Quarterly report pursuant to Section 13 or 15(d)

Revenue

v3.20.2
Revenue
 9 Months Ended
Sep. 30, 2020
Revenue from Contract with Customer [Abstract]  
Revenue Revenue
Disaggregated Revenue
Our revenues are derived from contract services performed for the United States Department of Defense ("DoD") agencies or federal civilian agencies and from the delivery of products to our customers. Our customers also include various other government agencies and commercial clients.

A summary of revenues for our operating segments by customer for the three and nine months ended September 30, 2020 are as follows (in thousands):
Three months ended September 30, 2020
Aviation Fleet Federal and Defense Total
DoD $ 104  $ 7,275  $ 49,556  $ 56,935 
Other government 39  43,973  15,584  59,596 
Commercial 36,075  12,471  428  48,974 
$ 36,218  $ 63,719  $ 65,568  $ 165,505 

Nine months ended September 30, 2020
Aviation Fleet Federal and Defense Total
DoD $ 941  $ 16,937  $ 168,078  $ 185,956 
Other government 283  141,390  27,579  169,252 
Commercial 125,295  29,818  1,317  156,430 
$ 126,519  $ 188,145  $ 196,974  $ 511,638 

A summary of revenues for our operating segments by customer for the three and nine months ended September 30, 2019 are as follows (in thousands):
Three months ended September 30, 2019
Aviation Fleet Federal and Defense Total
DoD $ 1,613  $ 6,935  $ 76,505  $ 85,053 
Other government 734  42,419  7,266  50,419 
Commercial 56,839  6,015  —  62,854 
$ 59,186  $ 55,369  $ 83,771  $ 198,326 

Nine months ended September 30, 2019
Aviation Fleet Federal and Defense Total
DoD $ 2,768  $ 18,238  $ 201,828  $ 222,834 
Other government 1,385  127,555  29,993  158,933 
Commercial 159,400  15,085  1,104  175,589 
$ 163,553  $ 160,878  $ 232,925  $ 557,356 

We changed our disaggregated revenue by type presentation below in the first quarter of 2020 to better align with our operating segments. Revenues from our Aviation and Fleet segment are derived from repair and distribution services primarily through shorter term purchase orders from customers. Our Federal and Defense segment's revenue results from services provided on longer term contracts, including cost plus, fixed price and time and materials contract types. This change provides a clearer
picture of the nature of each segment's contractual arrangements, how revenues derived from those contracts are affected by economic factors, and underlying performance trends impacting each segment. Additionally, the presentation is more in-line with how each segments' results are evaluated by our Chief Executive Officer in deciding how to allocate resources and evaluate performance.

The change in disaggregated revenue presentation did not result in any changes in our reported segments and had no effect on the reported results of operations.

A summary of revenues by type and operating segment for the three and nine months ended September 30, 2020 is as follows (in thousands):
Three months ended September 30, 2020
Aviation Fleet Federal and Defense Total
Repair $ 17,280  $ —  $ —  $ 17,280 
Distribution 18,938  63,719  —  82,657 
Cost Plus Contract —  —  18,194  18,194 
Fixed Price Contract —  —  32,937  32,937 
T&M Contract —  —  14,437  14,437 
     Total $ 36,218  $ 63,719  $ 65,568  $ 165,505 

Nine months ended September 30, 2020
Aviation Fleet Federal and Defense Total
Repair $ 66,936  $ —  $ —  $ 66,936 
Distribution 59,583  188,145  —  247,728 
Cost Plus Contract —  —  61,182  61,182 
Fixed Price Contract —  —  107,932  107,932 
T&M Contract —  —  27,860  27,860 
     Total $ 126,519  $ 188,145  $ 196,974  $ 511,638 

A summary of revenues by type and operating segment for the three and nine months ended September 30, 2019 is as follows (in thousands):
Three months ended September 30, 2019
Aviation Fleet Federal and Defense Total
Repair $ 32,603  $ —  $ —  $ 32,603 
Distribution 26,583  55,369  —  81,952 
Cost Plus Contract —  —  41,691  41,691 
Fixed Price Contract —  —  19,078  19,078 
T&M Contract —  —  23,002  23,002 
     Total $ 59,186  $ 55,369  $ 83,771  $ 198,326 
Nine months ended September 30, 2019
Aviation Fleet Federal and Defense Total
Repair $ 87,597  $ —  $ —  $ 87,597 
Distribution 75,956  160,878  —  236,834 
Cost Plus Contract —  —  103,027  103,027 
Fixed Price Contract —  —  58,098  58,098 
T&M Contract —  —  71,800  71,800 
     Total $ 163,553  $ 160,878  $ 232,925  $ 557,356 

Contract Balances
Billed receivables, unbilled receivables (contract assets), and contract liabilities are the results of revenue recognition, customer billing, and timing of payment receipts. Billed receivables, net, represent unconditional rights to consideration under the terms of the contract and include amounts billed and currently due from our customers. Unbilled receivables represent our right to consideration in exchange for goods or services that we have transferred to the customer prior to us having the right to payment for such goods or services. Contract liabilities are recorded when customers remit contractual cash payments in advance of us satisfying related performance obligations under contractual arrangements, including those with performance obligations to be satisfied over a period of time.
We present our unbilled receivables and contract liabilities on a contract-by-contract basis. If a contract liability exists, it is netted against the unbilled receivables balance for that contract. Unbilled receivables decreased from $46.3 million at December 31, 2019 to $27.0 million at September 30, 2020, primarily due to the billing of our customers in excess of revenue recognized as performance obligations were satisfied. Contract liabilities, which are included in accrued expenses and other current liabilities in our consolidated balance sheet, increased from $5.0 million at December 31, 2019 to $10.4 million at September 30, 2020, primarily due to advance payments received in excess of revenue recognized. For the nine months ended September 30, 2020 and September 30, 2019, we recognized revenue that was previously included in the beginning balance of contract liabilities of $2.0 million and $2.1 million, respectively.

Performance Obligations

Our performance obligations are satisfied either at a point in time or over time as work progresses. The majority of our revenue recognized at a point in time is for the sale of vehicle and aircraft parts in our Fleet and Aviation segments. Revenues from products and services transferred to customers at a point in time accounted for approximately 50% of our revenues for the three and nine months ended September 30, 2020 and 43% of our revenues for the three and nine months ended September 30, 2019. Revenues from products and services transferred to customers over time accounted for approximately 50% of our revenues for the three and nine months ended September 30, 2020 and 57% of our revenues for the three and nine months ended September 30, 2019, primarily related to revenues in our Federal and Defense segment and repair services in our Aviation segment.
As of September 30, 2020, the aggregate amount of transaction prices allocated to unsatisfied or partially unsatisfied performance obligations was $177 million. Performance obligations expected to be satisfied within one year and greater than one year are 90% and 10%, respectively. We have applied the practical expedient for certain parts sales and MRO services to exclude the amount of remaining performance obligations for (i) contracts with an original expected term of one year or less or (ii) contracts for which we recognize revenue in proportion to the amount we have the right to invoice for services performed.

During the nine months ended September 30, 2020 and September 30, 2019, revenue recognized from performance obligations satisfied in prior periods was not material.