Company: EME
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000105634-25-000015
Chunk: 69

Company: EMCOR Group, Inc.
Filing Date: 2025-02-26
Form: 10-K
Item: Item 7
Chunk 69
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Operating income of our United States building services segment for the year ended December 31, 2024 was $176.7 million, or 5.7% of revenues, compared to operating income of $183.0 million, or 5.9% of revenues, for the year ended December 31, 2023. Increased gross profit from this segment’s mechanical services division, due primarily to greater profitability across its portfolio of HVAC and building automation and controls projects and retrofits, was partially offset by reductions in gross profit from its commercial site-based services and government site-based services divisions, given the loss of certain facilities maintenance contracts not renewed pursuant to rebid. In addition, operating income and operating margin for the year ended December 31, 2024 were negatively impacted by an $11.0 million reserve recorded during the first quarter for a specific customer bankruptcy within this segment’s commercial site-based services division. Such reserve negatively impacted the operating margin of this segment for 2024 by approximately 30 basis points. 

Our United States industrial services segment’s operating income for the year ended December 31, 2024 was $44.2 million, or 3.5% of revenues, compared to operating income of $35.4 million, or 3.0% of revenues, for the year ended December 31, 2023. Operating income of this segment benefited from greater gross profit generated within its: (a) field services division due to the increase in revenues referenced above, and (b) shop services division as a result of an improvement in gross profit margin given favorable pricing. The increase in operating margin of this segment was attributable to the increased gross profit margin within the shop services division.

Operating income of our United Kingdom building services segment for the year ended December 31, 2024 was $21.5 million, or 5.0% of revenues, compared to operating income of $25.7 million, or 5.9% of revenues, for the year ended December 31, 2023. The decrease in operating income and operating margin was due to a decline in gross profit and gross profit margin. In addition to the impact of lower facilities maintenance revenues, gross profit and gross profit margin were negatively affected by a less favorable mix of work when compared to the prior year, which included a greater number of higher margin projects. Operating income of this segment for 2024 was positively impacted by $0.5 million as a result of favorable exchange rate movements for the British pound versus