Tutor Perini Q1 2025 Earnings Call Transcript

Quartr
Provided by Quartr
May 7, 2025

There are 9 speakers on the call.

Operator

Good day, ladies and gentlemen, and welcome to Tudor Parrini Corporation First Quarter twenty twenty five Earnings Conference Call. My name is Sherry, and I will be your coordinator for today. All participants are currently in a listen only mode. Following management's prepared remarks, we will be opening the call for a question and answer session. As a reminder, this conference call is being recorded for replay purposes.

Operator

I will now turn the conference over to your host for today, Jorge Casado, Vice President, Investor Relations. Please proceed.

Speaker 1

Hello, everyone, and thank you for joining us. With us today are Gary Smalley, CEO and President Ron Tudor, Executive Chairman and Ryan Siroka, Executive Vice President and CFO. Before we discuss our results, I will remind everyone that during this call, we will be making forward looking statements, which are based on management's current assessment of existing trends and information. There is an inherent risk that our actual results could differ materially. You can find our disclosures about risk factors that could contribute to such differences in our Form 10 ks, which we filed on 02/27/2025, and in our Form 10 Q that we are filing today.

Speaker 1

The company assumes no obligation to update forward looking statements whether due to new information, future events or otherwise other than as required by law. Thank you. And with that, I will turn the call over to Gary Smalley.

Speaker 2

Thanks, Jorge. Hello, everyone, and thank you all for joining us. We're off to a great start in 2025 with outstanding first quarter results that highlight our strong growth and performance across all key metrics and that were quite frankly better than expected. Specifically, year over year, our first quarter revenue grew 19% to 1,250,000,000 operating income was up 34% to 65,000,000 Earnings per share increased 77% to $0.53 And our backlog grew 94% to a new all time record of $19,400,000,000 In addition, our operating cash flow was $23,000,000 a solid result for the first quarter considering that historically our first quarter cash flow tends to be low and often negative due to seasonality. All in all, our first quarter EPS was the second best of any first quarter in Tutor Perini's history, and our operating cash flow was the third best first quarter result ever.

Speaker 2

Our business is performing well, and I'm pleased to report that it was a clean first quarter with solid project execution and no material project adjustments even for dispute resolutions. Ryan will go over the specifics of our financial results, but overall, our revenue and earnings were driven by increased project execution activities on certain newer higher margin projects that all have substantial scope of work remaining. Our operating cash flow for the first quarter of twenty twenty five was driven by collections from newer and ongoing projects unlike last year's first quarter cash flow, which included a large amount of collections related to dispute resolutions. We still expect to make progress this year resolving various other disputes and collecting significant associated cash, but those collections are expected later in the year. During the first quarter, we continued to win new projects, booking impressive $2,000,000,000 of new awards and contract adjustments, adding to our already record backlog.

Speaker 2

Our book to burn ratio for the first quarter was a solid 1.6x. Backlog for the civil and specialty contractor segments also set new records. The most significant new awards and contract adjustments in the first quarter included the $1,180,000,000 Manhattan tunnel project in New York, which is a component of the broader gateway program that includes critical rail infrastructure along the Northeast Corridor between Newark and New York Penn Station. 40 1 Million Dollars of additional funding for the Aprha Harbor waterfront repairs project in Guam, which brings the current value of this project to more than $570,000,000 1 hundred and 11 million dollars of additional funding for certain health care facility projects in California, an electrical project in Texas valued at more than $100,000,000 and $99,000,000 of additional funding for an existing electrical project in Texas. The outlook is excellent for strong sustained backlog this year with the potential for further backlog growth.

