Revenue Performance - Centuri reported first quarter 2025 revenue of $550.1 million, an increase of $22.1 million or 4.2% year-over-year[6]. - Total revenue for the three months ended March 30, 2025, was $550,081,000, an increase of 4.1% from $528,023,000 in the same period last year[30]. Profitability Metrics - Adjusted EBITDA for the first quarter improved by $4.1 million, or 20.1%, reaching $24.2 million compared to $20.2 million in the first quarter of 2024[5]. - Adjusted EBITDA for the three months ended March 30, 2025, was $24,228,000, with an adjusted EBITDA margin of 4.4%, compared to $20,172,000 and 3.8% margin in the prior year[26]. - The company reported a gross profit of $20,328,000 for the three months ended March 30, 2025, compared to $13,279,000 in the same period in 2024, reflecting a significant increase in profitability[30]. Customer and Market Activity - The company secured record customer awards exceeding $1.2 billion, with a book-to-bill ratio of 2.2x, leading to a backlog increase to $4.5 billion[8]. - Centuri anticipates continued strength in capital spending by customers despite macroeconomic uncertainties[4]. Segment Performance - U.S. Gas segment revenue decreased by $28.9 million, or 12.7%, year-over-year, while Non-union Electric revenue grew by $40.5 million, or 41.9%[13]. - The Canadian Gas segment delivered solid margins, contributing to overall performance despite challenges in the U.S. Gas segment[7]. Financial Position - Centuri's net loss attributable to common stock was $17.9 million, a reduction from $25.1 million in the first quarter of 2024[6]. - Centuri Holdings reported a net loss of $17,924,000 for the three months ended March 30, 2025, compared to a net loss of $25,233,000 for the same period in 2024, representing a 29% improvement[30]. - The diluted loss per share attributable to common stock was $(0.20) for the three months ended March 30, 2025, compared to $(0.35) for the same period in 2024[28]. - Centuri's total debt as of March 30, 2025, was $873,168,000, a decrease from $898,221,000 as of December 29, 2024[28]. - The net debt to adjusted EBITDA ratio improved to 3.5 as of March 30, 2025, compared to 3.6 as of December 29, 2024[28]. - Cash and cash equivalents decreased to $15,255,000 as of March 30, 2025, from $49,019,000 at the end of the previous period[32]. - Net cash provided by operating activities was $16,676,000 for the three months ended March 30, 2025, compared to a net cash used of $(26,451,000) in the same period last year[34]. Strategic Initiatives - The company completed a comprehensive review to optimize its opportunity pipeline and business development functions[6]. - The company affirms a full year 2025 revenue outlook of $2.60 to $2.80 billion and adjusted EBITDA of $240 to $275 million[11]. - The company incurred $1,611,000 in separation-related costs during the three months ended March 30, 2025, which were not present in the same period last year[26].

Financial Performance - Total revenue for the fiscal year ended December 29, 2024, was $2,637,229,000, a decrease of 9.1% compared to $2,899,276,000 in the previous year[371]. - Gross profit for the fiscal year was $220,672,000, down from $273,442,000, reflecting a gross margin of 8.4% compared to 9.4% in the prior year[371]. - The net loss attributable to common stock for the fiscal year was $6,724,000, significantly improved from a net loss of $186,176,000 in the previous year[374]. - Basic loss per share attributable to common stock was $0.08, compared to a loss of $2.60 per share in the prior year[371]. - Cash flows from operating activities generated $158,230,000, a decrease from $167,465,000 in the previous year[377]. - Capital expenditures for the fiscal year were $99,333,000, down from $106,650,000 in the previous year[377]. - The company reported a comprehensive loss of $15,908,000 for the fiscal year, compared to a comprehensive loss of $183,707,000 in the previous year[374]. - Cash and cash equivalents at the end of the period increased to $49,019,000 from $33,407,000 at the beginning of the period[377]. - The company recognized a goodwill impairment of $213,992,000 in the previous fiscal year, which was not present in the current fiscal year[377]. Impairment and Liabilities - The company incurred impairment charges of approximately $214.0 million during the fiscal year ended December 31, 2023, related to the write-down of goodwill from the August 2021 acquisition of Riggs Distler[142]. - The company faces potential liability for warranty claims and faulty engineering, which may reduce profitability[160]. - Warranty claims have historically not been material, but there is a risk of increased claims that could adversely affect results of operations and cash flows[160]. - The company may be subject to contingent tax liabilities of Southwest Gas Holdings following a Distribution, which could be substantial[187]. - The Separation Agreement