding depreciation and amortization, whereas decreasedand reduced productivity resulted incontributed an increase of approximately $38$22 million. Costs of revenue, excluding depreciation and amortization, as a percentage of revenue increased by approximately 20070 basis points from 86.3%to 87.7% of revenue for the three month period ended September 30, 2016 to 88.3%2023 from 87.0% of revenue for the same period in 2017.2022. The basis point increase was driven byprimarily due to a combination of reduced project efficiencies within our Communications and mixPower Delivery segments and the effects of certain overhead costs incurred to maintain operating capacity in our Oil and Gas segment,support of expected future project work, offset, in part, by improved project efficienciesproductivity within our Oil and mixGas and Clean Energy and Infrastructure segments and a decrease in our Communications, Electrical Transmissioncertain acquisition and Power Generation and Industrial segments. Additionally,integration costs of revenue, excluding depreciation and amortization, improved in our Other segment for the three month period ended September 30, 2017 as compared with the same period in 2016 due to a reduction in 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. This 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.approximately $19 million.
Depreciation.Depreciation and amortization. Depreciation and amortization was $50$115 million, or 2.6%3.5% of revenue, for the three month period ended September 30, 20172023, as compared with $43$91 million, or 2.7%3.6% of revenue, for the same period in 2016,2022, an increase of $8approximately $24 million, or 18%26%. Acquisitions contributed $4$12 million of incremental depreciation and amortization for the three month period ended September 30, 2017 as compared2023, and organic depreciation increased by $12 million, or approximately 13%, due primarily to the effect of capital expenditures in 2022 in support of certain prior year growth initiatives and to address prior year supply chain disruption concerns, offset, in part, by a $2 million reduction in depreciation expense related to a change in the depreciable lives of certain assets to better align the respective assets’ lives with the same period in 2016.their expected useful lives. As a percentage of revenue, depreciation and amortization decreased slightlyby approximately 10 basis points, due primarily to higher levels of revenue.

General and administrative expenses. General and administrative expenses were $66Amortization of intangible assets. Amortization of intangible assets was $42 million, or 3.4%1.3% of revenue, for the three month period ended September 30, 2017,2023, as compared with $67$28 million, or 4.2%1.1% of revenue, for the same period in 2016, a decrease2022, an increase of $1$14 million, or 1%approximately 51%. Acquisitions contributed $6approximately $14 million of incrementalamortization for the three month period ended September 30, 2023, and organic amortization was generally flat. As a percentage of revenue, amortization of intangible assets increased by approximately 20 basis points.
General and administrative expenses. General and administrative expenses totaled $181 million, or 5.5% of revenue, for the three month period ended September 30, 2023, as compared with $125 million, or 5.0% of revenue, for the same period in 2022, an increase of approximately $56 million, or 44%. Acquisitions, including certain acquisition and integration costs, contributed $42 million of general and administrative expenses for the three month period ended September 30, 2017, whereas2023 and organic general and administrative expenses in the prior year period included certain restructuring charges ofincreased by approximately $5$14 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, administrative expenses decreased by $2 million, or 11%, as compared with the same period in the prior year, primarily due primarily to a reduction in gains on sales of assets, net, and increases in various administrative costs, including information technology expenses, as well as the effects of timing of legal matters and other settlements. Overall,settlement matters. Total acquisition and integration costs included within general and administrative expenses as a percentage of revenue decreased by 80 basis pointsincreased to $18 million for the three month period ended September 30, 2017 as compared with2023 from approximately $9 million for 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%2022. Overall, general and administrative expenses increased by approximately 60 basis points as a percentage of revenue for the three month period ended September 30, 20172023 as compared with $13the same period in 2022.
Interest expense, net. Interest expense, net of interest income, was approximately $63 million, or 0.8%approximately 1.9% of revenue, for the three month period ended September 30, 2023, as compared with approximately $27 million, or 1.1% of revenue, for the same period in 2016.2022, an increase of approximately $36 million, or 133%. The increase in interest expense, wasnet, resulted primarily from credit facility activity and term loans, which accounted for approximately $27 million of the increase due to higher levelsaverage balances, including from indebtedness incurred in connection with acquisition activity, including $700 million of financing costs, including discount charges on financing arrangements,additional unsecured term loans entered into in connection with the acquisition of IEA in the fourth quarter of 2022, as well as an increase inhigher average interest expenserates on our Credit Facility in the third quarter of 2017floating rate debt as compared with 2016.the same period in 2022. In addition, interest expense from senior notes increased by $5 million due to the assumption, exchange and issuance of $300 million aggregate principal amount of 6.625% senior notes in connection with the IEA acquisition. See Financial Condition, Liquidity and Capital Resources discussion below for details of our debt instruments and recent transactions. Additionally, interest expense from accounts receivable financing arrangements increased by approximately $1 million due primarily to higher average interest rates and higher average balances, including from arrangements entered into in the second and third quarters of 2023. See Note 5 - Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities, which is incorporated by reference, for details of our financing arrangements.
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 three month periodperiods ended September 30, 2017,2023 and 2022, equity in earnings from unconsolidated affiliates, wasnet, totaled approximately $7 million and $6 million, respectively, and related primarily to our investments in the Waha JVs, which commenced operationsand, to a lesser extent to our investments in 2017.certain other entities.
Other income,(income) expense, net. Other income,(income) expense, net, consists primarily of gains or losses from saleschanges to estimated Earn-out accruals and certain contingent payments to the former owners of an acquired business; certain legal/other settlements; gains or losses, or changes in estimated recoveries from certain assets, and investments, certain legal/other settlements, gains or losses from changes to estimated earn-out accruals,including financial instruments, and certain restructuring charges related to losses on disposalliabilities; certain purchase accounting adjustments, and other miscellaneous income or expense. Other income, net, was $17 million for the three month period ended September 30, 2023, as compared with $0.2 million of excess fixed assets.other expense, net for the same period in 2022. For the three month period ended September 30, 2017,2023, other income, net, wasincluded approximately $5 million of income, net, from changes to estimated Earn-out accruals and $7 million of other miscellaneous income, net, including from insurance and other settlements, $7 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business and approximately $3 million of impairment losses on an investment. For the three month period ended September 30, 2022, other expense, net, included approximately $3 million of acquisition and integration-related financing costs, offset, in part, by approximately $1 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business and approximately $1 million of other miscellaneous income.
Provision for income taxes. Income tax expense was $8 million for the three month period ended September 30, 2023 as compared with $1$11 million for the same period in the prior year. OtherPre-tax income net, for the three month period ended September 30, 2017 included approximately $3 million of income from changesdecreased 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.
Provision for income taxes. Income tax expense was $43$23 million for the three month period ended September 30, 2017 as compared with $392023 from $60 million for the same period in the prior year. In the third quarter of 2017, we had pre-tax income of $108 million as compared with $95 million for the same period in the prior year. Our effective tax rate for2022. For the three month period ended September 30, 2017 decreased versus2023, our effective tax rate increased to 33.1% from 18.4% for the same period in 2016, primarily due to2022. Our effective tax credits that were recognized duringrate in the third quarter of 2017, offset by2023 included a benefit of approximately $4 million related to adjustments
34

