Company Quick10K Filing
Mastec
Financials
Price65.08 EPS4
Shares76 P/E15
MCap4,942 P/FCF11
Net Debt1,278 EBIT420
TEV6,219 TEV/EBIT15
TTM 2019-09-30, in MM, except price, ratios
Filings
10-Q 2020-03-31 Filed 2020-04-30
10-K 2019-12-31 Filed 2020-02-27
10-Q 2019-09-30 Filed 2019-10-31
10-Q 2019-06-30 Filed 2019-08-01
10-Q 2019-03-31 Filed 2019-05-02
10-K 2018-12-31 Filed 2019-02-28
10-Q 2018-09-30 Filed 2018-11-01
10-Q 2018-06-30 Filed 2018-08-02
10-Q 2018-03-31 Filed 2018-04-30
10-K 2017-12-31 Filed 2018-02-27
10-Q 2017-09-30 Filed 2017-11-02
10-Q 2017-06-30 Filed 2017-08-03
10-Q 2017-03-31 Filed 2017-05-04
10-K 2016-12-31 Filed 2017-02-24
10-Q 2016-09-30 Filed 2016-11-03
10-Q 2016-06-30 Filed 2016-08-04
10-Q 2016-03-31 Filed 2016-05-05
10-K 2015-12-31 Filed 2016-02-26
10-Q 2015-09-30 Filed 2015-11-03
10-Q 2015-06-30 Filed 2015-08-17
10-Q 2015-03-31 Filed 2015-08-07
10-K 2014-12-31 Filed 2015-07-31
10-Q 2014-09-30 Filed 2014-10-30
10-Q 2014-06-30 Filed 2014-08-11
10-Q 2014-03-31 Filed 2014-05-01
10-K 2013-12-31 Filed 2014-02-27
10-Q 2013-09-30 Filed 2013-10-31
10-Q 2013-06-30 Filed 2013-08-01
10-Q 2013-03-31 Filed 2013-05-02
10-K 2012-12-31 Filed 2013-02-28
10-Q 2012-09-30 Filed 2012-11-01
10-Q 2012-06-30 Filed 2012-08-02
10-Q 2012-03-31 Filed 2012-05-03
10-K 2011-12-31 Filed 2012-02-29
10-Q 2011-09-30 Filed 2011-11-03
10-Q 2011-06-30 Filed 2011-08-03
10-Q 2011-03-31 Filed 2011-05-04
10-K 2010-12-31 Filed 2011-02-23
10-Q 2010-09-30 Filed 2010-11-03
10-Q 2010-06-30 Filed 2010-08-04
10-Q 2010-03-31 Filed 2010-05-05
10-K 2009-12-31 Filed 2010-02-25
Reports
8-K 2020-04-30 Earnings, Regulation FD, Exhibits
8-K 2020-02-27 Earnings, Regulation FD, Exhibits
8-K 2019-10-31 Earnings, Regulation FD, Exhibits
8-K 2019-09-19 Enter Agreement
8-K 2019-08-01 Earnings, Regulation FD, Exhibits
8-K 2019-05-23 Shareholder Vote
8-K 2019-05-02 Earnings, Regulation FD, Exhibits
8-K 2019-02-28 Earnings, Regulation FD, Exhibits
8-K 2018-11-01 Earnings, Regulation FD, Exhibits
8-K 2018-08-02 Earnings, Regulation FD, Exhibits
8-K 2018-05-22 Shareholder Vote
8-K 2018-04-30 Earnings, Regulation FD, Exhibits
8-K 2018-02-27 Earnings, Regulation FD, Exhibits

MTZ 10Q Quarterly Report

Content
Part I. Financial Information
Item 1. Financial Statements
Note 1 - Business, Basis of Presentation and Significant Accounting Policies
Note 2 - Earnings per Share
Note 3 - Goodwill and Other Intangible Assets
Note 4 - Fair Value of Financial Instruments
Note 5 - Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities
Note 6 - Property and Equipment, Net
Note 7 - Debt
Note 8 - Lease Obligations
Note 9 - Stock - Based Compensation and Other Employee Benefit Plans
Note 10 - Other Retirement Plans
Note 11 - Equity
Note 12 - Income Taxes
Note 13 - Segments and Related Information
Note 14 - Commitments and Contingencies
Note 15 - Related Party Transactions
Note 16 - Supplemental Guarantor Condensed Consolidating Financial Information
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 4. Mine Safety Disclosures
Item 6. Exhibits
Exhibits
EX-31.1 mtz3312010-qex311.htm
EX-31.2 mtz3312010-qex312.htm
EX-32.1 mtz3312010-qex321.htm
EX-32.2 mtz3312010-qex322.htm

Mastec Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
5.04.03.02.01.00.02012201420172020
Assets, Equity
 2.11.71.20.80.3-0.12012201420172020
Rev, G Profit, Net Income
 0.40.20.1-0.1-0.2-0.42012201420172020
Ops, Inv, Fin
Document
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________
Form 10-Q
_____________________________________________
(Mark One)
☑     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020
 
OR
☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __ to __
Commission File Number 001-08106
_____________________________________________

image0a14.jpg
MasTec, Inc.
(Exact name of registrant as specified in its charter)
Florida
65-0829355
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
 
 
800 S. Douglas Road, 12th Floor
 
Coral Gables,
Florida
33134
(Address of principal executive offices)
(Zip Code)
(305) 599-1800
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common Stock, $0.10 Par Value
MTZ
New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes ☑  No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes ☑  No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☑
 
Accelerated filer
☐
Non-accelerated filer
☐
 
Smaller reporting company
☐
 
 
 
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.)    Yes ☐   No ☑
As of April 27, 2020, MasTec, Inc. had 73,752,319 shares of common stock outstanding.



