Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 21, 2022 | Mar. 31, 2022 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Entity File Number | 001-32998 | ||
Document Transition Report | false | ||
Document Period End Date | Sep. 30, 2022 | ||
Entity Registrant Name | Energy Services of America CORP | ||
Entity Central Index Key | 0001357971 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-4606266 | ||
Entity Address, Address Line One | 75 West 3rd Ave. | ||
Entity Address, City or Town | Huntington | ||
Entity Address, Postal Zip Code | 25701 | ||
Entity Address, State or Province | WV | ||
City Area Code | 304 | ||
Local Phone Number | 522-3868 | ||
Title of 12(g) Security | Common Stock, par value $0.0001per share | ||
Trading Symbol | ESOA | ||
Security Exchange Name | NASDAQ | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 16,667,185 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --09-30 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 24,004,287 | ||
Auditor Name | Baker Tilly US, LLP | ||
Auditor Location | Pittsburgh, Pennsylvania | ||
Auditor Firm ID | 23 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Current assets | ||
Cash and cash equivalents | $ 7,427,474 | $ 8,226,739 |
Accounts receivable-trade | 38,525,223 | 21,092,517 |
Allowance for doubtful accounts | (70,310) | (70,310) |
Retainages receivable | 4,443,679 | 917,526 |
Other receivables | 10,866 | 543,328 |
Contract assets | 16,109,593 | 8,730,402 |
Prepaid expenses and other | 3,945,968 | 3,541,000 |
Total current assets | 70,392,493 | 42,981,202 |
Property, plant and equipment, at cost | 73,736,433 | 61,145,705 |
less accumulated depreciation | (41,074,646) | (38,195,686) |
Total fixed assets | 32,661,787 | 22,950,019 |
Right-of-use assets-operating lease | 1,611,321 | |
Intangible assets, net | 3,873,690 | 2,425,923 |
Goodwill | 4,087,554 | 1,814,317 |
Total assets | 112,626,845 | 70,171,461 |
Current liabilities | ||
Current maturities of long-term debt | 4,060,016 | 3,401,574 |
Lines of credit and short term borrowings | 13,080,320 | 5,040,250 |
Current maturities of operating lease liabilities | 588,653 | |
Accounts payable | 20,314,408 | 7,285,392 |
Accrued expenses and other current liabilities | 11,266,008 | 5,599,702 |
Contract liabilities | 6,027,578 | 3,153,290 |
Total current liabilities | 55,336,983 | 24,480,208 |
Long-term debt, less current maturities | 13,494,084 | 9,020,774 |
Long-term operating lease liabilities | 1,015,624 | |
Deferred tax liability | 4,455,079 | 2,033,433 |
Total liabilities | 74,301,770 | 35,534,415 |
Shareholders' equity | ||
Preferred stock, $.0001 par value Authorized 1,000,000 shares, none issued at June 30, 2022 and 206 issued at September 30, 2021 | ||
Common stock, $.0001 par value Authorized 50,000,000 shares, 17,885,615 issued and 16,667,185 outstanding at September 30, 2022 and 14,839,836 issued and 13,621,406 outstanding at September 30, 2021 | 1,789 | 1,484 |
Treasury stock, 1,218,430 shares at September 30, 2022 and 2021 | (122) | (122) |
Additional paid in capital | 60,508,350 | 60,670,699 |
Retained deficit | (22,184,942) | (26,035,015) |
Total shareholders' equity | 38,325,075 | 34,637,046 |
Total liabilities and shareholders' equity | $ 112,626,845 | $ 70,171,461 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Sep. 30, 2022 | Sep. 30, 2021 |
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 | 0 | 206 |
Preferred Stock, Shares Outstanding | 0 | 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 | 17,885,615 | 14,839,836 |
Common stock, shares outstanding | 16,667,185 | 13,621,406 |
Treasury stock, shares | 1,218,430 | 1,218,430 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CONSOLIDATED STATEMENTS OF INCOME | ||
Revenue | $ 197,590,000 | $ 122,465,826 |
Cost of revenues | 175,219,252 | 109,544,804 |
Gross profit | 22,370,748 | 12,921,022 |
Selling and administrative expenses | 15,878,138 | 14,044,232 |
Income (loss) from operations | 6,492,610 | (1,123,210) |
Other income (expense) | ||
Interest income | 576 | 286,645 |
Paycheck Protection Program loan forgiveness | 0 | 9,839,100 |
Other nonoperating expense | (248,006) | (58,742) |
Interest expense | (887,931) | (557,320) |
Gain on sale of equipment | 755,470 | 681,653 |
Other nonoperating income (expense), Total | (379,891) | 10,191,336 |
Income before income taxes | 6,112,719 | 9,068,126 |
Income tax expense (benefit) | 2,262,646 | (29,129) |
Net income | 3,850,073 | 9,097,255 |
Dividends on preferred stock | 284,238 | |
Net income available to common shareholders | $ 3,850,073 | $ 8,813,017 |
Weighted average shares outstanding-basic | 16,323,790 | 13,621,406 |
Weighted average shares-diluted | 16,323,790 | 16,988,424 |
Earnings per share available to common shareholders | $ 0.24 | $ 0.65 |
Earnings per share-diluted available to common shareholders | $ 0.24 | $ 0.52 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income | $ 3,850,073 | $ 9,097,255 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation expense | 5,568,929 | 4,661,789 |
Paycheck Protection Program loan forgiveness | 0 | (9,839,100) |
Gain on sale of equipment | (755,470) | (681,653) |
Provision for deferred taxes | 2,421,646 | 211,677 |
Provision for loss on contract | 248,770 | 0 |
Amortization of intangible assets | 444,565 | 230,588 |
Amortization of operating lease right-of-use assets | 98,711 | 0 |
Accreted interest on operating lease right-of-use assets | 11,802 | 0 |
Accreted interest on notes payable | 49,638 | 0 |
Operating lease payments | (117,558) | 0 |
Increase in contracts receivable | (17,432,706) | (2,845,528) |
(Increase) decrease in retainage receivable | (3,526,153) | 1,566,283 |
Decrease (increase) in other receivables | 532,462 | (533,870) |
Increase in contract assets | (7,379,191) | (2,184,539) |
Decrease (increase) in prepaid expenses and other | 2,948,003 | (202,057) |
Increase in accounts payable | 13,029,016 | 2,063,170 |
Increase in accrued expenses and other current liabilities | 5,417,842 | 953,534 |
Increase (decrease) increase in contract liabilities | 2,874,288 | (1,698,610) |
Net cash provided by operating activities | 8,284,667 | 798,939 |
Cash flows from investing activities: | ||
Acquisition of Revolt Energy | 0 | (150,000) |
Acquisition of West Virginia Pipeline, net of cash received of $250,000 | 0 | (3,250,000) |
Investment in property and equipment | (5,308,189) | (6,047,693) |
Acquisition of Ryan Environmental and Ryan Transport | (4,042,057) | 0 |
Proceeds from sales of property and equipment | 1,071,723 | 758,391 |
Net cash used in investing activities | (8,278,523) | (8,689,302) |
Cash flows from financing activities: | ||
Preferred stock redemption | (1,210,525) | 0 |
Preferred dividends paid | 0 | (309,000) |
Borrowings on lines of credit and short-term debt, net of repayments | 4,687,099 | 8,030,407 |
Principal payments on long-term debt | (4,281,983) | (2,821,125) |
Net cash (used in) provided by financing activities | (805,409) | 4,900,282 |
Decrease in cash and cash equivalents | (799,265) | (2,990,081) |
Cash and cash equivalents beginning of period | 8,226,739 | 11,216,820 |
Cash and cash equivalents end of period | 7,427,474 | 8,226,739 |
Supplemental schedule of noncash investing and financing activities: | ||
Purchases of property & equipment under financing agreements | 549,455 | 3,349,139 |
Prepaid insurance premiums financed | 3,352,971 | 3,213,402 |
Note payable to finance West Virginia Pipeline acquisition | 0 | 3,000,000 |
Note payable to refinance short-term borrowing | 0 | 2,850,000 |
Accrued dividends on preferred stock | 0 | 52,488 |
Debt assumed in acquisitions for equipment | 390,445 | 205,829 |
Sellers' note Tri-State Paving acquisition | 936,000 | 0 |
Note payable to finance Tri-State Paving acquisition | 7,500,000 | 0 |
Common stock issued to finance Tri-State Paving acquisition | 1,048,218 | 0 |
Par value of common stock issued from preferred stock coversion | 263 | 0 |
Operating lease right-of-use assets | 1,710,032 | 0 |
Cash paid during the year for: | ||
Interest | 846,129 | 557,320 |
Income taxes | $ 50,231 | $ 251,996 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parentheticals) | 12 Months Ended |
Sep. 30, 2022 USD ($) | |
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 Deficit | Treasury Stock | Total |
Balance at the beginning at Sep. 30, 2020 | $ 1,484 | $ 60,670,699 | $ (34,848,032) | $ (122) | $ 25,824,029 |
Balance at the beginning (in shares) at Sep. 30, 2020 | 13,621,406 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 9,097,255 | 9,097,255 | |||
Accrued preferred dividends | (284,238) | (284,238) | |||
Balance at the end at Sep. 30, 2021 | $ 1,484 | 60,670,699 | (26,035,015) | (122) | 34,637,046 |
Balance at the end (in shares) at Sep. 30, 2021 | 13,621,406 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 3,850,073 | 3,850,073 | |||
Shares issued for Tri-State Paving acquisition | $ 42 | 1,048,176 | 1,048,218 | ||
Shares issued for Tri-State Paving acquisition (in shares) | (419,287) | ||||
Preferred share redemption, net of accrued dividends | (1,210,525) | (1,210,525) | |||
Preferred share conversion | $ 263 | 263 | |||
Preferred share conversion (in shares) | 2,626,492 | ||||
Balance at the end at Sep. 30, 2022 | $ 1,789 | $ 60,508,350 | $ (22,184,942) | $ (122) | $ 38,325,075 |
Balance at the end (in shares) at Sep. 30, 2022 | 16,667,185 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 12 Months Ended |
Sep. 30, 2022 | |
BUSINESS AND ORGANIZATION | |
BUSINESS AND ORGANIZATION | 1. BUSINESS AND ORGANIZATION: Energy Services of America Corporation (“Energy Services” or the “Company”), formed in 2006, is a contractor and service company that operates primarily in the mid-Atlantic and central regions of the United States and provides services to customers in the natural gas, petroleum, water distribution, automotive, chemical, and power industries. For the gas industry, the Company is primarily engaged in the construction, replacement and repair of natural gas pipelines and storage facilities for utility companies and private natural gas companies. Energy Services is involved in the construction of both interstate and intrastate pipelines, with an emphasis on the latter. For the oil industry, the Company provides a variety of services relating to pipeline, storage facilities and plant work. For the power, chemical, and automotive industries, the Company provides a full range of electrical and mechanical installations and repairs including substation and switchyard services, site preparation, equipment setting, pipe fabrication and installation, packaged buildings, transformers, and other ancillary work with regards thereto. Energy Services’ other services include liquid pipeline construction, pump station construction, production facility construction, water and sewer pipeline installations, various maintenance and repair services and other services related to pipeline construction. The Company has also added the ability to install residential, commercial, and industrial solar systems and perform civil and general contracting services. On October 6, 2021, the Company’s transfer agent completed the full redemption of all the Company’s 6.0% Convertible Cumulative Perpetual Preferred Stock, Series A (“Series A Preferred Stock”), which resulted in the issuance of 2,626,492 new shares of the Company’s common stock, the issuance of 317,500 common shares that were included in Series A Preferred Stock units, and cash redemption payments of $1.3 million. The Company’s total outstanding common shares after redemption was 16,247,898 as of October 6, 2021. On March 23, 2022, the Company’s common stock began trading on the Nasdaq Capital Market operated by The Nasdaq Stock Market, LLC under the symbol “ESOA”. Pursuant to the Asset Purchase Agreement signed on April 6, 2022, and amended on April 29, 2022, the Company acquired substantially all the assets (including but not limited to customer contracts, employees, and equipment) of Tri-State Paving, LLC for $7.5 million in cash, a $1.0 million promissory note, and $1.0 million in Energy Services common stock. The $7.5 million in cash was funded through a loan with United Bank, Inc., Huntington, West Virginia (“United Bank”). The transaction resulted in the issuance of 419,287 common shares. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Sep. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue Recognition The Company recognizes revenue as performance obligations are satisfied and control of the promised good and service is transferred to the customer. For Lump Sum and Unit Price contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward complete satisfaction of the performance obligation(s) using an input (i.e., “cost to cost”) method. For Cost Plus and Time and Material (“T&M”) contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward satisfaction of the performance obligation(s) using an output method. The Company does have certain service and maintenance contracts in which each customer purchase order is considered its own performance obligation recognized over time and would be recognized depending on the type of contract mentioned above. The Company also does certain T&M service work that is generally completed in a short duration and is recognized at a point in time. All contract costs, including those associated with affirmative claims, change orders and back charges, are recorded as incurred and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Contract costs consist of direct costs on contracts, including labor and materials, amounts payable to subcontractors and outside equipment providers, direct overhead costs and internal equipment expense (primarily depreciation, fuel, maintenance and repairs). The Company recognizes revenue, but not profit, on certain uninstalled materials. Revenue on these uninstalled materials is recognized when the cost is incurred (when control is transferred), but the associated profit is not recognized until the materials are installed. The costs of uninstalled materials are tracked separately within the Company’s accounting software. Pre-contract and bond costs, if required, and mobilization costs on projects are generally immaterial to the total value of the Company’s contracts and are expensed when incurred. As a practical expedient, the Company recognizes these incremental costs as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. For projects expected to last greater than one year, mobilization costs are capitalized as incurred and amortized over the expected duration of the project. For these projects, mobilization costs will be tracked separately in the Company’s accounting software. This includes costs associated with setting up a project lot or lay-down yard, equipment, tool and supply transportation, temporary facilities and utilities and worker qualification and safety training. Contracts may require the Company to warranty that work is performed in accordance with the contract; however, the warranty is not priced separately, and the Company does not offer customers an option to purchase a warranty. Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries, Contractors Rental, Nitro, and Pinnacle. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries. Use of Estimates and Assumptions The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S.GAAP”), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and loss during the reporting period. Actual results could differ materially from those estimates. Cash and Cash Equivalents Energy Services considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Fair Value Measurements The “Fair Value Measurement” Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP and specifies disclosures about fair value measurements. Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The “Fair Value Measurement” Topic establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 Level 2 Level 3 A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying amount for borrowings under the Company’s revolving credit facility approximates fair value because of the variable market interest rate charged to the Company for these borrowings. The fair value of the Company’s long term fixed-rate debt was estimated using a discounted cash flow analysis and a yield rate that was estimated based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $15.0 million at September 30, 2022 was $14.5 million. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $10.0 million at September 30, 2021 was $9.9 million. All other current assets and liabilities are carried at net realizable value which approximates fair value because of their short duration to maturity. Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable consists of amounts that have been billed to customers. Collateral is generally not required. A majority of the Company’s contracts have monthly billing terms and payment terms within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. Certain construction contracts include retention provisions to provide assurance to our customers that we will perform in accordance with the contract terms and are therefore not considered a financing benefit. The balances billed but not paid by customers pursuant to these provisions generally become due upon completion and acceptance of the project work or products by the customer. We have determined there are no significant financing components in our contracts as of and for the years ended September 30, 2022 and 2021. Retainage billed but not paid pursuant to contract provisions will be due upon completion of the contracts. Based on the Company’s experience, management considers all amounts classified as retainage receivable to be collectible. All retainage receivable amounts are expected to be collected within the next fiscal year. The Company provides an allowance for doubtful accounts when collection of an account or note receivable is considered doubtful, and receivables are written off against the allowance when deemed uncollectible. Inherent in the assessment of the allowance for doubtful accounts are certain judgments and estimates including, among others, the customer’s access to capital, the customer’s willingness or ability to pay, general economic conditions and the ongoing relationship with the customer. Property and Equipment Property and equipment are recorded at cost. Costs which extend the useful lives or increase the productivity of the assets are capitalized, while normal repairs and maintenance that do not extend the useful life or increase productivity of the asset are expensed as incurred. Property and equipment are depreciated principally on the straight-line method over the estimated useful lives of the assets: buildings 39 years; operating equipment and vehicles 5 5 Intangible Assets Acquired intangible assets subject to amortization are amortized on a straight-line basis, which approximates the pattern in which the economic benefit of the respective intangible assets are realized, over their respective estimated useful lives. The definite-lived identifiable intangible assets recognized as part of the Company's business combinations are recorded at their estimated fair value. Impairment of Long-Lived Assets A long-lived asset shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset would be compared to the asset’s carrying amount to determine if a write-down to market value is required. Claims Claims are amounts in excess of the agreed contract price that a contractor seeks to collect from customers or others for customer-caused delays, errors in specifications and designs, contract terminations, change orders in dispute or unapproved as to both scope and price, or other causes of unanticipated additional costs. The Company records revenue on claims that management believes are probable. Revenue from a claim is recorded only to the extent that contract costs relating to the claim have been incurred. Self -Insurance The Company has its workers compensation, general liability and auto insurance through a captive insurance company. While the Company believes that this arrangement has been very beneficial in reducing and stabilizing insurance costs, the Company has to maintain a surety deposit to guarantee payments of premiums. The surety deposit had a balance of $1.8 million and $2.1 million as of September 30, 2022 and 2021, respectively, which is in “Prepaid expenses and other” on the Company’s Consolidated Balance Sheets. Should the captive experience severe losses over an extended period, it could increase the Company’s insurance expense or surety deposit required. Advertising All advertising costs are expensed as incurred. Total advertising expense was $17,000 and $55,000 for the years ended September 30, 2022 and 2021, respectively. Stock Compensation Plans The Company accounts for its equity-based compensation as prescribed by U.S. GAAP for share-based payments. The Company has adopted a fair value-based method of accounting for employee equity-based plans, whereby compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. As a result, compensation expense relating to stock compensation plans will be reflected in net income as part of “Selling and administrative expenses” on the Consolidated Statements of Income. Income Taxes The Company and all subsidiaries file a consolidated federal and various state income tax returns on a fiscal year basis. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years ending prior to September 30, 2019. The Company follows the liability method of accounting for income taxes in accordance with U.S. GAAP. Under this method, deferred tax assets and liabilities are recorded for future tax consequences of temporary differences between financial reporting and tax bases of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the underlying assets or liabilities are recovered or settled. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. U.S. GAAP also prescribes a comprehensive model for how companies should recognize, measure, present and disclose in their financial statements uncertain tax positions taken or to be taken on a tax return. This evaluation is a two-step process. First, the recognition process determines if it is more likely than not that a tax position will be sustained based on the merits of the tax position upon examination by the appropriate taxing authority. Second, a measurement process is calculated to determine the amount of benefit/expense to recognize in the financial statements if a tax position meets the more likely than not recognition threshold. The tax position is measured at the greatest amount of benefit/expense that is more likely than not of being realized upon ultimate settlement. Any interest and penalty related to the unrecognized tax benefits, as the result of recognition of tax obligations resulting from uncertain tax positions, are included in the provision for income taxes. The Company had not recognized any uncertain tax positions at September 30, 2022 or 2021. Earnings Per Common Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the year, and diluted earnings per share is computed using the weighted average number of common shares outstanding during the year adjusted for all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. Collective Bargaining Agreements Certain Energy Services subsidiaries are party to collective bargaining agreements with unions representing members that are employed by the Company. The agreements require such subsidiaries to pay specified wages and provide certain benefits to the union employees. These agreements expire at various times and have typically been renegotiated and renewed on terms that are similar to the ones contained in the expiring agreements. Under certain collective bargaining agreements, the applicable Energy Services subsidiary is required to make contributions to multi-employer pension plans. If the subsidiary were to cease participation in one or more of these plans, a liability could potentially be assessed related to any underfunding of these plans. The amount of such assessment, were one to be made, cannot be reasonably estimated. Litigation Costs The Company recognizes reserves when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Litigation costs are expensed as incurred. New Accounting Pronouncements On October 28, 2021, the FASB released Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. The amendments of this ASU require entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2022. For all other entities they are effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Entities should apply the amendments prospectively to business combinations that occur after the effective date. Early adoption is permitted, including in any interim period, for public business entities for periods for which financial statements have not yet been issued, and for all other entities for periods for which financial statements have not yet been made available for issuance. The Company is currently assessing the effect that ASU 2021-08 will have on their results of operations, financial position and cash flows; however, the Company does not expect a significant impact. The FASB recently issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance”, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. Entities are required to provide the new disclosures prospectively for all transactions with a government entity that are accounted for under either a grant or a contribution accounting model and are reflected in the financial statements at the date of initially applying the new amendments, and to new transactions entered into after that date. Retrospective application of the guidance is permitted. The guidance in ASU 2021-10 is effective for financial statements of all entities for annual periods beginning after December 15, 2021, with early application permitted. ASU 2021-10 has not become effective for the Company; however, a significant impact is not expected. Subsequent Events On October 10, 2022, the Company entered into a $3.1 million promissory note agreement with United Bank to finance the Ryan Environmental acquisition. This is a five-year agreement with a fixed interest rate of 6.0% and monthly payments of $59,932 beginning on November 10, 2022. In February 2018, the Company filed a lawsuit against a former customer in the United States District Court for the Western District of Pennsylvania. The lawsuit is related to a dispute over work performed on a pipeline construction project. On November 16, 2022, a Judgement Order was issued, and the Company was awarded $13.1 million, of which $5.8 million was the jury award, $1.6 million was for attorney’s fees, and $5.7 million was for penalties and interest. None of the award had been recognized in the Company’s consolidated financial statements as of September 30, 2022. The Company’s attorney’s fees have been expensed as incurred. On December 16, 2022, the Defendant filed a notice of appeal with the court. Management has evaluated all subsequent events for accounting and disclosure. There have been no other material events during the period, other than noted above, that would either impact the results reflected in the report or the Company’s results going forward. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 12 Months Ended |
Sep. 30, 2022 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | 3. REVENUE RECOGNITION Our revenue is primarily derived from construction contracts that can span several quarters. We recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers 1. Identify the contract 2. Identify performance obligations 3. Determine the transaction price 4. Allocate the transaction price 5. Recognize revenue The accuracy of our revenue and profit recognition in a given period depends on the accuracy of our estimates of the cost to complete each project. We believe our experience allows us to create materially reliable estimates. There are a number of factors that can contribute to changes in estimates of contract cost and profitability. The most significant of these include: ● the completeness and accuracy of the original bid; ● costs associated with scope changes; ● changes in costs of labor and/or materials; ● extended overhead and other costs due to owner, weather and other delays; ● subcontractor performance issues; ● changes in productivity expectations; ● site conditions that differ from those assumed in the original bid; ● changes from original design on design-build projects; ● the availability and skill level of workers in the geographic location of the project; ● a change in the availability and proximity of equipment and materials; ● our ability to fully and promptly recover on affirmative claims and back charges for additional contract costs; and ● the customer’s ability to properly administer the contract. The foregoing factors, as well as the stage of completion of contracts in process and the mix of contracts at different margins may cause fluctuations in gross profit from period to period. Significant changes in cost estimates, particularly in our larger, more complex projects, could have a significant effect on our profitability. Our contract assets include cost and estimated earnings in excess of billings that represent amounts earned and reimbursable under contracts, including claim recovery estimates, but have a conditional right for billing and payment such as achievement of milestones or completion of the project. 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 consist of provisions for losses and billings in excess of costs and estimated earnings. Provisions for losses, if incurred, are recognized in the consolidated statements of income at the uncompleted performance obligation level for 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 | 12 Months Ended |
Sep. 30, 2022 | |
DISAGGREGATION OF REVENUE | |
DISAGGREGATION OF REVENUE | 4. DISAGGREGATION OF REVENUE The Company disaggregates revenue based on the following lines of service: (1) Gas & Water Distribution, (2) Gas & Petroleum Transmission, and (3) Electrical, Mechanical, & General services and construction. Certain reclassifications have been made to the year ended September 30, 2021, to reflect the current presentation. Our contract types are: Lump Sum, Unit Price, Cost Plus and T&M. The following tables present our disaggregated revenue for the fiscal years ended September 30, 2022 and 2021: Year Ended September 30, 2022 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission and General from contracts Lump sum contracts $ — $ — $ 49,451,175 $ 49,451,175 Unit price contracts 53,311,569 55,637,622 525,092 109,474,283 Cost plus and T&M contracts — 2,630,879 36,033,663 38,664,542 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Earned over time $ 34,493,112 $ 54,551,248 $ 83,557,477 $ 172,601,837 Earned at point in time 18,818,457 3,717,253 2,452,453 24,988,163 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Year Ended September 30, 2021 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission and General from contracts Lump sum contracts $ — $ — $ 37,691,770 $ 37,691,770 Unit price contracts 40,440,195 20,928,518 — 61,368,713 Cost plus and T&M contracts — 1,204,965 22,200,378 23,405,343 Total revenue from contracts $ 40,440,195 $ 22,133,483 $ 59,892,148 $ 122,465,826 Earned over time $ 26,244,396 $ 20,928,518 $ 58,796,767 $ 105,969,681 Earned at point in time 14,195,799 1,204,965 1,095,381 16,496,145 Total revenue from contracts $ 40,440,195 $ 22,133,483 $ 59,892,148 $ 122,465,826 |
CONTRACT BALANCES
CONTRACT BALANCES | 12 Months Ended |
Sep. 30, 2022 | |
CONTRACT BALANCES | |
CONTRACT BALANCES | 5. CONTRACT BALANCES The Company’s accounts receivable consists of amounts that have been billed to customers and collateral is generally not required. Most of the Company’s contracts have monthly billing terms; however, billing terms for some are based on project completion. Payment terms are generally within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. During the twelve months ended September 30, 2022, we recognized revenue of $3.0 million that was included in the contract liability balance at September 30, 2021. Accounts receivable-trade, net of allowance for doubtful accounts, contract assets and contract liabilities consisted of the following: September 30, 2021 September 30, 2022 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 21,022,207 $ 38,454,913 $ 17,432,706 Contract assets Cost and estimated earnings in excess of billings $ 8,730,402 $ 16,109,593 $ 7,379,191 Contract liabilities Billings in excess of cost and estimated earnings $ 3,153,290 $ 6,027,578 $ 2,874,288 |
PERFORMANCE OBLIGATIONS
PERFORMANCE OBLIGATIONS | 12 Months Ended |
Sep. 30, 2022 | |
PERFORMANCE OBLIGATIONS | |
PERFORMANCE OBLIGATIONS | 6. PERFORMANCE OBLIGATIONS For the year ended September 30, 2022, there was no revenue recognized as a result of changes in contract transaction price related to performance obligations that were satisfied prior to September 30, 2021. The changes in contract transaction price were from items such as executed or estimated change orders, and unresolved contract modifications and claims. For the year ended September 30, 2021, we recognized revenue of $430,000 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 may be for items such as executed or estimated change orders, and unresolved contract modifications and claims. At September 30, 2022, the Company had $69.5 million in remaining unsatisfied performance obligations, in which revenue is expected to be recognized in less than twelve months. |
ALLOWANCE FOR DOUBTFUL ACCOUNTS
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 12 Months Ended |
Sep. 30, 2022 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 7. ALLOWANCE FOR DOUBTFUL ACCOUNTS Activity in the Company’s allowance for doubtful accounts consists of the following: Year Ended September 30, 2022 2021 Balance at beginning of year $ 70,310 $ 70,310 Charged to expense — — Deductions for uncollectible receivables written off, net of recoveries — — Balance at end of year $ 70,310 $ 70,310 |
UNCOMPLETED CONTRACTS
UNCOMPLETED CONTRACTS | 12 Months Ended |
Sep. 30, 2022 | |
UNCOMPLETED CONTRACTS | |
UNCOMPLETED CONTRACTS | 8. UNCOMPLETED CONTRACTS Costs and estimated earnings in excess of billings on uncompleted contracts are included in contract assets on the Consolidated Balance Sheets. Billings in excess of costs and estimated earnings on uncompleted contracts are included in contract liabilities on the Consolidated Balance Sheets. Costs, estimated earnings, and billings on uncompleted contracts are summarized as follows: September 30, September 30, 2022 2021 Costs incurred on contracts in progress $ 192,957,145 $ 64,903,618 Estimated earnings, net of estimated losses 28,150,060 13,280,334 221,107,205 78,183,952 Less billings to date 211,025,190 72,606,840 $ 10,082,015 $ 5,577,112 Costs and estimated earnings in excess of billed on uncompleted contracts $ 16,109,593 $ 8,730,402 Less billings in excess of costs and estimated earnings on uncompleted contracts 6,027,578 3,153,290 $ 10,082,015 $ 5,577,112 The Company’s unaudited backlog at September 30, 2022, and September 30, 2021, was $142.3 million and $72.2 million, respectively. |
CLAIMS
CLAIMS | 12 Months Ended |
Sep. 30, 2022 | |
CLAIMS | |
CLAIMS | 9. CLAIMS The Company does not have any claims receivable as of September 30, 2022 and 2021. Claims receivable is a component of contract assets. |
PROVISION FOR LOSS
PROVISION FOR LOSS | 12 Months Ended |
Sep. 30, 2022 | |
PROVISION FOR LOSS | |
PROVISION FOR LOSS | 10. PROVISION FOR LOSS The Company has one project with a $248,000 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Sep. 30, 2022 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | |
SHORT-TERM DEBT
SHORT-TERM DEBT | 12 Months Ended |
Sep. 30, 2022 | |
SHORT-TERM DEBT | |