Speaker 2

Our new award bookings continue to be healthy in the second quarter as we have already won a $500,000,000 health care project in California that was recently awarded funding for the construction phase after having been in preconstruction for the past year. In addition to this project, there are several other building segment projects currently in the preconstruction phase that we expect will soon also advance to the construction phase, including another healthcare project also in California valued at $1,000,000,000 Our bidding pipeline continues to be full of opportunities this year and over the next several years. Our record backlog enables us to be even more selective than before as to which of the opportunities we will pursue and to focus on bidding projects that have favorable contractual terms, limited competition and higher margins. Also, the Indo Pacific region continues to be a major area of project opportunities, driven in large part by The U. S.

Speaker 2

Military specific deterrence initiative, which aims to enhance U. S. Military infrastructure and readiness. Plaque Construction, our Guam based subsidiary, has had tremendous success in capturing new projects and continues to be well positioned to win other major projects in the region. Tutapuruni and Plaque Construction together have been successful in capturing four recent multiple award construction contracts or MACs with a combined contract capacity of more than $32,000,000,000 over the next eight years.

Speaker 2

This capacity will be shared among us and the other firms that have been awarded these MACs, And the MACs essentially put us on the bidders list, enabling us to pursue the numerous project task orders that will be ultimately awarded. Ron, would you take a couple of minutes to discuss some of our other civil bidding opportunities on the horizon and also what you are seeing in the early stages of project execution as we kick off work on the major projects that have been awarded over the last few quarters.

Speaker 3

Certainly, Gary, we're about to submit our bid for the multibillion dollar Midtown bus terminal replacement project in New York and and will await contractor selection by the owner during the next thirty days. If we are successful, this will add substantially to our existing record backlog. Apart from this, the most significant upcoming project opportunities include the $12,000,000,000 Sepulveda Transit Corridor, the $3,800,000,000 Southeast Gateway Line, the $1,000,000,000 North Valley Rail project, the $900,000,000 Foothill Gold Line Light Rail project, all of which, by the way, are in California, and the $1,800,000,000 South Jersey Light Rail Glassboro to Camden line in New Jersey. I continue to work with Gary and our operations executives to help ensure that our newer major projects, including the Brooklyn And Manhattan Jails, the Honolulu Rail Transit line, the Kensico And Manhattan Tunnels, the Upper Harbor Breakwater, and the Newark air train train are properly set up to maximize the likelihood of success. We're still in the early stages of many of these projects, but they are all going extremely well, and I anticipate this will continue to be the case.

Speaker 3

Thank you. And I will now hand it back to you, Gary.

Speaker 2

Thanks, Ron. As a result of a strong start to the year and continued confidence in what we expect to achieve for the rest of this year, we are increasing our 2025 EPS guidance to the range of $1.6 to $1.95 up from the initial guidance of $1.5 to $1.9 that we provided in late February. It is important to note that our increased guidance continues to factor in a significant amount of contingency for various unknown or unexpected outcomes and developments in 2025, including the potential for slower ramp ups on our newer projects, project delays for existing or prospective work, lower than expected win rates for future bids and settlements or adverse legal decisions associated with the resolution of disputes. The future continues to look very bright for Tuopirini beyond 2025, and we are still anticipating that our earnings in 'twenty six and 'twenty seven will be more than double our increased EPS guidance for 2025. We also continue to expect strong operating cash flow for 2025 and beyond.

Speaker 2

Now with respect to potential concerns regarding U. S. Trade policy and various federal spending programs, I will reiterate that we do not currently anticipate any significant impacts to our business related to these factors. From a project funding perspective, we do not currently foresee the risk of any of our major projects and backlog being canceled, delayed or defunded. Most of our major projects are funded at the state or local level or with some combination of federal, state and local funding.

Speaker 2

For projects that are wholly or partly funded with federal dollars, the funding for these projects has already been committed and or these projects are strategically important to The United States. Specifically related to potential tariff impacts, we utilize a pre award and post award strategy. As part of our pre award strategy, our detailed estimating process includes consideration of anticipated cost increases over the performance period of our contracts as well as additional contingencies to address other potential incremental costs related to unforeseen risks. Prior to our bid or proposal submission, we also worked to negotiate favorable contract provisions that provide entitlement for certain compensable events, which may include price escalations and allowances. Once a project is awarded, our strategy shifts to entering into purchase orders or buyouts of materials such as steel and concrete, as well as large pieces of equipment, which mitigates the risk of future equipment and commodity price increases.

