TIC Solutions Q4 2025 Earnings Call Transcript

Quartr
Provided by Quartr
March 12, 2026

Key Takeaways

  • Positive Sentiment: TIC announced a planned CEO transition with Ben Heraud to take over on March 31, 2026, while founder Tal Pizzey moves to the board and will advise through the handoff to ensure continuity.
  • Positive Sentiment: On a combined basis 2025 revenue was roughly $2.1 billion with $312 million adjusted EBITDA (14.8% margin), and 2026 guidance targets $2.15–$2.25 billion revenue and $330–$355 million adjusted EBITDA (includes an $8M EBITDA headwind for NV5 comp reclassification).
  • Positive Sentiment: Integration progress is on track to deliver $25 million of annual cost synergies (about half expected in 2026) with full run-rate targeted by mid-2027 and an integration management office monitoring milestones.
  • Positive Sentiment: End-market momentum is notable—data center revenue nearly doubled to ~$70M in 2025 with line-of-sight to $100M, backlog rose ~10% to $1.07B, and the company is beginning client rollouts of its AI-enabled geospatial platform, GeoAgent.
  • Negative Sentiment: Inspection & Mitigation experienced near-term weakness in the Gulf Coast from LNG construction timing, slower chemical activity and elevated competition, prompting regional restructurings and tighter pricing/staffing to protect margins.
AI Generated. May Contain Errors.
Earnings Conference Call
TIC Solutions Q4 2025
00:00 / 00:00

Transcript Sections

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Operator

Hello, and welcome to the TIC Solutions fourth quarter 2025 earnings conference call. Currently, all participants are in a listen-only mode. The question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference call is being recorded. I would now like to turn the call over to your host, Andrew Shen, Director of Investor Relations. Thank you. You may begin.

Andrew Shen
Andrew Shen
Director of Investor Relations at TIC Solutions

Thank you, operator. Good morning, everyone, and thank you for joining the call. Joining me this morning is Tal Pizzey, our Chief Executive Officer, Ben Heraud, our President and Chief Operating Officer, Kristin Schultes, our Chief Financial Officer, and Robbie Franklin, Executive Chairman. As disclosed in our earnings release, we would like to acknowledge the planned leadership transition we announced this morning. Ben Heraud has been appointed Chief Executive Officer effective March 31st, 2026, succeeding Tal Pizzey. Tal will continue to serve on our board of directors and act as an advisor to Ben through and following the transition to ensure continuity. We will provide additional context during our prepared remarks.

Andrew Shen
Andrew Shen
Director of Investor Relations at TIC Solutions

I would now like to remind you that certain statements in the company's earnings press release and on this call are forward-looking statements that are based on expectations, intentions, and projections regarding the company's future performance, anticipated events or trends, and other measures that are not historical facts. These statements are not a guarantee of future performance and are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. In our press release and filings with the SEC, we detailed material risks that may cause our future results to differ from our expectations. Our statements are as of today, March 12th, 2026, and we undertake no obligation to update any forward-looking statements we may make except as required by law.

Andrew Shen
Andrew Shen
Director of Investor Relations at TIC Solutions

As a reminder, we have posted a presentation detailing our fourth quarter financial performance on the investor relations page of our website at ticsolutions.com. Our comments today will also include non-GAAP financial measures and other key operating metrics. The required reconciliations of non-GAAP financial metrics can be found in our press release and in our presentation. For the purpose of this call, we refer to our segments as Inspection and Mitigation, or I&M, Consulting Engineering, or CE, and Geospatial, or Geo. Any reference to combined results reflects a non-GAAP combined view of legacy Acuren and legacy NV5 for comparability. More details on the calculation of the combined results are included in the presentation. Let me outline the flow of today's prepared remarks. Tal will provide opening comments. Ben will review our operating priorities and segment performance. Kristen will cover our financial results, integration progress, and our 2026 outlook.

Andrew Shen
Andrew Shen
Director of Investor Relations at TIC Solutions

Robbie will conclude with strategic priorities and capital allocation. It's now my pleasure to turn the call over to Tal.

