Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Dec. 31, 2020 | Feb. 15, 2021 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2020 | |
Entity Registrant Name | Energy Services of America CORP | |
Entity Central Index Key | 0001357971 | |
Trading Symbol | esoa | |
Title of 12(g) Security | None | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Interactive Data Current | Yes | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 13,621,406 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Current assets | ||
Cash and cash equivalents | $ 12,345,745 | $ 11,216,820 |
Accounts receivable-trade | 17,096,770 | 18,246,989 |
Allowance for doubtful accounts | (70,310) | (70,310) |
Retainages receivable | 1,658,513 | 2,483,809 |
Other receivables | 6,677 | 9,458 |
Contract assets | 4,418,599 | 6,545,863 |
Prepaid expenses and other | 2,763,189 | 3,338,943 |
Total current assets | 38,219,183 | 41,771,572 |
Property, plant and equipment, at cost | 56,679,946 | 53,324,843 |
less accumulated depreciation | (37,706,313) | (36,933,129) |
Total fixed assets | 18,973,633 | 16,391,714 |
Acquired intangible assets, net | 300,000 | |
Goodwill | 4,520,829 | |
Total assets | 61,713,645 | 58,163,286 |
Current liabilities | ||
Current maturities of long-term debt | 4,645,254 | 4,028,900 |
Lines of credit and short term borrowings | 3,500,000 | 509,843 |
Accounts payable | 5,783,559 | 5,222,222 |
Accrued expenses and other current liabilities | 3,255,740 | 4,237,172 |
Contract liabilities | 3,721,385 | 4,851,900 |
Total current liabilities | 20,905,938 | 18,850,037 |
Long-term debt, less current maturities | 13,496,506 | 11,233,705 |
Deferred income taxes payable | 2,212,084 | 2,255,515 |
Total liabilities | 36,614,528 | 32,339,257 |
Shareholders' equity | ||
Preferred stock, $.0001 par value Authorized 1,000,000 shares, 206 issued at December 31, 2020 and September 30, 2020 | ||
Common stock, $.0001 par value Authorized 50,000,000 shares 14,839,836 issued and 13,621,406 outstanding at December 31, 2020 and September 30, 2020 | 1,484 | 1,484 |
Treasury stock, 1,218,430 shares at December 31, 2020 and September 30, 2020 | (122) | (122) |
Additional paid in capital | 60,670,699 | 60,670,699 |
Retained deficit | (35,572,944) | (34,848,032) |
Total shareholders' equity | 25,099,117 | 25,824,029 |
Total liabilities and shareholders' equity | $ 61,713,645 | $ 58,163,286 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2020 | Sep. 30, 2020 |
Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 206 | 206 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 14,839,836 | 14,839,836 |
Common stock, shares outstanding | 13,621,406 | 13,621,406 |
Treasury stock, shares | 1,218,430 | 1,218,430 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Consolidated Statements of Income | ||
Revenue | $ 32,009,796 | $ 25,843,307 |
Cost of revenues | 29,166,737 | 23,486,565 |
Gross profit | 2,843,059 | 2,356,742 |
Selling and administrative expenses | 3,595,830 | 2,595,772 |
Loss from operations | (752,771) | (239,030) |
Other income (expense) | ||
Interest income | 151,765 | 53,249 |
Other nonoperating expense | (52,623) | (33,938) |
Interest expense | (76,517) | (186,845) |
Gain on sale of equipment | 13,042 | 295,991 |
Other income (expense), Total | 35,667 | 128,457 |
Loss before income taxes | (717,104) | (110,573) |
Income tax benefit | (69,442) | (36,459) |
Net loss | (647,662) | (74,114) |
Dividends on preferred stock | 77,250 | 77,250 |
Net loss available to common shareholders | $ (724,912) | $ (151,364) |
Weighted average shares outstanding-basic | 13,621,406 | 13,911,610 |
Weighted average shares-diluted | 13,621,406 | 13,911,610 |
Loss per share available to common shareholders | $ (0.053) | $ (0.011) |
Loss per share-diluted available to common shareholders | $ (0.053) | $ (0.011) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (647,662) | $ (74,114) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation expense | 1,083,853 | 1,095,282 |
Gain on sale of equipment | (13,042) | (295,991) |
Provision for deferred taxes | 29,761 | (105,996) |
Decrease in contracts receivable | 1,150,219 | 8,424,777 |
Decrease in retainage receivable | 825,296 | 276,961 |
Decrease in other receivables | 2,781 | 100 |
Decrease in contract assets | 2,127,264 | 2,082,158 |
Decrease in prepaid expenses | 575,754 | 153,912 |
Increase in accounts payable | 561,337 | 1,384,658 |
Decrease in accrued expenses | (977,374) | (713,221) |
Decrease in contract liabilities | (1,130,515) | (222,884) |
Decrease in income taxes payable | 21,811 | |
Net cash provided by operating activities | 3,587,672 | 12,027,453 |
Cash flows from investing activities: | ||
Investment in property and equipment | (1,467,091) | (747,534) |
Proceeds from sales of property and equipment | 13,500 | 334,234 |
Acquisition of West Virginia Pipeline, net of cash received of $250,000 | (3,250,000) | |
Net cash used in investing activities | (4,703,591) | (413,300) |
Cash flows from financing activities: | ||
Dividends on common stock | (696,117) | |
Preferred dividends paid | (154,500) | (154,500) |
Treasury stock purchased by company | (29,974) | |
Borrowings on lines of credit and short term debt, net of (repayments) | 2,990,157 | (4,025,710) |
Principal payments on long term debt | (590,813) | (6,671,860) |
Net cash provided by (used in) financing activities | 2,244,844 | (11,578,161) |
Increase in cash and cash equivalents | 1,128,925 | 35,992 |
Cash and cash equivalents beginning of period | 11,216,820 | 4,578,275 |
Cash and cash equivalents end of period | 12,345,745 | 4,614,267 |
Supplemental schedule of noncash investing and financing activities: | ||
Purchases of property & equipment under financing agreements | 349,139 | 392,820 |
Note payable for acquisition of West Virginia Pipeline | 3,000,000 | |
Debt assumed in acquisition of West Virginia Pipeline | 120,829 | |
Cash paid during the year for: | ||
Interest | $ 76,517 | 186,845 |
Income taxes | $ 48,000 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parentheticals) | 3 Months Ended |
Dec. 31, 2020USD ($) | |
Consolidated Statements of Cash Flows | |
Cash received | $ 250,000 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) | Common Stock | Additional Paid in Capital | Retained Earnings (deficit) | Treasury Stock | Total |
Balance at Sep. 30, 2019 | $ 1,484 | $ 60,938,896 | $ (36,275,932) | $ (91) | $ 24,664,357 |
Balance (in shares) at Sep. 30, 2019 | 13,924,789 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (74,114) | (74,114) | |||
Preferred dividends | (77,250) | (77,250) | |||
Dividends on common stock ($0.05 per share on 13,922,336 shares; 317,500 common shares are part of preferred units and were not eligible for the common dividend) | (696,117) | ||||
Treasury stock purchased by company | (29,970) | (696,117) | (4) | (29,974) | |