SHORT-TERM DEBT | 12. SHORT-TERM DEBT Short-term debt consists of the following: On July 13, 2022, the Company received a one-year extension on its operating line of credit effective June 28, 2022. The $15.0 million revolving line of credit has a $12.5 million component and a $2.5 million component. The Company can borrow from the $12.5 million component first and then from the additional $2.5 million component if additional requirements are met. The covenant requirement for both components are below. Based on the borrowing base calculation, the Company borrowed all $12.5 million available on the line of credit as of September 30, 2022. The Company did not meet the requirements to borrow any from the $2.5 million component. The interest rate on the line of credit is the “ Wall Street Journal 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 $21.5 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 1.5x 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. Minimum traditional debt service coverage of 2.0x to be measured quarterly on a rolling twelve-month basis, 2. Minimum tangible net worth of $24.0 million to be measured quarterly. The Company was not in compliance with all covenants but received a waiver on the $12.5 million component of the line of credit at September 30, 2022. The Company projects to be in compliance with all covenants associated with the $12.5 million component for the next twelve months. 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. The Company makes a down payment in January and finances the remaining premium amount over ten monthly payments. In January 2022 and 2021, respectively, the Company financed $3.4 million and $3.2 million in insurance premiums. At September 30, 2022 and 2021, respectively, the remaining balance of the insurance premiums was $580,000 and $540,000. |
SHORT-TERM AND LONG-TERM DEBT
SHORT-TERM AND LONG-TERM DEBT | 12 Months Ended |
Sep. 30, 2022 | |
SHORT-TERM AND LONG-TERM DEBT | |
SHORT-TERM AND LONG-TERM DEBT | 13. SHORT-TERM AND LONG-TERM DEBT A summary of short-term and long-term debt as of September 30, 2022 and 2021 is as follows: 2022 2021 Line of credit payable to bank, variable interest rate of 5.50% at September 30, 2022, final payment due by June 28, 2023, guaranteed by certain directors of the Company. See also Note 5. $ 12,500,000 $ 4,500,000 Term note payable to United Bank, WV Pipeline acquisition, due in monthly installments of $64,853, fixed interest at 4.25%, final payment due by March 25, 2026, secured by receivables and equipment, guaranteed by certain directors of the Company. 2,529,421 3,183,549 Notes payable to finance companies, due in monthly installments totaling $59,500 at September 30, 2022 and $70,062 at September 30, 2021, including interest ranging from 0.00% to 5.50%, final payments due October 2022 through August 2026, secured by equipment. 889,165 1,066,580 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $282,297 in FY 2022 and $272,000 in FY 2021, including interest rate at 3.27%, final payment December 2022. 580,320 540,250 Notes payable to bank, due in monthly installments totaling $7,848, including interest at 4.82%, final payment due November 2034 secured by building and property. 867,383 919,017 Notes payable to bank, due in monthly installments totaling $12,193, variable interest of 7.25% at September 30, 2022, final payment due November 2025 secured by building and property, guaranteed by certain directors of the Company. 412,917 530,750 Notes payable to bank, due in monthly installments totaling $98,865, including interest at 4.99%, final payment due June 2022 secured by equipment, guaranteed by certain directors of the Company. — 872,452 Notes payable to David Bolton and Daniel Bolton, due in annual installments totaling $500,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 2,380,000 2,850,000 Notes payable to bank, fixed interest at 4.25% of outstanding balance due in monthly installments between January 2021 and January 2022. Note payments due in monthly installments totaling $68,150, including variable interest rate of 7.25% at September 30, 2022, with final payment due September 2026, secured by equipment, guaranteed by certain directors of the Company. 2,549,281 3,000,000 Term note payable to United Bank, Tri-State Paving acquisition, due in monthly installments of $129,910, fixed interest at 4.25%, final payment due by June 1, 2027, secured by receivables and equipment, guaranteed by certain directors of the Company. 6,982,097 — Notes payable to Corns Enterprises, due in annual installments totaling $250,000, including interest at 3.50%, final payment due April 29, 2026, unsecured 943,836 — Total debt $ 30,634,420 $ 17,462,598 Less current maturities 17,140,336 8,441,824 Total long term debt $ 13,494,084 $ 9,020,774 At September 30, 2022, future expected payments due on short-term and long-term debt are as follows: 2023 $ 17,140,336 2024 4,061,665 2025 4,170,114 2026 3,569,091 2027 1,069,272 Thereafter 623,942 $ 30,634,420 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Sep. 30, 2022 | |
INCOME TAXES | |
INCOME TAXES | 14. INCOME TAXES The components of income taxes are as follows: Year Ended September 30, 2022 2021 Federal Current $ 78,000 $ (187,829) Deferred 1,686,864 165,108 Total 1,764,864 (22,721) State Current 22,000 (52,977) Deferred 475,782 46,569 Total 497,782 (6,408) Total income tax expense (benefit) $ 2,262,646 $ (29,129) The Company’s income tax expense and deferred tax assets and liabilities reflect management’s best estimate of current and future taxes to be paid. Significant judgments and estimates are required in the determination of the consolidated income tax expense. The Company’s provision for income taxes is computed by applying a federal rate of 21.0% and a state rate of 6.0% to taxable income or loss after consideration of non-taxable and non-deductible items. The income tax expense for fiscal year ended September 30, 2022 was $2.3 million and was due to an increase in taxable income. The income tax benefit for fiscal year ended September 30, 2021, was ($29,000). According to the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) passed by Congress in March 2020, PPP loan forgiveness is not taxable. In accordance with the Consolidated Appropriations Act, 2021, the Company’s PPP related expenditures in fiscal year 2020 were considered deductible expenses for federal income tax purposes. The effective income tax rate for fiscal year ended September 30, 2022 was 37.0%. The effective income tax rate for fiscal year ended September 30, 2021, was (0.32%). The PPP forgiveness had a significant impact on the effective income tax rate for fiscal year ended September 30, 2021, as taxable income was decreased by $9.8 million. Effective income tax rates are estimates and may vary from period to period due to changes in the amount of taxable income or loss, non-taxable and non-deductible expenses. Year Ended September 30, 2022 2021 Statutory rate 21.0 % 21.0 % State income taxes 6.0 % 6.0 % Non-deductible meals and other 10.0 % 5.7 % Credit from solar installation project — % (2.8) % PPP loan forgiveness — % (30.2) % Effective tax rate 37.0 % (0.3) % Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements, which will result in taxable or deductible amounts in the future. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. At September 30, 2022, the Company expects all net operating loss carryforwards to be realized in the near future. The income tax effects of temporary differences giving rise to the deferred tax assets and liabilities are as follows: Year Ended September 30, 2022 2021 Deferred tax liabilities Property and equipment $ 7,686,064 $ 4,883,398 Other 7,632 37,582 Total deferred tax liabilities $ 7,693,696 $ 4,920,980 Deferred income tax assets Other $ 404,093 $ 358,400 Net operating loss carryforward 2,834,524 2,529,147 Total deferred tax assets $ 3,238,617 $ 2,887,547 Total net deferred tax liabilities $ 4,455,079 $ 2,033,433 The Company does not believe that it has any unrecognized tax benefits included in its consolidated financial statements that require recognition. The Company has not had any settlements in the current period with taxing authorities, nor has it recognized tax benefits as a result of a lapse of the applicable statute of limitations. The Company recognizes interest and penalties accrued related to unrecognized tax benefits, if applicable, in general and administrative expenses. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 15. EARNINGS PER SHARE Earnings per share for the years ended September 30, 2022, and 2021 are as follow: Twelve Months Ended Twelve Months Ended September 30, September 30, 2022 2021 Net income $ 3,850,073 $ 9,097,255 Dividends on preferred stock — 284,238 Income available to common shareholders $ 3,850,073 $ 8,813,017 Weighted average shares outstanding-basic 16,323,790 13,621,406 Weighted average shares outstanding-diluted 16,323,790 16,988,424 Earnings per share available to common shareholders $ 0.24 $ 0.65 Earnings per share available to common shareholders-diluted $ 0.24 $ 0.52 |
STOCK PURCHASE PLAN
STOCK PURCHASE PLAN | 12 Months Ended |
Sep. 30, 2022 | |
STOCK PURCHASE PLAN | |
STOCK PURCHASE PLAN | 16. STOCK PURCHASE PLAN At the annual meeting of the shareholders on November 19, 2008, the shareholders approved the establishment of an employee stock purchase plan. The stock purchase plan authorizes the issuance of up to 1,200,000 shares of common stock for purchase by eligible employees. A participant’s stock purchased during a calendar year may not exceed the lesser of (a) a percentage of the participant’s compensation or a total amount as specified by the compensation committee of the Board, or (b) $25,000. The stock will be offered at a purchase price of at least 85% of its fair market value on the date of purchase. The major plan provisions cover the purposes of the plan, effective date and duration, administration, eligibility, stock type, stock purchase limitations, price of stock, participation election, payroll deductions, payment for stock, date of purchase, termination of agreement, termination of employment, recapitalization, change of control, assignability, Stockholder rights, compliance with Internal Revenue Code Section 423, amendment and termination, application of funds, tax withholdings, governing laws, employment at will and arbitration. There have been no agreements with any employees made under this plan as of the year ended September 30, 2022. On July 6, 2022, the Company’s Board of Directors authorized a share repurchase program (the “Program”), pursuant to which the Company may, from time to time, purchase shares of its common stock for an aggregate repurchase not to exceed 1,000,000 shares, which is approximately 6.0% of its outstanding common stock. The Program does not obligate the Company to purchase any number of shares, and there is no guarantee as to the exact number of shares to be repurchased by the Company. To date, no repurchases have been made in connection with the Program. |
LONG TERM INCENTIVE PLAN
LONG TERM INCENTIVE PLAN | 12 Months Ended |
Sep. 30, 2022 | |
LONG TERM INCENTIVE PLAN | |
LONG TERM INCENTIVE PLAN | 17. LONG TERM INCENTIVE PLAN On February 16, 2022, the stockholders of Energy Services approved the Company’s 2022 Equity Incentive Plan (the “Plan”), which provides for the grant of stock-based awards to officers and employees of the Company and its subsidiaries. The maximum number of shares of stock, in the aggregate, that may be granted under the Plan as stock options, restricted stock or restricted stock units is 1,500,000 shares. A description of the material terms of the Plan is contained in the Company’s definitive proxy statement for the Annual Meeting of Stockholders filed with the Securities and Exchange Commission on January 11, 2022. To date, no grants of stock-based awards have been made. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Sep. 30, 2022 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 18. RELATED PARTY TRANSACTIONS The Company intends that all transactions between it and our executive officers, directors, holders of 10% or more of the shares of any class of our common stock and affiliates thereof, will be on terms no less favorable than those terms given to unaffiliated third parties and will be approved by a majority of our independent outside directors not having any interest in the transaction. On December 16, 2014, the Company’s Nitro subsidiary entered into a 20-year On April 29, 2022, the Company entered into a $1.0 million promissory note agreement with Corns Enterprises as partial consideration for the purchase of Tri-State Paving. This four-year agreement requires $250,000 principal installment payments on or before the end of each twelve (12) full calendar month period beginning April 29, 2022. Interest payments due shall be calculated on the principal balance remaining and shall be at the stated rate of 3.5% per year. The Company recorded $7,800 in accreted interest and has not made any principal payments on this note as of September 30, 2022. Subsequent to the April 29, 2022, acquisition of Tri-State Paving, the Company entered into a operating lease for facilities in Hurricane, West Virginia with Corns Enterprises. This thirty-six-month lease is treated as a right to use asset and has payments of $7,000 per month. The total net present value at inception was $236,000 with a carrying value of $205,000 at September 30, 2022. SQP made an equity investment of $156,000 in 1030 Quarrier Development, LLC (“Development”) in August 2022. Development is a variable interest entity (“VIE”) that is 75% owned by 1030 Quarrier Ventures, LLC (“Ventures”) and 25% owned by SQP. SQP is not the primary beneficiary of the VIE and therefore, will not consolidate Development into its consolidated financial statements. Instead, SQP will apply the equity method of accounting for its investment in Development. Development, a 1% owner, and United Bank, a 99% owner, formed 1030 Quarrier Landlord, LLC (“Landlord”). Landlord decided to pursue the following development project (the “Project”): An old building at 1030 Quarrier Street, Charleston, West Virginia as well as associated land (the “Property”) was purchased to be developed/rehabilitated into a commercial project including apartments and commercial space. Upon the completion of development, the Property will be used to generate rental income. SQP has been awarded the construction contract for the Project. United Bank provided $5.0 million in loans to fund the Project. SQP and Ventures has jointly provided an unconditional guarantee for the $5.0 million of obligations associated with the Project. Other than mentioned above, there were no new material related party transactions entered into during the fiscal year ended September 30, 2022. Certain Energy Services subsidiaries routinely engage in transactions in the normal course of business with each other, including sharing employee benefit plan coverage, payment for insurance and other expenses on behalf of other affiliates, and other services incidental to business of each of the affiliates. All revenue and related expense transactions, as well as the related accounts payable and accounts receivable have been eliminated in consolidation. |
LEASE OBLIGATIONS
LEASE OBLIGATIONS | 12 Months Ended |
Sep. 30, 2022 | |
LEASE OBLIGATIONS | |
LEASE OBLIGATIONS | 19. LEASE OBLIGATIONS The Company leases office space for SQP for $1,500 per month. The lease, signed on March 25, 2021, is for a period of two years with five one-year renewals available immediately following the end of the base term. Rental terms for the option periods shall be negotiated and agreed mutually between the parties and shall not exceed five percent increases to rent, if any. The lease is expensed monthly and not treated as a right-to-use asset as it does not have a material impact on the Company’s consolidated financial statements. During the twelve months ended September 30, 2022, the Company entered into two lease agreements of construction equipment for a combined $160,000. The leases have a term of twenty-two months with a stated interest rate of 0%, combined monthly installment payments of $6,645 and are cancellable at any time without penalty. The Company has the right to purchase the equipment at the expiration of the leases by applying the two-month deposit paid. The right-of-use assets and finance lease obligations associated with these lease agreements are included in the consolidated balance sheets within property, plant and equipment and long-term debt, respectively, and do not have a material impact on the Company’s consolidated financial statements. The Company has two right-of-use operating leases acquired on April 29, 2022, as part of the Tri-State Paving, LLC transaction. The first operating lease, for the Hurricane, WV facility, had a net present value of $236,000 at April 29, 2022, and a carrying value of $205,000 at September 30, 2022. The second operating lease, for the Chattanooga, Tennessee facility, had a net present value of $144,000 at April 29, 2022, and a carrying value of $119,000 at September 30, 2022. The 4.5% interest rate on the operating leases is based on the Company’s incremental borrowing rate at inception. The Company has a right-of-use operating lease with Enterprise Fleet Management, Inc. acquired on August 11, 2022, as part of the Ryan Environmental acquisition. This lease agreement was initially for 31 vehicles to be used for Ryan Construction; however, the Company plans to add vehicles as it finds necessary. This lease had a net present value of $1.2 million at inception, which approximates the carrying value at September 30, 2022. The 4.5% interest rate on the operating lease is based on the Company’s incremental borrowing rate at inception. The Company has a right-of-use operating lease with RICA Developers, LLC acquired on August 12, 2022, as part of the Ryan Environmental acquisition. This lease, for the Bridgeport, WV facility, had a net present value of $140,000 at inception and a carrying value of $113,000 at September 30, 2022. The 4.5% interest rate on the operating lease is based on the Company’s incremental borrowing rate at inception. Schedules related to the Company’s operating leases at fiscal year ended September 30, 2022 can be found below: Operating Lease-Weighted Average Remaining Term Years left Remaining liability Lease end Fiscal year end Operating lease 1 2.6 $ 205,267 4/30/2025 2025 Operating lease 2 1.8 119,032 5/31/2024 2024 Operating lease 3 3.9 1,166,498 8/10/2026 2027 Operating lease 4 1.0 113,480 8/11/2023 2023 $ 1,604,277 Weighted average remaining term 3.4 years Operating Lease Maturity Schedule 2023 $ 588,653 2024 465,428 2025 373,397 2026 296,606 1,724,084 Less amounts representing interest (119,807) Present value of operating lease liabilities $ 1,604,277 Year ended September 30, Operating Lease Expense 2022 Amortization Operating lease 1 $ 30,933 Operating lease 2 25,554 Operating lease 3 22,672 Operating lease 4 19,552 Total amortization 98,711 Interest Operating lease 1 4,067 Operating lease 2 2,411 Operating lease 3 4,360 Operating lease 4 964 Total interest 11,802 Total amortization and interest $ 110,513 Year ended September 30, Cash Paid for Operating Leases 2022 Operating lease 1 $ 35,000 Operating lease 2 27,965 Operating lease 3 27,032 Operating lease 4 27,561 $ 117,558 The Company rents equipment for use on construction projects with rental agreements being week to week or month to month. Rental expense can vary by fiscal year due to equipment requirements on construction projects and the availability of Company owned equipment. Rental expense, which is included in cost of goods sold on the consolidated statements of income, was $9.8 million and $3.6 million for the years ended September 30, 2022, and 2021, respectively. |