Tal Pizzey
Tal Pizzey
CEO at TIC Solutions

Thank you, Andrew. Good morning, everyone. This morning, we announced a planned leadership transition that has been contemplated as part of our broader succession planning process. After nearly four decades with the business, including serving as Chief Executive Officer, I will be transitioning from the CEO role as I prepare for retirement. I will continue to serve on the board and act as an advisor to Ben and his team to ensure a seamless transition. Since joining Acuren in 1987, it has been a privilege to help build this organization. We entered the public markets and completed the combination with NV5 to create TIC Solutions, a $2 billion revenue company. Ben has been deeply involved in shaping the combined operating model since the NV5 combination closed in August. He understands the platform, the culture, and the priorities ahead

Tal Pizzey
Tal Pizzey
CEO at TIC Solutions

I have full confidence in his leadership as the company moves into this next chapter. With that, I will turn the call over to Ben.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Thank you, Tal. I'm excited to step into the CEO role on March 31st and to build on the strong foundation we have established across both legacy organizations. Since joining TIC Solutions in August, my priority has been sharpening our commercial execution across the platform. That starts with aligning leadership around clear growth priorities, strengthening account management processes, and accelerating cross-segment collaboration. We are driving greater consistency in pricing and utilization. Before joining TIC Solutions, I served as CEO of NV5 and previously as COO. I joined NV5 through the acquisition of Energenz, a business I co-founded and spent more than a decade building and scaling engineering commissioning operations across global markets. That experience in building commercial teams, improving operating rigor, and driving prudent capital allocation informs how I approach this next chapter. 2025 marked an important step change for TIC Solutions.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

We completed the combination, rebranded, and established a scaled TIC engineering and geospatial platform positioned for the next phase of growth. On a combined basis in 2025, we grew revenue approximately 4% to $2.1 billion, representing our highest combined full-year revenue. We delivered approximately $312 million of adjusted EBITDA and 14.8% adjusted EBITDA margin for the full year. We now operate at meaningful scale with a diversified end market mix and a recurring revenue base anchored in compliance and essential services that positions us well for durable growth. We have an incredible opportunity ahead to expand margins and compound earnings through focused execution of our strategy. As we move into 2026, our priorities are clear. First, we'll accelerate organic growth across the platform with a particular focus on cross-selling and deeper client engagement across our segments.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

We see a meaningful opportunity to expand share of wallet with key infrastructure, industrial, utilities, data center, and government clients by leveraging our combined capabilities. Second, we are focused on strengthening organizational alignment and cultural cohesion across tech. We retain our great talent and deploy our resources and capital to the highest return opportunities. Finally, we'll drive margin expansion through prudent cost management, service mix improvement, and utilization improvements as we scale. We're beginning to see tangible cross-selling traction across the platform. For example, we're in late-stage negotiations on a multi-year bridge infrastructure engagement. The scope brings together drone-based LiDAR mapping and modeling, engineering oversight and design review, rope access and inspection capabilities, allowing the client to execute a long-term inspection and maintenance solution.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

This is a good example of how we can serve as a multi-disciplinary provider across the asset lifecycle, which we believe is a differentiator in the market. In this example, we expect opportunities to expand in scope over time, including additional inspection work and analytic services. This project is emblematic of the sizable market opportunity ahead for this integrated offering. Our revenue base remains anchored in recurring and repeat compliance-driven inspection, engineering, and geospatial activity. We believe the diversified nature of our portfolio provides enhanced ability and performance and greater flexibility in capital allocation. Diving into segment performance, CE continued to perform well. Activity in data centers, infrastructure engineering, building planning and design, and specialty services such as the development of digital twins remains healthy. Results were supported by ongoing infrastructure investment and grid hardening and modernization programs.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

These programs are typically embedded within multi-year capital plans rather than short cycle activity. Data center revenue increased meaningfully year-over-year, reaching nearly $70 million in 2025, more than doubling versus the prior year. We continue to see strong momentum with line of sight to nearly $100 million of data center revenue, supported by contracted backlog and programmatic client engagements. Within data centers, our work spans building systems design, commissioning and power-related scopes, including mechanical, electrical, fire protection, substation, peer review, and digital modeling services. Our mix reflects a broader life cycle position. We support hyperscale and co-location clients from early-stage engineering and design through commissioning and operational optimization, increasing scope density per site and supporting repeat deployment across multi-phase campus relationships. We also recently secured a U.S.-based I&M engagement within the data center vertical, extending our inspection capabilities into the mission-critical space.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