Treasury stock purchased by company (in shares) | (34,687) | ||||
Balance at Dec. 31, 2019 | $ 1,484 | 60,908,926 | (37,123,413) | (95) | 23,786,902 |
Balance (in shares) at Dec. 31, 2019 | 13,890,102 | ||||
Balance at Sep. 30, 2020 | $ 1,484 | 60,670,699 | (34,848,032) | (122) | 25,824,029 |
Balance (in shares) at Sep. 30, 2020 | 13,621,406 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | (647,662) | (647,662) | |||
Preferred dividends | (77,250) | (77,250) | |||
Balance at Dec. 31, 2020 | $ 1,484 | $ 60,670,699 | $ (35,572,944) | $ (122) | $ 25,099,117 |
Balance (in shares) at Dec. 31, 2020 | 13,621,406 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) | 3 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Consolidated Statements of Changes in Shareholders' Equity | |
Dividends on common stock, per share | $ / shares | $ 0.05 |
Common stock, shares eligible for dividend (in shares) | 13,922,336 |
Common stock, shares not eligible for dividend (in shares) | 317,500 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 3 Months Ended |
Dec. 31, 2020 | |
BUSINESS AND ORGANIZATION | |
BUSINESS AND ORGANIZATION | 1. BUSINESS AND ORGANIZATION Energy Services of America Corporation (“Energy Services” or the “Company”) is a contractor and service company that operates primarily in the mid-Atlantic region of the United States and provides services to customers in the natural gas, petroleum, water distribution, automotive, chemical and power industries. C.J. Hughes Construction Company, Inc. (“C.J. Hughes”), a wholly owned subsidiary of the Company, is a general contractor primarily engaged in pipeline construction for utility companies. Contractors Rental Corporation (“Contractors Rental”), a wholly owned subsidiary of C.J. Hughes, provides union building trade employees for projects managed by C.J. Hughes. Nitro Construction Services, Inc. (“Nitro”), a wholly owned subsidiary of C.J. Hughes, provides electrical, mechanical, HVAC/R and fire protection services to customers primarily in the automotive, chemical and power industries. Pinnacle Technical Solutions, Inc. (“Pinnacle”), a wholly owned subsidiary of Nitro, operates as a data storage facility within Nitro’s office building. Pinnacle is supported by Nitro and has no employees of its own. All C.J. Hughes, Nitro, and Contractors Rental production personnel are union members of various related construction trade unions and are subject to collective bargaining agreements that expire at varying time intervals. On December 31, 2020, Energy Services completed the purchase of West Virginia Pipeline, Inc. (“West Virginia Pipeline”), a West Virginia corporation located in Princeton, West Virginia. West Virginia Pipeline, a wholly owned subsidiary of Energy Services, operates as a gas and water distribution contractor primarily in southern West Virginia. West Virginia Pipeline’s employees are non-union, and the company is managed independently from C.J. Hughes and Nitro. The Company’s stock is quoted under the symbol “ESOA” on the OTC QB marketplace operated by the OTC Markets Group. Interim Financial Statements The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the Company’s audited consolidated financial statements and footnotes thereto for the years ended September 30, 2020 and 2019 included in the Company’s Annual Report on Form 10-K filed with the SEC on January 4, 2021. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to the interim financial reporting rules and regulations of the SEC. The financial statements reflect all adjustments (consisting primarily of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company’s financial position and results of operations. The operating results for the three months ended December 31, 2020 and 2019 are not necessarily indicative of the results to be expected for the full year or any other interim period. Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline and C.J. Hughes and its subsidiaries, Nitro, Pinnacle, and Contractors Rental. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline and C.J. Hughes and its subsidiaries. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Dec. 31, 2020 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | 2. REVENUE RECOGNITION Our revenue is primarily derived from construction contracts that can span several quarters. We recognize revenue in accordance with Topic 606, which provides for a five-step model for recognizing revenue from contracts with customers as follows: 1. Identify the contract 2. Identify performance obligations 3. Determine the transaction price 4. Allocate the transaction price 5. Recognize revenue The accuracy of our revenue and profit recognition in a given period depends on the accuracy of our estimates of the cost to complete each project. We believe our experience allows us to create materially reliable estimates. There are a number of factors that can contribute to changes in estimates of contract cost and profitability. The most significant of these include: · the completeness and accuracy of the original bid; · costs associated with scope changes; · changes in costs of labor and/or materials; · extended overhead and other costs due to owner, weather and other delays; · subcontractor performance issues; · changes in productivity expectations; · site conditions that differ from those assumed in the original bid; · changes from original design on design-build projects; · the availability and skill level of workers in the geographic location of the project; · a change in the availability and proximity of equipment and materials; · our ability to fully and promptly recover on affirmative claims and back charges for additional contract costs; and · the customer’s ability to properly administer the contract. The foregoing factors, as well as the stage of completion of contracts in process and the mix of contracts at different margins may cause fluctuations in gross profit from period to period. Significant changes in cost estimates, particularly in our larger, more complex projects have had, and can in future periods have, a significant effect on our profitability. Our contract assets may include cost and estimated earnings in excess of billings that represent amounts earned and reimbursable under contracts, including claim recovery estimates, but have a conditional right for billing and payment such as achievement of milestones or completion of the project. With the exception of customer affirmative claims, generally, such unbilled amounts will become billable according to the contract terms and generally will be billed and collected over the next three months. Settlement with the customer of outstanding affirmative claims is dependent on the claims resolution process and could extend beyond one year. Based on our historical experience, we generally consider the collection risk related to billable amounts to be low. When events or conditions indicate that it is probable that the amounts outstanding become unbillable, the transaction price and associated contract asset is reduced. Our contract liabilities may consist of provisions for losses and billings in excess of costs and estimated earnings. Provisions for losses are recognized in the consolidated statements of income at the uncompleted performance obligation level for the amount of total estimated losses in the period that evidence indicates that the estimated total cost of a performance obligation exceeds its estimated total revenue. Billings in excess of costs and estimated earnings are billings to customers on contracts in advance of work performed, including advance payments negotiated as a contract condition. Generally, unearned project-related costs will be earned over the next twelve months. |