MASTEC, INC.
FORM 10-Q
QUARTER ENDED MARCH 31, 2020

TABLE OF CONTENTS
 
 

2


PART I.     FINANCIAL INFORMATION
ITEM 1.
FINANCIAL STATEMENTS

MASTEC, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited - in thousands, except per share amounts)

 
For the Three Months Ended March 31,
 
2020
 
2019
Revenue
$
1,416,604

 
$
1,518,340

Costs of revenue, excluding depreciation and amortization
1,226,297

 
1,312,048

Depreciation
53,089

 
54,226

Amortization of intangible assets
7,391

 
4,805

General and administrative expenses
85,514

 
72,616

Interest expense, net
17,004

 
22,258

Equity in earnings of unconsolidated affiliates
(7,834
)
 
(6,260
)
Other (income) expense, net
(1,342
)
 
3,507

Income before income taxes
$
36,485

 
$
55,140

Provision for income taxes
(423
)
 
(12,033
)
Net income
$
36,062

 
$
43,107

Net loss attributable to non-controlling interests
(168
)
 
(5
)
Net income attributable to MasTec, Inc.
$
36,230


$
43,112

 
 
 
 
Earnings per share (Note 2):
 
 
 
Basic earnings per share
$
0.48

 
$
0.57

Basic weighted average common shares outstanding
74,738

 
74,991

 
 
 
 
Diluted earnings per share
$
0.48

 
$
0.57

Diluted weighted average common shares outstanding
75,413

 
75,578


The accompanying notes are an integral part of these consolidated financial statements.


3


MASTEC, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited - in thousands)

 
For the Three Months Ended March 31,
 
2020
 
2019
Net income
$
36,062

 
$
43,107

Other comprehensive loss:
 
 
 
Foreign currency translation losses, net of tax
(296
)
 
(100
)
Unrealized losses on equity investee activity, net of tax
(22,961
)
 
(5,462
)
Comprehensive income
$
12,805

 
$
37,545

Comprehensive loss attributable to non-controlling interests
(168
)
 
(5
)
Comprehensive income attributable to MasTec, Inc.
$
12,973

 
$
37,550


The accompanying notes are an integral part of these consolidated financial statements.

4


MASTEC, INC.
CONSOLIDATED BALANCE SHEETS
 (unaudited - in thousands, except share information)
 
March 31,
2020
 
December 31,
2019
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
71,663

 
$
71,427

Accounts receivable, net of allowance
796,120

 
850,326

Contract assets
997,901

 
1,024,568

Inventories, net
106,586

 
100,069

Prepaid expenses
46,207

 
52,000

Other current assets
61,302

 
75,169

Total current assets
$
2,079,779

 
$
2,173,559

Property and equipment, net
937,309

 
905,835

Operating lease assets
210,637

 
229,903

Goodwill, net
1,221,147

 
1,221,440

Other intangible assets, net
200,788

 
211,528

Other long-term assets
243,888

 
254,741

Total assets
$
4,893,548

 
$
4,997,006

Liabilities and equity
 
 
 
Current liabilities:
 
 
 
Current portion of long-term debt, including finance leases
$
121,848

 
$
118,429

Current portion of operating lease liabilities
80,076

 
81,561

Accounts payable
533,509

 
535,029

Accrued salaries and wages
123,080

 
87,562

Other accrued expenses
125,770

 
115,581

Contract liabilities
204,284

 
206,180

Other current liabilities
71,466

 
74,784

Total current liabilities
$
1,260,033

 
$
1,219,126

Long-term debt, including finance leases
1,297,342

 
1,314,030

Long-term operating lease liabilities
143,441

 
154,553

Deferred income taxes
276,060

 
296,326

Other long-term liabilities
226,859

 
221,280

Total liabilities
$
3,203,735

 
$
3,205,315

Commitments and contingencies (Note 14)


 


Equity
 
 
 
Preferred stock, $1.00 par value: authorized shares - 5,000,000; issued and outstanding shares – none
$
—

 
$
—

Common stock, $0.10 par value: authorized shares - 145,000,000; issued shares - 92,618,032 and 91,909,430 (including 1,759,870 and 1,221,593 of unvested stock awards) as of March 31, 2020 and December 31, 2019, respectively
9,262

 
9,191

Capital surplus
814,425

 
809,753

Retained earnings
1,546,939

 
1,510,709

Accumulated other comprehensive loss
(98,963
)
 
(75,706
)
Treasury stock, at cost: 18,914,841 shares and 15,344,917 shares as of March 31, 2020 and December 31, 2019, respectively
(586,153
)
 
(466,727
)
Total MasTec, Inc. shareholders’ equity
$
1,685,510

 
$
1,787,220

Non-controlling interests
$
4,303

 
$
4,471

Total equity
$
1,689,813

 
$
1,791,691

Total liabilities and equity
$
4,893,548

 
$
4,997,006


The accompanying notes are an integral part of these consolidated financial statements.

5


MASTEC, INC.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited - in thousands, except shares) 

 
Common Stock
 
Treasury Stock
 
Capital Surplus
 
Retained Earnings
 
Accumulated Other Comprehensive Loss
 
Total MasTec, Inc. Shareholders’ Equity
 
Non-Controlling Interests
 
Total Equity
 
Shares
 
Amount
 
Shares
 
Amount
 
 
 
 
 
 
For the Three Months Ended March 31, 2020
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance as of December 31, 2019
91,909,430

 
$
9,191

 
(15,344,917
)
 
$
(466,727
)
 
$
809,753

 
$
1,510,709

 
$
(75,706
)
 
$
1,787,220

 
$
4,471

 
$
1,791,691

Net income (loss)
 
 
 
 
 
 
 
 
 
 
36,230

 
 
 
36,230

 
(168
)
 
36,062

Other comprehensive loss
 
 
 