The scope involves radiographic testing of critical mechanical systems. The engagement demonstrates the applicability of our advanced NDT capabilities within the data center ecosystem. We continue to deepen relationships with global hyperscale clients. We, as we expand service breadth within existing accounts, we expect to continue gaining market share. Geo delivered steady growth and strong margins, supported by utility demand, healthy fleet utilization, and increasing contribution from analytics and software services. During the quarter, the federal funding lapse slowed certain procurement and approval processes, which affected timing of work and select programs. The impact was limited to award and approval pacing, and there were no material cancellations. We expect execution timing and visibility to improve as we progress through the year. In February, we announced GeoAgent, our proprietary AI-enabled geospatial platform, and we expect to begin rolling it out to clients in the coming weeks.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

GeoAgent is designed to integrate with clients' existing systems record, and over time, it should improve processing efficiency, automate key workflows, and enable higher value analytics. We expect it to support faster delivery times and incremental analytics services over time while operating within client environments and established workflows. Year-end backlog within CE and Geo was $1.07 billion, up about 10% from approximately $970 million last year. In I&M, lower volumes were concentrated in the Gulf Coast, primarily due to LNG construction timing and slower chemical activity, along with a few site losses amid elevated competition. Competitive intensity in the region remained elevated during 2025, and we stayed disciplined on pricing while tightening account coverage and improving staffing and resource deployment.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

LNG-related demand has increased globally, and we believe the impact in our second half results reflects timing between major construction phases rather than demand deterioration. We have strengthened regional leadership in the Gulf Coast and made targeted leadership additions within Inspection & Mitigation to drive operating consistency, commercial focus, and improved resource deployment. We remain focused on margin quality, and we continue to pursue work that meets our margin thresholds. We maintain pricing integrity even when competitors were more aggressive, and we will not trade long-term economics for short-term volume. Our embedded run and maintain programs and call-out activity grew in the year. This recurring and repeat revenue base provides meaningful visibility and resiliency across cycles.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

This growth was offset by declines in the timing of and scale of outages and capital projects. To strengthen execution, we refined the I&M operating model during the quarter by reorganizing the segment into economically meaningful operating regions with clear P&L ownership. We also streamlined support functions and improved indirect cost management to reduce duplication and improve coordination. We are tightening utilization management, asset deployment, and cost oversight. On the commercial side, we are reinforcing structured account and pipeline management discipline across our largest customers, with compensation frameworks aligned to growth and renewal performance. Collectively, these actions are intended to improve execution consistency and support margin progression in 2026. We plan to host an Investor Day in May to outline our longer-term growth strategy, margin trajectory, and capital allocation framework, including additional detail on our updated I&M operating framework.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Across tech solutions, this quarter's performance reinforces the benefits of scale and diversification in our business. We believe that this positions the company for continued growth and margin progression. With that, I'll turn the call over to Kristin to review the financial details for the full year and fourth quarter 2025, provide an update on integration, and offer context for our 2026 outlook.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Thank you, Ben, and congratulations. Good morning, everyone. On a combined basis, full-year revenue grew 4.4% on a constant currency basis or 3.6% as reported to $2.1 billion after FX headwinds in the year. Full-year combined adjusted gross profit was $794 million, with adjusted gross margin of 37.6%, up 14 basis points. In I&M, revenue was approximately $1.1 billion for 2025, roughly flat for the year, with growth in industrial, midstream, wind, and automotive offset by localized softness in the Gulf Coast. I&M full-year adjusted gross margin was 27.8% compared to 28.5% in the prior year. On a combined basis, CE revenue was $714 million, up roughly 8% against 2024, lifted by infrastructure and data center tailwinds.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

