Tutor Perini Corporation Q2 FY2025 earnings call

• Tutor Perini had an outstanding second quarter with record operating cash flow: $262 million in Q2 and $285 million in the first 6 months of 2025. - Backlog reached a new all-time high of $21.1 billion, up 102% year-over-year and driven by $3.1 billion of new awards. - GAAP EPS for Q2 2025 was $0.38, and adjusted EPS was $1.41. - Cost and estimated earnings in excess of billings (CIE) reduced to $856 million, the lowest in 8 years. - Major new awards included the $1.87 billion Midtown Bus Terminal Replacement Phase 1 project, $538 million healthcare project in California, and various civil and transit projects. - Discussed shift to share-settled equity awards to limit earnings volatility.

For the second quarter of 2025, revenue was $1.37 billion. Civil segment revenue was $734 million, up 34% from the second quarter of 2024; Building segment revenue was $462 million, up 11%; Specialty Contractors segment revenue was $177 million, up 9%. Civil segment income from construction operations was $140 million in Q2 2025, up 85% from the same period last year. Building segment income from construction operations was $22 million in Q2 2025, up from $5 million last year. Specialty Contractors segment posted a loss of $18 million in Q2 2025, compared to a loss of $8 million last year. Revenue contribution: Civil segment contributed 53.6% ($734M/$1.37B) of total revenue, Building segment 33.7% ($462M/$1.37B), and Specialty Contractors segment 12.9% ($177M/$1.37B).

• Raised 2025 GAAP EPS guidance to $1.70 to $2.00, up from previous $1.60 to $1.95; adjusted EPS guidance to $3.65 to $3.95, up from $2.45 to $2.80. - Anticipate GAAP and adjusted EPS in 2026 and 2027 to be significantly higher than 2025's upper end. - 2025 G&A expense expected $360M-$380M, depreciation/amortization ~$55M, interest expense ~$55M, effective tax rate 26%-28%, noncontrolling interest $75M-$85M, weighted average diluted shares ~53 million, capital expenditures $140M-$150M.

• Volatility in share-based compensation expense due to switch from cash-settled to share-settled awards. - Potential slower ramp-ups on newer projects, project delays, lower win rates for future bids. - Macro risks like tariffs, but no significant impact anticipated; major projects in backlog not expected to be canceled/delayed.

Q: Any major project closeouts in the next quarter and win expectations on new business?

A: Gary and Ron stated no significant project winding down soon; feel good about proposal prospects, expect to land 1-2 major projects which will offset work winding down.

Q: Project funnel and Specialty segment outlook?

A: Gary said significant opportunities in LA, Indo-Pacific, Midwest; Ryan mentioned Specialty expected to be breakeven or better in second half, aiming for 5%-8% margins by 2026 and beyond.

Q: Factors driving guidance change?

A: Gary discussed less contingency needs, faster project ramp-ups, progress in settlements releasing reserves, and Civil/Building segments contributing.

Q: Competition on bidding and transit investment?

A: Ron said competition is minimal, with rarely more than 1 other bidder; transit investment is increasing, benefiting Tutor Perini's strength in transit projects.