MAJOR CUSTOMERS
MAJOR CUSTOMERS | 12 Months Ended |
Sep. 30, 2022 | |
MAJOR CUSTOMERS | |
MAJOR CUSTOMERS | 20. MAJOR CUSTOMERS The tables below present customers that represent 10.0% or more of the Company’s revenue or accounts receivable, net of retention as of or for the fiscal years ended September 30, 2022, and 2021: Revenue FY 2022 FY 2021 TransCanada Corporation 16.6 % 11.0 % All other 83.4 % 89.0 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Accounts receivable, net of retention FY 2022 FY 2021 TransCanada Corporation 11.6 % 13.2 % Kentucky American Water * 16.3 % All other 88.4 % 70.5 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Virtually all work performed for major customers was awarded under competitive bid fixed price or unit price arrangements. The loss of a major customer could have a severe impact on the profitability of operations of the Company. However, due to the nature of the Company’s operations, the major customers and sources of revenues may change from year to year. |
RETIREMENT AND EMPLOYEE BENEFIT
RETIREMENT AND EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Sep. 30, 2022 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | 21. RETIREMENT AND EMPLOYEE BENEFIT PLANS In 2022 and 2021, C. J. Hughes maintained a tax-qualified 401(k) retirement plan for union employees. Employees can contribute up to 15% of eligible wages, provided the compensation deferred for a plan year does not exceed the indexed dollar amount set by the Internal Revenue Service which was $20,500 for 2022 and 2021. C. J. Hughes matches $0.25 on each dollar contributed up to 6% of eligible wages. C. J. Hughes contributed $22,000 and $26,000 to the union plan for fiscal years September 30, 2022 and 2021, respectively. Additionally, each plan year, C. J. Hughes may make a discretionary profit-sharing contribution for participants who are actively employed on the last day of the plan year. No discretionary profit-sharing contribution was made for the 2022 or 2021 plan year. Effective January 1, 2010, Energy Services became the successor plan sponsor of the C. J. Hughes Construction Company, Inc. 401(k) Plan for non-union employees (the “Plan”). The Plan was renamed the Energy Services of America Staff 401(k) Retirement Savings Plan. Employees are eligible to participate in the Plan upon completion of six months of service but must wait until a quarterly entry to join the Plan. In addition, participants who are age 50 or older by the end of the Plan year may elect to defer up to an additional $6,500 into the 401(k) Plan for 2022. Energy Services may make annual discretionary matching contributions and/or profit-sharing contributions to the Plan. The matching contribution formula for the Plan was 100% of each dollar contributed for the first 3% of eligible wages and 50% of each dollar contributed for the next 3% of eligible wages. The Company’s matching contribution is used by the Plan’s third-party administrator to purchase Energy Services of America common stock from the open market. No restrictions on the match exist after it has been contributed. No profit-sharing contribution was made for the 2022 or 2021 plan year. Energy Services and its wholly owned subsidiaries contributed $402,000 and $365,000, respectively, for the fiscal years ended September 30, 2022, and 2021 to the Plan. In addition, during fiscal year 2021, a one-time $651,000 Qualified Non-Elective Contribution (“QNEC”) was made to the Plan attributable to the 2021 Plan year to adjust Plan participant’s balances due to a third-party administrator’s actions. The Company contributes to a number of multi-employers defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multi-employer plans are different from single-employer plans in the following aspects: ● Assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers. If participating employers stop contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. ● If the Company chooses to stop participating in some of its multi-employer plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. The following table presents our participation in these plans: Contributions of Pension Protection Act ("PPA") Energy Services Certified Zone Status (1) FIP/RP Status Companies Expiration Date of EIN/Pension Pending/ Surcharge Collective Bargaining Pension Fund Plan Number 2021 2020 Implemented (2) 2022 2021 Imposed Agreement Central States, Southeast and Southwest Areas Pension Fund 36-6044243/001 Red Red Implemented $ 123,142 $ — no Various Employer-Teamsters Local Nos. 175 and 505 55-6021850/001 Red Red Implemented — — no Various Laborers National Pension Fund 75-1280827/001 Red Red Implemented 384,908 394,563 no Various Laborers' District Council of Western Pennsylvania Pension Plan 25-6135576/001 Yellow Yellow Implemented 269,915 — no Various Operating Engineers Local 324 Pension Fund 38-1900637/001 Red Red Implemented 66,757 — no Various National Automatic Sprinkler Industry Pension Fund 52-6054620/001 Red Red Implemented 199,984 121,133 no Various Iron Workers District Council of Southern Ohio &Vicinity Pension Trust 31-6038516/001 Yellow Yellow Implemented 208,588 160,367 no Various Carpenters Pension Fund of WV 55-6027998/001 Red Red Implemented 719,665 281,568 no Various Plumbers & Pipefitters National Pension Fund 52-6152779/001 Yellow Yellow Implemented 660,324 616,568 no Various Sheet Metal Workers' National Pension Fund 52-6112463/001 Yellow Yellow Implemented 175,643 538,286 no Various Sheet Metal Workers Local Pension Fund 34-6666753/001 Red Red Implemented — — no Various Plumbers and Pipefitters Local 152 Pension Fund 55-6029095/001 Red Red Implemented — 2,492 no Various All Other Green Green 3,611,624 2,783,713 no Various $ 6,420,550 $ 4,898,691 (1) The most recent PPA zone status available in 2022 and 2021 is the plan’s year-end during 2021 and 2020, respectively. The zone status is based on information that we received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the orange zone are less than 80 percent funded and have an Accumulated Funding Deficiency in the current year or projected into the next six years, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. (2) Indicates whether the plan has a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) which is either pending or has been implemented. The Company currently does not have intentions of withdrawing from any of the multi-employer pension plans in which it participates. On November 12, 2021, the Company received a withdrawal liability claim from a pension plan to which the Company made pension contributions for union construction employees performing covered work in a particular jurisdiction. The Company has not performed covered work in their jurisdiction since 2011; however, the Company disagrees with the withdrawal claim and believes it is covered by an exemption under federal law. The demand called for thirty-four quarterly installment payments of $41,000 starting December 15, 2021. The Company must comply with the demand under federal pension law; however, the Company firmly believes no withdrawal liability exists. The Company is in negotiations with the pension fund to resolve the matter and all future payments have been suspended as part of the negotiation. The Company has expensed all $164,000 in payments made through September 30, 2022, and does not expect any future liabilities related to this claim. |
CREDIT RISK
CREDIT RISK | 12 Months Ended |
Sep. 30, 2022 | |
CREDIT RISK | |
CREDIT RISK | 22. CREDIT RISK Financial instruments which potentially subject the Company to credit risk consist primarily of cash, cash equivalents and contract receivables. The Company places its cash with high quality financial institutions. At times, the balances in such institutions may exceed the FDIC insurance limit of $250,000 per depositor, per insured bank, for each account ownership category. FDIC insurance covers all deposit accounts, including checking accounts, savings accounts, money market deposit accounts, and certificates of deposit. As of September 30, 2022, the Company had $4.9 million of uninsured deposits. The Company performs periodic credit evaluations of its customer’s financial condition and generally does not require collateral. Consequently, the Company is subject to potential credit risk related to business and economic factors that would affect these companies. However, the Company generally has certain statutory lien rights with respect to services provided. Credit losses consistently have been within management’s expectations. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 23. COMMITMENTS AND CONTINGENCIES During the normal course of operations, the Company is subject to certain subcontractor claims, mechanic’s liens, and other litigation. Management is of the opinion that no material obligations will arise from any pending legal proceedings. Accordingly, no provision has been made in the financial statements for such litigation. Some customers, particularly new ones or governmental agencies require the Company to post bid bonds, performance bonds and payment bonds (collectively, performance bonds). These performance bonds are obtained through insurance carriers and guarantee to the customer that we will perform under the terms of a contract and that we will pay subcontractors and vendors. If the Company fails to perform under a contract or to pay subcontractors and vendors, the customer may demand that the insurer make payments or provide services under the bond. The Company must reimburse the insurer for any expenses or outlays it is required to make. In February 2014, the Company entered into an agreement with a surety company to provide bonding which will suit the Company’s immediate needs. The ability to obtain bonding for future contracts is an important factor in the contracting industry with respect to the type and value of contracts that can be bid. Depending upon the size and conditions of a particular contract, the Company may be required to post letters of credit or other collateral in favor of the insurer. Posting of these letters or other collateral will reduce our borrowing capabilities. The Company does not anticipate any claims in the foreseeable future. At September 30, 2022, the Company had $82.8 million in performance bonds outstanding. In fiscal year 2021, the Company received notification of forgiveness on the $9.8 million in PPP loans received in calendar year 2020. The Company must retain PPP loan documentation in its files for six years after the date of forgiveness. The Company believes it meets the SBA’s certification requirement based on its limited access to capital, weakened business operations during the pandemic and small market value. The Company’s shares of common stock did not trade on a national exchange at that time. However, no assurance can be given as to the outcome if the SBA re-evaluates the Company’s loan certification. The SBA could determine that the Company does not qualify in whole or in part for loan forgiveness. In addition, it is unknown what type of penalties could be assessed against the Company if the SBA disagrees with the Company’s certification. The Company could be required to repay its PPP Loans. Any penalties in addition to the potential repayment of the PPP Loans could negatively impact the Company’s business, financial condition and results of operations and prospects. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Sep. 30, 2022 | |
ACQUISITIONS | |
ACQUISITIONS | 24. ACQUISITIONS Energy Services accounts for business combinations under the acquisition method in accordance with ASC Topic 805 “Business Combinations”. Accordingly, for the transaction, the purchase price is allocated to the fair value of the assets acquired and liabilities assumed as of the date of the acquisition. In conjunction with ASC 805, upon receipt of final fair value estimates during the measurement period, which must be within one year of the acquisition date, Energy Services records any adjustments to the preliminary fair value estimates in the reporting period in which the adjustments are determined. On April 29, 2022, the Company completed the acquisition of Tri-State Paving LLC, located in Hurricane, West Virginia. Pursuant to the Asset Purchase Agreement (“Agreement”) signed on April 6, 2022, and amended on April 29, 2022, the Company acquired substantially all the assets (including but not limited to customer contracts, employees, and equipment) of Tri-State Paving, LLC for $7.5 million in cash, a $1.0 million promissory note, and $1.0 million in Energy Services common stock. The $7.5 million in cash was funded through a loan with United Bank and the transaction resulted in the issuance of 419,287 common shares. As part of the Agreement, the Company entered into a four-year, $1.0 million note that requires $250,000 principal installment payments on or before the end of each twelve (12) full calendar month period beginning on the date of the Note, April 29, 2022. Interest payments due shall be calculated on the principal balance remaining and shall be at the stated rate of 3.5% per year. The non-cash purchase price, including $390,000 of debt assumed, for the Tri-State Paving acquisition is allocated in the table below: Property and equipment $ 5,709,094 Goodwill 2,273,237 Customer relationships 1,649,159 Non-compete 39,960 Tradename 203,213 Total $ 9,874,663 On August 11, 2022, Ryan Construction, a newly formed wholly owned subsidiary of Energy Services, completed the acquisition of Ryan Environmental, located in Bridgeport, WV, pursuant to an order issued by the United States Bankruptcy Court for the Northern District of West Virginia (the “Court”) on August 9, 2022 and Ryan Transport, located in Bridgeport, West Virginia, under the terms of an Asset Purchase Agreement. As part of the business combination, the Company acquired certain assets, including equipment, vehicles, and small tools, of Ryan Environmental for $3.0 million in cash and certain assets, including equipment and small tools, of Ryan Transport for $1.0 million in cash. The purchase price for the Ryan Environmental and Ryan Transport acquisitions is allocated in the table below: Property and equipment $ 3,237,559 Accounts receivable, net of $250,000 allowance 677,254 Unbilled receivable 127,244 Total $ 4,042,057 ASC 805-10-50-2 requires public companies that present comparative financial statements to present pro forma financial statements as though the business combination that occurred during the current fiscal year had occurred as of the beginning of the comparable prior annual reporting period. As allowed under ASC 805-10-50-2, the Company finds this information impracticable to provide for the periods presented due to the lack of availability of meaningful financial statements of the acquired companies that comply with U.S. GAAP. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | 25. GOODWILL AND INTANGIBLE ASSETS The Company follows the guidance of ASC 350-20-35-3 “Intangibles-Goodwill and Other (Topic 350)” which requires a company to record an impairment charge based on the excess of a reporting unit’s carrying amount of goodwill over its fair value. Under the current guidance, companies can first choose to assess any impairment based on qualitative factors (Step 0). If a company fails this test or decides to bypass this step, it must proceed with a quantitative assessment of goodwill impairment. The Company did not have a goodwill impairment at September 30, 2022 or 2021. A table of the Company’s goodwill is below: September 30, September 30, 2022 2021 Beginning balance $ 1,814,317 $ — Acquired 2,273,237 1,814,317 Ending balance $ 4,087,554 $ 1,814,317 A table of the Company’s intangible assets subject to amortization at September 30, 2022, is below: Accumulated Accumulated Amortization and Amortization and Amortization and Impairment Remaining Life at Impairment at Impairment at Twelve Months Ended September 30, Original September 30, September 30, September 30, Net Book Intangible assets: 2022 Cost 2022 2021 2022 Value West Virginia Pipeline: Customer Relationships 99 months $ 2,209,724 $ 386,693 $ 165,725 $ 220,968 $ 1,823,031 Tradename 99 months 263,584 46,136 19,772 26,364 217,448 Non-competes 3 months 83,203 72,806 31,202 41,604 10,397 Revolt Energy: Employment agreement/non-compete 19 months 100,000 77,779 13,889 63,890 22,221 Tri-State Paving: Customer Relationships 115 months 1,649,159 66,781 — 66,781 1,582,378 Tradename 115 months 203,213 8,368 — 8,368 194,845 Non-competes 7 months 39,960 16,590 — 16,590 23,370 Total intangible assets $ 4,548,843 $ 675,153 $ 230,588 $ 444,565 $ 3,873,690 The amortization on identifiable intangible assets for fiscal years ended September 30, 2022 and 2021 was $445,000 $231,000 Amortization expense associated with the identifiable intangible assets is expected to be as follows: Amortization Expense 2023 $ 483,004 2024 438,122 2025 432,569 2026 432,569 2027 432,569 After 1,654,856 Total $ 3,873,690 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Sep. 30, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 26. SUBSEQUENT EVENTS On October 10, 2022, the Company entered into a $3.1 million promissory note agreement with United Bank to finance the Ryan Environmental acquisition. This is a five-year agreement with a fixed interest rate of 6.0% and monthly payments of $59,932 beginning on November 10, 2022. In February 2018, the Company filed a lawsuit against a former customer in the United States District Court for the Western District of Pennsylvania. The lawsuit is related to a dispute over work performed on a pipeline construction project. On November 16, 2022, a Judgement Order was issued, and the Company was awarded $13.1 million, of which $5.8 million was the jury award, Management has evaluated all subsequent events for accounting and disclosure. There have been no other material events during the period, other than noted above, that would either impact the results reflected in the report or the Company’s results going forward. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Sep. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Revenue Recognition | Revenue Recognition The Company recognizes revenue as performance obligations are satisfied and control of the promised good and service is transferred to the customer. For Lump Sum and Unit Price contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward complete satisfaction of the performance obligation(s) using an input (i.e., “cost to cost”) method. For Cost Plus and Time and Material (“T&M”) contracts, revenue is ordinarily recognized over time as control is transferred to the customers by measuring the progress toward satisfaction of the performance obligation(s) using an output method. The Company does have certain service and maintenance contracts in which each customer purchase order is considered its own performance obligation recognized over time and would be recognized depending on the type of contract mentioned above. The Company also does certain T&M service work that is generally completed in a short duration and is recognized at a point in time. All contract costs, including those associated with affirmative claims, change orders and back charges, are recorded as incurred and revisions to estimated total costs are reflected as soon as the obligation to perform is determined. Contract costs consist of direct costs on contracts, including labor and materials, amounts payable to subcontractors and outside equipment providers, direct overhead costs and internal equipment expense (primarily depreciation, fuel, maintenance and repairs). The Company recognizes revenue, but not profit, on certain uninstalled materials. Revenue on these uninstalled materials is recognized when the cost is incurred (when control is transferred), but the associated profit is not recognized until the materials are installed. The costs of uninstalled materials are tracked separately within the Company’s accounting software. Pre-contract and bond costs, if required, and mobilization costs on projects are generally immaterial to the total value of the Company’s contracts and are expensed when incurred. As a practical expedient, the Company recognizes these incremental costs as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. For projects expected to last greater than one year, mobilization costs are capitalized as incurred and amortized over the expected duration of the project. For these projects, mobilization costs will be tracked separately in the Company’s accounting software. This includes costs associated with setting up a project lot or lay-down yard, equipment, tool and supply transportation, temporary facilities and utilities and worker qualification and safety training. Contracts may require the Company to warranty that work is performed in accordance with the contract; however, the warranty is not priced separately, and the Company does not offer customers an option to purchase a warranty. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of Energy Services include the accounts of Energy Services, its wholly owned subsidiaries West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries, Contractors Rental, Nitro, and Pinnacle. All significant intercompany accounts and transactions have been eliminated in the consolidation. Unless the context requires otherwise, references to Energy Services include Energy Services, West Virginia Pipeline, SQP, Ryan Construction, Tri-State Paving and C.J. Hughes and its subsidiaries. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America (“U.S.GAAP”), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and loss during the reporting period. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Energy Services considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Fair Value Measurements | Fair Value Measurements The “Fair Value Measurement” Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP and specifies disclosures about fair value measurements. Under the FASB’s authoritative guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The “Fair Value Measurement” Topic establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: Level 1 Level 2 Level 3 A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The carrying amount for borrowings under the Company’s revolving credit facility approximates fair value because of the variable market interest rate charged to the Company for these borrowings. The fair value of the Company’s long term fixed-rate debt was estimated using a discounted cash flow analysis and a yield rate that was estimated based on the borrowing rates currently available to the Company for bank loans with similar terms and maturities. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $15.0 million at September 30, 2022 was $14.5 million. The fair value of the aggregate principal amount of the Company’s fixed-rate debt of $10.0 million at September 30, 2021 was $9.9 million. All other current assets and liabilities are carried at net realizable value which approximates fair value because of their short duration to maturity. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts The Company’s accounts receivable consists of amounts that have been billed to customers. Collateral is generally not required. A majority of the Company’s contracts have monthly billing terms and payment terms within 30 to 45 days after invoices have been issued. The Company attempts to negotiate two-week billing terms and 15-day payment terms on larger projects. The timing of billings to customers may generate contract assets or contract liabilities. Certain construction contracts include retention provisions to provide assurance to our customers that we will perform in accordance with the contract terms and are therefore not considered a financing benefit. The balances billed but not paid by customers pursuant to these provisions generally become due upon completion and acceptance of the project work or products by the customer. We have determined there are no significant financing components in our contracts as of and for the years ended September 30, 2022 and 2021. Retainage billed but not paid pursuant to contract provisions will be due upon completion of the contracts. Based on the Company’s experience, management considers all amounts classified as retainage receivable to be collectible. All retainage receivable amounts are expected to be collected within the next fiscal year. The Company provides an allowance for doubtful accounts when collection of an account or note receivable is considered doubtful, and receivables are written off against the allowance when deemed uncollectible. Inherent in the assessment of the allowance for doubtful accounts are certain judgments and estimates including, among others, the customer’s access to capital, the customer’s willingness or ability to pay, general economic conditions and the ongoing relationship with the customer. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Costs which extend the useful lives or increase the productivity of the assets are capitalized, while normal repairs and maintenance that do not extend the useful life or increase productivity of the asset are expensed as incurred. Property and equipment are depreciated principally on the straight-line method over the estimated useful lives of the assets: buildings 39 years; operating equipment and vehicles 5 5 |
Intangible Assets | Intangible Assets Acquired intangible assets subject to amortization are amortized on a straight-line basis, which approximates the pattern in which the economic benefit of the respective intangible assets are realized, over their respective estimated useful lives. The definite-lived identifiable intangible assets recognized as part of the Company's business combinations are recorded at their estimated fair value. |
Impairment of Long-Lived Assets | Intangible Assets Acquired intangible assets subject to amortization are amortized on a straight-line basis, which approximates the pattern in which the economic benefit of the respective intangible assets are realized, over their respective estimated useful lives. The definite-lived identifiable intangible assets recognized as part of the Company's business combinations are recorded at their estimated fair value. Impairment of Long-Lived Assets A long-lived asset shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset would be compared to the asset’s carrying amount to determine if a write-down to market value is required. |
Claims | Claims Claims are amounts in excess of the agreed contract price that a contractor seeks to collect from customers or others for customer-caused delays, errors in specifications and designs, contract terminations, change orders in dispute or unapproved as to both scope and price, or other causes of unanticipated additional costs. The Company records revenue on claims that management believes are probable. Revenue from a claim is recorded only to the extent that contract costs relating to the claim have been incurred. |
Self-Insurance | Self -Insurance The Company has its workers compensation, general liability and auto insurance through a captive insurance company. While the Company believes that this arrangement has been very beneficial in reducing and stabilizing insurance costs, the Company has to maintain a surety deposit to guarantee payments of premiums. The surety deposit had a balance of $1.8 million and $2.1 million as of September 30, 2022 and 2021, respectively, which is in “Prepaid expenses and other” on the Company’s Consolidated Balance Sheets. Should the captive experience severe losses over an extended period, it could increase the Company’s insurance expense or surety deposit required. |
Advertising | Advertising All advertising costs are expensed as incurred. Total advertising expense was $17,000 and $55,000 for the years ended September 30, 2022 and 2021, respectively. |
Stock Compensation Plans | Stock Compensation Plans The Company accounts for its equity-based compensation as prescribed by U.S. GAAP for share-based payments. The Company has adopted a fair value-based method of accounting for employee equity-based plans, whereby compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period, which is usually the vesting period. As a result, compensation expense relating to stock compensation plans will be reflected in net income as part of “Selling and administrative expenses” on the Consolidated Statements of Income. |
Income Taxes | Income Taxes The Company and all subsidiaries file a consolidated federal and various state income tax returns on a fiscal year basis. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations for years ending prior to September 30, 2019. The Company follows the liability method of accounting for income taxes in accordance with U.S. GAAP. Under this method, deferred tax assets and liabilities are recorded for future tax consequences of temporary differences between financial reporting and tax bases of assets and liabilities, and are measured using the enacted tax rates and laws that are expected to be in effect when the underlying assets or liabilities are recovered or settled. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. U.S. GAAP also prescribes a comprehensive model for how companies should recognize, measure, present and disclose in their financial statements uncertain tax positions taken or to be taken on a tax return. This evaluation is a two-step process. First, the recognition process determines if it is more likely than not that a tax position will be sustained based on the merits of the tax position upon examination by the appropriate taxing authority. Second, a measurement process is calculated to determine the amount of benefit/expense to recognize in the financial statements if a tax position meets the more likely than not recognition threshold. The tax position is measured at the greatest amount of benefit/expense that is more likely than not of being realized upon ultimate settlement. Any interest and penalty related to the unrecognized tax benefits, as the result of recognition of tax obligations resulting from uncertain tax positions, are included in the provision for income taxes. The Company had not recognized any uncertain tax positions at September 30, 2022 or 2021. |
Earnings Per Common Share | Earnings Per Common Share Basic earnings per share is computed using the weighted average number of common shares outstanding during the year, and diluted earnings per share is computed using the weighted average number of common shares outstanding during the year adjusted for all potentially dilutive common stock equivalents, except in cases where the effect of the common stock equivalent would be anti-dilutive. |
Collective Bargaining Agreements | Collective Bargaining Agreements Certain Energy Services subsidiaries are party to collective bargaining agreements with unions representing members that are employed by the Company. The agreements require such subsidiaries to pay specified wages and provide certain benefits to the union employees. These agreements expire at various times and have typically been renegotiated and renewed on terms that are similar to the ones contained in the expiring agreements. Under certain collective bargaining agreements, the applicable Energy Services subsidiary is required to make contributions to multi-employer pension plans. If the subsidiary were to cease participation in one or more of these plans, a liability could potentially be assessed related to any underfunding of these plans. The amount of such assessment, were one to be made, cannot be reasonably estimated. |
Litigation Costs | Litigation Costs The Company recognizes reserves when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Litigation costs are expensed as incurred. |
New Accounting Pronouncements | New Accounting Pronouncements On October 28, 2021, the FASB released Accounting Standards Update (“ASU”) 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”. The amendments of this ASU require entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2022. For all other entities they are effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2023. Entities should apply the amendments prospectively to business combinations that occur after the effective date. Early adoption is permitted, including in any interim period, for public business entities for periods for which financial statements have not yet been issued, and for all other entities for periods for which financial statements have not yet been made available for issuance. The Company is currently assessing the effect that ASU 2021-08 will have on their results of operations, financial position and cash flows; however, the Company does not expect a significant impact. The FASB recently issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance”, which aims to provide increased transparency by requiring business entities to disclose information about certain types of government assistance they receive in the notes to the financial statements. Entities are required to provide the new disclosures prospectively for all transactions with a government entity that are accounted for under either a grant or a contribution accounting model and are reflected in the financial statements at the date of initially applying the new amendments, and to new transactions entered into after that date. Retrospective application of the guidance is permitted. The guidance in ASU 2021-10 is effective for financial statements of all entities for annual periods beginning after December 15, 2021, with early application permitted. ASU 2021-10 has not become effective for the Company; however, a significant impact is not expected. |
Subsequent Events | Subsequent Events On October 10, 2022, the Company entered into a $3.1 million promissory note agreement with United Bank to finance the Ryan Environmental acquisition. This is a five-year agreement with a fixed interest rate of 6.0% and monthly payments of $59,932 beginning on November 10, 2022. In February 2018, the Company filed a lawsuit against a former customer in the United States District Court for the Western District of Pennsylvania. The lawsuit is related to a dispute over work performed on a pipeline construction project. On November 16, 2022, a Judgement Order was issued, and the Company was awarded $13.1 million, of which $5.8 million was the jury award, $1.6 million was for attorney’s fees, and $5.7 million was for penalties and interest. None of the award had been recognized in the Company’s consolidated financial statements as of September 30, 2022. The Company’s attorney’s fees have been expensed as incurred. On December 16, 2022, the Defendant filed a notice of appeal with the court. Management has evaluated all subsequent events for accounting and disclosure. There have been no other material events during the period, other than noted above, that would either impact the results reflected in the report or the Company’s results going forward. |