Speaker 2

Also at the onset of projects, we enter into fixed price contracts with our key project subcontractors whereby the risk of unforeseen escalation is transferred to the subcontractor. Thank you. And with that, I will now turn the call over to Ryan to discuss the details of our first quarter results.

Speaker 4

Thanks, Gary. Good afternoon, everyone. I will begin by discussing our results for the first quarter, after which I will provide some commentary on our balance sheet and our updated twenty twenty five guidance assumptions. Revenue for the first quarter of twenty twenty five was $1,250,000,000 up 19% compared to $1,050,000,000 for the first quarter of twenty twenty four. Civil segment revenue was $610,000,000 up a strong 29% compared to $472,000,000 last year.

Speaker 4

Building segment revenue was $460,000,000 up 12% compared to $412,000,000 last year and Specialty Contractors segment revenue was $177,000,000 up 7% compared to 165,000,000 last year. Our revenue growth was broad based and driven by increased project execution activities on certain newer higher margin projects that all have substantial scope of work remaining. These projects included the Brooklyn Jail, which contributed to the revenue growth across all three segments, the Honolulu Rail project and certain mass transit projects in California. Civil segment income from construction operations was $80,000,000 in the first quarter of twenty twenty five compared to $71,000,000 for the first quarter last year, with the increase driven by contributions related to the strong revenue growth I mentioned for the segment. Building segment income from construction operations was $10,000,000 in the first quarter of twenty twenty five compared to $16,000,000 last year, with the decrease primarily due to the absence of a prior year immaterial favorable adjustment that resulted from a legal ruling related to a completed hospitality and gaming project, offset by contributions associated with the higher first quarter revenue for the segment this year.

Speaker 4

The Specialty Contractors segment posted a loss of $7,000,000 in the first quarter of twenty twenty five compared to a loss of $18,000,000 last year. The improvement was primarily due to the absence of a prior year immaterial unfavorable adjustment pertaining to an arbitration ruling on the completed electrical project in New York and to a lesser extent contributions related to the higher first quarter revenue for the segment this year. We still anticipate improved operating income over the course of this year for the Specialty segment as our revenue volume is expected to gradually increase, which will help to cover the segment's G and A costs. Segment operating margins were 13%, two point three % and negative 4% for the Civil, Building and Specialty Contractors segments respectively. These margins are trending well and we anticipate further margin improvement ahead this year, especially for the Building and Specialty Contractors segment.

Speaker 4

Other income was $5,000,000 level with the other income reported for the first quarter last year. Interest expense was $14,000,000 down 26% compared to $19,000,000 for the same period last year due to our substantial debt reduction completed since last year. Income tax expense for the first quarter of twenty twenty five was $13,000,000 with a corresponding effective tax rate of 23.2% compared to $7,000,000 for the same period last year with a corresponding effective tax rate of 21%. Net income attributable to Tutor Perini for the first quarter of twenty twenty five was $28,000,000 or $0.53 of earnings per share compared to $16,000,000 or $0.30 of earnings per share in last year's first quarter. As Gary indicated, our operating cash flow for the first quarter was solid at $23,000,000 Looking back historically at the period between 02/2009 and 2024, on average, we have reported a usage of cash of approximately $22,000,000 in the first quarter.

Speaker 4

So a positive cash flow of $23,000,000 for the first quarter of this year was certainly another highlight and it was our third best first quarter result ever. We expect that our operating cash flow will be strong for 2025 as well as for the next several years, driven largely by organic cash collections, that is from new and existing projects, and augmented from time to time by collections related to dispute resolutions. Now I'll address the balance sheet. Our total debt as of 03/31/2025 was $4.00 $6,000,000 down 24% compared to $534,000,000 at the end of twenty twenty four. As we mentioned on last quarter's earnings call, we paid off the remaining balance of our Term Loan B in February.

