Company: LGN
Filing Date: 2025-05-14
Form Type: DRS/A
Source: 0000950123-25-005247
Chunk: 271

Company: Legence Corp.
Filing Date: 2025-05-14
Form: DRS/A
Chunk 271
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 Input Method, the
accuracy of the Company’s revenue and profit recognition in each year depends on the accuracy of management’s estimates of the cost to complete each project. Contract costs include labor, material, subcontractors and various overhead costs
such as maintenance, depreciation, consumables, or equipment rentals, which are either directly related to the fulfillment of specific contract performance obligations or indirectly contribute to the overall customer service delivery fulfillment of
multiple contracts and obligations. Costs associated with change orders, unresolved contract modifications, claims to or from owners and back-charge recoveries are recorded as incurred. Revisions to estimated total costs are reflected in the
Company’s measure of progress.

F-22

Confidential Treatment Requested by Legence Corp. Pursuant to 17 C.F.R. Section 200.83 Legence Holdings LLC and Subsidiaries Notes to Consolidated Financial Statements There are several factors that can contribute to changes in estimates of contract cost and profitability. Potential factors include:

| • |     | The completeness and accuracy of the original bid; |

| • |     | Costs associated with scope and schedule changes as well as changes from the original design; |

| • |     | Changes in costs of labor and/or materials, owner changes, weather, site conditions and other delays; |

| • |     | Subcontractor performance; |

| • |     | Changes in productivity expectations; |

| • |     | The Company’s ability to fully and promptly recover on contract scope changes; 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, which may have a significant impact on the Consolidated Financial Statements. At the time a loss on a contract becomes probable, the entire amount of the estimated loss is accrued. Management monitors for circumstances that may affect the accuracy of its estimates. Disaggregation of Revenue The Company’s revenue was derived from contracts to provide goods or services in the Engineering & Consulting and Installation & Maintenance segments. Refer to “ Note 16—Segment Information” for additional information on reportable segments. The Company disaggregates revenue by service line as management believes this category best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. See details in the following table (in thousands):

|                                          | Revenue by Service Line and Segment | Year Ended December 31, |