DISAGGREGATION OF REVENUE (Tabl
DISAGGREGATION OF REVENUE (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
DISAGGREGATION OF REVENUE | |
Schedule of disaggregation of revenue | Year Ended September 30, 2022 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission and General from contracts Lump sum contracts $ — $ — $ 49,451,175 $ 49,451,175 Unit price contracts 53,311,569 55,637,622 525,092 109,474,283 Cost plus and T&M contracts — 2,630,879 36,033,663 38,664,542 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Earned over time $ 34,493,112 $ 54,551,248 $ 83,557,477 $ 172,601,837 Earned at point in time 18,818,457 3,717,253 2,452,453 24,988,163 Total revenue from contracts $ 53,311,569 $ 58,268,501 $ 86,009,930 $ 197,590,000 Year Ended September 30, 2021 Electrical, Gas & Water Gas & Petroleum Mechanical, Total revenue Distribution Transmission and General from contracts Lump sum contracts $ — $ — $ 37,691,770 $ 37,691,770 Unit price contracts 40,440,195 20,928,518 — 61,368,713 Cost plus and T&M contracts — 1,204,965 22,200,378 23,405,343 Total revenue from contracts $ 40,440,195 $ 22,133,483 $ 59,892,148 $ 122,465,826 Earned over time $ 26,244,396 $ 20,928,518 $ 58,796,767 $ 105,969,681 Earned at point in time 14,195,799 1,204,965 1,095,381 16,496,145 Total revenue from contracts $ 40,440,195 $ 22,133,483 $ 59,892,148 $ 122,465,826 |
CONTRACT BALANCES (Tables)
CONTRACT BALANCES (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
CONTRACT BALANCES | |
Schedule of accounts receivable-trade, net of allowance for doubtful accounts, retainages receivable, contract assets and contract liabilities | September 30, 2021 September 30, 2022 Change Accounts receivable-trade, net of allowance for doubtful accounts $ 21,022,207 $ 38,454,913 $ 17,432,706 Contract assets Cost and estimated earnings in excess of billings $ 8,730,402 $ 16,109,593 $ 7,379,191 Contract liabilities Billings in excess of cost and estimated earnings $ 3,153,290 $ 6,027,578 $ 2,874,288 |
ALLOWANCE FOR DOUBTFUL ACCOUN_2
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
Schedule of allowance for doubtful accounts receivable | Year Ended September 30, 2022 2021 Balance at beginning of year $ 70,310 $ 70,310 Charged to expense — — Deductions for uncollectible receivables written off, net of recoveries — — Balance at end of year $ 70,310 $ 70,310 |
UNCOMPLETED CONTRACTS (Tables)
UNCOMPLETED CONTRACTS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
UNCOMPLETED CONTRACTS | |
Schedule of costs, estimated earnings and billings on uncompleted contracts | September 30, September 30, 2022 2021 Costs incurred on contracts in progress $ 192,957,145 $ 64,903,618 Estimated earnings, net of estimated losses 28,150,060 13,280,334 221,107,205 78,183,952 Less billings to date 211,025,190 72,606,840 $ 10,082,015 $ 5,577,112 Costs and estimated earnings in excess of billed on uncompleted contracts $ 16,109,593 $ 8,730,402 Less billings in excess of costs and estimated earnings on uncompleted contracts 6,027,578 3,153,290 $ 10,082,015 $ 5,577,112 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of property, plant and equipment | Year Ended September 30, 2022 2021 Land $ 2,942,190 $ 2,748,532 Buildings and leasehold improvements 9,291,898 8,194,827 Operating equipment and vehicles 60,245,329 48,941,730 Office equipment, furniture and fixtures 1,046,172 948,297 Assets not yet in service 210,844 312,319 73,736,433 61,145,705 Less accumulated depreciation 41,074,646 38,195,686 Property, plant and equipment, net $ 32,661,787 $ 22,950,019 |
SHORT-TERM AND LONG-TERM DEBT (
SHORT-TERM AND LONG-TERM DEBT (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
SHORT-TERM AND LONG-TERM DEBT | |
Schedule of short-term and long-term debt | 2022 2021 Line of credit payable to bank, variable interest rate of 5.50% at September 30, 2022, final payment due by June 28, 2023, guaranteed by certain directors of the Company. See also Note 5. $ 12,500,000 $ 4,500,000 Term note payable to United Bank, WV Pipeline acquisition, due in monthly installments of $64,853, fixed interest at 4.25%, final payment due by March 25, 2026, secured by receivables and equipment, guaranteed by certain directors of the Company. 2,529,421 3,183,549 Notes payable to finance companies, due in monthly installments totaling $59,500 at September 30, 2022 and $70,062 at September 30, 2021, including interest ranging from 0.00% to 5.50%, final payments due October 2022 through August 2026, secured by equipment. 889,165 1,066,580 Note payable to finance company for insurance premiums financed, due in monthly installments totaling $282,297 in FY 2022 and $272,000 in FY 2021, including interest rate at 3.27%, final payment December 2022. 580,320 540,250 Notes payable to bank, due in monthly installments totaling $7,848, including interest at 4.82%, final payment due November 2034 secured by building and property. 867,383 919,017 Notes payable to bank, due in monthly installments totaling $12,193, variable interest of 7.25% at September 30, 2022, final payment due November 2025 secured by building and property, guaranteed by certain directors of the Company. 412,917 530,750 Notes payable to bank, due in monthly installments totaling $98,865, including interest at 4.99%, final payment due June 2022 secured by equipment, guaranteed by certain directors of the Company. — 872,452 Notes payable to David Bolton and Daniel Bolton, due in annual installments totaling $500,000, including interest at 3.25%, final payment due December 31, 2026, unsecured 2,380,000 2,850,000 Notes payable to bank, fixed interest at 4.25% of outstanding balance due in monthly installments between January 2021 and January 2022. Note payments due in monthly installments totaling $68,150, including variable interest rate of 7.25% at September 30, 2022, with final payment due September 2026, secured by equipment, guaranteed by certain directors of the Company. 2,549,281 3,000,000 Term note payable to United Bank, Tri-State Paving acquisition, due in monthly installments of $129,910, fixed interest at 4.25%, final payment due by June 1, 2027, secured by receivables and equipment, guaranteed by certain directors of the Company. 6,982,097 — Notes payable to Corns Enterprises, due in annual installments totaling $250,000, including interest at 3.50%, final payment due April 29, 2026, unsecured 943,836 — Total debt $ 30,634,420 $ 17,462,598 Less current maturities 17,140,336 8,441,824 Total long term debt $ 13,494,084 $ 9,020,774 |
Schedule of future expected payments due on short-term and long-term debt | 2023 $ 17,140,336 2024 4,061,665 2025 4,170,114 2026 3,569,091 2027 1,069,272 Thereafter 623,942 $ 30,634,420 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
INCOME TAXES | |
Schedule of components of income taxes | Year Ended September 30, 2022 2021 Federal Current $ 78,000 $ (187,829) Deferred 1,686,864 165,108 Total 1,764,864 (22,721) State Current 22,000 (52,977) Deferred 475,782 46,569 Total 497,782 (6,408) Total income tax expense (benefit) $ 2,262,646 $ (29,129) |
Schedule of provision for income taxes differs from the amount computed by applying the federal statutory rate on income from operations | Year Ended September 30, 2022 2021 Statutory rate 21.0 % 21.0 % State income taxes 6.0 % 6.0 % Non-deductible meals and other 10.0 % 5.7 % Credit from solar installation project — % (2.8) % PPP loan forgiveness — % (30.2) % Effective tax rate 37.0 % (0.3) % |
Schedule of income tax effects to deferred tax assets and liabilities | Year Ended September 30, 2022 2021 Deferred tax liabilities Property and equipment $ 7,686,064 $ 4,883,398 Other 7,632 37,582 Total deferred tax liabilities $ 7,693,696 $ 4,920,980 Deferred income tax assets Other $ 404,093 $ 358,400 Net operating loss carryforward 2,834,524 2,529,147 Total deferred tax assets $ 3,238,617 $ 2,887,547 Total net deferred tax liabilities $ 4,455,079 $ 2,033,433 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
EARNINGS PER SHARE | |
Schedule to compute the earnings per share | Twelve Months Ended Twelve Months Ended September 30, September 30, 2022 2021 Net income $ 3,850,073 $ 9,097,255 Dividends on preferred stock — 284,238 Income available to common shareholders $ 3,850,073 $ 8,813,017 Weighted average shares outstanding-basic 16,323,790 13,621,406 Weighted average shares outstanding-diluted 16,323,790 16,988,424 Earnings per share available to common shareholders $ 0.24 $ 0.65 Earnings per share available to common shareholders-diluted $ 0.24 $ 0.52 |
LEASE OBLIGATIONS (Tables)
LEASE OBLIGATIONS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
LEASE OBLIGATIONS | |
Schedule of information about leases | Operating Lease-Weighted Average Remaining Term Years left Remaining liability Lease end Fiscal year end Operating lease 1 2.6 $ 205,267 4/30/2025 2025 Operating lease 2 1.8 119,032 5/31/2024 2024 Operating lease 3 3.9 1,166,498 8/10/2026 2027 Operating lease 4 1.0 113,480 8/11/2023 2023 $ 1,604,277 Weighted average remaining term 3.4 years Year ended September 30, Operating Lease Expense 2022 Amortization Operating lease 1 $ 30,933 Operating lease 2 25,554 Operating lease 3 22,672 Operating lease 4 19,552 Total amortization 98,711 Interest Operating lease 1 4,067 Operating lease 2 2,411 Operating lease 3 4,360 Operating lease 4 964 Total interest 11,802 Total amortization and interest $ 110,513 |
Schedule of operating lease maturity schedule | Operating Lease Maturity Schedule 2023 $ 588,653 2024 465,428 2025 373,397 2026 296,606 1,724,084 Less amounts representing interest (119,807) Present value of operating lease liabilities $ 1,604,277 |
Schedule of cash paid for operating leases | Year ended September 30, Cash Paid for Operating Leases 2022 Operating lease 1 $ 35,000 Operating lease 2 27,965 Operating lease 3 27,032 Operating lease 4 27,561 $ 117,558 |
MAJOR CUSTOMERS (Tables)
MAJOR CUSTOMERS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
MAJOR CUSTOMERS | |
Schedule of Company's revenue or accounts receivable net | Revenue FY 2022 FY 2021 TransCanada Corporation 16.6 % 11.0 % All other 83.4 % 89.0 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable Accounts receivable, net of retention FY 2022 FY 2021 TransCanada Corporation 11.6 % 13.2 % Kentucky American Water * 16.3 % All other 88.4 % 70.5 % Total 100.0 % 100.0 % * Less than 10.0% and included in “All other” if applicable |
RETIREMENT AND EMPLOYEE BENEF_2
RETIREMENT AND EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |
Schedule of multi-employer defined benefit pension plans | Contributions of Pension Protection Act ("PPA") Energy Services Certified Zone Status (1) FIP/RP Status Companies Expiration Date of EIN/Pension Pending/ Surcharge Collective Bargaining Pension Fund Plan Number 2021 2020 Implemented (2) 2022 2021 Imposed Agreement Central States, Southeast and Southwest Areas Pension Fund 36-6044243/001 Red Red Implemented $ 123,142 $ — no Various Employer-Teamsters Local Nos. 175 and 505 55-6021850/001 Red Red Implemented — — no Various Laborers National Pension Fund 75-1280827/001 Red Red Implemented 384,908 394,563 no Various Laborers' District Council of Western Pennsylvania Pension Plan 25-6135576/001 Yellow Yellow Implemented 269,915 — no Various Operating Engineers Local 324 Pension Fund 38-1900637/001 Red Red Implemented 66,757 — no Various National Automatic Sprinkler Industry Pension Fund 52-6054620/001 Red Red Implemented 199,984 121,133 no Various Iron Workers District Council of Southern Ohio &Vicinity Pension Trust 31-6038516/001 Yellow Yellow Implemented 208,588 160,367 no Various Carpenters Pension Fund of WV 55-6027998/001 Red Red Implemented 719,665 281,568 no Various Plumbers & Pipefitters National Pension Fund 52-6152779/001 Yellow Yellow Implemented 660,324 616,568 no Various Sheet Metal Workers' National Pension Fund 52-6112463/001 Yellow Yellow Implemented 175,643 538,286 no Various Sheet Metal Workers Local Pension Fund 34-6666753/001 Red Red Implemented — — no Various Plumbers and Pipefitters Local 152 Pension Fund 55-6029095/001 Red Red Implemented — 2,492 no Various All Other Green Green 3,611,624 2,783,713 no Various $ 6,420,550 $ 4,898,691 (1) The most recent PPA zone status available in 2022 and 2021 is the plan’s year-end during 2021 and 2020, respectively. The zone status is based on information that we received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the orange zone are less than 80 percent funded and have an Accumulated Funding Deficiency in the current year or projected into the next six years, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. (2) Indicates whether the plan has a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) which is either pending or has been implemented. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
Tri-State Paving | |
ACQUISITIONS | |
Schedule of allocation of purchase price for the cash and non-cash | Property and equipment $ 5,709,094 Goodwill 2,273,237 Customer relationships 1,649,159 Non-compete 39,960 Tradename 203,213 Total $ 9,874,663 |
Ryan Environmental and Ryan Transport | |
ACQUISITIONS | |
Schedule of allocation of purchase price for the cash and non-cash | Property and equipment $ 3,237,559 Accounts receivable, net of $250,000 allowance 677,254 Unbilled receivable 127,244 Total $ 4,042,057 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Sep. 30, 2022 | |
GOODWILL AND INTANGIBLE ASSETS | |
Summary of changes in goodwill | September 30, September 30, 2022 2021 Beginning balance $ 1,814,317 $ — Acquired 2,273,237 1,814,317 Ending balance $ 4,087,554 $ 1,814,317 |
Schedule of intangible assets subject to amortization | Accumulated Accumulated Amortization and Amortization and Amortization and Impairment Remaining Life at Impairment at Impairment at Twelve Months Ended September 30, Original September 30, September 30, September 30, Net Book Intangible assets: 2022 Cost 2022 2021 2022 Value West Virginia Pipeline: Customer Relationships 99 months $ 2,209,724 $ 386,693 $ 165,725 $ 220,968 $ 1,823,031 Tradename 99 months 263,584 46,136 19,772 26,364 217,448 Non-competes 3 months 83,203 72,806 31,202 41,604 10,397 Revolt Energy: Employment agreement/non-compete 19 months 100,000 77,779 13,889 63,890 22,221 Tri-State Paving: Customer Relationships 115 months 1,649,159 66,781 — 66,781 1,582,378 Tradename 115 months 203,213 8,368 — 8,368 194,845 Non-competes 7 months 39,960 16,590 — 16,590 23,370 Total intangible assets $ 4,548,843 $ 675,153 $ 230,588 $ 444,565 $ 3,873,690 |
Schedule of amortization on identifiable intangible assets | Amortization Expense 2023 $ 483,004 2024 438,122 2025 432,569 2026 432,569 2027 432,569 After 1,654,856 Total $ 3,873,690 |
BUSINESS AND ORGANIZATION (Deta
BUSINESS AND ORGANIZATION (Details) - USD ($) | 12 Months Ended | |||||
Aug. 11, 2022 | Aug. 09, 2022 | Apr. 29, 2022 | Oct. 06, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
BUSINESS AND ORGANIZATION | ||||||
Common stock, issuance value | $ 1,300,000 | |||||
Common stock, shares outstanding | 16,247,898 | 16,667,185 | 13,621,406 | |||
Common stock issued to finance Tri-State Paving acquisition | $ 1,048,218 | $ 0 | ||||
Common Stock | ||||||
BUSINESS AND ORGANIZATION | ||||||
Common stock, issuance shares | 2,626,492 | |||||
Shares issued for Tri-State Paving acquisition (in shares) | (419,287) | |||||
Tri State Paving Acquisition Company | ||||||
BUSINESS AND ORGANIZATION | ||||||
Purchase of equipment | $ 7,500,000 | |||||
Seller note as consideration for acquiring assets | 1,000,000 | |||||
Common stock issued to finance Tri-State Paving acquisition | $ 1,000,000 | |||||
Shares issued for Tri-State Paving acquisition (in shares) | 419,287 | |||||
Ryan Environmental | ||||||
BUSINESS AND ORGANIZATION | ||||||
Consideration paid | $ 3,000,000 | $ 3,000,000 | ||||
Ryan Transport | ||||||
BUSINESS AND ORGANIZATION | ||||||
Purchase of equipment | $ 1,000,000 | |||||
Consideration paid | $ 1,000,000 | |||||
Series A Preferred Stock | ||||||
BUSINESS AND ORGANIZATION | ||||||
Preferred stock dividend rate ( in percentage) | 6% | |||||
Series A Preferred Stock | Common Stock | ||||||
BUSINESS AND ORGANIZATION | ||||||
Common stock, issuance shares | 317,500 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition and Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Sep. 30, 2021 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Aggregate principal amount of fixed-rate debt | $ 15 | $ 10 |
Fair value of aggregate principal amount of debt | $ 14.5 | $ 9.9 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable and Allowance for Doubtful Accounts and Property and Equipment (Details) | 12 Months Ended |
Sep. 30, 2022 | |
Buildings | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | 39 years |
Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Billing and payment term | 30 days |
Minimum | Operating equipment and vehicles | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | P5Y |
Minimum | Office equipment, furniture and fixtures | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | P5Y |
Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Billing and payment term | 45 days |
Maximum | Operating equipment and vehicles | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | 7 years |
Maximum | Office equipment, furniture and fixtures | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | 7 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Self-Insurance, Advertising (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Surety deposit balance | $ 1,800,000 | $ 2,100,000 |
Advertising expense | $ 17,000 | $ 55,000 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Subsequent Events (Details) - USD ($) | Nov. 16, 2022 | Oct. 10, 2022 | Oct. 06, 2021 | Sep. 30, 2022 | Sep. 30, 2021 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Common stock, issuance value | $ 1,300,000 | ||||
Common stock, shares outstanding | 16,247,898 | 16,667,185 | 13,621,406 | ||
Debt instrument face amount | $ 15,000,000 | $ 10,000,000 | |||