Speaker 4

With our near term debt reduction goals now completed, our balance sheet remains healthier than it

Speaker 5

has ever been.

Speaker 4

And as we mentioned last quarter, as we accumulate more cash this year, we'll be looking at shifting our capital allocation priorities towards returning capital to our shareholders. Finally, all the assumptions we provided last quarter regarding our guidance remain the same. Thank you. And with that, I'll turn the

Speaker 2

call back over to Gary. Thanks, Ryan. To summarize, we delivered excellent first quarter results that exceeded our expectations with strong revenue, operating income and earnings growth, solid operating cash flow and backlog that nearly doubled year over year to a new all time record of $19,400,000,000 As I mentioned last quarter, our record backlog has been largely built on new awards with better margins and improved contractual terms, and we believe that this backlog will drive significant double digit revenue growth and generate strong earnings for the foreseeable future while also serving as a catalyst for continued strong cash flow as our newer projects progress through design and into construction. Our strong performance to date, combined with our confidence in how the rest of the year should unfold, has enabled us to increase our 2025 EPS guidance, while still maintaining what we believe is an appropriate amount of contingency for unknown or unanticipated developments. Our business is performing well, and I am encouraged by what we have accomplished in the first quarter and excited for what should be a very bright future.

Speaker 2

Reiterating what I recently stated in my shareholder letter published with our annual report, there has never been a better time to be a Tutor Perini shareholder as we believe we are at the dawn of a new era for the company. Thank you. And with that, I will turn the call over to the operator for your questions.

Operator

Thank you. We will now be conducting a question and answer Our first question is from Steven Fisher with UBS. Please proceed.

Speaker 6

Thanks. Good afternoon and congratulations on the strong results. Carrie, thought I heard you say that this quarter was clean as there wasn't any kind of particular closeouts or kind of contract settlements or arbitration awards or anything like that. Can you just confirm that? Because I thought you were supposed to have maybe one that was coming to fruition there?

Speaker 6

And if not, if it was clean, then I guess I'm curious how as we compare Q1 with what you might expect for Q2 given that it sounds like more of the closeout activity might be later in the year. What do you think would be different between Q1 versus Q2 other than typical seasonality where Q2 should theoretically be even better than Q1?

Speaker 2

Yes. Thanks, Steve. When I was talking about the quarter being clean, it's really clean from any significant impact of the dispute resolution activity that we had underway. We actually made very good progress on some of our larger claims. We settled up some things.

Speaker 2

The cash didn't flow in the first quarter. That's coming in the second quarter. But we were able to do that with, in some cases, a slight uptick in earnings, one case, slight downtick in earnings. But net neutral impact to earnings for really three fairly sizable resolutions. So quiet from, again, the impact on earnings, but not quiet from effort and progress being made.

Speaker 2

Also, on the second quarter, a lot of that is continuing. A lot of the progress is continuing. We would expect we're close in a couple of matters. We expect to resolve some more things in the second quarter. Our expectation is similar with respect to the earnings outcome.

Speaker 2

We feel really good about how things are progressing there. I'd like to say one other thing that's a little off from your question, but make sure that everyone understands this is that the profits that we budgeted by quarter for the year, the progress that we made in the first quarter is not from an acceleration of the profits later in the year bringing them forward. The quarter really was strong on its own. The strength is real. So it's not a shift forward of profits to come.

Speaker 2

Much of improvement over budget is really due to large projects that are cranking up, ramping up a lot faster than we expected. And that as well as we were maybe a little bit more conservative with what we expected on these dispute resolutions. So all those two things together provided this type of quarter. And we hope to have similar type of results if not better in the second quarter.

