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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 September 30, 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: 1-7525

The Goldfield Corporation

(Exact name of registrant as specified in its charter)

 

Delaware

 

88-0031580

(State or other jurisdiction

of incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

1684 W. Hibiscus Boulevard

Melbourne, Florida 32901

(Address of principal executive offices) (Zip Code)

 

(321) 724-1700

(Registrant’s telephone number, including area code)

 

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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 (Do not check if a smaller reporting company)

 

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 Exchange Act).    Yes      No  

The number of shares of the Registrant’s Common Stock outstanding as of November 2, 2020 was 24,522,534.

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, par value $0.10 per share

 

GV

 

NYSE American

 

 

 


Table of Contents

 

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED SEPTEMBER 30, 2020

TABLE OF CONTENTS

 

 

Page

 

PART I. FINANCIAL INFORMATION

1

 

 

Item 1. Consolidated Financial Statements (Unaudited).

1

 

 

Consolidated Balance Sheets

1

 

 

Consolidated Statements of Income

2

 

 

Consolidated Statements of Cash Flows

3

 

 

Consolidated Statements of Stockholders’ Equity

4

 

 

Notes to Consolidated Financial Statements

5

 

 

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

18

 

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

31

 

 

Item 4. Controls and Procedures.

31

 

 

PART II. OTHER INFORMATION

32

 

 

Item 1. Legal Proceedings.

32

 

 

Item 1A. Risk Factors.

32

 

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

32

 

 

Item 3. Defaults Upon Senior Securities.

32

 

 

Item 4. Mine Safety Disclosures.

32

 

 

Item 5. Other Information.

33

 

 

Item 6. Exhibits.

33

 

 

SIGNATURES

34

 

 


Table of Contents

 

PART I. FINANCIAL INFORMATION

ITEM 1.

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2019

 

ASSETS

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

20,593,879

 

 

$

23,272,156

 

Accounts receivable and accrued billings

 

 

27,483,338

 

 

 

23,930,655

 

Costs and estimated earnings in excess of billings on uncompleted contracts

 

 

24,328,912

 

 

 

9,321,368

 

Income taxes receivable

 

 

562,508

 

 

 

1,482,618

 

Residential properties under construction

 

 

919,020

 

 

 

2,060,364

 

Prepaid expenses

 

 

1,216,441

 

 

 

924,733

 

Other current assets

 

 

578,805

 

 

 

46,186

 

Total current assets

 

 

75,682,903

 

 

 

61,038,080

 

Property, buildings and equipment, at cost, net of accumulated depreciation of

$59,627,075 in 2020 and $51,904,568 in 2019

 

 

59,166,078

 

 

 

55,073,579

 

Deferred charges and other assets

 

 

 

 

 

 

 

 

Land and land development costs

 

 

4,457,410

 

 

 

5,060,581

 

Cash surrender value of life insurance

 

 

92,187

 

 

 

543,433

 

Goodwill

 

 

101,407

 

 

 

101,407

 

Intangibles, net of accumulated amortization of $429,926 in 2020 and

$384,801 in 2019

 

 

583,874

 

 

 

628,999

 

Operating lease right-of-use assets

 

 

19,231,952

 

 

 

6,861,099

 

Other assets

 

 

130,000

 

 

 

60,000

 

Total deferred charges and other assets

 

 

24,596,830

 

 

 

13,255,519

 

Total assets

 

$

159,445,811

 

 

$

129,367,178

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

16,355,664

 

 

$

13,881,277

 

Billings in excess of costs and estimated earnings on uncompleted contracts

 

 

1,227,268

 

 

 

731,492

 

Current portion of operating lease liability

 

 

3,881,692

 

 

 

1,880,957

 

Current portion of notes payable, net

 

 

13,895,635

 

 

 

7,769,497

 

Accrued remediation costs

 

 

80,420

 

 

 

75,545

 

Total current liabilities

 

 

35,440,679

 

 

 

24,338,768

 

Deferred income taxes

 

 

10,078,684

 

 

 

9,008,765

 

Accrued remediation costs, less current portion

 

 

389,950

 

 

 

398,877

 

Notes payable, less current portion, net

 

 

26,388,948

 

 

 

24,402,926

 

Operating lease liabilities

 

 

15,723,328

 

 

 

4,987,088

 

Other accrued liabilities

 

 

150,000

 

 

 

60,000

 

Total liabilities

 

 

88,171,589

 

 

 

63,196,424

 

Commitments and contingencies (notes 4 and 6)

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

Preferred stock, $1 par value, 5,000,000 shares authorized, none issued

 

 

 

 

 

 

 

 

Common stock, $.10 par value, 40,000,000 shares authorized; 27,813,772

shares issued; 24,522,534 shares outstanding in 2020 and in 2019.

