Company: LGN
Filing Date: 2025-09-02
Form Type: S-1/A
Source: 0001193125-25-193346
Chunk: 354

Company: Legence Corp.
Filing Date: 2025-09-02
Form: S-1/A
Chunk 354
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     | 2025 | Three Months Ended 
           June 30, |   |     | 2024 |       |   |     | 2025 | Six Months Ended 
         June 30, |    |     | 2024 |        |    |
|:--------------------------|:----|:-----|-------------------:|:--|:----|:-----|------:|:--|:----|:-----|-----------------:|:---|:----|:-----|-------:|:---|
| Income tax expense        |     | $    |              5,546 |   |     | $    | 3,656 |   |     | $    |            9,584 |    |     | $    |  4,936 |    |
| Effective income tax rate |     |      |              330.7 | % |     |      |  37.1 | % |     |      |            (71.4 | )% |     |      | (128.8 | )% |

The Company evaluates its estimated annual effective income tax rate based on current and forecasted business results and enacted tax laws on a quarterly basis, adjusted for discrete events arising in each respective quarter, and applies this tax rate to ordinary income or loss to calculate the estimated tax liability or benefit. Due to the nature of the legal structure, the effective tax rate is impacted by the changes in the mix of earnings from pass-through businesses that are not subject to income taxes at the Company level. For the three months ended June 30, 2025 and 2024, the effective tax rate was higher than the U.S. federal statutory rate of 21%, primarily due to the loss before income tax from pass-through business not subject to income taxes at the Company level. For the six months ended June 30, 2025 and 2024, the effective tax rate was lower than the U.S. federal statutory rate of 21%, primarily due to the loss before income tax from pass-through business not subject to income taxes at the Company level. Note 12—Segment Information Legence reports its results under two reportable segments: 1) Engineering & Consulting, and 2) Installation & Maintenance. Segments are presented according to the nature of the business activities, and reflect the Company’s consideration of financial information provided to the chief executive officer, who is the chief operating decision maker (“CODM”). The CODM primarily uses gross profit to