Speaker 6

That's really helpful. And then you mentioned you have a number of things in preconstruction. And I guess I'm wondering just generally what has to happen to get those moving to construction phase. Know in the broader construction economy today, there is a lot of things in preconstruction. And given some of the uncertain macro environment and costs, I guess there's some hesitation in some parts of the market.

Speaker 6

And maybe I think as you pointed out in your release, some places where there's more confidence. So I guess what has to happen to get those projects into actual construction phase? How much kind of concern from your customers is there? And I guess I'm curious related to this, what are you seeing in terms of construction costs in the last, let's say, since the March? Have those been kind of rising in line with what we're seeing in terms of materials and tariff impact?

Speaker 6

And how is that affecting these decisions kind of moving from preconstruction into construction?

Speaker 2

Yeah. Okay. Good. I'll do the first part of the question, Steve, the preconstruction then let Ron comment on the cost. But on the preconstruction, I don't want to trivialize it, but it's almost like just a passage of time has

Speaker 2

We do certain pre construction activities, but these are solid projects that we expect with the passage of time to for those to materialize into backlog. As an example, the last half of twenty twenty four, we had about $1,500,000,000 in total of projects that moved into backlog. In the second quarter, what we said on our earlier comments, in the second quarter, we have already recorded from out of preconstruction into construction and into backlog over 500,000,000 in one of the projects. We also expect the latter part of the second quarter and it could shift, you know, could slip a little bit into the third quarter, but we just paid a project close to $1,000,000,000 to come out of preconstruction into construction. So we're not seeing in this market, and these are all building segment projects, are not seeing the concern about these projects not materializing that you might be concerned about.

Speaker 2

We are not. And then on the cost side, Ron, I'll let you address that if you want.

Speaker 3

Well, costs are constantly rising, particularly in New York, which is one of our biggest markets. But I can say having just turned in a bid for a multibillion dollar project this week in New York, There's nothing to do with tariffs that has affected us as of yet other than threats. Our pricing remains the same. We we have favorable contract terms that we believe protect us even if there was tariff impact. And there there just hasn't been anything in a negative tone on any of our existing work.

Speaker 3

Now I can't predict what impact, if any, it'll have on future work that we're tracking coming out to bid the latter part of this year and next. But with the existing work programs, we're under contracts or purchase orders on most of the work and haven't haven't felt any pain from tariffs or any major increases that were unanticipated.

Speaker 6

Okay. I'll turn it over. Thank you very much.

Speaker 2

Thank you.

Operator

Our next question is from Adam Thalhimer with Thompson Davis. Please proceed. Hey,

Speaker 7

afternoon guys. Great quarter.

Speaker 2

Hi, Thank you.

Speaker 7

Can you give a little more color on the comment about doubling the EPS guidance for 2025 and 2026 and 2027? Is that basically based on the timing of existing projects?

Speaker 2

Yes. It's really the new projects as they continue to ramp up and these new larger projects with the better margins, better contractual terms that we've been talking about. As they really get going then they're going to contribute even more. And we're building backlog and so that will contribute to some of it as well. But look, the best way to look at that is to look at the midpoint and then double that.

Speaker 2

Obviously, we continue to perform like we expect to in future quarters, then we'll have to soften that charge because we can't keep saying we're going be doubling what the midpoint is right now. That still is the case. Similar to what we had said last quarter, We still feel that when we look at twenty six percent and twenty seven percent where we are right there, would expect to double what our midpoint is with this guidance.

Speaker 7

Okay. And then when you so that would imply EPS obviously above $3 per share. What segment level operating margins would you expect to see associated with that level of EPS?

Speaker 2

I'm sorry, could you repeat that please?

Speaker 7

I'm just curious. So the $26 and $27 guidance would imply EPS above $3 And I'm just curious to get to that level where the segment level margins need to be? So the Civil margins, the Building margins, the Specialty margins.