 

 

2,781,377

 

 

 

2,781,377

 

Additional paid-in capital

 

 

18,551,959

 

 

 

18,481,683

 

Retained earnings

 

 

53,380,990

 

 

 

48,347,798

 

Treasury stock, 3,291,238 shares in 2020 and in 2019, at cost

 

 

(3,440,104

)

 

 

(3,440,104

)

Total stockholders’ equity

 

 

71,274,222

 

 

 

66,170,754

 

Total liabilities and stockholders’ equity

 

$

159,445,811

 

 

$

129,367,178

 

 

See accompanying notes to consolidated financial statements

1


Table of Contents

 

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electrical construction

 

$

48,056,897

 

 

$

43,182,197

 

 

$

137,794,907

 

 

$

123,773,883

 

Real estate development

 

 

364,900

 

 

 

1,550,684

 

 

 

3,250,563

 

 

 

12,819,473

 

Total revenue

 

 

48,421,797

 

 

 

44,732,881

 

 

 

141,045,470

 

 

 

136,593,356

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Electrical construction

 

 

39,640,718

 

 

 

36,789,515

 

 

 

114,042,479

 

 

 

105,597,926

 

Real estate development

 

 

244,813

 

 

 

1,031,373

 

 

 

2,187,998

 

 

 

9,360,449

 

Selling, general and administrative

 

 

3,633,799

 

 

 

2,162,360

 

 

 

8,581,365

 

 

 

7,033,244

 

Depreciation and amortization

 

 

3,056,457

 

 

 

2,728,988

 

 

 

8,950,772

 

 

 

8,048,549

 

(Gain) loss on sale of property and equipment

 

 

(25,831

)

 

 

(45,504

)

 

 

2,915

 

 

 

(77,571

)

Total costs and expenses

 

 

46,549,956

 

 

 

42,666,732

 

 

 

133,765,529

 

 

 

129,962,597

 

Total operating income

 

 

1,871,841

 

 

 

2,066,149

 

 

 

7,279,941

 

 

 

6,630,759

 

Other income (expense), net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

29,245

 

 

 

28,311

 

 

 

58,939

 

 

 

71,082

 

Interest expense, net of amount capitalized

 

 

(215,063

)

 

 

(367,244

)

 

 

(761,118

)

 

 

(1,130,798

)

Other income, net

 

 

38,195

 

 

 

27,199

 

 

 

121,199

 

 

 

91,736

 

Total other expense, net

 

 

(147,623

)

 

 

(311,734

)

 

 

(580,980

)

 

 

(967,980

)

Income before income taxes

 

 

1,724,218

 

 

 

1,754,415

 

 

 

6,698,961

 

 

 

5,662,779

 

Income tax provision

 

 

632,467

 

 

 

592,413

 

 

 

1,665,769

 

 

 

1,902,034

 

Net income

 

$

1,091,751

 

 

$

1,162,002

 

 

$

5,033,192

 

 

$

3,760,745

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share of common stock — basic

 

$

0.04

 

 

$

0.05

 

 

$

0.21

 

 

$

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share of common stock — diluted

 

$

0.04

 

 

$

0.05

 

 

$

0.21

 

 

$

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

24,522,534

 

 

 

24,522,534

 

 

 

24,522,534

 

 

 

24,523,731

 

Diluted

 

 

24,554,324

 

 

 

24,522,534

 

 

 

24,533,208

 

 

 

24,523,731

 

 

See accompanying notes to consolidated financial statements

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THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net income

 

$

5,033,192

 

 

$

3,760,745

 

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

8,950,772

 

 

 

8,048,549

 

Amortization of debt issuance costs

 

 

24,660

 

 

 

22,500

 

Deferred income taxes

 

 

1,069,919

 

 

 

1,685,510

 

Loss (gain) on sale of property and equipment

 

 

2,915

 

 

 

(77,571

)

Other losses

 

 

215,446

 

 

 

2,572

 

Stock-based compensation expense

 

 

70,276

 

 

 

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Accounts receivable and accrued billings

 

 

(3,316,883

)

 

 

(932,038

)

Costs and estimated earnings in excess of billings on uncompleted contracts

 

 

(15,007,544

)

 

 

(1,158,343

)

Residential properties under construction

 

 

1,141,344

 

 

 

6,839,119

 

Income taxes receivable

 

 

920,110

 

 

 

(263,507

)

Prepaid expenses and other assets

 

 

(894,327

)

 

 

1,141,340

 

Land and land development costs

 

 

603,171

 

 

 

(304,998

)

Accounts payable and accrued liabilities

 

 

2,277,325

 

 

 

1,878,771

 

Operating leases

 

 

366,122

 

 

 

(18,609

)

Billings in excess of costs and estimated earnings on uncompleted contracts

 

 

495,776

 

 

 

(228,688

)

Accrued remediation costs

 

 

(4,052

)

 

 