resulting from the effectfinalization of lossesour 2022 tax returns, whereas in foreign jurisdictions.the third quarter of 2022, our effective tax rate included a benefit of approximately $13 million related to adjustments from finalization of our 2021 tax returns.
Analysis of EBITDA by Segment
Communications Segment. EBITDA for our Communications segment was $65$73 million, or 10.7%8.9% of revenue, for the three month period ended September 30, 2017,2023, as compared with $63$110 million, or 10.1%12.4% of revenue, for the same period in 2016,2022, a decrease of approximately $37 million, or 33%. As a percentage of revenue, EBITDA decreased by 350 basis points, or approximately $29 million, due primarily to reduced operating leverage from lower levels of wireless revenue, as well as reduced project efficiencies and an increase of approximately $3$4 million or 4%. The increase was primarily due to production efficiencies.in certain acquisition and integration costs. Lower levels of revenue contributed a decrease in EBITDA of $8 million.
OilClean Energy and GasInfrastructure Segment. EBITDA for our OilClean Energy and GasInfrastructure segment was $108$42 million, or 9.3%3.9% of revenue, for the three month period ended September 30, 2017,2023, as compared with $118EBITDA of $25 million, or 16.0%4.4% of revenue, for the same period in 2016, a decrease in EBITDA2022, an increase of $10approximately $18 million, or approximately 8%73%. Higher levels of revenue contributed an increase in EBITDA of $68approximately $23 million, which was offset bywhereas reduced productivity contributed a decrease of approximately $6 million. As a percentage of revenue, EBITDA decreased by approximately 50 basis points due primarily to project inefficiencies, including from certain industrial infrastructure project work, as well as the effects of certain overhead costs incurred to maintain operating capacity in EBITDA from lower EBITDA margins due to reducedsupport of expected future project efficiencieswork, and an increase of approximately $15 million in certain acquisition and integration costs, offset, in part, by improved productivity for certain renewable projects and the effects of project mix.
Electrical TransmissionOil and Gas Segment. EBITDA for our Electrical TransmissionOil and Gas segment was $5$97 million, or 5.5%14.5% of revenue, for the three month period ended September 30, 2017,2023, as compared with EBITDA of negative $8$49 million, or negative 8.1%13.1% of revenue, for the same period in 2016, for2022, an improvementincrease of approximately $48 million, or 98%. Higher levels of revenue contributed an increase in EBITDA of $13approximately $39 million. The improvement in Electrical TransmissionAs a percentage of revenue, EBITDA wasmargins increased by approximately 140 basis points, or $9 million, due primarily to a combination of project efficiencies and improved productivity, including as a result of improved operating leverage from higher levels of revenue, as well as the effects of project mix the non-recurrenceand a decrease of approximately $4$1 million of restructuring charges for the three month period ended September 30, 2016,in certain acquisition and improved cost and overhead utilization.integration costs.
Power Generation and IndustrialDelivery Segment. EBITDA for our Power Generation and IndustrialDelivery segment was $9$57 million, or 9.6%8.5% of revenue, for the three month period ended September 30, 2017,2023, as compared with EBITDA of $63 million, or 9.2% of revenue, for the same period in 2022, a decrease in EBITDA of approximately $7 million, or 11%. As a percentage of revenue, EBITDA decreased by approximately 70 basis points, or $4 million, due primarily to reduced project efficiencies, offset, in part, by a reduction of approximately $20 million in certain acquisition and integration costs. Lower levels of revenue contributed a decrease in EBITDA of approximately $2 million.
Other Segment. EBITDA from Other businesses was approximately $4 million for the three month period ended September 30, 2023, as compared with EBITDA of $6 million or 4.9% of revenue, for the same period in 2016,2022. EBITDA from Other businesses relates primarily to equity in earnings from our investments in the Waha JVs, offset, in part, by losses from other businesses and investments.
Corporate. Corporate EBITDA was negative $31 million for the three month period ended September 30, 2023, as compared with EBITDA of negative $46 million for the same period in 2022, for an improvementincrease in EBITDA of $3approximately $15 million. Acquisition and integration costs included within corporate expenses decreased to approximately $1 million or 52%. As a percentagefor the three month period ended September 30, 2023 from $11 million for the same period in 2022. For the three month period ended September 30, 2023, Corporate EBITDA included approximately $5 million of revenue, segmentincome, net, from changes to estimated Earn-out accruals and $7 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business. Corporate EBITDA improvedfor the three month period ended September 30, 2022 included approximately $1 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business. Corporate expenses not related to the above-described items increased by approximately 470 basis points$6 million for the three month period ended September 30, 2023 as compared with the same period in the prior year, due primarily to improved project efficienciesan increase in compensation costs and mix,other administrative expenses, including professional fees, and the effects of timing of ordinary course legal and other settlement matters, offset, in part, by reduced cost and overhead utilization due to lower revenue.
Other Segment. EBITDAother miscellaneous income, net, including from Other businesses was $10 million for the three month period ended September 30, 2017, as compared with EBITDA of negative $3 million for the same period in 2016, an improvement of $13 million. Other segment EBITDA 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 the three month periods ended September 30, 2017 and 2016, included losses of $0.4 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 $22 million 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. Corporate EBITDA for the three month period ended September 30, 2017 included approximately $3 million of income from changes to estimated earn-out accruals. For the three month period ended September 30, 2017, other corporate expenses increased as compared with the prior year period primarily as a result of costs related to the timing of legal mattersinsurance and other settlements.

Nine Months Ended September 30, 20172023 Compared to Nine Months Ended September 30, 20162022
Revenue. For the nine month period ended September 30, 2017,2023, consolidated revenue increased to $5,004totaled $8,716 million from $3,793as compared with $6,770 million for the same period in 2022, an increase of $1,211$1,946 million, or 32%29%. Acquisitions contributed $1,504 million of increased revenue for the nine month period ended September 30, 2023 and organic revenue increased by approximately $443 million, or 7%, as compared with the same period in 2016. Oil and Gas2022. See below for details of 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.segment.
Communications Segment. Communications revenue was $1,762$2,500 million for the nine month period ended September 30, 2017,2023, as compared with $1,728$2,375 million for the same period in 2016,2022, an increase of $34$125 million, or 2%5%. Acquisitions contributed $71$106 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 the nine month period ended September 30, 2017,2023, and organic revenue increased by approximately $19 million, or 1%, as compared with $1,454 million for the same period in 2016, an increase of $1,303 million, or 90%.2022. The increase in Oil and Gasorganic revenue was driven primarily by an increasehigher levels of wireline and utility project activity, offset, in multiple large long-haul pipeline construction projects.part, by a decrease in wireless and install-to-the-home project work due, in part, to the effect of macroeconomic conditions on project activity levels, reflecting delays driven, in part, by customers’ higher financing costs.
Electrical TransmissionClean Energy and Infrastructure Segment. Electrical TransmissionClean Energy and Infrastructure revenue was $277$2,895 million for the nine month period ended September 30, 2017,2023 as compared with $284$1,494 million for the same period in 2016, a decrease2022, an increase of $6$1,401 million, or 2%94%. Acquisitions contributed $1,383 million of revenue for the nine month period ended September 30, 2023, and organic revenue increased by approximately $18 million, or 1%, as compared with the same period in 2022, due primarily to higher levels of renewable and heavy civil project activity due to timing of project work, offset, in part, by lower levels of certain industrial infrastructure project work.
35

