Company: LGN
Filing Date: 2025-12-09
Form Type: S-1
Source: 0001193125-25-312729
Chunk: 110

Company: Legence Corp.
Filing Date: 2025-12-09
Form: S-1
Chunk 110
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 a modest
revenue mix shift towards the Engineering & Design service line.

Installation& Maintenance: The
$26.1 million, or 47.9%, increase in gross profit for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily driven by strong revenue growth in both the Installation &
Fabrication and Maintenance & Service service lines as well as higher margins in the Installation & Fabrication service line, driven by strong project execution, partially offset by a revenue mix shift towards the lower margin
Installation & Fabrication service line.

Selling, General & Administrative

Selling, general and administrative expenses increased $18.7 million during the three months ended September 30, 2025 compared to the
three months ended September 30, 2024, primarily driven by $12.0 million in compensation expense largely due to an increase in fair value of profits interest awards as well as higher headcount. The remaining increase in selling, general
and administrative expenses of $6.7 million is primarily attributable to professional fees related to the preparation of our IPO as well as increases in IT software and subscription.

Depreciation and Amortization

The
decrease in depreciation and amortization is primarily attributable to the runoff of contract backlog intangible assets from recent acquisitions.

Interest Expense

The increase in
interest expense is primarily attributable to higher average borrowings during the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.

Loss on debt extinguishment

The
loss on debt extinguishment is due to accelerated amortization of debt issuance costs related to the early debt payment of $780.3 million during the three months ended September 30, 2025.

Income Tax Expense

Income tax
expense was $4.1 million for the three months ended September 30, 2025, and resulted in an effective tax rate of 91.5%, as compared to an income tax expense of $4.6 million for the three months ended September 30, 2024 and an
effective tax rate of 117.4%. For the three months ended September 30, 2025 and 2024, the effective tax rate was higher than the U.S. federal statutory rate of 21%, primarily due to earnings incurred prior to the IPO and Reorganization from
pass-through business not subject to income taxes at the Company level.

71

For the Nine Months Ended September 30