 
 
 
 
 
 
 
 
 
(23,257
)
 
(23,257
)
 
 
 
(23,257
)
Non-cash stock-based compensation
 
 
 
 
 
 
 
 
4,049

 
 
 
 
 
4,049

 
 
 
4,049

Issuance of restricted shares, net
694,779

 
69

 
 
 
 
 
(69
)
 
 
 
 
 
—

 
 
 
—

Other stock issuances, net of shares withheld for taxes
13,823

 
2

 
 
 
 
 
692

 
 
 
 
 
694

 
 
 
694

Acquisition of treasury stock, at cost
 
 
 
 
(3,569,924
)
 
(119,426
)
 
 
 
 
 
 
 
(119,426
)
 
 
 
(119,426
)
Balance as of March 31, 2020
92,618,032

 
$
9,262

 
(18,914,841
)
 
$
(586,153
)
 
$
814,425

 
$
1,546,939

 
$
(98,963
)
 
$
1,685,510

 
$
4,303

 
$
1,689,813

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended March 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance as of December 31, 2018
91,327,009

 
$
9,133

 
(15,329,817
)
 
$
(466,125
)
 
$
789,009

 
$
1,118,375

 
$
(60,494
)
 
$
1,389,898

 
$
2,126

 
$
1,392,024

Net income (loss)
 
 
 
 
 
 
 
 
 
 
43,112

 
 
 
43,112

 
(5
)
 
43,107

Other comprehensive loss
 
 
 
 
 
 
 
 
 
 
 
 
(5,562
)
 
(5,562
)
 
 
 
(5,562
)
Non-cash stock-based compensation
 
 
 
 
 
 
 
 
3,720

 
 
 
 
 
3,720

 
 
 
3,720

Issuance of restricted shares, net
233,362

 
23

 
 
 
 
 
(23
)
 
 
 
 
 
—

 
 
 
—

Other stock issuances, net of shares withheld for taxes
31,027

 
3

 
 
 
 
 
1,042

 
 
 
 
 
1,045

 
 
 
1,045

Acquisition of treasury stock, at cost
 
 
 
 
(15,100
)
 
(602
)
 
 
 
 
 
 
 
(602
)
 
 
 
(602
)
Balance as of March 31, 2019
91,591,398

 
$
9,159

 
(15,344,917
)
 
$
(466,727
)
 
$
793,748

 
$
1,161,487

 
$
(66,056
)
 
$
1,431,611

 
$
2,121

 
$
1,433,732


The accompanying notes are an integral part of these consolidated financial statements.


6


MASTEC, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited - in thousands)

 
For the Three Months Ended March 31,
 
2020
 
2019
Cash flows from operating activities:
 
 
 
Net income
$
36,062

 
$
43,107

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
 
Depreciation
53,089

 
54,226

Amortization of intangible assets
7,391

 
4,805

Non-cash interest expense, net
725

 
453

Non-cash stock-based compensation expense
4,049

 
3,720

(Benefit from) provision for deferred income taxes
(12,614
)
 
899

Equity in earnings of unconsolidated affiliates
(7,834
)
 
(6,260
)
Gains on sales of assets, net
(2,407
)
 
(2,052
)
Other non-cash items, net
734

 
(3,043
)
Changes in assets and liabilities, net of acquisitions:
 
 
 
Accounts receivable, net of allowance
48,337

 
(37,831
)
Contract assets
26,311

 
6,376

Inventories
5,932

 
9,690

Other assets, current and long-term portion
17,906

 
2,398

Accounts payable and accrued expenses
34,058

 
(134,491
)
Contract liabilities
2,603

 
3,821

Other liabilities, current and long-term portion
(11,076
)
 
7,375

Net cash provided by (used in) operating activities
$
203,266

 
$
(46,807
)
Cash flows from investing activities:
 
 
 
Cash paid for acquisitions, net of cash acquired
—

 
(93,684
)
Capital expenditures
(60,594
)
 
(34,396
)
Proceeds from sale of property and equipment
8,363

 
8,654

Payments for other investments
(12,000
)
 
(2,190
)
Proceeds from other investments
648

 
10,413

Other investing activities, net
4,843

 
—

Net cash used in investing activities
$
(58,740
)
 
$
(111,203
)
Cash flows from financing activities:
 
 
 
Proceeds from credit facilities
675,935

 
866,397

Repayments of credit facilities
(671,780
)
 
(670,794
)
Repayments of other borrowings, net
—

 
(6
)
Payments of finance lease obligations
(30,856
)
 
(17,239
)
Proceeds from stock-based awards
1,476

 
1,079

Payments for stock-based awards
(572
)
 
(12
)
Repurchases of common stock
(119,427
)
 
(5,652
)
Net cash (used in) provided by financing activities
$
(145,224
)
 
$
173,773

Effect of currency translation on cash
934

 
9

Net increase in cash and cash equivalents
$
236

 
$
15,772

Cash and cash equivalents - beginning of period
$
71,427

 
$
27,422

Cash and cash equivalents - end of period
$
71,663

 
$
43,194

Supplemental cash flow information:
 
 
 
Interest paid
$
21,479

 
$
26,220

Income tax (refunds) payments, net
$
(287
)
 
$
2,837

Supplemental disclosure of non-cash information:
 
 
 
Additions to property and equipment from finance leases
$
26,932

 
$
40,258


The accompanying notes are an integral part of these consolidated financial statements.