Oil and timing.
Power GenerationGas Segment. Oil and Industrial Segment. Power Generation and IndustrialGas revenue was $204$1,271 million for the nine month period ended September 30, 2017,2023, as compared with $325$928 million for the same period in 2016, a decrease2022, an increase of $121$343 million, or 37%. Acquisitions contributed $25 million, primarily due to higher levels of revenue, which wasproject activity, including large-diameter pipeline, pipeline integrity and midstream pipeline project work, offset, in part, by a decreasereduction in organic revenue of $145 million. The decrease in organiccertain facilities and other infrastructure-related project work.
Power Delivery Segment. Power Delivery revenue was driven primarily by lower levels of renewable power project activity and timing.
Other Segment. Other segment revenue totaled $14$2,077 million for the nine month period ended September 30, 2017,2023 as compared with $15$1,985 million for the same period in 2016, a decrease2022, an increase of $92 million, or 5%. For the nine month period ended September 30, 2023, acquisitions contributed $15 million of revenue, and organic revenue increased by approximately $1$77 million, or 4%, drivenas compared with the same period in 2022, primarily due to higher levels of project activity, including for transmission and substation-related project work, offset, in part, by a reduction in revenue from a proportionately consolidated non-controlled Canadian joint venture, offset, in part, by increased levels of activity from our oilstorm restoration services, certain facilities and gas operations in Mexico.other infrastructure-related project work.
Costs of revenue, excluding depreciation and amortization. Costs of revenue, excluding depreciation and amortization, increased by approximately $1,002$1,752 million, or 30%29%, to $4,324$7,701 million for the nine month period ended September 30, 2017, as compared with $3,3222023 from $5,949 million for the same period in 2016.2022. Higher levels of revenue contributed $1,061 million of an increase of $1,710 million in costs of revenue, excluding depreciation and amortization, whereas improvedand reduced productivity resulted in a decreasecontributed an increase of approximately $59$42 million. Costs of revenue, excluding depreciation and amortization, as a percentage of revenue decreasedincreased by approximately 12050 basis points from 87.6%to 88.4% of revenue for the nine month period ended September 30, 2016 to 86.4%2023 from 87.9% of revenue for the same period in 2017. This2022. The basis point improvementincrease was driven primarily bydue to a combination of reduced project efficiencies within our Electrical TransmissionCommunications and Power Generation and IndustrialDelivery segments, which benefited from improved project efficiencies, close-outs and mix, as well as the non-recurrenceeffects of certain first quarter 2016overhead costs incurred to maintain operating capacity in support of expected future project losses. These improvements werework and the effects of inflation on labor, fuel and materials costs across our businesses, offset, in part, by reduced project efficienciesimproved productivity within our Clean Energy and mix in ourInfrastructure and Oil and Gas segments, a $14 million decrease in certain acquisition and Communications segments. Additionally,integration costs and the positive effects of certain project lossesclose-outs.
Depreciation. Depreciation was $325 million, or 3.7% of revenue, for the nine month period ended September 30, 2023, as compared with $263 million, or 3.9% of revenue, for the same period in 2022, an increase of approximately $62 million, or 23%. Acquisitions contributed $33 million of depreciation for the nine month period ended September 30, 2023, and organic depreciation increased by $29 million, or approximately 11%, due primarily to the effect of capital expenditures in 2022 in support of certain prior year growth initiatives and to address prior year supply chain disruption concerns, offset, in part, by a $4 million reduction in depreciation expense related to a change in the depreciable lives of certain assets to better align the respective assets’ lives with their expected useful lives. As a percentage of revenue, depreciation decreased by approximately 20 basis points, due primarily to higher levels of revenue.
Amortization of intangible assets. Amortization of intangible assets was $126 million, or 1.4% of revenue, for the nine month period ended September 30, 2023, as compared with $81 million, or 1.2% of revenue, for the same period in 2022, an increase of approximately $45 million, or 55%. Acquisitions contributed approximately $44 million of amortization for the nine month period ended September 30, 2023, and organic amortization increased by approximately $1 million, or 1%. As a percentage of revenue, amortization of intangible assets increased by approximately 20 basis points.
General and administrative expenses. General and administrative expenses totaled $521 million, or 6.0% of revenue, for the nine month period ended September 30, 2023, as compared with $404 million, or 6.0% of revenue, for the same period in 2022, an increase of $116 million, or 29%. Acquisitions, including certain acquisition and integration costs, contributed $115 million of general and administrative expenses for the nine month period ended September 30, 2023, and organic general and administrative expenses increased by approximately $1 million as compared with the same period in the prior year, primarily due to a reduction in gains on sales of assets, net, and increases in various administrative costs, including information technology expenses, professional fees and legal expenses, offset, in part, by a proportionately consolidated non-controlled Canadian joint venturereduction in our Other segment totaled $7compensation expense and other miscellaneous administrative costs. Total acquisition and integration costs included within general and administrative expenses increased to $53 million for the nine month period ended September 30, 2017 as compared with $52023 from approximately $35 million for the same period in 2022. Overall, general and administrative expenses as a percentage of revenue were generally flat at 6.0% of revenue for both periods.
Interest expense, net. Interest expense, net of interest income, was approximately $175 million, or 2.0% of revenue, for the prior year.nine month period ended September 30, 2023, as compared with approximately $62 million, or 0.9% of revenue, for the same period in 2022, an increase of approximately $112 million, or 180%. The increase in interest expense, net, resulted primarily from credit facility activity and term loans, which accounted for approximately $85 million of the increase due to higher average balances, including from indebtedness incurred in connection with acquisition activity, including $700 million of additional unsecured term loans entered into in connection with the acquisition of IEA in the fourth quarter of 2022, as well as higher average interest rates on our floating rate debt as compared with the same period in 2022. In addition, interest expense from senior notes increased by $15 million due to the assumption, exchange and issuance of $300 million aggregate principal amount of 6.625% senior notes in connection with the IEA acquisition. See Financial Condition, Liquidity and Capital Resources discussion below for details of our debt instruments and recent transactions. Additionally, interest expense from accounts receivable financing arrangements increased by approximately $7 million due primarily to higher average interest rates and higher average balances, including from arrangements entered into in the second and third quarters of 2023. See Note 5 - Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities, which is incorporated by reference, for details of our financing arrangements.
DepreciationEquity in earnings of unconsolidated affiliates, net. For the nine month periods ended September 30, 2023 and amortization. Depreciation2022, equity in earnings from unconsolidated affiliates, net, totaled approximately $23 million and amortization$19 million, respectively, and related primarily to our investments in the Waha JVs, and, to a lesser extent to our investments in certain other entities.
Other income, net. Other income, net, was $138$26 million for the nine month period ended September 30, 2023, as compared with $2 million for the same period in 2022. For the nine month period ended September 30, 2023, other income, net, included approximately $7 million of income, net, from changes to estimated Earn-out accruals, approximately $3 million of income from the final settlement and expiration of certain warrants related to the acquisition of IEA, approximately $19 million of other miscellaneous income, including from insurance and other settlements, and approximately $2 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business, offset, in part, by approximately $3 million of impairment losses on an investment. For the nine month period ended September 30, 2022, other
36

