Company: MWA
Filing Date: 2025-02-05
Form Type: 10-Q
Source: 0001350593-25-000012
Chunk: 18

Company: Mueller Water Products, Inc.
Filing Date: 2025-02-05
Form: 10-Q
Item: Part I, Item 1
Chunk 18
---
 as well as unbilled amounts including contract assets.  Amounts are billed in accordance with contractual terms and unbilled amounts arise when the timing of billing differs from the timing of revenue recognized.Advance payments and billings in excess of revenue are recognized and recorded as deferred revenue and are classified as Other current liabilities or Other noncurrent liabilities in the accompanying condensed consolidated balance sheets based on the timing of when we expect to recognize revenue.  Refer to Note 7. for current and noncurrent amounts.  Deferred revenue represents contract liabilities and is recorded when customers remit cash payments in advance of our satisfaction of performance obligations pursuant to contractual arrangements.  Contract liabilities are reversed when the performance obligation is satisfied and revenue is recognized.  Deferred revenue primarily consists of amounts related to monitoring, leak detection, software and hosting services.  In each of the three months ended December 31, 2024 and 2023, we recognized approximately $2.3 million of revenue that was previously deferred.  Additionally, during the three months ended December 31, 2024 and 2023, we recorded approximately $2.1 million and $1.5 million, respectively, of additional deferred revenue.  We estimate that noncurrent deferred revenue will be recognized as follows: $1.1 million in 2026, $1.3 million in 2027, $1.2 million in 2028, $0.7 million in 2029, $0.5 million in 2030 and $0.8 million thereafter.

11

The table below represents the balances of our customer receivables and deferred revenue:December 31,September 30, 20242024(in millions)Billed receivables$148.0 $212.7 Unbilled receivables5.2 4.5 Gross customer receivables153.2 217.2 Allowance for credit losses(7.9)(8.3)Receivables, net$145.3 $208.9 Deferred revenue$12.6 $12.8 Performance ObligationsA performance obligation is a promise in a contract to transfer a distinct good or service to the customer.  Our performance obligations are generally satisfied at a point in time for sales of equipment and products or over time for our software hosting and leak detection monitoring services.  Performance obligations are supported by customer contracts which provide frameworks for the nature of the distinct products or services.  The transaction price is adjusted for