CE's full-year adjusted gross margin was 47.0%, up 150 basis points against 45.5% in the prior year, driven by data center growth and real estate transaction work. On a combined basis, geospatial revenue was $298 million, up roughly 6% against 2024, driven by strong commercial demand as well as broadening analytics and software sales. Geospatial's full-year adjusted gross margin was 51.5% compared to 53.6% in the prior year, driven by mix and utilization. Now shifting to our fourth quarter results. Total revenue was $508 million, reflecting a full quarter of NV5 contribution. On a combined basis, this was roughly flat year-over-year, with growth in CE and Geo offset by I&M.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Adjusted gross profit for the quarter was $197 million, up 8% from the combined $183 million. Adjusted gross margin was 38.8%, up 277 basis points from the combined margin of 36.0% in the prior year period. This performance represented margin expansion on a dollar and percentage basis across all three segments. In I&M, revenue was $258 million in the fourth quarter, down 2%, driven by lower outage and capital project spending. Adjusted gross margin was 28.2% for the quarter compared to 26.1% in the prior year period. The over 200 basis point margin improvement reflects favorable mix, including higher call-out activity as well as improved execution. On a combined basis, CE contributed fourth quarter revenue of $181 million, up 2%.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

CE's adjusted gross margin was 46.9% in the quarter, up 150 basis points against 45.4% in the prior year period, driven by infrastructure and data center tailwinds. On a combined basis, Geo contributed fourth quarter revenue of $70 million, up 2%, with growth impacted due to the federal funding lapse. Geo's adjusted gross margin of 57.2% in the quarter improved against 50.0% in the prior year period, reflecting favorable project mix and strong operational execution. The margin improvement in each of our three segments in the quarter demonstrates real momentum as we start 2026. Adjusted SG&A for the quarter was $124 million or 24.4% of revenue, reflecting the inclusion of NV5 operations, which carry a higher SG&A ratio.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

In the near term, we are attacking the elevated SG&A levels through the announced integration program as well as our commercial excellence initiatives. Adjusted EBITDA for the fourth quarter was $76.4 million, representing an adjusted EBITDA margin of 15.0% compared to $40.7 million in the prior year period. The full year combined adjusted EBITDA was $312 million, representing an adjusted EBITDA margin of 14.8%. We improved cash conversion during the year, supported by lower DSO and tighter working capital management. Operating cash flow, as reported for the year, was $95 million, reflecting only a partial year contribution from NV5. Capital expenditures for the full year totaled $34 million or 2.2% of revenue.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

On a combined basis, CapEx was $56 million or 2.7% of revenue, reflecting our low capital intensity and asset-light business. Moving now to an overview of our balance sheet and capital resources. As of year-end, we had total liquidity of $551 million, including approximately $440 million of cash and cash equivalents and $111 million of available capacity under our revolving credit facility. Total term loan debt was approximately $1.6 billion. Our balance sheet is in a solid position and we remain focused on generating free cash flow to achieve our long-term net leverage ratio target of below three times. In October, we completed a $250 million private placement of 20 million shares of common stock and pre-funded warrants to an existing shareholder.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

The transaction strengthened our balance sheet and provided additional flexibility to fund growth opportunities and to deleverage. Turning to integration, we transitioned to the execution phase of the integration program toward the end of the fourth quarter. We remain on track to execute on the $25 million of cost synergies that we've committed to delivering. We anticipate roughly half of the annualized cost savings to be realized during 2026, and we expect to reach full synergy run rate by mid-2027. To ensure disciplined execution, our integration management office has clear ownership across key functional work streams with defined milestones to track delivery and cost capture while ensuring operational stability. We are also focused on communication, incentive alignment, and cultural integration as we bring the organizations together. Now turning to our outlook.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