income, net, included approximately $1 million of income, net, from changes to estimated Earn-out accruals, approximately $6 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business and approximately $5 million of other miscellaneous income, offset, in part, by approximately $7 million of expense from changes in the fair value of our investment in AVCT, net of income from strategic arrangements and approximately $3 million of acquisition and integration-related financing costs.
Benefit from income taxes. Income tax benefit was $34 million for the nine month period ended September 30, 2023 as compared with $0.1 million for the same period in 2022. Pre-tax losses totaled $83 million for the nine month period ended September 30, 2023 as compared with $30 million of pre-tax income for the same period in 2022. For the nine month period ended September 30, 2023, our effective tax rate was a benefit of 41.4% as compared with 0.2% for the same period in 2022. Our effective tax rate for the nine month period ended September 30, 2023 included a benefit of approximately $6 million related to adjustments resulting from the finalization of our 2022 tax returns and the effects of a net tax benefit of approximately $9 million from share-based payment awards, offset, in part, by an increase in non-deductible expenses. For the nine month period ended September 30, 2022, our effective tax rate included a benefit of approximately $15 million from adjustments related to the finalization of our 2021 tax returns, and a net tax benefit of approximately $1 million from share-based payment awards.
Analysis of EBITDA by Segment
Communications Segment. EBITDA for our Communications segment was $216 million, or 8.6% of revenue, for the nine month period ended September 30, 2023, as compared with EBITDA of $235 million, or 9.9% of revenue, for the same period in 2022, a decrease of approximately $19 million, or approximately 8%. As a percentage of revenue, EBITDA decreased by approximately 120 basis points, or approximately $31 million, due primarily to reduced operating leverage from lower levels of wireless revenue, as well as reduced project efficiencies, including the effects of inflation on labor, fuel and materials costs, and an increase of approximately $16 million in certain acquisition and integration costs, offset, in part, by the positive effects of certain project close-outs. Higher levels of revenue contributed an increase in EBITDA of $12 million.
Clean Energy and Infrastructure Segment. EBITDA for our Clean Energy and Infrastructure segment was $81 million, or 2.8% of revenue, for the nine month period ended September 30, 20172023, as compared with $122EBITDA of $30 million, or 3.2%2.0% 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 2016.2022, an increase in EBITDA of approximately $51 million, or 168%. Higher levels of revenue contributed an increase in EBITDA of approximately $28 million. As a percentage of revenue, depreciation and amortization decreasedEBITDA increased by approximately 5080 basis points, or $22 million, due primarily to higher levelsa combination of revenue.improved productivity, including for certain renewable projects, offset, in part, by an increase of approximately $37 million in certain acquisition and integration costs, the effects of certain overhead costs incurred to maintain operating capacity in support of expected future project work, project mix and the effects of inflation on labor, fuel and materials costs.
GeneralOil and administrative expenses. GeneralGas Segment. EBITDA for our Oil and administrative expenses were $202Gas segment was $189 million, or 4.0%14.9% of revenue, for the nine month period ended September 30, 2017,2023, as compared with $195EBITDA of $133 million, or 5.1%14.4% of revenue, for the same period in 2016,2022, an increase of $7$55 million, or 4%42%. AcquisitionsHigher levels of revenue contributed $10an increase in EBITDA of $49 million. As a percentage of revenue, EBITDA margins increased by approximately 50 basis points, or approximately $6 million, due primarily to project efficiencies and improved productivity, including as a result of incremental generalimproved operating leverage from higher levels of revenue, as well as the effects of project mix, certain project close-outs and administrative expensesa reduction of approximately $5 million in certain acquisition and integration costs, offset, in part, by the effects of inflation on labor, fuel and materials costs.
Power Delivery Segment. EBITDA for our Power Delivery segment was $161 million, or 7.8% of revenue, for the nine month period ended September 30, 2017, whereas general and administrative expenses2023, as compared with EBITDA of $151 million, or 7.6% of revenue, for the same period in the prior year included certain restructuring charges2022, an increase in EBITDA of approximately $11$10 million, relatedor 7%. Higher levels of revenue contributed an increase in EBITDA of $7 million. As a percentage of revenue, EBITDA increased by approximately 20 basis points, or $3 million, due primarily to our efforts to streamline our western Canadian oilimproved project efficiencies and gasa reduction of approximately $32 million in certain acquisition and our electrical transmission operations, which efforts were substantially completedintegration costs, offset, in 2016. Excludingpart, by the effects of the above mentioned items, various administrative expenses increased byinflation on labor, fuel and materials costs.
Other Segment. EBITDA from Other businesses totaled approximately $8$18 million for the nine month period ended September 30, 2017, driven2023, as compared with EBITDA of $20 million for the same period in 2022. EBITDA from Other businesses relates primarily to equity in earnings from our investments in the Waha JVs, offset, in part, by costs related to the timing of legal matterslosses from other businesses and other settlements as well as costs associated with growth initiatives. Overall,investments.
Corporate. Corporate EBITDA was negative $121 million for the nine month period ended September 30, 2017, general2023, as compared with EBITDA of negative $131 million for the same period in 2022, for an increase in EBITDA of approximately $10 million. Acquisition and administrativeintegration costs included within corporate expenses as a percentagedecreased to approximately $3 million for the nine month period ended September 30, 2023 from $18 million for the same period in 2022. For the nine month period ended September 30, 2023, Corporate EBITDA included approximately $7 million of revenue improved 110 basis pointsincome, net, from changes to estimated Earn-out accruals, $3 million of income from the final settlement and expiration of certain warrants related to the acquisition of IEA and $2 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business. For the nine month period ended September 30, 2022, Corporate EBITDA included approximately $1 million of income, net, from changes to estimated Earn-out accruals and $6 million of income from changes in the fair value of additional contingent payments to the former owners of an acquired business, offset by approximately $7 million, of expense from changes in the fair value of certain investments, net of income from strategic arrangements.For the nine month period ended September 30, 2023, Corporate expenses not related to the above-described items increased by approximately $17 million as compared with the same period in the prior year, due primarily to improvementsincreases in overhead cost utilization from higher levels of revenue.
Interestcompensation 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,professional fees and other administrative expenses 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 earningseffects 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 ordinary course legal matters and other settlements; (iv)settlement matters, offset, in part, by a benefitother miscellaneous income, net, including 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 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 mattersinsurance and other settlements, as well as costs associated with growth initiatives, including incentive and compensation expense.settlements.
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
37

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”). TheThese “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 forexpense; acquisition and integration costs related to our recent acquisitions; fair value gains or losses, net, on an investment; and the periods presented, were losses,bargain purchase gain from a proportionately consolidated non-controlled Canadian joint venture that was underway when we acquired Pacer in 2014, 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,2021 acquisition; and, for Adjusted Net Income and Adjusted Diluted Earnings Per Share, amortization of intangible assets, and the tax effects of the adjusted items, including non-cash stock based compensation. Theitems. 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-cashanalyzing 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 2021, we initiated a significant transformation of our end-market business operations to position the Company for expected future opportunities. This transformation included significant acquisition activity to expand our scale and capacity in renewable energy, power delivery, heavy civil and telecommunications services, and has resulted in significant acquisition and integration costs. Beginning in the fourth quarter of 2021, due to the extent of the acquisition costs related to this acquisition activity and the extent of the integration efforts that have been, and 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. These integration efforts are ongoing and we expect to incur any remaining acquisition and integration expenses in the fourth quarter of 2023.
In addition, since the second quarter of 2022, we exclude fair value gains or losses, net, for our investment in American Virtual Cloud Technologies, Inc. (“AVCT”) in calculating our adjusted results, with prior periods updated to conform to this presentation. We believe that fair value gains or losses for our investment in AVCT, a company in which we had no active involvement and which varied from period to period based on fluctuations in the market price of the investment, are not indicative of our core operations, and that this presentation improves comparability of our results with those of our peers. AVCT filed for bankruptcy in the first quarter of 2023, and our investment was fully written off. We exclude intangible asset amortization and selected purchase accounting adjustments, including the bargain purchase gain from a 2021 acquisition, from our adjusted measures provide a baseline for analyzing trendsdue to their non-operational nature and inherent volatility, as acquisition activity varies from period to period. Note that while intangible asset amortization related to the assets of acquired entities is excluded from our non-U.S. GAAP financial measures, our non-U.S. GAAP financial measures include the revenue and all other expenses of the acquired entities, unless otherwise stated. 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. 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 indicatedindicated. The tables below (dollar amounts in millions). The tables below may contain slight summation differences due to rounding.
For the Three Months Ended September 30,For the Nine Months Ended September 30,
2023202220232022
Net income (loss)$15.3 0.5 %$49.2 2.0 %$(48.5)(0.6)%$30.5 0.5 %
Interest expense, net62.6 1.9 %26.9 1.1 %174.7 2.0 %62.3 0.9 %
Provision for (benefit from) income taxes7.6 0.2 %11.1 0.4 %(34.2)(0.4)%(0.1)(0.0)%
Depreciation115.0 3.5 %91.3 3.6 %325.3 3.7 %263.5 3.9 %
Amortization of intangible assets42.3 1.3 %28.0 1.1 %126.3 1.4 %81.2 1.2 %
EBITDA$242.7 7.5 %$206.5 8.2 %$543.5 6.2 %$437.5 6.5 %
Non-cash stock-based compensation expense7.2 0.2 %5.7 0.2 %24.3 0.3 %18.9 0.3 %
Acquisition and integration costs21.1 0.6 %33.3 1.3 %60.9 0.7 %59.4 0.9 %
Losses on fair value of investment— — %0.1 0.0 %0.2 0.0 %7.2 0.1 %
Bargain purchase gain— — %— — %— — %(0.2)(0.0)%
Adjusted EBITDA$271.1 8.3 %$245.6 9.8 %$629.0 7.2 %$522.8 7.7 %
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 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, net17.6
 0.9% 13.1
 0.8% 45.0
 0.9% 37.9
 1.0%
Provision for income taxes43.4
 2.2% 38.8
 2.4% 126.2
 2.5% 54.3
 1.4%
Depreciation and amortization50.1
 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 expense3.4
 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 venture0.4
 0.0% 5.1
 0.3% 7.4
 0.1% 5.1
 0.1%
Charges (recoveries) from multi-employer pension plan withdrawals0.6
 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 September 30,For the Nine Months Ended September 30,
2023202220232022
EBITDA$242.7 7.5 %$206.5 8.2 %$543.5 6.2 %$437.5 6.5 %
Non-cash stock-based compensation expense (a)
7.2 0.2 %5.7 0.2 %24.3 0.3 %18.9 0.3 %
Acquisition and integration costs (b)
21.1 0.6 %33.3 1.3 %60.9 0.7 %59.4 0.9 %
Losses on fair value of investment (a)
— — %0.1 0.0 %0.2 0.0 %7.2 0.1 %
Bargain purchase gain (a)
— — %— — %— — %(0.2)(0.0)%
Adjusted EBITDA$271.1 8.3 %$245.6 9.8 %$629.0 7.2 %$522.8 7.7 %
Segment:
Communications$78.2 9.5 %$110.4 12.4 %$234.0 9.4 %$236.9 10.0 %
Clean Energy and Infrastructure57.6 5.2 %24.6 4.4 %117.8 4.1 %30.2 2.0 %
Oil and Gas97.3 14.5 %50.3 13.4 %188.9 14.9 %137.9 14.9 %
Power Delivery57.0 8.6 %83.5 12.1 %163.5 7.9 %185.1 9.3 %
Other4.4 NM5.6 NM18.2 NM20.0 NM
Segment Total$294.5 9.0 %$274.4 10.9 %$722.4 8.3 %$610.1 9.0 %
Corporate(23.4)— (28.8)— (93.4)— (87.3)— 
Adjusted EBITDA$271.1 8.3 %$245.6 9.8 %$629.0 7.2 %$522.8 7.7 %