Speaker 2

Yes. The margins are similar to what we have talked about in the past. Of course, Civil margins have been building from before we used to guide at eight to 10 and then we were eight to 12 and now we're seeing north of that. The building margins will be higher than the 1%, two three % that we have historically had. We've been guiding toward 3% to 5% now and some of that is due to some of the work that we're doing is more complex.

Speaker 2

The margins are better, and also some of it is fixed price in nature with some of the building work that we're doing with the jails. On specialty, we hope to make those margins positive, okay, which would be a big positive since they've dragged down earnings for some time now. But we're looking at somewhat around 1% or 2%, something like that as we go forward into the end of twenty five and into '26. Okay.

Speaker 7

So 1% to 2% for now is your thought on specialty?

Speaker 2

Yes. That's right. And I should say, Adam, that more than half of our expected earnings in 2025 will be in the second half of the year. That's similar to what we have always seen in the past. Sometimes it's two thirds, but we're looking at somewhere around half at this point because we're out of the gate so strong with the first quarter.

Speaker 7

Okay. And then Gary, think it was a comment, I think you made it about deploying cash to shareholders. Can you just expand on that? Because obviously, the net debt at the end of the quarter was only $129,000,000 and I think you said strong operating cash, particularly in the back half of this year. Maybe just talk about the options there.

Speaker 2

Yes. Well, really there are two major options. One would be to pay dividends and the other would be to buy back shares. And we're not quite at that point yet. We need to accumulate more cash before we feel comfortable.

Speaker 2

We've we've had conversations with the board. We have a board meeting next week. We'll talk further about that. It's on the agenda. So those those are the the options available, and we are you know, we we want to do the right thing, but we also wanna make sure that we don't go down a path and have to pull back because we we wanna make sure that we have cash reserves in hand that make it a a long term place.

Speaker 7

I'll turn it over. Thank you.

Speaker 2

Thank you.

Operator

Our next question is from Liam Burke with B. Riley Securities. Please proceed.

Speaker 8

Thank you. Good afternoon, Gary. Good afternoon, Ryan. Good afternoon. Hi.

Speaker 8

Gary, everyone was talking about tariffs and regulatory uncertainty, but flipping the coin, the current policy now is less regulation. Are you seeing any speed up in project planning due to less regulation?

Speaker 3

No. No. We haven't seen any speed up

Speaker 4

in

Speaker 3

planning, engineering, or anything in the process as of yet. But remember, no matter how decisive government is, it takes a certain period of time before the words become impact in real life. I'm sure it's impacting many of the environmental restrictions, but we haven't seen any speed up. But yet at this point, we're so selective in what we're bidding. We're not looking for any speed up.

Speaker 3

Our our challenge over the next few years is to manage the huge backlog that we've already got.

Speaker 2

Liam, one one thing that is, you know, somewhat related to that, but really more on the tariff front. One of the things that we've seen is that with the talk of tariffs and where tariffs are, we've seen a few projects, some of our smaller ones, actually the timeline has sped up as our owners, our customers have wanted to push those along at an even quicker pace. So that's interesting, right?

Speaker 8

Great. Thank you. And on transit, mass transit, has there been any sentiment change on funding either repairs or newbuilds on mass transit?

Speaker 2

No. There there has not been. What? Any any funding changes as it relates to mass No. Great.

Speaker 2

Thank you. Thanks, Ben.

Operator

Our next question is from Michael Dudas with Vertical Research Partners. Please proceed.

Speaker 5

Good afternoon, gentlemen.

Speaker 6

Hi, there. How are doing, Mike?

Speaker 5

Great. Gary, great. Thank you. I know you guys are doing well given the results you just put forth. Maybe you talked about Guam and I think the Indo Pacific region certainly for several reasons could be a lot more active as we move forward.

Speaker 5

How's the visibility or the appetite to, you know, to for Black to continue to really maybe step change some of the opportunities in that part of the world? Has it fits into what you have in capacity and where you are relative to, you know, your new bidding opportunities elsewhere and and some of the discipline you guys support?