7


MASTEC, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 – Business, Basis of Presentation and Significant Accounting Policies
Nature of the Business
MasTec, Inc. (collectively with its subsidiaries, “MasTec” or the “Company”) is a leading infrastructure construction company operating mainly throughout North America across a range of industries. The Company’s primary activities include the engineering, building, installation, maintenance and upgrade of communications, energy, utility and other infrastructure, such as: wireless, wireline/fiber and customer fulfillment activities; petroleum and natural gas pipeline infrastructure; electrical utility transmission and distribution; power generation, including from renewable sources; heavy civil; and industrial infrastructure. MasTec’s customers are primarily in these industries. MasTec reports its results under five reportable segments: (1) Communications; (2) Oil and Gas; (3) Electrical Transmission; (4) Power Generation and Industrial; and (5) Other.
Basis of Presentation
The accompanying consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The accompanying consolidated balance sheet as of December 31, 2019 is derived from the Company’s audited financial statements as of that date. Because certain information and footnote disclosures have been condensed or omitted, these consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2019 contained in the Company’s 2019 Annual Report on Form 10-K (the “2019 Form 10-K”). In management’s opinion, all normal and recurring adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented have been included. When necessary, certain prior year amounts have been reclassified to conform to the current period presentation. Interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. The Company believes that the disclosures made in these consolidated financial statements are adequate to make the information not misleading.
Principles of Consolidation
The accompanying consolidated financial statements include MasTec, Inc. and its subsidiaries and include the accounts of all majority owned subsidiaries over which the Company exercises control and, when applicable, entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. Other parties’ interests in entities that MasTec consolidates are reported as non-controlling interests within equity, except for mandatorily redeemable non-controlling interests, which are recorded within liabilities. Net income or loss attributable to non-controlling interests is reported as a separate line item below net income or loss. The Company’s investments in entities for which the Company does not have a controlling interest, but over which it has the ability to exert significant influence, are accounted for using the equity method of accounting. For equity investees in which the Company has an undivided interest in the assets, liabilities and profits or losses of an unincorporated entity, but does not exercise control over the entity, the Company consolidates its proportional interest in the accounts of the entity.
Translation of Foreign Currencies
The assets and liabilities of foreign subsidiaries with a functional currency other than the U.S. dollar are translated into U.S. dollars at period-end exchange rates, with resulting translation gains or losses included within other comprehensive income or loss. Revenue and expenses are translated into U.S. dollars at average rates of exchange during the applicable period. Substantially all of the Company’s foreign operations use their local currency as their functional currency. Currency gains or losses resulting from transactions executed in currencies other than the functional currency are included in other income or expense, net. In these consolidated financial statements, “$” means U.S. dollars unless otherwise noted.
Management Estimates
The preparation of consolidated financial statements in accordance with U.S. GAAP requires the use of estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates are based on historical experience and various other assumptions, the results of which form the basis of making judgments about the Company’s operating results and the carrying values of assets and liabilities that are not readily apparent from other sources. Key estimates include: the recognition of revenue and project profit or loss, which the Company defines as project revenue, less project costs of revenue, including project-related depreciation, in particular, on construction contracts accounted for under the cost-to-cost method, for which the recorded amounts require estimates of costs to complete and the amount and probability of variable consideration included in the contract transaction price; fair value estimates, including those related to acquisitions, valuations of goodwill and intangible assets, acquisition-related contingent consideration and equity investments; allowances for credit losses; asset lives used in computing depreciation and amortization; fair values of financial instruments; self-insurance liabilities; other accruals and allowances; income taxes; and the estimated effects of litigation and other contingencies. While management believes that such estimates are reasonable when considered in conjunction with the Company’s consolidated financial position and results of operations taken as a whole, actual results could differ materially from those estimates.
Significant Accounting Policies
Revenue Recognition
The Company recognizes revenue from contracts with customers under Accounting Standards Codification (“ASC”) Topic 606 (“Topic 606”). Under Topic 606, revenue is recognized when, or as, control of promised goods and services is transferred to customers, and the amount of revenue recognized reflects the consideration to which an entity expects to be entitled in exchange for the goods and services transferred. Revenue is primarily