For the full year 2026, we expect revenue in the range of $2.15 billion-$2.25 billion and adjusted EBITDA in the range of $330 million-$355 million. At the midpoint, this implies approximately 4% revenue growth over our 2025 combined baseline of $2.1 billion. Meaningful year-over-year growth in adjusted EBITDA is expected to be driven by commercial focus and partial realization of our cost synergies, along with the operating model refinements in I&M that Ben discussed earlier. By segment on a combined basis, we expect growth in CE & Geo to outpace growth in I&M for the full year. Please note that our 2026 adjusted EBITDA guidance reflects an $8 million investment related to compensation alignment actions at NV5.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Specifically, we made a decision to reclassify the short-term incentive program at NV5 from stock-based compensation to cash compensation, which all else equal, reduces adjusted EBITDA beginning in 2026, thus impacting our guidance framework. This important change reflects an integrated market-based compensation structure at TIC. We are excited to announce this to our team, and we believe this will help retain and attract top talent as we continue to grow. We expect typical seasonality in 2026, consistent with the combined profile of our business. First quarter adjusted EBITDA typically represents roughly 15%-18% of full-year EBITDA. In line with historical patterns, the first quarter is generally the lightest quarter of the year, and we expect activity levels and margins to improve with performance weighted towards the second and third quarters.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

As you think about the first quarter, based on what we see today and our internal planning assumptions, we imply revenue in the range of $470 million-$485 million and adjusted EBITDA of $55 million-$60 million. From a cash flow perspective, we expect healthy free cash flow conversion from adjusted EBITDA. In 2026, we expect net interest expense of $95 million-$105 million, cash taxes in the range of $20 million-$30 million, and capital expenditures between $60 million-$70 million. We also expect working capital to be a modest use of cash as we see growth this year. Taken together, these items frame our expected free cash flow generation for 2026. We are excited to be filing our first 10-K as a combined company.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

I want to thank our teams across the organization for the care, commitment and TIC-first mindset that they've demonstrated through this period of change. Many leaders within our businesses have taken on additional responsibilities to move this forward, and the integration momentum and progress we've made reflects the pride and ownership our teams bring to the table every day. With that, I'll turn the call over to Robbie to discuss our long-term strategy and capital allocation priorities.

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

Good morning, and thank you, Kristen. I also want to thank our investors for your continued engagement and support. Before I outline our strategic priorities, I want to reiterate the board's confidence in Ben's leadership and thank Tal for his decades of service. With integration underway, TIC Solutions is a unified platform with meaningful scale across inspection, engineering, and geospatial analytics. Our revenue base is anchored in non-discretionary maintenance, regulatory compliance, utility programs, and long-cycle investment across critical industries. We support our clients from planning and design through commissioning, maintenance, compliance, and asset optimization. Our team combines field data collection with design analysis and digital capabilities that enhance reliability and reduce operational risk. Our capital allocation framework is disciplined.

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

We will prioritize deleveraging towards our long-term target, reinvest organically in the highest return areas of our business, and pursue selective tuck-ins and larger acquisitions that enhance capability, geography, or technical depth at attractive returns. This week, our board authorized a $200 million share repurchase program, which we may use opportunistically based on market conditions.

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

With scale, diverse end markets, and resilient revenue characteristics, we believe TIC Solutions is positioned to compound earnings and cash flow over time. 2026 is a critical year for TIC Solutions. We are laser-focused on execution and delivering on the targets we have shared with the investor community. We are encouraged by our early results to start the year and have confidence in our team's ability to drive top and bottom-line growth. With that, I'll turn the call back to Ben to close our prepared remarks.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Thank you, Robbie. As we close, I want to frame where we are going. 2025 was a pivotal year for TIC Solutions. We successfully brought together two scaled organizations, strengthened the balance sheet, and advanced integration while continuing to deliver for our clients without disruption. The structural tailwinds in our markets remain intact, including infrastructure reinvestment, grid modernization, increasing technical and regulatory complexity, and the continued expansion of mission-critical facilities. As we move into 2026, we are focused on accelerating growth by increasing share of wallet, expanding cross-selling across our segments, and scaling our account coverage while strengthening how we work together and reinforcing a common culture. That focus supports continued margin progression and cash generation while maintaining balance sheet strength, which will ultimately drive shareholder returns. I want to take a moment to recognize our teammates across TIC Solutions.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

They've handled a period of significant change with discipline and focus while staying committed to delivering for our clients every day. Thank you. With that operator, we're ready to open the line for questions.