NM - Percentage is not meaningful

(a)    Non-cash stock-based compensation expense, losses on the fair value of our investment in AVCT and the bargain purchase gain from a fourth quarter 2021 acquisition are 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 expense3.4
 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 venture0.4
 0.0% 5.1
 0.3 % 7.4
 0.1% 5.1
 0.1 %
Charges (recoveries) from multi-employer pension plan withdrawals0.6
 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 Gas108.1
 9.3% 118.0
 16.0 % 356.1
 12.9% 194.1
 13.3 %
Electrical Transmission4.5
 5.5% (3.8) (3.7)% 11.8
 4.3% (34.7) (12.2)%
Power Generation and Industrial9.3
 9.6% 6.1
 4.9 % 14.8
 7.3% 13.9
 4.3 %
Other10.5
 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 September 30, 2023, Communications, Clean Energy and Adjusted Diluted Earnings Per ShareInfrastructure and Power Delivery EBITDA included $4.8 million, $15.3 million and $0.5 million, respectively, of acquisition and integration costs related to our recent acquisitions, and Corporate EBITDA included $0.5 million of such costs, and for the nine month period ended September 30, 2023, $18.3 million, $36.9 million, $2.5 million and $3.2 million of such costs were included in EBITDA of the segments and Corporate, respectively. For the three month period ended September 30, 2022, Communications, Oil and Gas, Power Delivery and Corporate EBITDA included $0.5 million, $1.1 million, $20.4 million and $11.2 million of such acquisition and integration costs, respectively, and for the nine month period ended September 30, 2022, $2.4 million, $4.5 million, $34.5 million, and $18.0 million of such costs were included in EBITDA of the segments and Corporate, respectively.
The tablestable below, which may contain slight summation differences due to rounding, reconcilereconciles 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,
20232022
Net Income (in millions)Diluted Earnings Per ShareNet Income (in millions)Diluted Earnings Per Share
Reported U.S. GAAP measure$15.3 $0.18 $49.2 $0.65 
Adjustments:
Non-cash stock-based compensation expense7.2 0.09 5.7 0.08 
Amortization of intangible assets42.3 0.54 28.0 0.37 
Acquisition and integration costs21.1 0.27 33.3 0.44 
Losses on fair value of investment— — 0.1 0.00 
Total adjustments, pre-tax$70.6 $0.90 $67.1 $0.89 
   Income tax effect of adjustments (a)
(10.0)(0.13)(15.5)(0.21)
Adjusted non-U.S. GAAP measure$75.9 $0.95 $100.8 $1.34 
39
 For the Three 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$64.2
 $0.77
 $56.5
 $0.69
Adjustments:       
Non-cash stock-based compensation expense3.4
 0.04
 3.9
 0.05
Restructuring charges—
 —
 4.7
 0.06
Project results from non-controlled joint venture0.4
 0.00
 5.1
 0.06
Charges (recoveries) from multi-employer pension plan withdrawals0.6
 0.01
 —
 —
Total adjustments, pre-tax$4.4
 $0.05
 $13.7
 $0.17
   Income tax effect of adjustments (a)
(0.6) (0.01) (4.0) (0.05)
Adjusted non-U.S. GAAP measure$68.0
 $0.82
 $66.3
 $0.81

For the Nine Months Ended September 30For the Nine Months Ended September 30,
2017 201620232022
Net Income
(in millions)		 Diluted Earnings Per Share Net Income
(in millions)		 Diluted Earnings Per ShareNet (Loss) Income (in millions)Diluted (Loss) Earnings Per ShareNet Income (in millions)Diluted Earnings Per Share
Reported U.S. GAAP measure$188.2
 $2.27
 $78.1
 $0.96
Reported U.S. GAAP measure$(48.5)$(0.65)$30.5 $0.38 
Adjustments:       Adjustments:
Non-cash stock-based compensation expense10.5
 0.13
 11.3
 0.14
Non-cash stock-based compensation expense24.3 0.31 18.9 0.25 
Restructuring charges0.6
 0.01
 13.8
 0.17
Project results from non-controlled joint venture7.4
 0.09
 5.1
 0.06
Charges (recoveries) from multi-employer pension plan withdrawals0.6
 0.01
 —
 —
Amortization of intangible assetsAmortization of intangible assets126.3 1.61 81.2 1.07 
Acquisition and integration costsAcquisition and integration costs60.9 0.78 59.4 0.79 
Losses on fair value of investmentLosses on fair value of investment0.2 0.00 7.2 0.10 
Bargain purchase gainBargain purchase gain— — (0.2)(0.00)
Total adjustments, pre-tax$19.1
 $0.23
 $30.3
 $0.37
Total adjustments, pre-tax$211.7 $2.70 $166.5 $2.20 
Income tax effect of adjustments (a)
(4.1) (0.05) (10.6) (0.13)
Income tax effect of adjustments (a)
(58.6)(0.75)(42.2)(0.56)
Adjusted non-U.S. GAAP measure$203.1
 $2.45
 $97.7
 $1.20
Adjusted non-U.S. GAAP measure$104.7 $1.31 $154.8 $2.02 
(a)
(a)    Represents the tax effects of the adjusted items that are subject to tax, including the tax effects of non-cash stock-based compensation expense, including from 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 effects on pre-tax income. For the three and nine month periods ended September 30, 2023, our consolidated effective tax rates, as reported, were an expense of 33.1% and a benefit of 41.4%, respectively, and as adjusted, were 18.8% and 18.9%, respectively. For the three and nine month periods ended September 30, 2022, our consolidated effective tax rates, as reported, were an expense of 18.4% and a benefit of 0.2%, respectively, and as adjusted, were 20.9% and 21.4%, respectively.
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 ninemonth 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 funding requirements, debt service, income taxes, earn-out obligations and share repurchase programs.equity and other investment funding requirements. We also evaluate opportunities for strategic acquisitions, investments and investmentsother 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, extend the terms of our existing indebtedness 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 month period ended September 30, 2017,2023, we spent $83approximately $157 million on capital expenditures, or $70$101 million, net of asset disposals, and incurred approximately $131$113 million of equipment purchases under capital leasefinance leases and other financing arrangements. We estimate that we will spend approximately $105$175 million on capital expenditures, or approximately $90$100 million, net of asset disposals, in 2017,2023, and we expect to incur approximately $155$150 million of equipment purchases under capital lease orfinance leases and other financing arrangements. Actual capital expenditures may increase or decrease in the future depending upon business activity levels, as well as ongoing assessments of equipment lease versus buypurchase decisions based on short and long-term equipment requirements.
Acquisitions and Acquisition-Related Contingent Consideration.Earn-Out Liabilities. We typically utilize cash for ourbusiness acquisitions and other strategic acquisitions of other businesses,arrangements, and for the nine month period ended September 30, 2017,2023, we used $116$69 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 whichthat are contingent upon the future earnings performance of the acquired businesses. Certain earn-outbusinesses, 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, generally 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 asfuture Earn-out liabilities as of September 30,