Common Stock | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Common stock, issuance shares | 2,626,492 | ||||
Series A Preferred Stock | Common Stock | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Common stock, issuance shares | 317,500 | ||||
Subsequent event | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Loss contingency value | $ 13,100,000 | $ 13,100,000 | |||
Jury award value | 5,800,000 | 5,800,000 | |||
Attorney fees | 1,600,000 | 1,600,000 | |||
Penalties and interest value | $ 5,700,000 | 5,700,000 | |||
Subsequent event | Promissory Note agreement with United Bank | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Debt instrument face amount | $ 3,100,000 | ||||
Term of loan agreement | 5 years | ||||
Interest rate | 6% | ||||
Debt instrument, periodic payment term | $ 59,932 | ||||
Subsequent event | Promissory Note agreement with United Bank | Series A Preferred Stock | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Interest rate | 6% | ||||
Debt instrument, periodic payment term | $ 59,932 |
DISAGGREGATION OF REVENUE (Deta
DISAGGREGATION OF REVENUE (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | $ 197,590,000 | $ 122,465,826 |
Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 172,601,837 | 105,969,681 |
Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 24,988,163 | 16,496,145 |
Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 49,451,175 | 37,691,770 |
Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 109,474,283 | 61,368,713 |
Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 38,664,542 | 23,405,343 |
Gas and Water Distribution | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 53,311,569 | 40,440,195 |
Gas and Water Distribution | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 34,493,112 | 26,244,396 |
Gas and Water Distribution | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 18,818,457 | 14,195,799 |
Gas and Water Distribution | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 0 | 0 |
Gas and Water Distribution | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 53,311,569 | 40,440,195 |
Gas and Water Distribution | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 0 | 0 |
Gas and Petroleum Transmission | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 58,268,501 | 22,133,483 |
Gas and Petroleum Transmission | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 54,551,248 | 20,928,518 |
Gas and Petroleum Transmission | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 3,717,253 | 1,204,965 |
Gas and Petroleum Transmission | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 0 | 0 |
Gas and Petroleum Transmission | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 55,637,622 | 20,928,518 |
Gas and Petroleum Transmission | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 2,630,879 | 1,204,965 |
Electrical, Mechanical, and General | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 86,009,930 | 59,892,148 |
Electrical, Mechanical, and General | Earned over time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 83,557,477 | 58,796,767 |
Electrical, Mechanical, and General | Earned at point in time | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 2,452,453 | 1,095,381 |
Electrical, Mechanical, and General | Lump sum contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 49,451,175 | 37,691,770 |
Electrical, Mechanical, and General | Unit price contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | 525,092 | 0 |
Electrical, Mechanical, and General | Cost plus and T&M contracts | ||
DISAGGREGATION OF REVENUE | ||
Total revenue from contracts | $ 36,033,663 | $ 22,200,378 |
CONTRACT BALANCES (Details)
CONTRACT BALANCES (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CONTRACT BALANCES | ||
Accounts receivable-trade, net of allowance for doubtful accounts | $ 38,454,913 | $ 21,022,207 |
Change in accounts receivable-trade, net of allowance for doubtful accounts | 17,432,706 | 2,845,528 |
Contract assets | ||
Cost and estimated earnings in excess of billings | 16,109,593 | 8,730,402 |
Change in cost and estimated earnings in excess of billings | 7,379,191 | 2,184,539 |
Contract liabilities | ||
Billings in excess of cost and estimated earnings | 6,027,578 | 3,153,290 |
Change in billings in excess of cost and estimated earnings | $ 2,874,288 | $ (1,698,610) |
CONTRACT BALANCES - Additional
CONTRACT BALANCES - Additional Information (Details) $ in Millions | 12 Months Ended |
Sep. 30, 2022 USD ($) | |
CONTRACT BALANCES | |
Recognized revenue included in contract liability | $ 3 |
Minimum | |
CONTRACT BALANCES | |
Billing and payment term | 30 days |
Maximum | |
CONTRACT BALANCES | |
Billing and payment term | 45 days |
PERFORMANCE OBLIGATIONS (Detail
PERFORMANCE OBLIGATIONS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
PERFORMANCE OBLIGATIONS | ||
Recognized revenue | $ 0 | $ 430,000 |
Amount of remaining unsatisfied performance obligations | $ 69,500,000 |
ALLOWANCE FOR DOUBTFUL ACCOUN_3
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Allowance for Doubtful Accounts Receivable | ||
Balance at beginning of year | $ 70,310 | $ 70,310 |
Charged to expense | 0 | 0 |
Deductions for uncollectible receivables written off, net of recoveries | 0 | 0 |
Balance at end of year | $ 70,310 | $ 70,310 |
UNCOMPLETED CONTRACTS - Summary
UNCOMPLETED CONTRACTS - Summary of costs, estimated earnings, and billings on uncompleted contracts (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
UNCOMPLETED CONTRACTS | ||
Costs incurred on contracts in progress | $ 192,957,145 | $ 64,903,618 |
Estimated earnings, net of estimated losses | 28,150,060 | 13,280,334 |
Costs of uncompleted contracts including net estimated earnings | 221,107,205 | 78,183,952 |
Less billings to date | 211,025,190 | 72,606,840 |
Unbilled contracts | 10,082,015 | 5,577,112 |
Costs and estimated earnings in excess of billed on uncompleted contracts | 16,109,593 | 8,730,402 |
Billings in excess of cost and estimated earnings | 6,027,578 | 3,153,290 |
Unbilled contracts receivable | $ 10,082,015 | $ 5,577,112 |
UNCOMPLETED CONTRACTS - Backlog
UNCOMPLETED CONTRACTS - Backlog (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Sep. 30, 2021 |
UNCOMPLETED CONTRACTS | ||
Backlog | $ 142.3 | $ 72.2 |
PROVISION FOR LOSS (Details)
PROVISION FOR LOSS (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
PROVISION FOR LOSS | ||
Provision for loss on contract | $ 248,770 | $ 0 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | $ 73,736,433 | $ 61,145,705 |
Less accumulated depreciation | 41,074,646 | 38,195,686 |
Total fixed assets | 32,661,787 | 22,950,019 |
Land | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 2,942,190 | 2,748,532 |
Buildings and leasehold improvements | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 9,291,898 | 8,194,827 |
Operating equipment and vehicles | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 60,245,329 | 48,941,730 |
Office equipment, furniture and fixtures | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | 1,046,172 | 948,297 |
Assets not yet in service | ||
PROPERTY, PLANT AND EQUIPMENT | ||
Property, plant and equipment | $ 210,844 | $ 312,319 |
SHORT-TERM DEBT (Details)
SHORT-TERM DEBT (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
SHORT-TERM DEBT | ||
Insurance policy amount | $ 3,400,000 | $ 3,200,000 |
Insurance policy premium outstanding | 580,000 | 540,000 |
United Bank, Inc. | 12.5 million component | ||
SHORT-TERM DEBT | ||
Amount of loan covenants | $ 12,500,000 | |
Financing agreement "Operating Line of Credit (2022)" | ||
SHORT-TERM DEBT | ||
Line of credit | $ 4,500,000 | |
Interest rate | 4.99% | |
Financing agreement "Operating Line of Credit (2022)" | United Bank, Inc. | ||
SHORT-TERM DEBT | ||
Interest rate | 5.50% | |
Amount of loan covenants | $ 12,500,000 | |
Financing agreement Operating Line of Credit (2022) | ||
SHORT-TERM DEBT | ||
Amount available to borrowing | $ 12,200,000 | |
Financing agreement Operating Line of Credit (2020). | ||
SHORT-TERM DEBT | ||
Amount available to borrowing | $ 7,700,000 | |
Financing agreement Operating Line of Credit (2020). | United Bank, Inc. | ||
SHORT-TERM DEBT | ||
Line of credit | $ 15,000,000 | |
Interest rate on the line of credit description | “Wall Street Journal” Prime Rate | |
Interest rate on line of credit | 4.99% | |
Amount of loan covenants | $ 12,500,000 | |
Minimum tangible net worth | $ 21,500,000 | |
Minimum traditional debt service coverage ratio | 1.25x | |
Minimum current ratio | 1.50x | |
Maximum debt to tangible net worth ratio | 1.5x | |
Traditional debt service coverage ratio | 2.0x | |
Amount of minimum tangible net worth | $ 24,000,000 | |
Financing agreement Operating Line of Credit (2020). | United Bank, Inc. | 12.5 million component | ||
SHORT-TERM DEBT | ||
Line of credit | 12,500,000 | |
Financing agreement Operating Line of Credit (2020). | United Bank, Inc. | 2.5 million component | ||
SHORT-TERM DEBT | ||
Line of credit | $ 2,500,000 |
SHORT-TERM AND LONG-TERM DEBT -
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Debt Instrument | ||
Total debt | $ 30,634,420 | $ 17,462,598 |
Less current maturities | (17,140,336) | (8,441,824) |
Total long term debt | 13,494,084 | 9,020,774 |
Line of credit payable to bank, final payment due by June 28, 2023 | ||
Debt Instrument | ||
Total debt | 12,500,000 | 4,500,000 |
Term note payable to United Bank, WV Pipeline acquisition, final payment due by March 25, 2026 | ||
Debt Instrument | ||
Total debt | 2,529,421 | 3,183,549 |
Notes payable to finance companies due October 2022 through August 2026 | ||
Debt Instrument | ||
Total debt | 889,165 | 1,066,580 |
Note payable to finance company for insurance premiums financed due December 2022 in monthly installments | ||
Debt Instrument | ||
Total debt | 580,320 | 540,250 |
Notes payable to bank, final payment due November 2034 | ||
Debt Instrument | ||
Total debt | 867,383 | 919,017 |
Notes payable to bank, final payment due November 2025 | ||
Debt Instrument | ||
Total debt | 412,917 | 530,750 |
Notes payable to banks due June 2022 | ||
Debt Instrument | ||
Total debt | 872,452 | |
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | ||
Debt Instrument | ||
Total debt | 2,380,000 | 2,850,000 |
Notes payable to bank, at interest at 5.00%, final payment due September 2021 | ||
Debt Instrument | ||
Total debt | 2,549,281 | $ 3,000,000 |
Term note payable to United Bank, Tri-State Paving acquisition, final payment due by June 1, 2027 | ||
Debt Instrument | ||
Total debt | 6,982,097 | |
Notes payable to Corns Enterprises, final payment due April 29, 2026 | ||
Debt Instrument | ||
Total debt | $ 943,836 |
SHORT-TERM AND LONG-TERM DEBT_2
SHORT-TERM AND LONG-TERM DEBT - Summary of short-term and long-term debt (Parenthetical) (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Debt Instrument | ||
Debt instrument face amount | $ 15,000,000 | $ 10,000,000 |
Fair value of debt | $ 14,500,000 | 9,900,000 |
Line of credit payable to bank, final payment due by June 28, 2023 | ||
Debt Instrument | ||
Interest rate | 5.50% | |
Term note payable to United Bank, WV Pipeline acquisition, final payment due by March 25, 2026 | ||
Debt Instrument | ||
Interest rate | 4.25% | |
Note payable in monthly or annual installments | $ 64,853 | |
Notes payable to finance companies due October 2022 through August 2026 | ||
Debt Instrument | ||
Note payable in monthly or annual installments | $ 59,500 | 70,062 |
Notes payable to finance companies due October 2022 through August 2026 | Minimum | ||
Debt Instrument | ||
Interest rate | 0% | |
Notes payable to finance companies due October 2022 through August 2026 | Maximum | ||
Debt Instrument | ||
Interest rate | 5.50% | |
Note payable to finance company for insurance premiums financed due December 2022 in monthly installments | ||
Debt Instrument | ||
Interest rate | 3.27% | |
Note payable in monthly or annual installments | $ 282,297 | $ 272,000 |
Notes payable to bank, final payment due November 2034 | ||
Debt Instrument | ||
Interest rate | 4.82% | |
Note payable in monthly or annual installments | $ 7,848 | |
Notes payable to bank, final payment due November 2025 | ||
Debt Instrument | ||
Interest rate | 7.25% | |
Note payable in monthly or annual installments | $ 12,193 | |
Notes payable to banks due June 2022 | ||
Debt Instrument | ||
Interest rate | 4.99% | |
Debt instrument face amount | $ 98,865 | |
Notes payable to David and Daniel Bolton due final payment December 31, 2026 | ||
Debt Instrument | ||
Interest rate | 3.25% | |
Note payable in monthly or annual installments | $ 500,000 | |
Notes payable to bank, at interest at 5.00%, final payment due September 2021 | ||
Debt Instrument | ||
Interest rate | 4.25% | |
Note payable in monthly or annual installments | $ 68,150 | |
Notes payable to bank, at interest at 5.00%, final payment due September 2021 | Minimum | ||
Debt Instrument | ||
Interest rate | 7.25% | |
Term note payable to United Bank, Tri-State Paving acquisition, final payment due by June 1, 2027 | ||
Debt Instrument | ||
Interest rate | 4.25% | |
Debt instrument face amount | $ 129,910 | |
Notes payable to Corns Enterprises, final payment due April 29, 2026 | ||
Debt Instrument | ||
Interest rate | 3.50% | |
Debt instrument face amount | $ 250,000 |
SHORT-TERM AND LONG-TERM DEBT_3
SHORT-TERM AND LONG-TERM DEBT - future expected payments due on short-term and long-term debt (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
SHORT-TERM AND LONG-TERM DEBT | ||
2023 | $ 17,140,336 | |
2024 | 4,061,665 | |
2025 | 4,170,114 | |
2026 | 3,569,091 | |
2027 | 1,069,272 | |
Thereafter | 623,942 | |
Total debt | $ 30,634,420 | $ 17,462,598 |
INCOME TAXES - Components of in
INCOME TAXES - Components of income taxes (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Federal | ||
Current | $ 78,000 | $ (187,829) |
Deferred | 1,686,864 | 165,108 |
Total | 1,764,864 | (22,721) |
State | ||
Current | 22,000 | (52,977) |
Deferred | 475,782 | 46,569 |
Total | 497,782 | (6,408) |
Total income tax expense (benefit) | $ 2,262,646 | $ (29,129) |
INCOME TAXES - Summary of provi
INCOME TAXES - Summary of provision for income taxes differs from amount computed by applying federal statutory rate (Details) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
INCOME TAXES | ||
Statutory rate | 21% | 21% |
State income taxes | 6% | 6% |
Non-deductible meals and other | 10% | 5.70% |
Credit from solar installation project | (2.80%) | |
PPP loan forgiveness | (30.20%) | |
Effective tax rate | 37% | (0.30%) |
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 ($) | Sep. 30, 2022 | Sep. 30, 2021 |
Deferred tax liabilities | ||
Property and equipment | $ 7,686,064 | $ 4,883,398 |
Other | 7,632 | 37,582 |
Total deferred tax liabilities | 7,693,696 | 4,920,980 |
Deferred income tax assets | ||
Other | 404,093 | 358,400 |
Net operating loss carryforward | 2,834,524 | 2,529,147 |
Total deferred tax assets | 3,238,617 | 2,887,547 |
Total net deferred tax liabilities | $ 4,455,079 | $ 2,033,433 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
INCOME TAXES | ||
Federal rate | 21% | 21% |
State rate | 6% | 6% |
Paycheck Protection Program loan forgiveness | $ 0 | $ (9,839,100) |
PPP funds | ||
INCOME TAXES | ||
Federal rate | 37% | 0.32% |
Increase in taxable income due to non deductible expense | $ (2,300,000) | |
Decrease In taxable income nondeductible expense | 29,000 | |
Paycheck Protection Program loan forgiveness | $ 9,800,000 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
EARNINGS PER SHARE | ||
Net income | $ 3,850,073 | $ 9,097,255 |
Dividends on preferred stock | 284,238 | |
Income available to common shareholders | $ 3,850,073 | $ 8,813,017 |
Weighted average shares outstanding-basic | 16,323,790 | 13,621,406 |
Weighted average shares outstanding-diluted | 16,323,790 | 16,988,424 |
Earnings per share available to common shareholders | $ 0.24 | $ 0.65 |
Earnings per share available to common shareholders-diluted | $ 0.24 | $ 0.52 |
STOCK PURCHASE PLAN (Details)
STOCK PURCHASE PLAN (Details) - Employee Stock Purchase Plan - USD ($) | Jul. 06, 2022 | Nov. 19, 2008 |
STOCK PURCHASE PLAN | ||
Number of common stock shares authorized | 1,200,000 | |
Compensation expense | $ 25,000 | |
Percentage stock offered at a purchase price least of fair market value | 85% | |
Participant's stock purchased description | A participant’s stock purchased during a calendar year may not exceed the lesser of (a) a percentage of the participant’s compensation or a total amount as specified by the compensation committee of the Board, or (b) $25,000. | |
Shares repurchased | 1,000,000 | |
Percent of shares authorized | 6% |
LONG TERM INCENTIVE PLAN (Detai
LONG TERM INCENTIVE PLAN (Details) | Feb. 16, 2022 shares |
2022 Equity Incentive Plan | |
LONG TERM INCENTIVE PLAN | |
Maximum number of shares of stock, granted under the Plan as stock options, restricted stock or restricted stock units | 1,500,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | ||
Dec. 16, 2014 | Sep. 30, 2022 | Sep. 30, 2021 | |
RELATED PARTY TRANSACTIONS | |||
Percentage of shares of common stock transaction between executive, officers, directors and holders | 10% or more | ||
Aggregate principal amount of fixed-rate debt | $ 15,000,000 | $ 10,000,000 | |
loan agreement | Nitro Electric | |||
RELATED PARTY TRANSACTIONS | |||
Term of loan agreement | 20 years | ||
Aggregate principal amount of fixed-rate debt | $ 1,200,000 | ||
Monthly rent | $ 6,300 | ||
Interest rate | 4.82% | ||
Note payable in monthly or annual installments | $ 7,800 | ||
Principal installment payments | 333,000 | ||
Interest payment | $ 370,000 |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional information (Details) - USD ($) | 1 Months Ended | ||||
Apr. 29, 2022 | Aug. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 15,000,000 | $ 10,000,000 | |||
Fair value of debt | 14,500,000 | $ 9,900,000 | |||
Unconditional guarantee | $ 5,000,000 | ||||
Development | Ventures | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage | 75% | ||||
Landlord | Development | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage by non controlling owners | 1% | ||||