Operator

Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for your questions. Our first question has come from the line of Chris Moore with CJS Securities. Please proceed with your questions.

Analyst at CJS Securities

Good morning. This is Will in for Chris.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Morning, Will.

Analyst at CJS Securities

Can you talk a little bit more about the integration process in a little more detail? Are there specific milestones you're looking to reach in 2026?

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Yeah. Thank you for the question. I will tell you that I am extremely proud of the team and the momentum that we have so far. A high degree of confidence in our ability to execute on this. Right now, I would tell you that some of our focus areas have been around communications and culture, which is incredibly important, especially during a leadership transition. We're working through compensation studies and alignment and choosing system implementation partners. If you think about our commitment of $25 million of savings and capturing half of that this year, think about that as roughly 60% headcount and the rest non-headcount. The team is meeting weekly on individual milestones and, you know, on track or ahead of schedule.

Analyst at CJS Securities

That's super helpful. Thank you. On the top line, can you talk more about the biggest potential synergies and go-to-market strategies, and what are you hearing from customers? Are there any cross-selling opportunities that you're seeing that you weren't thinking about initially?

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah, thanks. Yeah, we touched on it on the call, but we have some really exciting developments and opportunities that are coming through the cross-selling program. Been really pleased with how the segments have been coming together and exploring ideas with their clients. You know, we have a lot of white space between the businesses that create opportunity. You know, just pointing to that recent win in Inspection & Mitigation within the data center space, that's really exciting. That's completely new to Inspection & Mitigation. To be able to bring that, get that exposure to that market where we're seeing a lot of tailwinds is exciting.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

On the infrastructure side of things, where we're able to really service the full life cycle of any kind of asset now with our capabilities from planning and design, consulting and engineering and through I&M, it's driving opportunity for us to service our clients in new ways. We're seeing a lot of upside. It does take time to get these wins in play. We've got to put these ideas in front of our clients and get it to a contract. Very pleased with the progress that we're seeing so far.

Analyst at CJS Securities

Thank you.

Operator

Thank you. Our next question has come from the line of Brian Biros with Thompson Research Group. Please proceed with your questions.

Analyst at Thompson Research Group

Good morning. This is Chris calling in for Brian. A couple of questions on end markets. It seems fair to say that some of the smaller exposure categories are the fastest-growing. In your release and prepared comments, you called out significant organic growth in data centers, and we know that aerospace is another fast-growing end market. Both of these, of course, are higher margin businesses. Where do you think these businesses could be in the next 12-24 months, and could they represent a double-digit percentage of sales?

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah. I mean, in terms of organic growth, we sort of, you know, we've doubled the data center business over the last 12 months. We're continuing to see, you know, be on track for continued significant growth. Related to that is power delivery and, you know, the demand that data centers are putting on the grid. We're very well positioned to exploit that also with our technical capabilities in that space, along with infrastructure in general and the demand that we're seeing there. Some good end markets. Data centers will continue to grow and outpace certain parts of the business, especially as we layer in new services and increase our revenue per megawatt.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Chris, I would just add that. You know, one of the things we're really excited about with the combination of the businesses is the more diversified platform. Really, we see all of our end markets as having tailwinds. Yes, there are pockets of outsized or outpaced growth, but in general, we're really optimistic about all of our end markets.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah, probably a good indicator of that, the backlog being up 10% year-over-year.

Analyst at Thompson Research Group

Yeah. Fantastic. Thanks for the color. Can you talk a little bit about your expectations on the inspection side for the energy and oil end markets? I know they can be somewhat lumpy quarter to quarter with the chemical market pressure and how oil and gas is performing, but how should we think about that end market into 2026?

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah. I mean, we have good visibility on the business. A very large percentage of it is planned outages and run and maintain. You know, year on year, as we look at the number of sites that we're working on, it is similar. In a lot of cases, the contracts have a longer timeline. So we have good visibility there.

Analyst at Thompson Research Group

Fantastic. Thank you for taking my questions.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Thanks, Chris.

Operator

Thank you. Our next question has come from the line of Tomohiko Sano with JPMorgan. Please proceed with your questions.