DISAGGREGATION OF REVENUE
DISAGGREGATION OF REVENUE | 3 Months Ended |
Dec. 31, 2020 | |
DISAGGREGATION OF REVENUE | |
DISAGGREGATION OF REVENUE | 3. DISAGGREGATION OF REVENUE We disaggregate our revenue based on our operating groups and contract types as it is the format that is regularly reviewed by management. Our reportable operating groups are: Petroleum and Gas, Water, Sewer and other services, and Electrical and Mechanical services. Our contract types are: Lump Sum, Unit Price, Cost Plus and Time and Materials (“T&M”). The following tables present our disaggregated revenue for the three months ended December 31, 2020 and 2019: Three Months Ended December 31, 2020 Petroleum & Water, Sewer and Electrical and Total revenue Gas Other Mechanical from contracts Lump sum contracts $ — $ — $ 11,666,631 $ 11,666,631 Unit price contracts 11,827,050 3,707,181 — 15,534,231 Cost plus and T&M contracts 290,000 — 4,518,934 4,808,934 Total revenue from contracts $ 12,117,050 $ 3,707,181 $ 16,185,565 $ 32,009,796 Earned over time $ 8,402,592 $ 3,707,181 $ 16,013,755 $ 28,123,528 Earned at point in time 3,714,458 171,810 3,886,268 Total revenue from contracts $ 12,117,050 $ 3,707,181 $ 16,185,565 $ 32,009,796 Three Months Ended December 31, 2019 Petroleum & Water, Sewer and Electrical and Total revenue Gas Other Mechanical from contracts Lump sum contracts $ — $ — $ 7,448,512 $ 7,448,512 Unit price contracts 6,218,532 2,125,934 — 8,344,466 Cost plus and T&M contracts 3,311,566 1,274,832 5,463,931 10,050,329 Total revenue from contracts $ 9,530,098 $ 3,400,766 $ 12,912,443 $ 25,843,307 Earned over time $ 7,116,701 $ 3,400,766 $ 12,599,705 $ 23,117,172 Earned at point in time 2,413,397 — 312,738 2,726,135 Total revenue from contracts $ 9,530,098 $ 3,400,766 $ 12,912,443 $ 25,843,307 |
CONTRACT BALANCES
CONTRACT BALANCES | 3 Months Ended |
Dec. 31, 2020 | |
CONTRACT BALANCES | |
CONTRACT BALANCES | 4. CONTRACT BALANCES The Company’s accounts receivable consists of amounts that have been billed to customers. Collateral is generally not required. A majority of the Company’s contracts have monthly billing terms and payment terms within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15‑day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. During the three months ended December 31, 2020, we recognized revenue of $4.6 million that was included in the contract liability balance at September 30, 2020. Accounts receivable-trade, net of allowance for doubtful accounts, retentions receivable, contract assets and contract liabilities consisted of the following: September 30, 2020 December 31, 2020 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 18,176,679 $ 17,026,460 $ (1,150,219) Contract assets Cost and estimated earnings in excess of billings $ 6,545,863 $ 4,418,599 $ (2,127,264) Contract liabilities Billings in excess of cost and estimated earnings $ 4,851,900 $ 3,721,385 $ (1,130,515) |
PERFORMANCE OBLIGATIONS
PERFORMANCE OBLIGATIONS | 3 Months Ended |
Dec. 31, 2020 | |
PERFORMANCE OBLIGATIONS | |
PERFORMANCE OBLIGATIONS | 5. PERFORMANCE OBLIGATIONS The Company provides construction services that can be classified into several groups: petroleum and gas, water, sewer and other, and electrical and mechanical services. Generally, our contracts contain one performance obligation that is satisfied over time because our performance typically creates or enhances an asset that the customer controls as the asset is created or enhanced. We recognize revenue as performance obligations are satisfied and control of the promised good and service is transferred to the customer. Revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward complete satisfaction of the performance obligation(s) using an input (i.e., “cost-to-cost”) method. Under the cost-to-cost method, costs incurred to-date are generally the best depiction of transfer of control. All contract costs, including those associated with affirmative claims, change orders and back charges, are recorded as incurred and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Contract costs consist of direct costs on contracts, including labor and materials, amounts payable to subcontractors, direct overhead costs and equipment expense (primarily depreciation, fuel, maintenance and repairs). During the three months ended December 31, 2020, we recognized revenue of $1.0 million as a result of changes in contract transaction price related to performance obligations that were satisfied prior to September 30, 2020. The changes in contract transaction price were from items such as changes in projected profit, executed or estimated change orders, and unresolved contract modifications and claims. The Company does not sell warranties for its construction services. At December 31, 2020, the Company had $9.5 million in remaining unsatisfied performance obligations, in which revenue is expected to be recognized in less than twelve months. |
UNCOMPLETED CONTRACTS
UNCOMPLETED CONTRACTS | 3 Months Ended |
Dec. 31, 2020 | |
UNCOMPLETED CONTRACTS. | |