(22,519

)

Net cash provided by operating activities

 

 

1,948,222

 

 

 

20,372,833

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Proceeds from disposal of property and equipment

 

 

259,360

 

 

 

399,817

 

Purchases of property, buildings and equipment

 

 

(12,973,359

)

 

 

(16,156,893

)

Net cash used in investing activities

 

 

(12,713,999

)

 

 

(15,757,076

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

Purchases of treasury stock

 

 

 

 

 

(161,285

)

Proceeds from notes payable

 

 

14,500,000

 

 

 

15,500,000

 

Repayments on notes payable

 

 

(6,412,500

)

 

 

(10,382,000

)

Other long-term debt repayments

 

 

 

 

 

(297,599

)

Debt issuance costs

 

 

 

 

 

(57,883

)

Net cash provided by financing activities

 

 

8,087,500

 

 

 

4,601,233

 

Net (decrease) increase in cash and cash equivalents

 

 

(2,678,277

)

 

 

9,216,990

 

Cash and cash equivalents at beginning of the period

 

 

23,272,156

 

 

 

11,402,353

 

Cash and cash equivalents at end of the period

 

$

20,593,879

 

 

$

20,619,343

 

Supplemental disclosure of cash flow information

 

 

 

 

 

 

 

 

Interest paid, net of amounts capitalized

 

$

762,983

 

 

$

1,107,666

 

Income taxes (refunded) paid, net

 

$

(324,260

)

 

$

480,031

 

Supplemental disclosure of non-cash investing

 

 

 

 

 

 

 

 

Liability for equipment acquired

 

$

411,240

 

 

$

809,521

 

Right-of-use asset obtained in exchange for operating lease obligations

 

$

14,310,658

 

 

$

4,215,378

 

 

See accompanying notes to consolidated financial statements

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Table of Contents

 

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(UNAUDITED)

 

Three Months Ended September 30, 2020

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

Total

 

 

Common stock

 

 

paid-in

 

 

Retained

 

 

Treasury

 

 

stockholders’

 

 

Shares

 

 

Amount

 

 

capital

 

 

earnings

 

 

stock

 

 

equity

 

Balance as of June 30, 2020

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

52,289,239

 

 

$

(3,440,104

)

 

$

70,112,195

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

70,276

 

 

 

 

 

 

 

 

 

 

 

70,276

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

1,091,751

 

 

 

 

 

 

 

1,091,751

 

Balance as of September 30, 2020

 

27,813,772

 

 

$

2,781,377

 

 

$

18,551,959

 

 

$

53,380,990

 

 

$

(3,440,104

)

 

$

71,274,222

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2019

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

Total

 

 

Common stock

 

 

paid-in

 

 

Retained

 

 

Treasury

 

 

stockholders’

 

 

Shares

 

 

Amount

 

 

capital

 

 

earnings

 

 

stock

 

 

equity

 

Balance as of June 30, 2019

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

44,219,934

 

 

$

(3,440,104

)

 

$

62,042,890

 

Repurchase of stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

1,162,002

 

 

 

 

 

 

 

1,162,002

 

Balance as of September 30, 2019

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

45,381,936

 

 

$

(3,440,104

)

 

$

63,204,892

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2020

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

Total

 

 

Common stock

 

 

paid-in

 

 

Retained

 

 

Treasury

 

 

stockholders’

 

 

Shares

 

 

Amount

 

 

capital

 

 

earnings

 

 

stock

 

 

equity

 

Balance as of December 31, 2019

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

48,347,798

 

 

$

(3,440,104

)

 

$

66,170,754

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

70,276

 

 

 

 

 

 

 

 

 

 

 

70,276

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

5,033,192

 

 

 

 

 

 

 

5,033,192

 

Balance as of September 30, 2020

 

27,813,772

 

 

$

2,781,377

 

 

$

18,551,959

 

 

$

53,380,990

 

 

$

(3,440,104

)

 

$

71,274,222

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2019

 

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

 

 

 

 

 

Total

 

 

Common stock

 

 

paid-in

 

 

Retained

 

 

Treasury

 

 

stockholders’

 

 

Shares

 

 

Amount

 

 

capital

 

 

earnings

 

 

stock

 

 

equity

 

Balance as of December 31, 2018

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

41,621,191

 

 

$

(3,278,819

)

 

$

59,605,432

 

Repurchase of stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(161,285

)

 

 

(161,285

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

3,760,745

 

 

 

 

 

 

 

3,760,745

 

Balance as of September 30, 2019

 

27,813,772

 

 

$

2,781,377

 

 

$

18,481,683

 

 

$

45,381,936

 

 

$

(3,440,104

)

 

$

63,204,892

 

 

See accompanying notes to consolidated financial statements

4


Table of Contents

 

THE GOLDFIELD CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

Note 1 – Organization and Summary of Significant Accounting Policies

Overview

The Goldfield Corporation (the “Company”) was incorporated in Wyoming in 1906 and subsequently reincorporated in Delaware in 1968. The Company’s principal line of business is the construction of electrical infrastructure for the utility industry and industrial customers. The Company is also engaged in real estate development operations. The principal market for the Company’s electrical construction operation is primarily in the Southeast, mid-Atlantic and Texas-Southwest regions of the United States. The Company’s real estate development operation is along the east coast of Central Florida.