8


recognized by the Company over time utilizing the cost-to-cost measure of progress, which best depicts the continuous transfer of control of goods or services to the customer, and correspondingly, when performance obligations are satisfied for the related contracts.
Contracts. The Company derives revenue primarily from construction projects performed under: (i) master and other service agreements, which provide a menu of available services in a specific geographic territory that are utilized on an as-needed basis, and are typically priced using either a time and materials, or a fixed price per unit basis; and (ii) contracts for specific projects requiring the construction and installation of an entire infrastructure system, or specified units within an infrastructure system, which are subject to multiple pricing options, including fixed price, unit price, time and materials, or cost plus a markup. Revenue derived from projects performed under master service and other service agreements totaled 42% and 41% of consolidated revenue for the three month periods ended March 31, 2020 and 2019, respectively.
For certain master service and other service agreements under which the Company performs installation and maintenance services, primarily for install-to-the-home service providers in its Communications segment, revenue is recognized at a point in time. This is generally when the work order has been fulfilled, which is typically the same day the work is initiated. Point in time revenue accounted for approximately 6% of consolidated revenue for both the three month periods ended March 31, 2020 and 2019. Substantially all of the Company’s other revenue is recognized over time.
The total contract transaction price and cost estimation processes used for recognizing revenue over time under the cost-to-cost method is based on the professional knowledge and experience of the Company’s project managers, engineers and financial professionals. Management reviews estimates of total contract transaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected variable consideration are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and the Company’s profit recognition. Changes in these factors could result in revisions to revenue in the period in which the revisions are determined, which could materially affect the Company’s consolidated results of operations for that period. Provisions for losses on uncompleted contracts are recorded in the period in which such losses are determined. For both the three month periods ended March 31, 2020 and 2019, project profit was affected by less than 5% as a result of changes in contract estimates included in projects that were in process as of December 31, 2019 and 2018. Revenue recognized for the three month periods ended March 31, 2020 and 2019 as a result of changes in total contract transaction price estimates, including from variable consideration, from performance obligations satisfied or partially satisfied in prior periods totaled approximately $17.8 million and $12.5 million, respectively.
The Company may incur certain costs that can be capitalized, such as initial set-up or mobilization costs. Such costs, which are amortized over the life of the respective projects, were not material in either of the three month periods ended March 31, 2020 or 2019.
Performance Obligations. A performance obligation is a contractual promise to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the performance obligation is satisfied. The vast majority of the Company’s performance obligations are completed within one year.
Remaining performance obligations represent the amount of unearned transaction prices under contracts for which work is wholly or partially unperformed, including the Company’s share of unearned transaction prices from its proportionately consolidated non-controlled joint ventures. As of March 31, 2020, the amount of the Company’s remaining performance obligations was $5.7 billion. Based on current expectations, the Company expects to recognize approximately $4.5 billion of its remaining performance obligations as revenue during 2020, with the remainder to be recognized primarily in 2021.
Variable Consideration. Transaction prices for the Company’s contracts may include variable consideration, which comprises items such as change orders, claims and incentives. Management estimates variable consideration for a performance obligation utilizing estimation methods that it believes best predict the amount of consideration to which the Company will be entitled. Management’s estimates of variable consideration and the determination of whether to include estimated amounts in transaction prices are based largely on engineering studies and legal opinions, past practices with the customer, specific discussions, correspondence or preliminary negotiations with the customer and all other relevant information that is reasonably available at the time of the estimate. To the extent unapproved change orders, claims and other variable consideration reflected in transaction prices are not resolved in the Company’s favor, or to the extent incentives reflected in transaction prices are not earned, there could be reductions in, or reversals of, previously recognized revenue.
As of March 31, 2020 and December 31, 2019, the Company included approximately $35 million and $27 million, respectively, of change orders and/or claims in transaction prices for certain contracts that were in the process of being resolved in the ordinary course of business, including through negotiation, arbitration and other proceedings. These transaction price adjustments, when earned, are included within contract assets or accounts receivable, net of allowance, as appropriate. As of both March 31, 2020 and December 31, 2019, these change orders and/or claims were primarily related to certain projects in the Company’s Oil and Gas segment. The Company actively engages with its customers to complete the final approval process, and generally expects these processes to be completed within one year. Amounts ultimately realized upon final agreement by customers could be higher or lower than such estimated amounts.
Recently Issued Accounting Pronouncements
See the recent accounting pronouncements discussion below for information pertaining to the effects of recently adopted and other recent accounting pronouncements, as updated from the discussion in the Company’s 2019 Form 10-K.
Accounting Pronouncements Adopted in 2020
In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”) to reduce diversity in practice in accounting for the costs of implementing cloud computing arrangements that are service contracts. ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a cloud computing arrangement that is a service contract with the requirements for internal-use software. Accounting for the service element of the cloud computing arrangement is not affected by the new guidance. Under ASU 2018-15, amortization expense, payments for and asset balances related to such capitalized implementation costs are to be presented within the same line items of the entity’s statements of operations, cash flows and balance sheets, respectively,

9


as the related service fee activity and balances would be presented. ASU 2018-15, which the Company adopted on a prospective basis during the first quarter of 2020, did not have a material effect on the Company’s consolidated financial statements.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). ASU 2018-13, which is intended to improve the effectiveness of fair value measurement disclosures, modifies the disclosure requirements for certain estimates and assumptions used in determining the fair value of assets and liabilities. ASU 2018-13, which the Company adopted during the first quarter of 2020, did not have a material effect on the Company’s consolidated financial statements. See Note 4 - Fair Value of Financial Instruments for certain disclosure updates pertaining to the Company’s Level 3 financial instruments as a result of the adoption of ASU 2018-13.
In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This ASU, together with its related clarifying ASUs (collectively, “ASU 2016-13”), introduced an expected credit loss methodology for the measurement and recognition of credit losses on most financial assets, including financial assets arising from revenue transactions, such as accounts receivable and contract assets. The current expected credit loss methodology, which is based on historical experience, current conditions and reasonable and supportable forecasts, replaced the probable/incurred loss model for measuring and recognizing expected credit losses. The Company adopted this ASU in the first quarter of 2020 and incorporated this guidance into its methodology for estimating its accounts receivable allowances. The adoption of ASU 2016-13 did not have a material effect on the Company’s consolidated financial statements as credit losses are not expected to be significant based on historical trends, the financial condition of our customers and external factors. Management actively monitors the economic environment, including any potential effects from the COVID-19 pandemic, on the Company’s customers and/or its financial assets. For additional information about the Company’s accounts receivable and related allowances, see Note 5 - Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities.
In March 2020, the FASB issued ASU 2020-04, Reference Reform Rate (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”) to provide temporary optional expedients and exceptions to the contract modifications, hedge relationships and other transactions affected by reference rate reform if certain criteria are met. This ASU, which was effective upon issuance and may be applied through December 31, 2022, is applicable to all contracts and hedging relationships that reference the London Interbank Offered Rate or any other reference rate expected to be discontinued. The Company is currently evaluating the impact of reference rate reform and the potential application of this guidance.
Note 2 – Earnings Per Share
Basic earnings or loss per share is computed by dividing net income attributable to MasTec by the weighted average number of common shares outstanding for the period, which excludes non-participating unvested restricted share awards. Diluted earnings per share is computed by dividing net income attributable to MasTec by the weighted average number of fully diluted shares, as calculated under the treasury stock method, which includes the potential effect of dilutive common stock equivalents, such as issued but unvested restricted shares. If the Company reports a loss, rather than income, the computation of diluted loss per share excludes the effect of dilutive common stock equivalents, as their effect would be anti-dilutive.
The following table provides details underlying the Company’s earnings per share calculations for the periods indicated (in thousands):
 