includes indemnification obligations that could result in substantial liabilities for the company[192]. Market and Economic Conditions - Increased inflation has led to higher operating expenses, particularly in fuel, labor, and materials, adversely impacting profitability and cash flows[145]. - The company has experienced pressures on construction costs due to inflation, which may continue to affect project completion and profitability[146]. - Unfavorable economic conditions, including inflation and supply chain disruptions, could reduce demand for the company's services[150]. - The natural gas market's volatility, influenced by global events and legislative changes, may affect customer investment decisions and project timelines[151]. - Climate change-related events and extreme weather conditions could significantly impact the company's operations and financial results[153]. Regulatory and Compliance Risks - The company is subject to numerous environmental laws, and failure to comply could result in significant liabilities and operational impacts[168]. - Compliance with OSHA regulations incurs significant costs, and non-compliance may lead to penalties and operational delays[166]. - Regulatory constraints and budgetary limitations of customers, primarily regulated utilities, could materially impact the volume of work awarded to the company[148]. - Regulatory changes affecting natural gas and electric transmission could impact demand for the company's services and profitability[162]. - Legislative actions regarding greenhouse gas emissions could increase operational costs and impact pricing strategies[172]. - Changes in renewable energy mandates could reduce project development and impact the company's growth potential[165]. Ownership and Corporate Governance - Southwest Gas Holdings owns approximately 81% of the company's outstanding common stock, controlling significant corporate decisions[174]. - The concentrated ownership by Southwest Gas Holdings may delay or prevent favorable acquisition attempts, affecting stock price[174]. - The company is classified as a "controlled company" under NYSE rules, allowing it to qualify for exemptions from certain corporate governance requirements[188]. - The company may face challenges in negotiating terms with Southwest Gas Holdings that are as favorable as those with unaffiliated third parties[178]. - The company is subject to restrictions on actions, including issuing additional equity, until a Distribution is implemented or abandoned to avoid significant tax-related liabilities[180]. Transition and Separation - The Separation is intended to allow the company to focus on its distinct operating priorities and strategies, enhancing long-term growth opportunities[194]. - The expected benefits of the Separation may not be fully realized, potentially affecting the company's financial condition and operating results[194]. - The company may incur higher costs for certain functions previously performed by Southwest Gas Holdings, which could decrease profitability[194]. - The transition to being a separate publicly traded company may incur significant costs, including accounting, tax, and legal expenses[199]. - The company may face challenges in achieving the anticipated benefits of the Separation from Southwest Gas Holdings[199]. Revenue and Contracts - Revenue from unit-priced contracts for the year ended December 29, 2024 was $1,508.7 million[363]. - Revenue from fixed-price contracts for the year ended December 29, 2024 was $539.5 million[363]. - Master services agreements revenue decreased to $2,121.1 million in 2024 from $2,388.7 million in 2023, representing a decline of 11.2%[453]. - The aggregate amount of transaction price allocated to unsatisfied performance obligations for fixed-price contracts was $251.9 million as of December 29, 2024[458]. - The Company utilizes master services agreements (MSAs) and bid contracts for revenue generation, with the majority of work performed under unit-price contracts[400][403]. Assets and Liabilities - Total assets as of December 29, 2024 were $2,074.4 million, a decrease from $2,189.9 million as of December 31, 2023[368]. - Total liabilities as of December 29, 2024 were $1,514.2 million, down from $1,864.7 million as of December 31, 2023[368]. - Total equity increased to $555.6 million as of December 29, 2024, compared to $226.0 million as of December 31, 2023[368]. - The current portion of long-term debt decreased to $30.0 million as of December 29, 2024, from $42.6 million as of December 31, 2023[368]. - Accounts receivable, net, decreased to $281.4 million as of December 29, 2024, from $347.5 million in 2023[459]. Employee and Organizational Changes - Approximately 59% of the Company's employees were covered by collective bargaining agreements as of December 29, 2024[445]. - The Company underwent a reorganization in January 2024, realigning its reportable segments from two to four[460].