UNCOMPLETED CONTRACTS | 6. UNCOMPLETED CONTRACTS Costs, estimated earnings, and billings on uncompleted contracts as of December 31, 2020 and September 30, 2020 are summarized as follows: December 31, September 30, 2020 2020 Costs incurred on contracts in progress $ 114,491,141 $ 74,996,405 Estimated earnings, net of estimated losses 19,336,835 16,067,668 133,827,976 91,064,073 Less billings to date 133,130,762 89,370,110 $ 697,214 $ 1,693,963 Costs and estimated earnings in excess of billed on uncompleted contracts $ 4,418,599 $ 6,545,863 Less billings in excess of costs and estimated earnings on uncompleted contracts 4,851,900 $ 697,214 $ 1,693,963 Backlog at December 31, 2020 and September 30, 2020 was $60.7 million and $63.8 million, respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 7. FAIR VALUE MEASUREMENTS The Fair Value Measurements and Disclosures Topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurements Topic of the FASB Accounting Standards Codification establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. As noted above, there is a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 — Quoted prices for identical assets and liabilities traded in active exchange markets, such as the New York Stock Exchange. Level 2 — Observable inputs other than Level 1 including quoted prices for similar assets or liabilities, quoted prices in less active markets, or other observable inputs that can be corroborated by observable market data. Level 3 — Unobservable inputs supported by little or no market activity for financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation; also includes observable inputs for nonbinding single dealer quotes not corroborated by observable market data. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying amount for borrowings under the Company’s revolving credit facility approximates fair value because of the variable market interest rate charged to the Company for these borrowings. The fair value of the Company’s long term fixed-rate debt to unrelated parties was estimated using a discounted cash flow analysis and a yield rate that was estimated based on the borrowing rates for bank loans with similar terms and maturities. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $17.2 million at December 31, 2020 was $16.1 million as of the same date . The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $15.8 million at September 30, 2020 was $14.8 million. All receivables and payables are carried at net realizable value which approximates fair value because of their short duration to maturity. |
LOSS PER SHARE
LOSS PER SHARE | 3 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
LOSS PER SHARE | 8. LOSS PER SHARE The amounts used to compute the loss per share for the three months ended December 31, 2020 and 2019 are summarized below. Three Months Ended Three Months Ended December 31, December 31, 2020 2019 Net loss $ (647,662) $ (74,114) Dividends on preferred stock 77,250 77,250 Net loss available to common shareholders $ (724,912) $ (151,364) Weighted average shares outstanding-basic 13,621,406 13,911,610 Weighted average shares-diluted 13,621,406 13,911,610 Loss per share available to common shareholders $ (0.053) $ (0.011) Loss per share available to common shareholders-diluted $ (0.053) $ (0.011) |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | 9. INCOME TAXES The components of income taxes are as follows: Three Months Ended December 31, 2020 2019 Federal Current $ (77,380) $ 54,240 Deferred 23,214 (82,678) Total $ (54,166) $ (28,438) State Current $ (21,824) $ 15,298 Deferred 6,548 (23,319) Total $ (15,276) $ (8,021) Total income tax benefit $ (69,442) $ (36,459) The effective income tax rate for the three months ended December 31, 2020 was (9.7%), as compared to (33.0%) for the same period in 2019. Effective income tax rates are estimates and may vary from period to period due to changes in the amount of taxable income and non-deductible expenses. Per diem paid to employees on construction projects is only partially deductible from taxable income and can have a significant impact on the effective tax rate. The income tax effects of temporary differences giving rise to the deferred tax assets and liabilities are as follows: December 31, September 30, 2020 2020 Deferred income tax liabilities Long-term Property and equipment $ 2,750,067 $ 2,746,331 Other (19,805) (19,805) Total deferred income tax liabilities $ 2,730,262 $ 2,726,526 Deferred income tax assets Long-term Other $ 518,178 $ 471,011 Total deferred income tax assets $ 518,178 $ 471,011 Total net deferred income tax liabilities $ 2,212,084 $ 2,255,515 The Company and all subsidiaries file a consolidated federal and various state income tax returns on a fiscal year basis. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years ended prior to September 30, 2017. The Company does not believe that it has any unrecognized tax benefits included in its consolidated financial statements that require recognition. The Company has not had any settlements in the current period with taxing authorities, nor has it recognized tax benefits as a result of a lapse of the applicable statute of limitations. The Company recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in general and administrative expenses. |
SHORT-TERM AND LONG-TERM DEBT
SHORT-TERM AND LONG-TERM DEBT | 3 Months Ended |
Dec. 31, 2020 | |
SHORT-TERM AND LONG-TERM DEBT | |
SHORT-TERM AND LONG-TERM DEBT | 10. SHORT-TERM AND LONG-TERM DEBT Short-term debt consists of the following: On July 30, 2020, the Company received a one-year extension on its line of credit (“Operating Line of credit (2020)”) effective June 28, 2020. The $15.0 million revolving line of credit has a $12.5 million component and a $2.5 million component, each with separate borrowing requirements. The interest rate on the line of credit is the “Wall Street Journal” Prime Rate (the index) with a floor of 4.99%. The line of credit expires on June 28, 2021. Based on the borrowing base calculation, the Company was able to borrow up to $9.9 million as of December 31, 2020. The Company had $3.5 million in borrowings on the line of credit, leaving $6.4 million available on the line of credit as of December 31, 2020. Based on the borrowing base calculation, the Company was able to borrow up to $11.1 million as of September 30, 2020. The Company had no borrowings on the line of credit, leaving $11.1 million available on the line of credit as of September 30, 2020. Major items excluded from the borrowing base calculation are receivables from bonded jobs and retainage as well as all items greater than ninety (90) days old. Line of credit borrowings are collateralized by the Company’s accounts receivable. Cash available under the line is calculated based on 70.0% of the Company’s eligible accounts receivable. Major items excluded from the calculation are receivables from bonded jobs and retainage as well as items greater than 90 days old. Under the terms of the agreement, the Company must meet the following loan covenants to access the first $12.5 million: 1. Minimum tangible net worth of $19.0 million to be measured quarterly, 2. Minimum traditional debt service coverage of 1.25x to be measured quarterly on a rolling twelve- month basis, 3. Minimum current ratio of 1.50x to be measured quarterly, 4. Maximum debt to tangible net worth ratio (“TNW”) of 2.0x to be measured semi-annually, 5. Full review of accounts receivable aging report and work in progress. The results of the review shall be satisfactory to the lender in its sole and unfettered discretion. Under the terms of the agreement, the Company must meet the following additional requirements for draw requests causing the borrowings to exceed $12.5 million: 1. 