2017 2023 was approximately $105$83 million. Of this amount, $15approximately $12 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 obligationsEarn-out liabilities that are contingent upon future performance. There were noFor the nine month periods ended September 30, 2023 and 2022, we made $39 million and $38 million, respectively, of payments relatedfor Earn-outs.
Our acquisition of HMG provides for certain additional payments to earn-out obligations forbe made to the threesellers if certain acquired receivables are collected, which we refer to as the “Additional Payments.” Pursuant to the terms of the HMG purchase agreement, a portion of the Additional Payments will be made in cash, with the remainder due in shares of MasTec common stock. An Additional Payment of approximately $29.4 million was made in May 2022, which payment was composed of approximately $18 million in cash and 133,157 shares of MasTec common stock. As of September 30, 2023, the estimated fair value of remaining Additional Payments was approximately $33 million, which, for the nine month period ended September 30, 2017,2023, includes the effect of unrealized fair value gains related to the contingent shares of approximately $2 million and a reduction of approximately $2 million in the estimated remaining liability from changes in collections attributed to acquired balances. The number of shares that would be paid in connection with the remaining Additional Payments as of September 30, 2023 is approximately 160,000 shares. In addition, for the nine month period ended September 30, 2017, we made payments2023, a fair value gain of $19 million. Forapproximately $3 million was recognized related primarily to 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.remaining unexercised IEA warrants that expired on March 26, 2023.
Income Taxes. Tax payments, net of tax refunds, were approximately $78 million and $15 million, respectively, forFor the nine month periods ended September 30, 20172023 and 2016. Tax2022, tax payments, which are made quarterly,net of tax refunds totaled approximately $15 million and $2 million, respectively. Our tax payments vary with changes in taxable income and earnings based on estimates of full year taxable income activity and estimated tax rates.
40

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 milestonesbillings and project close-outs can also contribute to changes in unbilled revenue. As of September 30, 2017,2023, we expect that substantially all of our CIEBunbilled receivables will be billed to customers in the normal course of business within the next 12twelve months. AccountsTotal accounts receivable, balances, which consistconsists of contract billings, as well as CIEBunbilled receivables and retainage, net of allowance, increased to $1.5approximately $3.5 billion as of September 30, 20172023 from $1.2$3.1 billion as of December 31, 20162022 due, in part, to higher levels of quarterly revenue, as well as the ramp-uptiming of various projects, primarily inproject billings and collections. See below for discussion of our oil and gas business.days sales outstanding, net of contract liabilities, which we refer to as 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 Facilitycredit 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, 2017,2023, we had $746approximately $1,227 million in working capital, defined as current assets less current liabilities, as compared with $562$1,363 million as of December 31, 2016, an increase2022, a decrease of approximately $183$136 million. Total cashCash and cash equivalents of $44totaled approximately $214 million and $371 million as of September 30, 2017 increased by $5 million from total cash2023 and cash equivalents of $39 million as of December 31, 2016.2022, respectively, for a decrease of approximately $156 million. See discussion below for further detail regarding our cash flows.
Sources and uses of cash are summarized below (in millions):
For the Nine Months Ended September 30,
20232022
Net cash provided by operating activities$196.6 $118.7 
Net cash used in investing activities$(171.7)$(241.7)
Net cash used in financing activities$(181.6)$(139.5)
 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 month period ended September 30, 20172023 was $179$197 million, as compared with approximately $127$119 million of net cash provided by operating activities for the same period in 2016. The increase in cash flow from operating activities was driven by2022, for an increase in net incomecash provided by operating activities of $110approximately $78 million, due, to growth in revenue and an increase inpart, to the effect of non-cash adjustmentstiming-related changes in working capital-related assets and liabilities, net, resulting from ordinary course project activity, including the positive effect of $107 million, partiallychanges in accounts receivable, net (including the benefit of certain accounts receivable financing arrangements), inventories and contract liabilities, offset, in part by a reduction in accounts payable and accrued expenses; and a net increase in expenses that reconcile net income to operating cash flows, including depreciation and amortization of intangible assets. The above noted factors that increased cash provided by operating activities were offset, in part, by a decrease in the effect of net changes in assets and liabilities of $165 million.


Our days sales outstanding (“DSO”), net of BIEC, was 67 as of September 30, 2017,income as compared with 68 as of December 31, 2016 and 61 as of September 30, 2016. the prior year period.
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 days sales outstanding, net of contract liabilities (“DSO”), was 85 as of September 30, 2023, and as of December 31, 2022, was 83. 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.initiatives, including certain accounts receivable financing arrangements. The increase in DSO as of September 30, 2023 as compared with December 31, 2022
41

