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The
following table presents EMCOR's operating income, and operating
income as a percentage of segment revenues, for the years ended
December 31, 1999, 1998 and 1997 (in thousands, except for percentages):

Operating
income increased for the United States electrical construction and
facilities services operations for 1999 compared to 1998. The dollar
increase in operating income for 1999 of $2.2 million, or 6.0%,
as compared to 1998, was attributable to the incremental effect
of businesses acquired during 1999 and 1998 as well as growth from
the balance of EMCOR's operations. As a percentage of revenues,
operating income decreased by 0.3% for 1999 as compared to 1998
primarily due to reduced operating income for certain operations
which were only partially offset by a higher percentage of revenues
being derived from markets where higher operating income margins
are more typical than in other EMCOR markets, particularly in Eastern
United States cities such as New York City, Boston and Washington,
D.C. Operating income for 1998 for the United States electrical
construction and facilities services operations increased $7.6 million,
or 26.6%, from 1997 levels due to a similar increase in revenues
for businesses operating in the Eastern United States, particularly
in New York City due to renovation projects.
United
States mechanical construction and facilities services operations
operating income increased $16.9 million for 1999, an 80.5% increase
over 1998 amounts primarily due to growth of EMCOR's existing businesses
and operating income contributed by businesses acquired during 1999
and 1998. For 1998 compared with 1997, operating income increased
$2.3 million, or 12.5%, primarily due to businesses acquired in
1998. As a percentage of revenues, operating income increased 0.3%
from 1997 to 1998 and 0.1% from 1998 to 1999, principally due to
the continued strong renovation market in New York City and new
construction markets in Denver and Salt Lake City.
United
States other operating losses decreased $0.4 million for 1999 as
compared to 1998 primarily due to the continuing development of
consulting and maintenance services operations, offset partially
by incremental operating income from certain businesses acquired
during 1999 and 1998. Operating losses for 1998 compared to 1997
increased by $2.7 million primarily due to costs associated with
the development of the consulting and maintenance services activities.
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