Speaker 3

Well, there's tremendous opportunities in Guam and throughout the islands. We're monitoring 7 and $800,000,000 jobs on the island of Palau and Crozaroy, all US government funded. So there's no question the amount of major jobs as well as the routine government jobs that contribute to the multibillion dollar fundings that's taken place. There's almost no limit to what we can do there other than our capacities to hire and train people and management. But make no bones about it.

Speaker 3

Between Diego Garcia, the entire Pacific, and even The Philippines, we're inundated with opportunities. In fact, Gary and I are making a trip with management to Guam in the near future to discuss how we man and support Guam as they face more and more demands in a marketplace where they're by far the most dominant player.

Speaker 2

And, Mike, in our prepared comments, you know, we talked about four MACs, and that was four out of four MACs that we have qualified for. But the total of $32,000,000,000 of potential work for those contractors that are participants in the MAC, I think that's indicative of the type of work that's you know, the volume of of work that's going through Guam, but also our capabilities to be able to qualify for all four of those. Obviously, we can't support that that much work, but we're not gonna get that much work. That's just, you know, the the total amount of programs that we feel like we're, well positioned better positioned than anybody else in the region.

Speaker 5

I I agree. Thank you for that. As you look through new bookings, these project bids that are coming in to the Port Authority in a month or so, maybe a mix of, like, the preconstruction flow that you talked about in this quarter and some of what you have versus the new business and how that can, structure what backlog could be as we move towards year end and for that baseline to move forward for 2016?

Speaker 2

Yeah. The, you know, the 19,400,000,000.0, based on the activity that we've seen so far, you know, we we think that it's it's likely to to grow from the the 19.4 at the end of the first quarter. It depends on success on the award that Ron indicated that we the multibillion dollar bid that we released this week. Look, we have the potential to hold where we are probably long term in the year. We could also grow it.

Speaker 2

It really depends on some of these bidding opportunities. But look, if it does grow, it's not going to grow significantly. If it does it has more chance to grow significantly than it does to decline significantly. We think that the more likely scenarios that we're going to maintain backlog where it is somewhere within maybe $1,000,000,000 or 2,000,000,000 as we go into 2026. Does that help?

Speaker 5

Yes, that's fair. No, that's very helpful. Thank you, Gary. Then maybe my final one is, as you look at your backlog and you're ramping up on some of these earlier projects with long scope, As you look at the rollouts today, where do you see a kind of peaking or a real strong period of revenue conversion relative to where your book of business and where you're positioning in that?

Speaker 3

This is Ron Tudor. It there's no question that 02/2025 is the beginning of ramping up revenue. '26 should be considerably more. '27 even more than '26. I think we'll see peak revenues in '27 with significant increases in '26 as those billions of dollars of lump sum high margin work ramps up and generates the revenue.

Speaker 3

And if you've got a five to six year contract and they're 3,000,000,000 a piece, you don't have to be great with numbers to see they generate 5 to 600,000,000 of revenue each of them. So that's what's taken place. So you'll see that ramp up in '26 and again in '27. And then it levels into '28 and '29.

Speaker 2

Well said.

Speaker 5

I think the math works, Gary and Ron. Thank you very much.

Speaker 2

Thanks Mike.

Operator

There are no further questions at this time. I would like to turn the floor back over to Gary Swalley for closing comments.

Speaker 2

Yes. Thank you very much. I appreciate everyone's time and your patience over the years with us. Look, this is the first time we've ever raised guidance at Tutor Perini, first time ever. And we hope it's not the last time this year.

Speaker 2

We look forward to talking to you again next quarter when we hope to have more good news to share with you.

Operator

Thank you. This will conclude today's teleconference. You may disconnect your lines at this time and thank you for your participation.

Powered by Quartr
Earnings Conference Call
Tutor Perini Q1 2025
00:00 / 00:00