2. The Company believes it was in compliance with all covenants for the $12.5 million component of Operating Line of Credit (2020) at December 31, 2020. The Company also finances insurance policy premiums on a short-term basis through a financing company. These insurance policies include workers’ compensation, general liability, automobile, umbrella, and equipment policies. It is typical that the Company makes a down payment in January and finances the remaining premium amount over ten monthly payments. In January 2020, the Company financed $3.1 million in insurance premium policies. At December 31, 2020, the balance of the premiums payments had been paid off. A summary of short-term and long-term debt as of December 31, 2020 and September 30, 2020 is as follows: December 31, September 30, 2020 2020 Line of credit payable to bank, monthly interest at 4.99%, final payment due by June 28, 2021. 3,500,000 — Notes payable to finance companies, due in monthly installments totaling $70,062 including interest ranging from 0.00% to 6.03%, final payments due January 2021 through August 2026, secured by equipment. 1,668,998 1,334,566 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $254,922 in FY 2020 and $267,677 in FY 2019, including interest rate at 3.50%, final payment made November 2020. — 509,843 Notes payable to bank, due in monthly installments totaling $7,799, including interest at 4.82%, final payment due November 2034 secured by building and property. 956,168 967,665 Notes payable to bank, due in monthly installments totaling $11,602, including interest at 4.25%, final payment due November 2025 secured by building and property. 606,842 644,172 Notes payable to bank for $9.8 million in Paycheck Protection Program ("PPP") loan funds. Payments on the five-year note are expected to begin in March 2021 if PPP loan repayment is not forgiven, due in monthly installments totaling $168,187, including interest at 1.0%, final payment due December 2025. 9,839,100 9,839,100 Notes payable to bank, due in monthly installments totaling $98,865, including interest at 4.99%, final payment due September 2022 secured by equipment. 1,711,220 1,983,911 Notes payable to bank, due in monthly installments totaling $46,482, including interest at 5.00%, final payment due September 2021 secured by equipment. 359,432 493,191 Notes payable to David and Daniel Bolton, due in annual installments totaling $600,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 3,000,000 — Total debt 21,641,760 15,772,448 Less current maturities 8,145,254 4,538,743 Total long term debt $ 13,496,506 $ 11,233,705 |
ACQUISITION
ACQUISITION | 3 Months Ended |
Dec. 31, 2020 | |
Acquisitions | |
Acquisitions | 1 1. ACQUISITION On December 31, 2020, Energy Services completed an asset purchase of West Virginia Pipeline, a wholly owned subsidiary of Energy Services that operates as a gas and water distribution contractor primarily in southern West Virginia. Energy Services paid $3.5 million in cash and acquired a $3.0 million seller note with a term of five years with an interest rate of 3.25%. Previous owners, David Bolton and Daniel Bolton, have continued their roles as President and Vice President, respectively. Energy Services accounts for business combinations under the acquisition method in accordance with ASC Topic 805, Business Combinations. Accordingly, for each transaction, the purchase price is allocated to the fair value of the assets acquired and liabilities assumed as of the date of the acquisition. In conjunction with the adoption of ASU 2015-16, upon receipt of final fair value estimates during the measurement period, which must be within one year of the acquisition date, Energy Services records any adjustments to the preliminary fair value estimates in the reporting period in which the adjustments are determined. Energy Services is continuing to finalize the purchase price allocations related to the West Virginia Pipeline acquisition. Based on management's preliminary valuation of tangible and intangible assets acquired and liabilities assumed, the purchase price for the West Virginia Pipeline acquisition is allocated in the table below. These allocations are subject to change. Goodwill $ 4,220,829 Equipment and vehicles 1,565,000 Building 220,243 Land 64,757 Non-compete agreement 150,000 Customer list 150,000 Cash received in acquisition 250,000 Debt assumed in acquisition (120,829) Purchase price $ 6,500,000 On January 7, 2021, the Company filed a Current Report on Form 8-K to announce the completion of the acquisition under Item 2.01 Completion of Acquisition of Disposition of Assets . The Company has seventy-one (71) days from the filing date to amend the Form 8-K to include the financial statements of the business acquired and pro forma financial information. The Company has incurred approximately $50,000 in legal expenses and $5,000 in accounting software expenses as part of the acquisition. The Company estimates it will have $75,000 in auditing expenses related to the Securities and Exchange Commission’s required disclosures mentioned directly above. West Virginia Pipeline’s past financial performance, experienced management and workforce and relationships with its customers made it an attractive acquisition for the Company. Going back to 1963, West Virginia Pipeline has a long history of excellent work performance in southern West Virginia. Their geographic region compliments Energy Services’ as the two companies rarely competed for work previously. The $4.2 million in goodwill generated by the acquisition is largely the result of the synergies and economies of scale expected from the combining the operation of the Company and West Virginia Pipeline. Adding a non-union subsidiary will give Energy Services some flexibility in competing for work. While West Virginia Pipeline will be managed separately from the Company’s other union operations, it is expected that relationships built by all the companies will help provide new opportunities within the organization. |
BUSINESS AND ORGANIZATION (Poli
BUSINESS AND ORGANIZATION (Policies) | 3 Months Ended |
Dec. 31, 2020 | |
BUSINESS AND ORGANIZATION | |
Interim Financial Statements | Interim Financial Statements The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and should be read in conjunction with the Company’s audited consolidated financial statements and footnotes thereto for the years ended September 30, 2020 and 2019 included in the Company’s Annual Report on Form 10-K filed with the SEC on January 4, 2021. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to the interim financial reporting rules and regulations of the SEC. The financial statements reflect all adjustments (consisting primarily of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company’s financial position and results of operations. The operating results for the three months ended December 31, 2020 and 2019 are not necessarily indicative of the results to be expected for the full year or any other interim period. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline and C.J. Hughes and its subsidiaries, Nitro, Pinnacle, and Contractors Rental. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline and C.J. Hughes and its subsidiaries. |