was due to timing of ordinary course billing and collection activities, offset, in part, by the benefit of improved cash collections from certain accounts receivable financing arrangements. Other than ordinary course 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 increaseddecreased by $155approximately $70 million to $249$172 million for the nine month period ended September 30, 20172023 from $94$242 million for the same period in 2022. Capital expenditures for the nine month period ended September 30, 2016. For the nine month period ended September 30, 2017, payments for acquisitions, net of cash acquired,2023 totaled $116$157 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 million for the same period in 2016, representing an increase in cash used in investing activities of approximately $56 million. Payments for other investments for the nine month period ended September 30, 2017 related 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$101 million, net of asset disposals, as compared with capital expenditures,$213 million, or $166 million, net of asset disposals, of $82 million for the same period in the prior year,2022, for a decrease in cash used in investing activities of $12 million.
Financing Activities. Net cash provided by financingapproximately $65 million, due to the effect in the prior year period of acceleration of capital expenditures to address certain growth initiatives and supply chain disruption concerns. Cash used in investing activities forfrom acquisition activity was slightly lower for the nine month period ended September 30, 2017 was $76 million,2023 as compared with $28the same period in 2022, decreasing to $69 million from $72 million, a decrease of netapproximately $3 million.
Financing Activities. Net cash used in financing activities for the nine month period ended September 30, 2016,2023 was $182 million, as compared with $139 million for the same period in 2022, for an increase in cash used in financing activities of $42 million. For the nine month period ended September 30, 2023, we had $13 million of repayments, net of borrowings, under our credit facility and term loans, as compared with $148 million of borrowings, net of repayments, for the same period in 2022, for an increase in cash provided by financing activities of $103approximately $161 million. Credit facility related activity, net,Additionally, for the nine month period ended September 30, 2017,2023, we paid approximately $12 million to holders of our non-controlling interests, including $10 million to acquire the remaining 15% interests of one of these entities, whereas for the same period in 2022, we made no payments.
The increase in cash used in financing activities from the above described items was offset, in part, by the effects of share repurchase activity, which totaled $162 million of borrowings, net of repayments, as compared to $37$81 million for the nine month period ended September 30, 2016,2022, whereas there were no share repurchases for an increasethe same period in cash provided by credit facility-related activities, net, of $125 million, which increase was partially offset by2023. Additionally, payments of $6 million for Credit Facility-related financing costs. Payments of acquisition-related contingent consideration included within financing activities totaled $22 million for the nine month periodsperiod ended September 30, 2017 and 2016 were generally flat, totaling $19 million in 20172023 as compared with $20$35 million for the same period in 2016.2022, for a decrease in cash used in financing activities of approximately $14 million. Total payments with respect to acquisition-related contingent consideration, including payments in excess of acquisition-date liabilities, which are classified within operating activities, totaled $39 million for the nine month period ended September 30, 2023 as compared with $38 million for the same period in 2022. Additional Payments for acquisition-related contingent assets related to the acquisition of HMG totaled approximately $18 million for the nine month period ended September 30, 2022, whereas for the same period in 2023, we made no payments. In addition, payments for other financing activities, net, which includes amounts paid for other borrowings and transaction-related financing activities, totaled $5 million for the nine month period ended September 30, 2023 as compared with $18 million for the same period in 2022, for a decrease in cash used in financing activities of $13 million.
Senior Secured Credit Facility
We have a senior securedunsecured credit facility (the “Credit Facility”) that we refer to as our “Credit Facility,” which was amendedmatures on November 1, 2026 and restated in February 2017. As of September 30, 2017, the Credit Facility has aggregate borrowing commitments of approximately $1.5totaling $2.25 billion, which amount is composed of $1.1$1.9 billion of revolving commitments and ana Term Loan totaling $350 million in original principal amount. Aggregate outstanding term loan inborrowings under the aggregate principal amountCredit Facility as of $400 million. September 30, 2023 totaled approximately $1.2 billion. 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,equity investments or other strategic arrangements, andand/or the repurchase or prepayment of indebtedness.indebtedness, among other corporate borrowing requirements, including potential share repurchases.
We are dependent upon borrowings and letters of credit under theour Credit Facility to fund our operations. Should we be unable to comply with the terms and conditions of theour 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 unauditedaudited consolidated financial statements which is incorporated by reference.included in our 2022 Form 10-K.
4.875%4.50% Senior Notes
We have outstanding $400$600 million aggregate principal amount of 4.875% senior notes4.50% Senior Notes due MarchAugust 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 guaranteed by certain of our subsidiaries and 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 20162022 Form 10-K. Also see
6.625% Senior Notes
We have $300 million aggregate principal amount of 6.625% Senior Notes due August 15, 2029, which amount is composed of $225.1 million aggregate principal amount of 6.625%% IEA senior notes (the “6.625% IEA Senior Notes”) and $74.9 million aggregate principal amount of 6.625% MasTec senior notes (the “6.625% MasTec Senior Notes”). The 6.625% IEA Senior Notes are structurally subordinated to all indebtedness and other liabilities, including trade payables, of the Company’s subsidiaries and are effectively subordinated to any secured indebtedness of IEA Energy Services LLC, the issuer of the IEA 6.625% Senior Notes, to the extent of the value of the collateral securing such indebtedness. The 6.625% MasTec Senior Notes are general senior unsecured obligations of the Company, and rank equal in right of payment with all of the Company’s existing and future senior unsecured indebtedness and senior in right of payment to any of the Company’s future subordinated indebtedness. The 6.625% MasTec Senior Notes are effectively subordinated to all secured indebtedness of the Company to the extent of the value of the assets securing such indebtedness, and are structurally subordinated to all obligations of the subsidiaries of the Company, including trade payables and the 6.625% IEA Senior Notes. The 6.625% Senior Notes are subject to certain provisions and covenants, as more fully described in Note 167 - Supplemental Guarantor Condensed Unaudited Consolidating Financial InformationDebt in the notes to the condensed unauditedaudited consolidated financial statements included in thisour 2022 Form 10-Q, which10-K.
42

2022 Term Loan Facility     
We have $700.0 million of unsecured term loans that were entered into in connection with the IEA acquisition, composed of $400.0 million in principal amount of three-year loans maturing on October 7, 2025, and $300.0 million in principal amount of five-year loans maturing on October 7, 2027 (together, the “2022 Term Loan Facility”). The obligations under the 2022 Term Loan Facility are incorporatedunsecured and are not guaranteed by reference.any of the Company or its subsidiaries. The 2022 Term Loan Facility is subject to certain provisions and covenants, as more fully described in Note 7 - Debt in the notes to the audited consolidated financial statements included in our 2022 Form 10-K.
Debt Covenants
We were in compliance with the provisions and covenants contained in our outstanding debt instruments as of September 30, 2017.2023.
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 20162022 Form 10-K. Also, see Note 7 - Debt in the notes to the condensed unaudited consolidated financial statements in this Form 10-Q, which is incorporated by reference, for current period balances and discussion, which is incorporated by reference.discussion.
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 certainpotential funding obligations and indemnification andand/or guarantee arrangements and obligations relating to our costequity and equity investees,other investment arrangements, including our