Tomohiko Sano
Tomohiko Sano
Managing Director at JPMorgan

Hi. Good morning, everyone.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Morning.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Morning.

Tomohiko Sano
Tomohiko Sano
Managing Director at JPMorgan

Thank you. Could you talk about the EBITDA margins in the latest 2026 guidance? I see it's lower than what was indicated in your prior outlook. Given the considerations of the stock comp to cash comp, I get that, but what other reasons for this more cautious margin outlook compared to what you guided three months ago, please?

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Yeah. Thank you. You're spot on. The previous range was 15.5%-16.5%, and that's been adjusted by the stock compensation investment that we've decided to make. We think this is best for the business on the long term and really drives the integration of the teams and provides market-based compensation for our teams. We feel that that's the right decision, and from there. From there, we've given, you know, a nice framework for our 2026 guidance, both on revenue and adjusted EBITDA on a consolidated basis. You know, demonstrating growth on the top line as well as, you know, margin expansion coming from improved execution across all three segments as well as the planned cost synergy realization.

Tomohiko Sano
Tomohiko Sano
Managing Director at JPMorgan

Thank you. Follow up on CEO transitions. Could you elaborate on the timing and rationale for these transitions? Should we expect any changes in strategies or execution, please?

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

It's Robbie. The transition was so sort of contemplated from the onset, when we even bought Acuren. Tal's been in the business for a very long time, and we wanted to create an environment where he could execute and put really have his fingerprints on what the combined TIC Solutions entity would look like. We also had Ben, who was already CEO of NV5, knew the business, but we wanted to give him sort of the period to learn about Acuren and sort of the inspection side of the business. In terms of timing, we feel like this is sort of the right transition time as we build sort of this unified culture.

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

Pretty consistent with sort of our original thinking, and the board and the entire team is very supportive of sort of this path.

Tomohiko Sano
Tomohiko Sano
Managing Director at JPMorgan

Thank you, Robbie. That's all from me.

Operator

Thank you. Our next question has come from the line of Alex Rygiel with Texas Capital. Please proceed with your questions.

Alex Rygiel
Alex Rygiel
Managing Director and Head of Equity Research at Texas Capital

Thank you very much. You know, more broadly, can you address the current situation in the Middle East and the rise in oil prices and how that could impact your business or some of your customers' decisions?

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah. The Middle East is a relatively small piece of our business, around 1%. You know, it's relatively immaterial. Right now, the impacts that we're seeing are minimal on the business there. As far as the price of oil and the impact on the business, you know, we could see some additional work around pipelines. It's good for our oil sands business, and the refinery side of the business is relatively stable. I mentioned earlier the good line of sight that we have with the run and maintain business and, you know, right now the outlook looks good.

Alex Rygiel
Alex Rygiel
Managing Director and Head of Equity Research at Texas Capital

Very helpful. As it relates to revenue guidance, which suggests a kind of 2%-7% growth rate, can you talk about the primary variables that could cause this to be either kind of closer to the high end or the low end?

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Yeah. From a 2026 perspective on the top line, I would tell you we have a high degree of confidence in this, and it was a very thoughtful approach that we did to the budgeting process this year, down to the division level and a bottoms-up approach. Given the tailwinds we have in our business, you know, we feel very confident in our ability to deliver against that.

Alex Rygiel
Alex Rygiel
Managing Director and Head of Equity Research at Texas Capital

Thank you.

Operator

Thank you. Our next question has come from the line of Harold Antor with Jefferies. Please proceed with your questions.

