Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v3.22.1
Segment Information
 3 Months Ended
Mar. 31, 2022
Segment Reporting [Abstract]  
Segment Information SEGMENT INFORMATION:
Beginning with the three months ended December 31, 2021, Quanta reports results under three reportable segments: (1) Electric Power Infrastructure Solutions, (2) Renewable Energy Infrastructure Solutions and (3) Underground Utility and Infrastructure Solutions. The Renewable Energy Infrastructure Solutions segment was added primarily due to the acquisition of Blattner Holding Company and its operating subsidiaries (collectively, Blattner) on October 13, 2021. For additional information regarding this acquisition, see Note 6. In conjunction with this change, certain prior period amounts have been recast to conform to this new segment reporting structure. This structure is generally based on the broad end-user markets for Quanta’s services. See Note 1 for additional information regarding Quanta’s reportable segments.
Quanta’s segment results are derived from the types of services provided across its operating companies in each of its end user markets. Quanta’s entrepreneurial business model allows multiple operating companies to serve the same or similar customers and to provide a range of services across end user markets. Reportable segment information, including revenues and operating income by type of work, is gathered from each operating company for the purpose of evaluating segment performance in support of Quanta’s market strategies. Classification of operating company revenues by type of work for segment reporting purposes can require judgment on the part of management. Quanta’s operating companies may perform joint projects for customers in multiple industries, deliver multiple types of services under a single customer contract or provide service offerings to various industries. For example, Quanta performs joint trenching projects to install distribution lines for electric power and natural gas customers.
In addition, integrated operations and common administrative support for Quanta’s operating companies require that certain allocations be made to determine segment profitability, including allocations of corporate shared and indirect operating costs as well as general and administrative costs. Certain corporate costs are not allocated, including facility costs, acquisition and integration costs, non-cash stock-based compensation, amortization related to intangible assets, asset impairment related to goodwill and intangible assets and change in fair value of contingent consideration liabilities.
Summarized financial information for Quanta’s reportable segments is presented in the following table (in thousands):
Three Months Ended
March 31,
  2022 2021
Revenues:    
Electric Power Infrastructure Solutions $ 2,138,697  $ 1,676,046 
Renewable Energy Infrastructure Solutions 875,632  384,074 
Underground Utility and Infrastructure Solutions
 951,196  643,461 
Consolidated revenues $ 3,965,525  $ 2,703,581 
Operating income (loss):
   
Electric Power Infrastructure Solutions (1)
$ 203,419  $ 153,739 
Renewable Energy Infrastructure Solutions 69,942  45,296 
Underground Utility and Infrastructure Solutions
 48,175  8,813 
Corporate and Non-Allocated Costs (2)
(204,020) (94,119)
Consolidated operating income $ 117,516  $ 113,729 
Depreciation:    
Electric Power Infrastructure Solutions $ 36,779  $ 34,404 
Renewable Energy Infrastructure Solutions 8,233  2,241 
Underground Utility and Infrastructure Solutions
 20,938  21,087 
Corporate and Non-Allocated Costs 5,004  4,375 
Consolidated depreciation $ 70,954  $ 62,107 
(1)    Operating income for the Electric Power Infrastructure Solutions segment includes equity in earnings of integral unconsolidated affiliates that are operationally integral to the operations of Quanta, which primarily consists of equity in earnings related to Quanta’s equity interest in LUMA.
(2)    Corporate and Non-Allocated Costs for the three months ended March 31, 2022 and 2021 included amortization expense of $115.8 million and $21.4 million and non-cash stock-based compensation of $22.4 million and $18.7 million.
Separate measures of Quanta’s assets and cash flows by reportable segment, including capital expenditures, are not produced or utilized by management to evaluate segment performance. Quanta’s fixed assets, which are held at the operating company level, include operating machinery, equipment and vehicles, office equipment, buildings and leasehold improvements, and certain fixed assets are used on an interchangeable basis across its reportable segments. As such, for reporting purposes, total depreciation expense is allocated each quarter among Quanta’s reportable segments based on the ratio of each reportable segment’s revenue contribution to consolidated revenues.
Foreign Operations
During the three months ended March 31, 2022 and 2021, Quanta derived $641.6 million and $497.5 million of its revenues from foreign operations. Of Quanta’s foreign revenues, 86% and 83% were earned in Canada during the three months ended March 31, 2022 and 2021. In addition, Quanta held property and equipment of $331.2 million and $338.1 million in foreign countries, primarily Canada, as of March 31, 2022 and December 31, 2021.