variable interest entities. These off-balance sheet arrangements have not had, 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
Over the past year, inflation, supply chain and labor constraints have had a significant impact on the global economy, including on the construction industry in the United States. We expect elevated market interest rates and continuing, but moderating levels of cost inflation for the remainder of 2023 and for the foreseeable future. The primary inflationary factors directly affecting our operations are labor, and fuel costs, and to a lesser extent, material costs. The current elevated levels of inflation have caused an increase in consumer prices and regulatory actions to increase interest rates, while the labor market remains at historically low levels of unemployment, creating further pressure on the supply of skilled labor. In times of low unemployment and/or high inflation, 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 pricescost of oilmaterials could negatively affect the economic viability of our customers’ projects, and gasaccordingly, demand for our services. Material and commodity prices are subject to unexpected fluctuations due to events outside of our control, including geopolitical events and fluctuations in global supply and demand, climate-related effects and geopolitical events, such as military conflicts, which events, including the political unrest and military conflicts in the Middle East and Ukraine, have recently caused recent market volatility and could create heightened global market volatility in the oil markets. future.
The recent elevation in levels of labor, fuel and materials costs, to the extent we have been unable to pass such increases along to our customers, has negatively affected our project margins, and could continue to affect our profitability in the future. Market volatility and/or uncertainty can also 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. Additionally, as discussed within “Interest Rate Risk” below, the current inflationary environment has resulted in an increase in market interest rates, which has increased the rates of interest on our variable rate debt, which rates may continue to increase depending on further monetary and fiscal actions taken to reduce inflation.
We closely monitor inflationary factors, including current rates of inflation, and any impactpotential effects they may have on our business operations, operating results and/or financial condition. While the impact of these factors cannot be fully eliminated, we proactively work to mitigate their effects; however, inflationary pressures and interest rate increases could adversely affect our business operations in the future.
ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Risk
As of September 30, 2017,2023, our variable interest rate debt was primarily related to our Credit Facility. Interest on outstanding revolving loansFacility and our Term Loan underterm loans. Outstanding borrowings under our Credit Facility accruesbear interest, at variable rates based,the Company’s option, at our option, on a Eurocurrency rate equal to either (a) Term Secured Overnight Financing Rate (“SOFR”), as defined in the Credit Facility, plus a margin of 1.125% to 1.625%, or (b) a base rate,Base Rate, as defined in the Credit Facility, plus a margin.margin of 0.125% to 0.625%. As of September 30, 2017,2023, we had $301approximately $890 million aggregate principal amount of outstanding revolving loans under our Credit Facility with a weighted average interest rate of 2.96%7.05% and a term loanTerm Loan with a balance of $400$343 million withand an interest rate of 2.86%7.04%. AThe current year interest rates for outstanding revolving loans under our Credit Facility and Term Loan reflect basis point increases of approximately 280 and 250, respectively, over the comparable period in 2022.
Outstanding loans under the $400 million Three-Year Tranche of our 2022 Term Loan Facility bear interest, at the Company’s option, at a rate equal to either (a) SOFR, as defined in the 2022 Term Loan Facility, plus a margin of 1.125% to 1.500%, or (b) a Base Rate, as defined in the 2022 Term Loan Facility, plus a margin of 0.125% to 0.500%. Outstanding loans under the $300 million Five-Year Tranche of our 2022 Term Loan Facility bear interest, at the Company’s option, at a rate equal to either (a) Term SOFR plus a margin of 1.250% to 1.625%, or (b) a Base Rate, plus a
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margin of 0.250% to 0.625%. As of September 30, 2023, the Three-Year Tranche and Five-Year Tranche term loans accrued interest at weighted average rates of 6.809% and 6.934%, respectively.
Our interest expense is affected by the overall interest rate environment. Our variable rate interest debt subjects us to risk from increases in prevailing interest rates. This risk has increased in the current market environment, in which the Federal Reserve has increased interest rates, resulting in an increase in our variable interest rates and related interest expense. We manage interest rate risk by maintaining a mix of fixed and variable rate debt obligations. An additional 100 basis point increase in the applicable interest rates under our credit facilitiesCredit Facility and term loans would have increased our interest expense by approximately $5$16 million for the nine month period ended September 30, 2017.2023.
As of September 30, 2017,2023, our fixed interest rate debt primarily included $400$600 million aggregate principal amount of 4.875%4.50% Senior Notes, $300 million aggregate principal amount of 6.625% Senior Notes and an aggregate $187$366 million of capitalfinance lease obligations, and notes payable, which accrued interest at a weighted average interest rate of approximately 3.4% as of September 30, 2017.4.5%. 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 month period ended September 30, 2017.2023. 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 wereactivity was not material to our operations for the three or nine month periodsperiod ended September 30, 2017.2023. 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 periodsperiod ended September 30, 2017,2023, foreign currency translation effectsgains, 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, 2017.2023. 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
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’sIn conducting the evaluation of disclosure controls and procedures and internal control over financial reporting as of December 31, 2022, as described in the 2022 Form 10-K, we identified the following material weaknesses in our internal control over financial reporting:
•Design and operating effectiveness of controls over the order to cash cycle predominantly related to the assessment of certain 2021 acquired entities that underwent initial controls evaluation in 2022 (the “2021 Acquired Entities”).
•Operating effectiveness of controls related to the initial purchase price allocation of the 2022 IEA acquisition.
•Design of the precision level for a variance analysis management review control within the period end reporting cycle.
In addition, for certain 2021 Acquired Entities, we identified control deficiencies that, when aggregated, constitute material weaknesses as follows:
•Design and operating effectiveness of information technology general computer controls (“ITGCs”) in the areas of user access and program change-management for certain information technology systems (the “affected IT systems”) that are critical to capturing, processing, and reporting financial transactions. These ineffective information technology controls contributed to (i) improper segregation of duties among certain business process controls and (ii) ineffective data validation of spreadsheets and system-generated reports.
•Design and operating effectiveness of business process controls in each of the following business cycles: procure to pay, asset management, hire to pay, and period-end reporting.
As a result, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level as of September 30, 2017.2023.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
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Notwithstanding the material weaknesses in our internal control over financial reporting, the consolidated financial statements included in this Quarterly Report on Form 10-Q fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States of America. In addition, the material weaknesses did not result in any restatements of the Company’s audited or unaudited consolidated financial statements and disclosures for any prior period previously reported by the Company.
To the extent permitted under SEC guidance, the disclosure controls and procedures of two businesses acquired in 2023, were excluded from the evaluation of effectiveness of the Company’s disclosure controls and procedures as of September 30, 2023 due to the timing of the acquisitions. These acquisitions’ total assets constituted approximately 2% of the Company’s total assets as of September 30, 2023, and represented approximately 1% of the Company’s revenue for the nine month period then ended.
Remediation Efforts to Address Material Weaknesses. Management is committed to maintaining a strong control environment. Management, with the oversight of the Audit Committee of the Board of Directors, has implemented and continues to implement measures designed to ensure that control deficiencies contributing to the material weaknesses are remediated, such that these controls are designed, implemented, and operating effectively. These remediation actions are ongoing and include the following actions, predominately at the 2021 Acquired Entities: (i) expanding functions of IT compliance from the existing, effective ITGC environment at the enterprise level to the 2021 Acquired Entities; (ii) implementing a newly developed training program to address ITGCs and IT policies with appropriate IT personnel; (iii) implementing procedures to ensure enforcement of proper segregation of duties; (iv) enhancing IT management review and testing plans to monitor ITGCs and (v) enhancing and/or refining the design, implementation and documentary evidence requirements of control procedures over the order to cash, procure to pay, asset management, hire to pay, initial acquisition purchase price allocation and period-end reporting processes for appropriate personnel. Although we believe that these actions will remediate the material weaknesses, the weaknesses will not be considered remediated until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
Changes in Internal Control overOver Financial Reporting
There. Other than the ongoing remediation efforts related to the material weaknesses described above, there have been no changes in the Company’s internal control over financial reporting during the quarter ended September 30, 20172023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.


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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 20162022 Form 10-K.
MasTec has elected to use a $1 million threshold for disclosing proceedings arising under federal, state or local environmental laws, which proceedings involve potential monetary sanctions, and in which a governmental authority is a party. MasTec believes proceedings under this threshold are not material to its business and financial condition.
ITEM 1A.    RISK FACTORS
ThereSubject to the potential effects of general economic and market conditions, including levels of inflation, interest rates and other market and geopolitical conditions, including political unrest and military conflicts, on certain of the risks we normally face in operating our business, including those disclosed in our 2022 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 20162022 Form 10-K, as updated by our Quarterly ReportReports 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, 2017:2023:



Period
Total Number of Shares Purchased (a)
Average Price Paid per ShareTotal Number of Shares Purchased as Part of Publicly Announced Program
Approximate Dollar Value of Shares that May Yet be Purchased under the Program (b)
July 1 through July 316,204 $115.57 — $77,326,434 
August 1 through August 318,040 $95.12 — $77,326,434 
September 1 through September 308,973 $87.42 — $77,326,434 
Total23,217 — 
(a)Includes 6,204, 7,647 and 8,973 shares reacquired by the Company on the open market pursuant to the Amended ESPPs in July, August and September of 2023, respectively, and 393 shares withheld for income tax purposes in connection with shares issued under compensation and benefit programs in August of 2023.
(b)As of September 30, 2023, the remaining amount available for share repurchases under our March 2020 $150 million share repurchase program, which was publicly announced on March 19, 2020, totaled $77.3 million.



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.
ITEM 4.
ITEM 4.    MINE SAFETY DISCLOSURES
Not applicable.
The information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95.1 to this Quarterly Report on Form 10-Q.
ITEM 5.    OTHER INFORMATION
During the three month period ended September 30, 2023, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted, modified or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as defined in Item 408(c) of Regulation S-K.
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ITEM 6.    EXHIBITS
See theThe Exhibit Index following the signatures page to this Form 10-Q forbelow contains a list of exhibits filed or furnished with this Form 10-Q, which Exhibit Index is incorporated herein by reference.10-Q.


ExhibitsDescription
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*
101.INSInline 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.SCHInline XBRL Taxonomy Extension Schema
101.CALInline XBRL Taxonomy Extension Calculation Linkbase
101.DEFInline XBRL Taxonomy Extension Definition Linkbase
101.LABInline XBRL Taxonomy Extension Label Linkbase
101.PREInline XBRL Taxonomy Extension Presentation Linkbase
104The cover page of MasTec, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, formatted in Inline XBRL (included with the Exhibit 101 attachments).

______________

*    Filed herewith.
**    Furnished herewith.
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SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
MASTEC, INC.
Date:November 2, 20172023
/s/  JOSÉ R. MAS
José R. Mas
/s/  T. MICHAEL LOVE
T. Michael Love
Chief ExecutiveAccounting Officer
(Principal Executive Officer)
/s/  GEORGE L. PITA
George L. Pita
Chief Financial Officer
(Principal Financial and Accounting Officer)



Exhibit Index

48
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
______________
*Filed herewith.
**Furnished herewith.


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