Basis of Financial Statement Presentation

In the opinion of management, the accompanying unaudited interim consolidated financial statements include all adjustments necessary to present fairly the Company’s financial position, results of operations, and changes in cash flows for the interim periods reported. These adjustments are of a normal recurring nature. All consolidated financial statements presented herein are unaudited with the exception of the consolidated balance sheet as of December 31, 2019, which was derived from the audited consolidated financial statements. The results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the year. These statements should be read in conjunction with the consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2019.

Allowance for Doubtful Accounts

The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on customer specific information and historical write-off experience. The Company reviews its allowance for doubtful accounts quarterly. Account balances are charged off against the allowance after reasonable means of collection have been exhausted and the potential for recovery is considered remote. As of September 30, 2020 and December 31, 2019, upon its review, management determined it was not necessary to record an allowance for doubtful accounts due to the majority of accounts receivable being generated by electrical utility customers whom the Company considers creditworthy based on timely collection history and other considerations.

Use of Estimates

Management of the Company has made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with U.S. generally accepted accounting principles. Actual results could differ from those estimates. Management considers the most significant estimates in preparing these consolidated financial statements to be the estimated costs at completion of electrical construction contracts in progress.

Fair Value of Financial Instruments

The Company’s financial instruments include cash and cash equivalents, accounts receivable and accrued billings, income tax receivable, cash surrender value of life insurance policies, accounts payable and notes payable.

Fair value is the price that would be received to sell an asset or 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:

Level 1 - Quoted market prices in active markets for identical assets or liabilities.

Level 2 - Observable market based inputs or other observable inputs.

Level 3 - Significant unobservable inputs that cannot be corroborated by observable market data. These values are generally determined using valuation models incorporating management’s estimates of market participant assumptions.

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Fair values of financial instruments are estimated through the use of public market prices, quotes from financial institutions, and other available information. Management considers the carrying amounts reported on the consolidated balance sheets for cash and cash equivalents, accounts receivable and accrued billings, income tax receivable, accounts payable and accrued liabilities, to approximate fair value due to the immediate or short-term maturity of these financial instruments. The Company’s carrying value of long-term notes payable are estimated by management to approximate fair value since the interest rates prescribed by Truist Bank are variable market interest rates and are adjusted periodically, and as such, are classified as Level 2. The carrying value of cash surrender value of life insurance is considered by management to approximate fair value as the carrying value is based on the current settlement value under the contract, as provided by the carrier and as such, is classified as Level 2.

Land and Land Development Costs and Residential Properties Under Construction

The costs of a land purchase and any development expenses up to the initial construction phase of any residential property development project are recorded under the asset “land and land development costs.” Once construction commences, both the land development costs and construction costs are recorded under the asset “residential properties under construction.” The assets “land and land development costs” and “residential properties under construction” relating to specific projects are recorded as current assets when the estimated project completion date is less than one year from the date of the consolidated financial statements, or as non-current assets when the estimated project completion date is one year or more from the date of the consolidated financial statements.

In accordance with Accounting Standards Codification (“ASC”) 360-10, Accounting for the Impairment or Disposal of Long-lived Assets, land and residential properties under construction are reviewed by the Company for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. If the carrying amount or basis is not expected to be recovered, impairment losses are recorded and the related assets are adjusted to their estimated fair value. The fair value of an asset is the amount at which that asset could be bought or sold in a current transaction between willing parties, other than in a forced or liquidation sale. The Company also complies with ASC 820, Fair Value Measurement, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The Company did not record an impairment write-down to its land, land development costs or residential properties under construction carrying value for either of the three or nine months ended September 30, 2020 and 2019.

Goodwill and Intangible Assets

Intangible assets with finite useful lives recorded in connection with a historical acquisition are amortized over the term of the related contract or useful life, as applicable. Intangible assets held by the Company with finite useful lives include customer relationships and trademarks. The Company reviews the values recorded for intangible assets and goodwill to assess recoverability from future operations annually or whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. As of December 31, 2019, the Company assessed the recoverability of its long-lived assets and goodwill, by reviewing relevant events and circumstances to evaluate the qualitative factors in addition to the quantitative impairment test. As a result, there was no impairment of the carrying amounts of such assets. There were no events or changes in circumstances as of September 30, 2020 that would indicate that the carrying amounts may not be recoverable.

Share-Based Compensation