For the Three Months Ended March 31,
 
2020
 
2019
Net income attributable to MasTec:
 
 
 
Net income - basic and diluted (a)
$
36,230

 
$
43,112

Weighted average shares outstanding:
 
 
 
Weighted average shares outstanding - basic
74,738

 
74,991

Dilutive common stock equivalents
675

 
587

Weighted average shares outstanding - diluted
75,413

 
75,578
(a)
Calculated as total net income less amounts attributable to non-controlling interests.
The Company repurchased approximately 3.6 million shares of its common stock during the three month period ended March 31, 2020, as discussed in Note 11 - Equity. The effect of these repurchases on the Company’s first quarter 2020 weighted average shares outstanding was not significant due to the timing of the repurchases, which occurred in the latter part of the quarter. In future quarters, these share repurchases will be fully reflected in the total number of weighted average shares outstanding for the respective quarter to date periods.
Note 3 – Goodwill and Other Intangible Assets
The following table provides balances for goodwill by reportable segment as of March 31, 2020 (in millions):
 
Communications
 
Oil and Gas
 
Electrical
Transmission
 
Power Generation and Industrial
 
Total Goodwill
Goodwill, gross
$
541.8

 
$
489.3

 
$
149.9

 
$
152.8

 
$
1,333.8

Accumulated impairment loss
—

 
(112.7
)
 
—

 
—

 
(112.7
)
Goodwill, net
$
541.8

 
$
376.6

 
$
149.9

 
$
152.8

 
$
1,221.1

10


For the three month period ended March 31, 2020, goodwill included a net increase of $0.8 million from measurement period adjustments. Currency translation effects related to goodwill and accumulated impairment losses for the three month period ended March 31, 2020 totaled approximately $9.9 million of losses and $8.8 million of gains, respectively.
The following table provides a reconciliation of changes in other intangible assets, net, for the period indicated (in millions):
 
Other Intangible Assets
 
Non-Amortizing
 
Amortizing
 
 
 
Trade Names
 
Pre-Qualifications
 
Customer Relationships and Backlog
 
Pre-Qualifications
 
Other (a)
 
Total
Other intangible assets, gross, as of December 31, 2019
$
34.5

 
$
72.9

 
$
286.5

 
$
—

 
$
26.3

 
$
420.2

Accumulated amortization
 
 
 
 
(191.2
)
 
—

 
(17.5
)
 
(208.7
)
Other intangible assets, net, as of December 31, 2019
$
34.5

 
$
72.9

 
$
95.3

 
$
—

 
$
8.8

 
$
211.5

Classification changes (b)
—

 
(69.8
)
 
—

 
69.8

 
—

 
—

Measurement period adjustments (c)
—

 
—

 
(0.2
)
 
—

 
—

 
(0.2
)
Currency translation adjustments
—

 
(3.1
)
 
—

 
—

 
—

 
(3.1
)
Amortization expense
 
 
 
 
(5.9
)
 
(1.0
)
 
(0.5
)
 
(7.4
)
Other intangible assets, net, as of March 31, 2020
$
34.5

 
$
—

 
$
89.2

 
$
68.8

 
$
8.3

 
$
200.8

(a)
Consists principally of trade names and non-compete agreements.
(b)
In connection with its first quarter assessment of goodwill and indefinite-lived intangible assets, management reassessed the indefinite life classification of its two pre-qualification intangible assets. Management determined that, based on changes in the assets’ characteristics, including current and expected changes in the customer mix of the associated reporting units, a finite life classification for these assets was more appropriate. As a result, in the first quarter of 2020, the Company changed the classification of these pre-qualification intangible assets from indefinite-lived to finite-lived and began amortizing them on an accelerated basis. As of March 31, 2020, the estimated remaining weighted average useful life of these assets was approximately 12 years.
(c)
Represents adjustments to preliminary estimates of fair value within the measurement period of up to one year from the date of acquisition.
Amortization of intangible assets for the three month periods ended March 31, 2020 and 2019 totaled $7.4 million and $4.8 million, respectively.
2019 Acquisitions. During 2019, MasTec completed six acquisitions, one of which specializes in water infrastructure for pipeline companies and is included within the Company’s Oil and Gas segment, four of which are included within the Company’s Communications segment, including a wireline/fiber deployment construction contractor and a telecommunications company specializing in a broad range of end-to-end wireless telecommunications solutions, and one of which specializes in construction projects in the power industry and is included in the Company’s Power Generation and Industrial segment. For all but one of these acquisitions, the Company acquired all of the equity interests in the related entities. For the telecommunications company specializing in wireless telecommunications solutions, the Company acquired 96% of the entity’s equity interests, with the obligation to acquire the balance over time.
The aggregate purchase price for these entities, as adjusted, was composed of approximately $175.1 million in cash, net of cash acquired, plus earn-out liabilities and a mandatorily redeemable non-controlling interest valued at approximately $22.2 million and $17.8 million, respectively. The Company refers to its traditional earn-out arrangements and the mandatorily redeemable non-controlling interest collectively as “Earn-outs,” which are generally payable annually and are recorded within other current and other long-term liabilities in the consolidated balance sheets. Earn-outs for the 2019 acquisitions have terms ranging from three to five years. As of March 31, 2020, the range of remaining potential undiscounted Earn-out liabilities for the 2019 acquisitions was estimated to be between $2 million and $71 million; however, there is no maximum payment amount. Determination of the estimated fair values of the net assets acquired and the estimated Earn-out liabilities for these acquisitions was preliminary as of March 31, 2020; as a result, further adjustments to these estimates may occur.
Pro Forma Financial Information and Acquisition Results. For the three month periods ended March 31, 2020 and 2019, unaudited supplemental pro forma revenue totaled approximately $1.4 billion and $1.6 billion, respectively, and unaudited supplemental pro forma net income totaled approximately $37.3 million and $48.1 million, respectively.
For the three month periods ended March 31, 2020 and 2019, the Company’s consolidated results of operations included acquisition-related revenue of approximately $49.5 million and $39.7 million, respectively, and included acquisition-related net loss of approximately $1.2 million and $6.1 million, respectively, based on the Company’s consolidated effective tax rates. These acquisition-related results do not include the effects of acquisition costs or interest expense associated with consideration paid for the related acquisitions.
Note 4 – Fair Value of Financial Instruments
The Company’s financial instruments include cash and cash equivalents, accounts and notes receivable, cash collateral deposited with insurance carriers, life insurance assets, equity investments, deferred compensation plan assets and liabilities, accounts payable and other current liabilities, acquisition-related contingent consideration, mandatorily redeemable non-controlling interests and debt obligations.
Fair value is the price that would be received to sell an asset or the amount paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value guidance establishes a valuation hierarchy, which requires maximizing the use of observable inputs when measuring fair value. The three levels of inputs that may be used are: (i) Level 1 - quoted market prices in active markets for identical assets or liabilities; (ii) Level 2 - observable market-based inputs or other observable inputs; and (iii) Level 3 - significant unobservable inputs that cannot be corroborated by observable market data, which are generally determined using valuation models incorporating management estimates of market participant assumptions.

