Company: EME
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0000105634-25-000029
Chunk: 57

Company: EMCOR Group, Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Part I, Item 1
Chunk 57
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6 million. Partially offsetting these increases was a reduction in gross profit from the commercial market sector, primarily as a result of the reduced revenues previously referenced.

Operating income of our United States building services segment was $36.4 million, or 4.9% of revenues, for the three months ended March 31, 2025 compared to $33.5 million, or 4.3% of revenues, for the three months ended March 31, 2024. For the first quarter of 2025, this segment experienced an increase in gross profit and gross profit margin from its mechanical services division, due to greater profitability across its portfolio of HVAC retrofits, building automation and controls projects, and repair service work orders. These increases were partially offset by reductions in gross profit and gross profit margin from the segment’s commercial site-based services and government site-based services divisions given the loss of the previously referenced facilities maintenance contracts. The results of this segment for the prior year period included an $11.0 million reserve for a specific customer bankruptcy within its commercial site-based services division, which negatively impacted the segment’s operating margin by 140 basis points for the three months ended March 31, 2024.

Our United States industrial services segment reported operating income of $6.8 million, or 1.9% of revenues, for the three months ended March 31, 2025, compared to $18.0 million, or 5.1% of revenues, for the three months ended March 31, 2024. The decreases in operating income and operating margin of this segment were primarily a result of: (a) a less favorable revenue mix when compared to the prior year period, which benefited from turnaround projects of a greater size as well as a large renewable fuel project, (b) the impact of the aforementioned project deferrals and delays, which resulted in a greater amount of unabsorbed labor costs, and (c) a $4.0 million increase in the allowance for credit losses, which negatively impacted the operating margin of this segment by 110 basis points.

Operating income of our United Kingdom building services segment was $5.0 million, or 4.7% of revenues, for the three months ended March 31, 2025, compared to $5.4 million, or 5.1% of revenues, for the three months ended March 31, 2024. The slight decrease in operating income and the reduction in operating margin were due to certain mobilization