Company: LGN
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0002052568-25-000018
Chunk: 113

Company: Legence Corp.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 113
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 months ended September 301.3x1.4x

The increase in backlog and awarded contracts from September 30, 2024 to September 30, 2025 resulted from an increase in awards in both segments. The modest increase in Engineering & Consulting was primarily driven by new projects within the state & local government client end market, partially offset by education, data centers & technology and mixed-use end markets. The increase in Installation & Maintenance was primarily driven by new projects within the data centers & technology and life sciences & healthcare client end markets, partially offset by the education client end market. 

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Critical Accounting Estimates 

Our management’s discussion and analysis of our financial condition and results of operations is based on our Condensed Consolidated Financial Statements. The preparation of the Condensed Consolidated Financial Statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the related revenues and expenses and disclosures as of the date of the financial statements. Actual results could differ from those estimates. Our significant accounting policies are discussed in “Item 1. Financial Statements, Note 2—Summary of Significant Accounting Policies” in Notes to Condensed Consolidated Financial Statements and “Note 2—Summary of Significant Accounting Policies” in Notes to Consolidated Financial Statements for the year ended December 31, 2024 as presented in the Prospectus. These policies, along with our underlying judgments and assumptions made in their application, have a significant impact on our Condensed Consolidated Financial Statements.

We identify our critical accounting policies as those that are the most pervasive and important to the portrayal of our financial position and operating results and that require the most difficult, subjective and/or complex judgments regarding estimates in matters that are inherently uncertain. Our critical accounting policies are those related to revenue recognition, goodwill, income taxes, acquisitions and valuation of intangible assets. Refer to "Critical Accounting Estimates" for the year ended December 31, 2024 as presented in the Prospectus for more information. During the nine months ended September 30, 2025, the only significant changes to our critical accounting estimates are as follows:

Tax Receivable Agreement

The TRA generally provides for the payment by us of 85% of the net cash savings, if any, we realize, or are deemed to realize, as a result of certain tax attributes and benefits covered by the TRA.

We estimate our obligation under the TRA utilizing various assumptions set forth in the Tax Receivable Agreement, including: (i) a constant combined federal and state