11


Acquisition-Related Contingent Consideration and Other Liabilities
Acquisition-related contingent consideration and other liabilities is composed of Earn-outs, which represent the estimated fair value of future amounts payable for businesses that are contingent upon the acquired business achieving certain levels of earnings in the future. As of March 31, 2020 and December 31, 2019, the estimated fair value of the Company’s Earn-out liabilities totaled $176.0 million and $173.2 million, respectively, of which $52.9 million and $54.1 million, respectively, was included within other current liabilities. The fair values of the Company’s Earn-out liabilities are estimated using income approaches such as discounted cash flows or option pricing models, both of which incorporate significant inputs not observable in the market (Level 3 inputs), including management’s estimates and entity-specific assumptions, and are evaluated on an ongoing basis. Key assumptions include the discount rate, which ranged from 12.0% to 24.7%, with a weighted average rate of 14.0% based on relative fair value, as of March 31, 2020, and probability-weighted projections of earnings before interest, taxes, depreciation and amortization (“EBITDA”). Significant changes in any of these assumptions could result in significantly higher or lower potential Earn-out liabilities. As of March 31, 2020, the range of potential undiscounted Earn-out liabilities was estimated to be between $60 million and $256 million; however, there is no maximum payment amount.
Earn-out activity consists primarily of additions from new business combinations; changes in the expected fair value of future payment obligations; and payments. Measurement period adjustments for Earn-out liabilities, which are fair value adjustments relating to new information obtained about the facts and circumstances existing as of the date of acquisition for a period of up to one year, are recorded to goodwill. Other revisions to the expected fair values of the Company’s traditional earn-out liabilities are reflected as income or expense, as appropriate, and, for the mandatorily redeemable non-controlling interest, are recorded as interest expense, net. Earn-out payments, to the extent they relate to estimated liabilities as of the date of acquisition, are reflected within financing activities in the consolidated statements of cash flows. Payments in excess of acquisition date liabilities are classified within operating activities.
There were no additions to acquisition-related contingent consideration and other liabilities from new business combinations for the three month period ended March 31, 2020, and for the three month period ended March 31, 2019, additions from new business combinations totaled $15.2 million. Measurement period adjustments for the three month period ended March 31, 2020 totaled an increase of approximately $1.1 million and related to a business in the Company’s Communications segment. There were no measurement period adjustments for the three month period ended March 31, 2019. Fair value adjustments totaled a net increase of approximately $1.8 million for the three month period ended March 31, 2020, and related to businesses in the Company’s Oil and Gas and Communications segments. Fair value adjustments, including those related to finalization of completed earn-out arrangements, totaled a net increase of approximately $7.2 million for the three month period ended March 31, 2019, and related to businesses in the Company’s Oil and Gas and Communications segments. There were no Earn-out payments in either of the three month periods ended March 31, 2020 or 2019.
Equity Investments
The Company’s equity investments as of March 31, 2020 include: (i) the Company’s 33% equity interests in Trans-Pecos Pipeline, LLC (“TPP”) and Comanche Trail Pipeline, LLC (“CTP,” and together with TPP, the “Waha JVs”), which are accounted for as equity method investments; (ii) a $15 million investment in Cross Country Infrastructure Services, Inc. (“CCI”); (iii) the Company’s interests in certain proportionately consolidated non-controlled contractual joint ventures; (iv) the Company’s equity interests in American Virtual Cloud Technologies, Inc. (formerly Pensare Acquisition Corp. (“Pensare”)); and (v) certain other equity investments.
Investment Arrangements. From time to time, the Company may participate in selected investment or strategic arrangements, including equity interests in various business entities and participation in contractual joint ventures, some of which may involve the extension of loans or other types of financing arrangements. As of March 31, 2020, the Company determined that certain of its investment arrangements were variable interest entities (“VIEs”). Except for one individually insignificant VIE, the Company does not have the power to direct the primary activities that most significantly impact the economic performance of its VIEs nor is it the primary beneficiary. Accordingly, except for the previously mentioned VIE, the Company’s VIEs are not consolidated.
Equity investments, other than those accounted for as equity method investments or those that are proportionately consolidated, are measured at fair value if their fair values are readily determinable. Equity investments that do not have readily determinable fair values are measured at cost, adjusted for changes from observable market transactions, less impairment (“adjusted cost basis”). As of March 31, 2020 and December 31, 2019, the aggregate carrying value of the Company’s equity investments totaled approximately $195 million and $196 million, respectively, including approximately $18 million of equity investments measured on an adjusted cost basis as of both March 31, 2020 and December 31, 2019. There were no impairments of, or material changes in, the fair value of these investments during either of the three month periods ended March 31, 2020 or 2019.
The Waha JVs. The Waha JVs own and operate two pipelines and a header system that transport natural gas to the Mexican border for export. Equity in earnings related to the Company’s proportionate share of income from the Waha JVs, which is included within the Company’s Other segment, totaled approximately $7.6 million and $6.3 million for the three month periods ended March 31, 2020 and 2019, respectively. Cumulative undistributed earnings from the Waha JVs, which represents cumulative equity in earnings for the Waha JVs less distributions of earnings, totaled $53.1 million as of March 31, 2020. Distributions of earnings from the Waha JVs, which are included within operating cash flows, totaled $2.6 million and $3.9 million for the three month periods ended March 31, 2020 and 2019, respectively. The Company’s net investment in the Waha JVs, which differs from its proportionate share of the net assets of the Waha JVs due primarily to capitalized investment costs, totaled approximately $156 million and $174 million as of March 31, 2020 and December 31, 2019, respectively.
The Waha JVs are party to separate non-recourse financing facilities, each of which are secured by pledges of the equity interests in the respective entities, as well as a first lien security interest over virtually all of their assets. The Waha JVs are also party to certain interest rate swaps, which are accounted for as qualifying cash flow hedges. The Company reflects its proportionate share of any unrealized fair market value gains or losses from fluctuations in interest rates associated with these swaps within other comprehensive income or loss, as appropriate. For the three month periods ended March 31, 2020 and 2019, the Company’s proportionate share of unrecognized unrealized activity on these interest rate swaps totaled losses of approximately $30.3 million, or $23.0 million, net of tax, and $7.2 million, or $5.5 million, net of tax, respectively.