Harold Antor
Harold Antor
Senior Equity Research Associate at Jefferies

Good morning. This is Harold Antor on for Stephanie Moore. Quick question, just on the pricing front, could you remind us what pricing ran historically, how it trended in the quarter, just given you were more disciplined, and what, as you focus on the margin profile and want to walk away from some businesses? I guess, do you see that you guys are better positioned to be more aggressive on pricing just given you provide the full suite of products and services today versus most of your competitors who can't compete on that front? Thank you.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah. We mentioned some of the work that we've done around the organization of our inspection and mitigation business in the U.S. That has offered us an opportunity to, you know, be more competitive on our pricing and go after more of the work in that space. A lot of the work that we price is more on a value proposition, you know, fixed fee kind of work, and we continue to see good momentum there. I would also just point back to the backlog being up 10% and the sales being very positive through the first part of this year already.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Yeah, just, I mean, you mentioned the mix of work and if we think of this opportunity to work through the life cycle of an asset, we are very sticky with our clients. You know, we have very strong relationships, and our ability to work through the entire life cycle of an asset keeps us very sticky with those assets and clients.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Harold, on the pricing. I think also would just remind you to point back to our Q4 results. You know, gross margin dollars and percentage were up across all three of our segments. We feel really good about that heading into 2026. If you combine that with some of the operational initiatives under Ben's leadership, you know, high degree of confidence.

Harold Antor
Harold Antor
Senior Equity Research Associate at Jefferies

Yep. Then just to piggyback on an earlier question. Ben, I think you highlighted that you see line of sight to $100 million in data center revenue. Just wanted to get a sense, is that a 2027 event? Is that a 2028 event, or is that a longer term event? Just wanted to get a sense of the timing on that.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

It's a 2026 line of sight. You know, we have a very strong backlog particularly to that, and we have multi-year programs. It's an extremely resource-constrained area of the business where we have very strong relationships with the hyperscalers. You know, we see, you know, over the next 12 months, line of sight to those numbers.

Harold Antor
Harold Antor
Senior Equity Research Associate at Jefferies

Thank you. If I could squeeze in one more just on capital allocation that you guys focused, did the buyback. Should we be thinking more of the capital being deployed in buybacks or do you expect to do a little bit more on the, on tuck-in side or any organic growth, tech implementation investments that you could provide a little bit more color on? That would be great. Thank you. That's all for me.

Robbie Franklin
Robbie Franklin
Executive Chairman at TIC Solutions

On capital allocation, we have a robust tuck-in pipeline that we're gonna continue to execute on. We thought as a board it was prudent to have the flexibility to have a buyback program in place given where market conditions are. Frankly, there's no better acquisition than your own stock at the right levels. We have a very opportunistic view on how we approach M&A. There is no question we're continuing with pipeline because it creates a more robust operating profile and allows us to new geographies and new service lines which are critical to sort of our investment thesis.

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

Harold-

Operator

Thank you-

Kristin Schultes
Kristin Schultes
CFO at TIC Solutions

I would just add that on our, you know, on the tuck-in side that Robbie mentioned, I'm really proud of the team's ability to continue maintaining focus on the broader integration with the merger, but also remain focused on the importance of the small tuck-in strategy that we have that's been largely successful for us. We, you know, completed three small tuck-ins during the quarter and the combined business together, you know, added 12 for the full year, and that's across all three segments. We're excited to continue that into the new year

Operator

Thank you. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We have reached the end of our question and answer session. I would now like to hand the call back over to Ben Heraud for any closing comments.

Ben Heraud
Ben Heraud
President and COO at TIC Solutions

Thank you all for your questions. You know, I just wanted to reemphasize our strategic priorities to drive shareholder value. You know, one, we need to accelerate our organic growth, and we will. Two, we're gonna strengthen our organizational alignment and cultural cohesion. Three, drive margin expansion. Finally, I wanna thank our investors for their continued support and partnership. We look forward to updating you on our next quarter. Thank you all, and have a good day.

Operator

Thank you, ladies and gentlemen. This does now conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

Executives
    • Andrew Shen
      Andrew Shen
      Director of Investor Relations
    • Ben Heraud
      Ben Heraud
      President and COO
    • Kristin Schultes
      Kristin Schultes
      CFO
    • Robbie Franklin
      Robbie Franklin
      Executive Chairman
    • Tal Pizzey
      Tal Pizzey
      CEO
Analysts
    • Alex Rygiel
      Managing Director and Head of Equity Research at Texas Capital
    • Harold Antor
      Senior Equity Research Associate at Jefferies
    • Tomohiko Sano
      Managing Director at JPMorgan
    • Analyst at CJS Securities
    • Analyst at Thompson Research Group
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