DISAGGREGATION OF REVENUE (Tabl
DISAGGREGATION OF REVENUE (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
DISAGGREGATION OF REVENUE | |
Schedule of disaggregation of revenue | Three Months Ended December 31, 2020 Petroleum & Water, Sewer and Electrical and Total revenue Gas Other Mechanical from contracts Lump sum contracts $ — $ — $ 11,666,631 $ 11,666,631 Unit price contracts 11,827,050 3,707,181 — 15,534,231 Cost plus and T&M contracts 290,000 — 4,518,934 4,808,934 Total revenue from contracts $ 12,117,050 $ 3,707,181 $ 16,185,565 $ 32,009,796 Earned over time $ 8,402,592 $ 3,707,181 $ 16,013,755 $ 28,123,528 Earned at point in time 3,714,458 171,810 3,886,268 Total revenue from contracts $ 12,117,050 $ 3,707,181 $ 16,185,565 $ 32,009,796 Three Months Ended December 31, 2019 Petroleum & Water, Sewer and Electrical and Total revenue Gas Other Mechanical from contracts Lump sum contracts $ — $ — $ 7,448,512 $ 7,448,512 Unit price contracts 6,218,532 2,125,934 — 8,344,466 Cost plus and T&M contracts 3,311,566 1,274,832 5,463,931 10,050,329 Total revenue from contracts $ 9,530,098 $ 3,400,766 $ 12,912,443 $ 25,843,307 Earned over time $ 7,116,701 $ 3,400,766 $ 12,599,705 $ 23,117,172 Earned at point in time 2,413,397 — 312,738 2,726,135 Total revenue from contracts $ 9,530,098 $ 3,400,766 $ 12,912,443 $ 25,843,307 |
CONTRACT BALANCES (Tables)
CONTRACT BALANCES (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
CONTRACT BALANCES | |
Schedule of accounts receivable-trade, net of allowance for doubtful accounts, retainages receivable, contract assets and contract liabilities | September 30, 2020 December 31, 2020 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 18,176,679 $ 17,026,460 $ (1,150,219) Contract assets Cost and estimated earnings in excess of billings $ 6,545,863 $ 4,418,599 $ (2,127,264) Contract liabilities Billings in excess of cost and estimated earnings $ 4,851,900 $ 3,721,385 $ (1,130,515) |
UNCOMPLETED CONTRACTS (Tables)
UNCOMPLETED CONTRACTS (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
UNCOMPLETED CONTRACTS. | |
Schedule of costs, estimated earnings and billings on uncompleted contracts | December 31, September 30, 2020 2020 Costs incurred on contracts in progress $ 114,491,141 $ 74,996,405 Estimated earnings, net of estimated losses 19,336,835 16,067,668 133,827,976 91,064,073 Less billings to date 133,130,762 89,370,110 $ 697,214 $ 1,693,963 Costs and estimated earnings in excess of billed on uncompleted contracts $ 4,418,599 $ 6,545,863 Less billings in excess of costs and estimated earnings on uncompleted contracts 4,851,900 $ 697,214 $ 1,693,963 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
Schedule to compute (loss) earnings per share | Three Months Ended Three Months Ended December 31, December 31, 2020 2019 Net loss $ (647,662) $ (74,114) Dividends on preferred stock 77,250 77,250 Net loss available to common shareholders $ (724,912) $ (151,364) Weighted average shares outstanding-basic 13,621,406 13,911,610 Weighted average shares-diluted 13,621,406 13,911,610 Loss per share available to common shareholders $ (0.053) $ (0.011) Loss per share available to common shareholders-diluted $ (0.053) $ (0.011) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of components of income taxes | Three Months Ended December 31, 2020 2019 Federal Current $ (77,380) $ 54,240 Deferred 23,214 (82,678) Total $ (54,166) $ (28,438) State Current $ (21,824) $ 15,298 Deferred 6,548 (23,319) Total $ (15,276) $ (8,021) Total income tax benefit $ (69,442) $ (36,459) |
Schedule of income tax effects to deferred tax assets and liabilities | December 31, September 30, 2020 2020 Deferred income tax liabilities Long-term Property and equipment $ 2,750,067 $ 2,746,331 Other (19,805) (19,805) Total deferred income tax liabilities $ 2,730,262 $ 2,726,526 Deferred income tax assets Long-term Other $ 518,178 $ 471,011 Total deferred income tax assets $ 518,178 $ 471,011 Total net deferred income tax liabilities $ 2,212,084 $ 2,255,515 |
SHORT-TERM AND LONG-TERM DEBT (
SHORT-TERM AND LONG-TERM DEBT (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
SHORT-TERM AND LONG-TERM DEBT | |
Schedule of summary of short-term and long-term debt | December 31, September 30, 2020 2020 Line of credit payable to bank, monthly interest at 4.99%, final payment due by June 28, 2021. 3,500,000 — Notes payable to finance companies, due in monthly installments totaling $70,062 including interest ranging from 0.00% to 6.03%, final payments due January 2021 through August 2026, secured by equipment. 1,668,998 1,334,566 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $254,922 in FY 2020 and $267,677 in FY 2019, including interest rate at 3.50%, final payment made November 2020. — 509,843 Notes payable to bank, due in monthly installments totaling $7,799, including interest at 4.82%, final payment due November 2034 secured by building and property. 956,168 967,665 Notes payable to bank, due in monthly installments totaling $11,602, including interest at 4.25%, final payment due November 2025 secured by building and property. 606,842 644,172 Notes payable to bank for $9.8 million in Paycheck Protection Program ("PPP") loan funds. Payments on the five-year note are expected to begin in March 2021 if PPP loan repayment is not forgiven, due in monthly installments totaling $168,187, including interest at 1.0%, final payment due December 2025. 9,839,100 9,839,100 Notes payable to bank, due in monthly installments totaling $98,865, including interest at 4.99%, final payment due September 2022 secured by equipment. 1,711,220 1,983,911 Notes payable to bank, due in monthly installments totaling $46,482, including interest at 5.00%, final payment due September 2021 secured by equipment. 359,432 493,191 Notes payable to David and Daniel Bolton, due in annual installments totaling $600,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 3,000,000 — Total debt 21,641,760 15,772,448 Less current maturities 8,145,254 4,538,743 Total long term debt $ 13,496,506 $ 11,233,705 |
ACQUISITION (Tables)
ACQUISITION (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
Acquisitions | |
Schedule of allocation of purchase price | Goodwill $ 4,220,829 Equipment and vehicles 1,565,000 Building 220,243 Land 64,757 Non-compete agreement 150,000 Customer list 150,000 Cash received in acquisition 250,000 Debt assumed in acquisition (120,829) Purchase price $ 6,500,000 |