12


Other Investments. During 2017, the Company purchased approximately 4% of the common stock of Pensare, a special purpose acquisition company focusing on transactions in the telecommunications industry, and warrants to purchase an additional 2.0 million shares of Pensare common stock (the “initial warrants”), for $2.0 million. José R. Mas, MasTec’s Chief Executive Officer, was a director of Pensare through the end of March 2020. The shares of common stock purchased by MasTec are not transferable or salable until one year after Pensare successfully completes a business combination transaction, with limited exceptions. The initial warrants are exercisable at a purchase price of $11.50 per share beginning thirty days after the first date Pensare successfully completes a business combination transaction. In April 2020, Pensare completed a business combination transaction with Stratos Management Systems, Inc. and its operating companies, which do business as Computex Technology Solutions (collectively, “Computex”), an information technology service provider, and in connection therewith, Pensare changed its name to American Virtual Cloud Technologies, Inc. (“AVCT”). In addition to other investors in a private placement conducted by AVCT contemporaneously with the completion of the business combination transaction in April 2020, MasTec invested $3.0 million in exchange for 3,000 units of AVCT securities, each of which consists of $1,000 in principal amount of AVCT Series A convertible debentures, convertible at $3.45 per share, subject to customary anti-dilution adjustments, and a warrant to purchase 100 shares of AVCT common stock at $0.01 per share (the “AVCT warrants”). The convertible debentures may be converted in whole or in part at any time from April 7, 2020 until full payment thereof, subject to mandatory conversion of the convertible debentures, pursuant to the terms thereof, and the AVCT warrants are exercisable at any time from April 7, 2020 through April 7, 2025. Due to the completion of the Computex business combination, the initial warrants will be exercisable beginning May 7, 2020, until the earlier to occur of April 7, 2025 and the liquidation of AVCT, subject to extension.
Prior to completion of the Computex acquisition, certain holders of AVCT’s redeemable common stock elected to redeem their shares, the effect of which, after giving effect to the additional investment described above, was to increase the Company’s beneficial ownership interest in AVCT common stock to approximately 21%. The Company does not have the ability to exert significant influence over the operating and financial policies of AVCT, therefore, the shares are measured on an adjusted cost basis. The initial warrants, which are derivative financial instruments, and the shares, for which the fair value was not readily determinable as of both March 31, 2020 and December 31, 2019 due to the nature of the restrictions, are included within other long-term assets in the Company’s consolidated financial statements. The fair value of the initial warrants is determined based on observable and unobservable Level 3 inputs, including market volatility and the rights and obligations of the warrants. For both the three month periods ended March 31, 2020 and 2019, there were no material changes in the fair value of the Company’s investment in AVCT.
The Company has equity interests in three telecommunications entities that provide certain services to MasTec. Expense recognized in connection with these arrangements totaled $2.7 million for the three month period ended March 31, 2020, and related amounts payable were $2.1 million as of March 31, 2020.
Summarized Financial Information of Equity Method Investments
The following presents summarized information for entities that comprise the Company’s significant equity method investments (in millions):
 
For the Three Months Ended March 31,
 
2020
 
2019
Revenue
$
39.4

 
$
37.3

Net income
$
23.0

 
$
19.2
Senior Notes
As of both March 31, 2020 and December 31, 2019, the gross carrying amount of the Company’s 4.875% senior notes due March 15, 2023 (the “4.875% Senior Notes”), which are measured at fair value on a non-recurring basis, totaled $400 million. As of March 31, 2020 and December 31, 2019, the estimated fair value of the 4.875% Senior Notes, based on Level 1 inputs, totaled $372.0 million and $404.5 million, respectively.
Note 5 – Accounts Receivable, Net of Allowance, and Contract Assets and Liabilities
The following table provides details of accounts receivable, net of allowance, and contract assets (together, “accounts receivable, net”) as of the dates indicated (in millions):
 
March 31,
2020
 
December 31,
2019
Contract billings
$
806.0