Landlord | United Bank | |||||
RELATED PARTY TRANSACTIONS | |||||
Ownership percentage by parent | 99% | ||||
SQP | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 5,000,000 | ||||
SQP | Development | |||||
RELATED PARTY TRANSACTIONS | |||||
Equity investment | $ 156,000 | ||||
Equity method investment ownership percentage | 25% | ||||
Tri State Paving | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 236,000 | ||||
Interest rate on carrying value | 205,000% | ||||
Unsecured loan agreement with David Bolton and Daniel Bolton | |||||
RELATED PARTY TRANSACTIONS | |||||
Fair acquisition | $ 3,500,000 | ||||
Accreted interest | $ 7,800 | ||||
Unsecured loan agreement with David Bolton and Daniel Bolton | Tri State Paving | |||||
RELATED PARTY TRANSACTIONS | |||||
Interest payment | $ 7,000 | ||||
Promissory Note agreement with Corns Enterprises | |||||
RELATED PARTY TRANSACTIONS | |||||
Aggregate principal amount of fixed-rate debt | $ 1,000,000 | ||||
Fair value of debt | $ 250,000,000,000 |
LEASE OBLIGATIONS - Additional
LEASE OBLIGATIONS - Additional Information (Details) | 12 Months Ended | |||||
Aug. 11, 2022 USD ($) item | Mar. 25, 2021 USD ($) | Sep. 30, 2022 USD ($) agreement | Sep. 30, 2021 USD ($) | Aug. 12, 2022 USD ($) | Apr. 29, 2022 USD ($) | |
LEASE OBLIGATIONS | ||||||
Operating lease payments for office space per month | $ 1,500 | |||||
Number of financing leases entered | 2 | 2 | ||||
Finance lease, value | $ 160,000 | |||||
Term of finance leases | 22 months | |||||
Finance lease, interest rate | 0% | |||||
Finance lease, monthly installment payments | $ 6,645 | |||||
Option to cancel the finance lease | false | |||||
Carrying value | $ 1,604,277 | |||||
Rental expense | 9,800,000 | $ 3,600,000 | ||||
Operating lease 1 | ||||||
LEASE OBLIGATIONS | ||||||
Net present value | $ 236,000 | |||||
Carrying value | 205,000 | |||||
Operating lease 2 | ||||||
LEASE OBLIGATIONS | ||||||
Net present value | $ 144,000 | |||||
Carrying value | $ 119,000 | |||||
Interest rate on operating lease | 4.50% | |||||
Operating lease 3 | ||||||
LEASE OBLIGATIONS | ||||||
Net present value | $ 1,200,000 | |||||
Interest rate on operating lease | 4.50% | |||||
Number of vehicles to be used under lease agreement | item | 31 | |||||
Operating lease 4 | ||||||
LEASE OBLIGATIONS | ||||||
Net present value | $ 140,000 | |||||
Carrying value | $ 113,000 | |||||
Interest rate on operating lease | 4.50% |
LEASE OBLIGATIONS - Operating L
LEASE OBLIGATIONS - Operating Lease-Weighted Average Remaining Term (Details) | Sep. 30, 2022 USD ($) |
LEASE OBLIGATIONS | |
Weighted average remaining term | 3 years 4 months 24 days |
Present value of operating lease liabilities | $ 1,604,277 |
Operating lease 1 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 2 years 7 months 6 days |
Present value of operating lease liabilities | $ 205,267 |
Operating Lease 2 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 1 year 9 months 18 days |
Present value of operating lease liabilities | $ 119,032 |
Operating Lease 3 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 3 years 10 months 24 days |
Present value of operating lease liabilities | $ 1,166,498 |
Operating Lease 4 | |
LEASE OBLIGATIONS | |
Weighted average remaining term | 1 year |
Present value of operating lease liabilities | $ 113,480 |
LEASE OBLIGATIONS - Operating_2
LEASE OBLIGATIONS - Operating Lease Maturity Schedule (Details) | Sep. 30, 2022 USD ($) |
LEASE OBLIGATIONS | |
2023 | $ 588,653 |
2024 | 465,428 |
2025 | 373,397 |
2026 | 296,606 |
Operating lease liability | 1,724,084 |
Less amounts representing interest | (119,807) |
Present value of operating lease liabilities | $ 1,604,277 |
LEASE OBLIGATIONS - Operating_3
LEASE OBLIGATIONS - Operating Lease Expense (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
LEASE OBLIGATIONS | ||
Amortization | $ 98,711 | $ 0 |
Interest | 11,802 | |
Total amortization and interest | 110,513 | |
Operating lease 1 | ||
LEASE OBLIGATIONS | ||
Amortization | 30,933 | |
Interest | 4,067 | |
Operating Lease 2 | ||
LEASE OBLIGATIONS | ||
Amortization | 25,554 | |
Interest | 2,411 | |
Operating Lease 3 | ||
LEASE OBLIGATIONS | ||
Amortization | 22,672 | |
Interest | 4,360 | |
Operating Lease 4 | ||
LEASE OBLIGATIONS | ||
Amortization | 19,552 | |
Interest | $ 964 |
LEASE OBLIGATIONS - Cash Paid f
LEASE OBLIGATIONS - Cash Paid for Operating Leases (Details) | 12 Months Ended | |
Mar. 25, 2021 USD ($) | Sep. 30, 2022 USD ($) agreement | |
LEASE OBLIGATIONS | ||
Cash paid for operating leases | $ 117,558 | |
Lessee, Finance Lease, Number Of New Leases | 2 | 2 |
Operating lease 1 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | $ 35,000 | |
Operating Lease 2 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 27,965 | |
Operating Lease 3 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | 27,032 | |
Operating Lease 4 | ||
LEASE OBLIGATIONS | ||
Cash paid for operating leases | $ 27,561 |
MAJOR CUSTOMERS (Details)
MAJOR CUSTOMERS (Details) - Customer Concentration Risk | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Concentration Risk [Line Items] | ||
Customers concentration percentage | 10% | |
Revenues | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 100% | 100% |
Revenues | TransCanada Corporation | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 16.60% | 11% |
Revenues | All Other | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 83.40% | 89% |
Revenues | Customer One | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 10% | |
Receivables | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 100% | 100% |
Receivables | TransCanada Corporation | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 11.60% | 13.20% |
Receivables | All Other | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 88.40% | 70.50% |
Receivables | Kentucky American Water | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 16.30% | |
Receivables | Customer Two | ||
Concentration Risk [Line Items] | ||
Customers concentration percentage | 10% |
RETIREMENT AND EMPLOYEE BENEF_3
RETIREMENT AND EMPLOYEE BENEFIT PLANS - Summary of Participation in Pension Fund Plan (Details) - USD ($) | 12 Months Ended | 36 Months Ended | |||
Dec. 15, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2022 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
Multiemployer Plan, Employer Contribution, Cost | $ 6,420,550 | $ 4,898,691 | |||
Payments for installment | $ 41,000 | ||||
Amount expensed | $ 164,000 | ||||
Central States, Southeast and Southwest Areas Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 36-6044243/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 123,142 | $ 0 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Employer-Teamsters Local Nos. 175 and 505 | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 55-6021850/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 0 | ||||
Surcharge Imposed | No | ||||
Expiration Date of Collective Bargaining Agreement | Various | ||||
Laborers National Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 75-1280827/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 384,908 | $ 394,563 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Laborers' District Council of Western Pennsylvania Pension Plan | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 25-6135576/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 269,915 | $ 0 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Operating Engineers Local 324 Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 38-1900637/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 66,757 | $ 0 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
National Automatic Sprinkler Industry Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 52-6054620/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 199,984 | $ 121,133 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Iron Workers District Council of Southern Ohio &Vicinity Pension Trust | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 31-6038516/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 208,588 | $ 160,367 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Carpenters Pension Fund of WV | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 55-6027998/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 719,665 | $ 281,568 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Plumbers & Pipefitters National Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 52-6152779/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 660,324 | $ 616,568 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Sheet Metal Workers' National Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 52-6112463/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Yellow | Yellow | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 175,643 | $ 538,286 | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Sheet Metal Workers Local Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 34-6666753/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 0 | ||||
Surcharge Imposed | No | ||||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Plumbers and Pipefitters Local 152 Pension Fund | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
EIN/Pension Plan Number | 55-6029095/001 | ||||
Pension Protection Act ("PPA") Certified Zone Status | Red | Red | |||
FIP/RP Status | Implemented | Implemented | Implemented | ||
Contributions of Energy Services Companies | $ 2,492 | ||||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
All Other | |||||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | |||||
Pension Protection Act ("PPA") Certified Zone Status | Green | Green | |||
Surcharge Imposed | No | No | No | ||
Expiration Date of Collective Bargaining Agreement | Various | Various | Various | ||
Multiemployer Plan, Pension, Insignificant, Employer Contribution, Cost | $ 3,611,624 | $ 2,783,713 |
RETIREMENT AND EMPLOYEE BENEF_4
RETIREMENT AND EMPLOYEE BENEFIT PLANS - C.J. Hughes retirement plan (Details) - Union Employees Retirement Plan - C J Hughes Construction Company - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Percentage of employees contribution to retirement compensation plan | 15% | |
Maximum amount of employees contribution | $ 20,500 | $ 20,500 |
Amount of contribution matched per dollar | $ 0.25 | |
Percentage of contribution of eligible wages | 6% | |
Amount of contribution to union plan | $ 22,000 | $ 26,000 |
RETIREMENT AND EMPLOYEE BENEF_5
RETIREMENT AND EMPLOYEE BENEFIT PLANS - Energy Services of America retirement plan (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Non Union Employees Retirement Plan | Nitro Electric And C. J. Hughes Construction Company merger | ||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Defined contribution plan employer matching contribution percent of each dollar contributed for the first 3% | 100% | |
Defined contribution plan employer matching contribution percent of each dollar contributed for the next 3% | 50% | |
Retirement Plan | Energy Services of America | ||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Amount of contribution to union plan | $ 402,000 | $ 365,000 |
Qualified Non-Elective Contribution ("QNEC") | ||
RETIREMENT AND EMPLOYEE BENEFIT PLANS | ||
Amount of contribution to union plan | $ 651,000 |
CREDIT RISK (Details)
CREDIT RISK (Details) $ in Millions | Sep. 30, 2022 USD ($) |
CREDIT RISK | |
Uninsured deposits | $ 4.9 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | ||
Performance bonds outstanding amount | $ 82.8 | |
PPP loans received | $ 9.8 |
ACQUISITIONS - Non-cash purchas
ACQUISITIONS - Non-cash purchase price for the Tri-State Paving acquisition (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
ACQUISITIONS | ||
Property and equipment | $ 32,661,787 | $ 22,950,019 |
Goodwill | 4,087,554 | 1,814,317 |
Intangible assets, net | 3,873,690 | $ 2,425,923 |
Tri-State Paving | ||
ACQUISITIONS | ||
Property and equipment | 5,709,094 | |
Goodwill | 2,273,237 | |
Total | 9,874,663 | |
Tri-State Paving | Customer Relationships | ||
ACQUISITIONS | ||
Intangible assets, net | 1,649,159 | |
Tri-State Paving | Non-competes | ||
ACQUISITIONS | ||
Intangible assets, net | 39,960 | |
Tri-State Paving | Tradename | ||
ACQUISITIONS | ||
Intangible assets, net | $ 203,213 |
ACQUISITIONS - Purchase price f
ACQUISITIONS - Purchase price for the Ryan Environmental and Ryan Transport acquisitions (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 |
ACQUISITIONS | ||
Property and equipment | $ 32,661,787 | $ 22,950,019 |
Ryan Environmental and Ryan Transport | ||
ACQUISITIONS | ||
Property and equipment | 3,237,559 | |
Accounts receivable, net of $250,000 allowance | 677,254 | |
Accounts receivable, allowance | 250,000 | |
Unbilled receivable | 127,244 | |
Total | $ 4,042,057 |
ACQUISITIONS - Additional Infor
ACQUISITIONS - Additional Information (Details) - USD ($) | 12 Months Ended | ||||||
Aug. 11, 2022 | Aug. 09, 2022 | Apr. 29, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Oct. 06, 2021 | Dec. 31, 2020 | |
ACQUISITIONS | |||||||
Value of common stock issued | $ 1,048,218 | $ 0 | |||||
Outstanding common shares | 16,667,185 | 13,621,406 | 16,247,898 | ||||
Debt instrument face amount | $ 15,000,000 | $ 10,000,000 | |||||
Fair value of debt | 14,500,000 | $ 9,900,000 | |||||
Tri-State Paving | |||||||
ACQUISITIONS | |||||||
Payments to Acquire Productive Assets | $ 7,500,000 | ||||||
Seller note as consideration for acquiring assets | 1,000,000 | ||||||
Value of common stock issued | $ 1,000,000 | ||||||
Number of shares issued | 419,287 | ||||||
Cash consideration | $ 7,500,000 | ||||||
Non-cash purchase price of debt | $ 390,000 | ||||||
Ryan Environmental | |||||||
ACQUISITIONS | |||||||
Amount of consideration | $ 3,000,000 | $ 3,000,000 | |||||
Ryan Transport | |||||||
ACQUISITIONS | |||||||
Payments to Acquire Productive Assets | 1,000,000 | ||||||
Amount of consideration | $ 1,000,000 | ||||||
Cash consideration | $ 1,000,000 | ||||||
Promissory Note agreement with Corns Enterprises | |||||||
ACQUISITIONS | |||||||
Debt instrument face amount | $ 1,000,000 | ||||||
Fair value of debt | $ 250,000,000,000 | ||||||
Tri-State Paving | |||||||
ACQUISITIONS | |||||||
Seller note as consideration for acquiring assets | 1,000,000 | ||||||
Value of common stock issued | $ 1,000,000 | ||||||
Number of shares issued | 419,287 | ||||||
Tri-State Paving | Promissory Note agreement with Corns Enterprises | |||||||
ACQUISITIONS | |||||||
Term of debt | 4 years | ||||||
Debt instrument face amount | $ 1,000,000 | ||||||
Principal installment payments | $ 250,000 | ||||||
Interest rate on carrying value | 3.50% |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) - USD ($) | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Goodwill | ||
Beginning balance | $ 1,814,317 | |
Acquired | 2,273,237 | $ 1,814,317 |
Ending balance | $ 4,087,554 | $ 1,814,317 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Intangible assets subject to amortization (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
GOODWILL AND INTANGIBLE ASSETS | |||
Original Cost | $ 4,548,843 | $ 4,548,843 | |
Accumulated Amortization and Impairment | 675,153 | 444,565 | $ 230,588 |
Net Book Value | 3,873,690 | 3,873,690 | |
Accumulated Amortization and impairment on identifiable intangible assets | $ 444,565 | 230,588 | |
Customer Relationships | West Virginia Pipeline | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 99 months | ||
Original Cost | 2,209,724 | $ 2,209,724 | |
Accumulated Amortization and Impairment | 386,693 | 220,968 | 165,725 |
Net Book Value | 1,823,031 | $ 1,823,031 | |
Customer Relationships | Tri-State Paving | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 115 months | ||
Original Cost | 1,649,159 | $ 1,649,159 | |
Accumulated Amortization and Impairment | 66,781 | 66,781 | |
Net Book Value | 1,582,378 | $ 1,582,378 | |
Tradename | West Virginia Pipeline | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 99 months | ||
Original Cost | 263,584 | $ 263,584 | |
Accumulated Amortization and Impairment | 46,136 | 26,364 | 19,772 |
Net Book Value | 217,448 | $ 217,448 | |
Tradename | Tri-State Paving | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 115 months | ||
Original Cost | 203,213 | $ 203,213 | |
Accumulated Amortization and Impairment | 8,368 | 8,368 | |
Net Book Value | 194,845 | $ 194,845 | |
Non-competes | West Virginia Pipeline | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 3 months | ||
Original Cost | 83,203 | $ 83,203 | |
Accumulated Amortization and Impairment | 72,806 | 41,604 | 31,202 |
Net Book Value | 10,397 | $ 10,397 | |
Non-competes | Tri-State Paving | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 7 months | ||
Original Cost | 39,960 | $ 39,960 | |
Accumulated Amortization and Impairment | 16,590 | 16,590 | |
Net Book Value | 23,370 | $ 23,370 | |
Employment agreement/non-compete | Revolt Energy: | |||
GOODWILL AND INTANGIBLE ASSETS | |||
Remaining Life | 19 months | ||
Original Cost | 100,000 | $ 100,000 | |
Accumulated Amortization and Impairment | 77,779 | 63,890 | $ 13,889 |
Net Book Value | $ 22,221 | $ 22,221 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Amortization expenses (Details) | Sep. 30, 2022 USD ($) |
GOODWILL AND INTANGIBLE ASSETS | |
2023 | $ 483,004 |
2024 | 438,122 |
2025 | 432,569 |
2026 | 432,569 |
2027 | 432,569 |
After | 1,654,856 |
Total | $ 3,873,690 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Nov. 16, 2022 | Oct. 10, 2022 | Sep. 30, 2022 | Sep. 30, 2021 |
Subsequent Event | ||||
Debt instrument face amount | $ 15,000,000 | $ 10,000,000 | ||
Subsequent event | ||||
Subsequent Event | ||||
Loss contingency value | $ 13,100,000 | $ 13,100,000 | ||
Jury award value | 5,800,000 | 5,800,000 | ||
Attorney fees | 1,600,000 | 1,600,000 | ||
Penalties and interest value | $ 5,700,000 | 5,700,000 | ||
Subsequent event | Promissory Note agreement with United Bank | ||||
Subsequent Event | ||||
Debt instrument face amount | $ 3,100,000 | |||
Term of loan agreement | 5 years | |||
Interest rate | 6% | |||
Debt instrument, periodic payment term | $ 59,932 |