DISAGGREGATION OF REVENUE (Deta
DISAGGREGATION OF REVENUE (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | $ 32,009,796 | $ 25,843,307 |
Earned over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 28,123,528 | 23,117,172 |
Earned at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 3,886,268 | 2,726,135 |
Lump sum contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 11,666,631 | 7,448,512 |
Unit price contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 15,534,231 | 8,344,466 |
Cost plus and T&M contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 4,808,934 | 10,050,329 |
Petroleum and Gas | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 12,117,050 | 9,530,098 |
Petroleum and Gas | Earned over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 8,402,592 | 7,116,701 |
Petroleum and Gas | Earned at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 3,714,458 | 2,413,397 |
Petroleum and Gas | Unit price contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 11,827,050 | 6,218,532 |
Petroleum and Gas | Cost plus and T&M contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 290,000 | 3,311,566 |
Water, Sewer and Other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 3,707,181 | 3,400,766 |
Water, Sewer and Other | Earned over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 3,707,181 | 3,400,766 |
Water, Sewer and Other | Unit price contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 3,707,181 | 2,125,934 |
Water, Sewer and Other | Cost plus and T&M contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 1,274,832 | |
Electrical and Mechanical | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 16,185,565 | 12,912,443 |
Electrical and Mechanical | Earned over time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 16,013,755 | 12,599,705 |
Electrical and Mechanical | Earned at point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 171,810 | 312,738 |
Electrical and Mechanical | Lump sum contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | 11,666,631 | 7,448,512 |
Electrical and Mechanical | Cost plus and T&M contracts | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue from contracts | $ 4,518,934 | $ 5,463,931 |
CONTRACT BALANCES (Details)
CONTRACT BALANCES (Details) - USD ($) | 3 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2020 | |
CONTRACT BALANCES | |||
Accounts receivable-trade, net of allowance for doubtful accounts | $ 17,026,460 | $ 18,176,679 | |
Change in accounts receivable-trade | (1,150,219) | $ (8,424,777) | |
Contract assets | |||
Cost and estimated earnings in excess of billings | 4,418,599 | 6,545,863 | |
Change in cost and estimated earnings in excess of billings | (2,127,264) | (2,082,158) | |
Contract liabilities | |||
Billings in excess of cost and estimated earnings | 3,721,385 | $ 4,851,900 | |
Change in billings in excess of cost and estimated earnings | $ (1,130,515) | $ (222,884) |
CONTRACT BALANCES - Additional
CONTRACT BALANCES - Additional Information (Details) | 3 Months Ended |
Dec. 31, 2020USD ($) | |
Contract Balances [Line Items] | |
Billing term | 14 days |
Payment term | 15 days |
Recognized revenue included in contract liability | $ 4,600,000 |
Minimum | |
Contract Balances [Line Items] | |
Billing And Payment Term | 30 days |
Maximum | |
Contract Balances [Line Items] | |
Billing And Payment Term | 45 days |
PERFORMANCE OBLIGATIONS (Detail
PERFORMANCE OBLIGATIONS (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2020USD ($) | |
PERFORMANCE OBLIGATIONS | |
Recognized revenue | $ 1 |
Amount of remaining unsatisfied performance obligations | $ 9.5 |
UNCOMPLETED CONTRACTS - Summary
UNCOMPLETED CONTRACTS - Summary of costs, estimated earnings, and billings on uncompleted contracts (Details) - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
UNCOMPLETED CONTRACTS. | ||
Costs incurred on contracts in progress | $ 114,491,141 | $ 74,996,405 |
Estimated earnings, net of estimated losses | 19,336,835 | 16,067,668 |
Costs of uncompleted contracts including net estimated earnings | 133,827,976 | 91,064,073 |
Less billings to date | 133,130,762 | 89,370,110 |
Unbilled Contracts | 697,214 | 1,693,963 |
Contract assets: Costs and estimated earnings in excess of billed on uncompleted contracts | 4,418,599 | 6,545,863 |
Less contract liabilities: billings in excess of costs and estimated earnings on uncompleted contracts | 3,721,385 | 4,851,900 |
Unbilled contracts receivable | $ 697,214 | $ 1,693,963 |
UNCOMPLETED CONTRACTS - Backlog
UNCOMPLETED CONTRACTS - Backlog (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Sep. 30, 2020 |
UNCOMPLETED CONTRACTS. | ||
Backlog | $ 60.7 | $ 63.8 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Sep. 30, 2020 |
FAIR VALUE MEASUREMENTS | ||
Debt principal amount | $ 17.2 | $ 15.8 |
Debt fair value | $ 16.1 | $ 14.8 |
LOSS PER SHARE - Summary of amo
LOSS PER SHARE - Summary of amounts used to compute earnings per share (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LOSS PER SHARE | ||
Net loss | $ (647,662) | $ (74,114) |
Dividends on preferred stock | 77,250 | 77,250 |
Net loss available to common shareholders | $ (724,912) | $ (151,364) |
Weighted average shares outstanding-basic (in shares) | 13,621,406 | 13,911,610 |
Weighted average shares-diluted (in shares) | 13,621,406 | 13,911,610 |
Loss per share available to common shareholders | $ (0.053) | $ (0.011) |
Loss per share available to common shareholders-diluted | $ (0.053) | $ (0.011) |
INCOME TAXES - Components of in
INCOME TAXES - Components of income taxes (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Federal | ||
Current | $ (77,380) | $ 54,240 |
Deferred | 23,214 | (82,678) |
Total | (54,166) | (28,438) |
State | ||
Current | (21,824) | 15,298 |
Deferred | 6,548 | (23,319) |
Total | (15,276) | (8,021) |
Total income tax benefit | $ (69,442) | $ (36,459) |
INCOME TAXES - Summary of incom
INCOME TAXES - Summary of income tax effects of temporary differences giving rise to the deferred tax assets and liabilities (Details) - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Deferred income tax liabilities | ||
Property and equipment | $ 2,750,067 | $ 2,746,331 |
Other | (19,805) | (19,805) |
Total deferred income tax liabilities | 2,730,262 | 2,726,526 |
Deferred income tax assets | ||
Other | 518,178 | 471,011 |
Total deferred income tax assets | 518,178 | 471,011 |
Total net deferred income tax liabilities | $ 2,212,084 | $ 2,255,515 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
INCOME TAXES | ||
Effective income tax rate | (9.70%) | (33.00%) |
SHORT-TERM AND LONG-TERM DEBT -
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Details) - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Debt Instrument [Line Items] | ||
Total debt | $ 21,641,760 | $ 15,772,448 |
Less current maturities | 8,145,254 | 4,538,743 |
Total long term debt | 13,496,506 | 11,233,705 |
Line of credit payable to bank, final payment due by June 28, 2021 | ||
Debt Instrument [Line Items] | ||
Total debt | 3,500,000 | |
Notes payable to finance companies, final payments due January 2021 through August 2026 | ||
Debt Instrument [Line Items] | ||
Total debt | 1,668,998 | 1,334,566 |
Note payable to finance company for insurance premiums financed due November 2020 in monthly installments | ||
Debt Instrument [Line Items] | ||
Total debt | 509,843 | |
Note payable to bank due November 2034 | ||
Debt Instrument [Line Items] | ||
Total debt | 956,168 | 967,665 |
Notes payable to banks due November 2025 | ||
Debt Instrument [Line Items] | ||
Total debt | 606,842 | 644,172 |
Notes payable to bank in Paycheck Protection Program ("PPP") loan funds due December 2025 | ||
Debt Instrument [Line Items] | ||
Total debt | 9,839,100 | 9,839,100 |
Notes payable to bank due September 2022 | ||
Debt Instrument [Line Items] | ||
Total debt | 1,711,220 | 1,983,911 |
Notes payable to bank due September 2021 | ||
Debt Instrument [Line Items] | ||
Total debt | 359,432 | $ 493,191 |
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | ||
Debt Instrument [Line Items] | ||
Total debt | $ 3,000,000 |
SHORT-TERM AND LONG-TERM DEBT_2
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Parentheticals) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | |
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | $ 17,200,000 | $ 15,800,000 | |
Line of credit payable to bank, final payment due by June 28, 2021 | |||
Debt Instrument [Line Items] | |||
Interest rate | 4.99% | ||
Notes payable to finance companies, final payments due January 2021 through August 2026 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 70,062 | ||
Notes payable to finance companies, final payments due January 2021 through August 2026 | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate | 0.00% | ||
Notes payable to finance companies, final payments due January 2021 through August 2026 | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate | 6.03% | ||
Note payable to finance company for insurance premiums financed due November 2020 in monthly installments | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 254,922 | $ 267,677 | |
Interest rate | 3.50% | ||
Note payable to bank due November 2034 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 7,799 | ||
Interest rate | 4.82% | ||
Notes payable to banks due November 2025 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 11,602 | ||
Interest rate | 4.25% | ||
Notes payable to bank in Paycheck Protection Program ("PPP") loan funds due December 2025 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 168,187 | ||
Interest rate | 1.00% | ||
Debt Instrument, Face Amount | $ 9,800,000 | ||
Term of debt | 5 years | ||
Notes payable to bank due September 2022 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 98,865 | ||
Interest rate | 4.99% | ||
Notes payable to bank due September 2021 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 46,482 | ||
Interest rate | 5.00% | ||
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | |||
Debt Instrument [Line Items] | |||
Note payable in monthly installments | $ 600,000 | ||
Interest rate | 3.25% |
SHORT-TERM AND LONG-TERM DEBT_3
SHORT-TERM AND LONG-TERM DEBT - Interest rates (Details) - USD ($) $ in Millions | Jul. 30, 2020 | Jan. 31, 2020 | Dec. 31, 2020 | Sep. 30, 2020 |
Line of Credit Facility [Line Items] | ||||
Insurance policy amount | $ 3.1 | |||
Financing agreement "Operating Line of Credit (2020)" | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit | $ 3.5 | |||
Amount available to borrowing | 6.4 | |||
Financing agreement "Operating Line of Credit (2020)" | ||||
Line of Credit Facility [Line Items] | ||||
Amount available to borrowing | $ 9.9 | |||
United Bank, Inc. | Financing agreement "Operating Line of Credit (2020)" | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit | $ 15 | |||
Interest rate on the line of credit description | "Wall Street Journal" Prime Rate | |||
Interest rate on line of credit | 4.99% | |||
Amount repaid against the line of credit | $ 11.1 | |||
Percentage of eligible accounts receivable | 70.00% | |||
Amount of loan covenants | $ 12.5 | |||
Minimum tangible net worth | $ 19 | |||
Minimum traditional debt service coverage ratio | 1.25x | |||
Minimum current ratio | 1.50x | |||
Maximum debt to tangible net worth ratio | 2.0x | |||
Amount of minimum tangible net worth | $ 21 | |||
Traditional debt service coverage ratio | 2.0x | |||
United Bank, Inc. | Financing agreement "Operating Line of Credit (2020)" | 12.5 million component | ||||
Line of Credit Facility [Line Items] | ||||
Amount borrowed against the line of credit | $ 12.5 | $ 11.1 | ||
United Bank, Inc. | Financing agreement "Operating Line of Credit (2020)" | 2.5 million component | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit | $ 2.5 |
ACQUISITION - Tangible and inta
ACQUISITION - Tangible and intangible assets acquired and liabilities assumed, the purchase price allocations (Details) - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Asset Acquisition [Line Items] | ||
Goodwill | $ 4,520,829 | |
Property, Plant and Equipment, Net, Total | 18,973,633 | $ 16,391,714 |
Intangible Assets, Net (Excluding Goodwill) | 300,000 | |
West Virginia Pipeline | ||
Asset Acquisition [Line Items] | ||
Goodwill | 4,220,829 | |
Cash received in acquisition | 250,000 | |
Debt assumed in acquisition | (120,829) | |
Purchase price | 6,500,000 | |
West Virginia Pipeline | Non-compete agreement | ||
Asset Acquisition [Line Items] | ||
Intangible Assets, Net (Excluding Goodwill) | 150,000 | |
West Virginia Pipeline | Customer list | ||
Asset Acquisition [Line Items] | ||
Intangible Assets, Net (Excluding Goodwill) | 150,000 | |
West Virginia Pipeline | Equipment and vehicles | ||
Asset Acquisition [Line Items] | ||
Property, Plant and Equipment, Net, Total | 1,565,000 | |
West Virginia Pipeline | Building | ||
Asset Acquisition [Line Items] | ||
Property, Plant and Equipment, Net, Total | 220,243 | |
West Virginia Pipeline | Land | ||
Asset Acquisition [Line Items] | ||
Property, Plant and Equipment, Net, Total | $ 64,757 |
ACQUISITION - Additional Inform
ACQUISITION - Additional Information (Details) - USD ($) | Jan. 07, 2021 | Dec. 31, 2020 |
Asset Acquisition [Line Items] | ||
Goodwill | $ 4,520,829 | |
West Virginia Pipeline | ||
Asset Acquisition [Line Items] | ||
Cash consideration | 3,500,000 | |
Seller note as consideration for acquiring assets | $ 3,000,000 | |
Term of debt | 5 years | |
Interest Rate | 3.25% | |
Legal Expenses | $ 50,000 | |
Software Expenses | 5,000 | |
Auditing Expenses | $ 75,000 | |
Goodwill | $ 4,220,829 |