Revenue Performance - Fourth quarter 2024 revenue reached $717.1 million, an increase of $51.8 million or 7.8% year-over-year[5] - Full year 2024 revenue totaled $2.64 billion, exceeding the $2.6 billion midpoint of guidance provided in July[10] - Total revenue for the fiscal year ended December 29, 2024, was $2,637,229, a decrease of 9.1% compared to $2,899,276 for the fiscal year ended December 31, 2023[39] Net Income and Earnings - Net income attributable to common stock for Q4 2024 was $10.3 million, with diluted earnings per share of $0.12[5] - Net income for the fiscal three months ended December 29, 2024, was $10,331, compared to a loss of $212,846 for the same period in the previous year[34] - Net income attributable to common stock for the fiscal year ended December 29, 2024, was a loss of $6,724, compared to a loss of $186,176 for the fiscal year ended December 31, 2023[39] - Adjusted Diluted Earnings per Share for the fiscal three months ended December 29, 2024, was $0.21, compared to $0.07 for the same period last year[37] EBITDA and Margins - Adjusted EBITDA for Q4 2024 was $70.7 million, resulting in an Adjusted EBITDA Margin of 9.9%[5] - Adjusted EBITDA for the fiscal year ended December 29, 2024, was $238,226, down from $291,182 in the previous year, with an Adjusted EBITDA Margin of 9.0% compared to 10.0%[34] - The company recognized $66,569 in EBITDA for the fiscal three months ended December 29, 2024, compared to a loss of $161,243 in the same period last year[34] Debt and Financial Ratios - Centuri's net debt to Adjusted EBITDA ratio improved to 3.6x as of December 2024, down from 4.0x in December 2023[11] - The company reported a net debt of $849,202 as of December 29, 2024, with a Net Debt to Adjusted EBITDA ratio of 3.6, improved from 4.0 in the previous year[37] - Total debt decreased to $898,221 as of December 29, 2024, from $1,186,551 in the previous year[37] Cash Flow and Assets - Cash and cash equivalents increased to $49,019 as of December 29, 2024, from $33,407 at the end of the previous fiscal year, marking a 46.7% increase[43] - Total assets decreased to $2,074,390 as of December 29, 2024, down from $2,189,908 as of December 31, 2023, reflecting a decline of 5.2%[41] - The company reported net cash provided by operating activities of $158,230 for the fiscal year ended December 29, 2024, compared to $167,465 in the previous year, a decrease of 5.4%[43] Strategic Developments - The company appointed Chris Brown as President and CEO, effective December 3, 2024, to drive earnings growth[5] - In Q4 2024, Centuri booked $221 million in new awards, with 45% from MSA renewals and 55% from new contracts[9] - The sales opportunity pipeline has grown by one-third, including $1.5 billion in late-stage bids and approximately 40 MSA renewals expected in the next 12 months[9] Costs and Expenses - The company incurred $1,827 in CEO transition costs during the fiscal three months ended December 29, 2024[34] - Non-cash stock-based compensation expense was $1,421 for the fiscal three months ended December 29, 2024, compared to a negative $298 in the same period last year[34] - Strategic review costs for the fiscal year ended December 29, 2024, totaled $2,010, down from $3,365 in the previous year[34] - Interest expense for the fiscal year ended December 29, 2024, was $90,515, slightly down from $97,476 in the previous year[34] Profitability Metrics - Gross profit for the fiscal year ended December 29, 2024, was $220,672, down from $273,442 in the previous year, representing a decline of 19.2%[39] - Operating income for the fiscal year ended December 29, 2024, was $86,783, a significant improvement from an operating loss of $77,564 in the previous year[39] Capital Expenditures - Capital expenditures for the fiscal year ended December 29, 2024, were $99,333, down from $106,650 in the previous year, indicating a reduction of 6.2%[43] Shareholder Information - The weighted average diluted shares outstanding increased to 88,609 for the fiscal quarter ended December 29, 2024, compared to 71,666 for the same period in the previous year[39]

Core Insights - Centuri Holdings, Inc. is under investigation for possible securities fraud, with a potential class action being considered for affected investors [1][2] - The company reported Q2 financial results that missed market expectations, with a Non-GAAP EPS of $0.20, falling short by $0.02, and quarterly revenue of $643.39 million, a 17.0% decline year-over-year, missing analyst estimates by $117.03 million [3] Financial Performance - Q2 2024 Non-GAAP EPS was $0.20, missing expectations by $0.02 [3] - Quarterly revenue was $643.39 million, representing a 17.0% decline compared to the same period last year [3] - Revenue missed analyst estimates by $117.03 million [3] IPO Information - Centuri went public on April 18, 2024, offering 12.4 million shares at $21 per share [3]

Financial Performance - Third quarter 2024 revenue was $720.1 million, a decrease of $54.8 million, or 7.1%, compared to the prior year period[11] - The company reported a net loss attributable to common stock of $3.7 million, with a diluted loss per share of $0.04[2] - Adjusted EBITDA for the third quarter was $78.8 million, resulting in an adjusted EBITDA margin of 10.9%[2] - Total revenue for the fiscal three months ended September 29, 2024, was $720.1 million, a decrease of 7.1% from $774.9 million for the same period in 2023[36] - Gross profit for the fiscal nine months ended September 29, 2024, was $149.6 million, down 31.7% from $219.5 million for the same period in 2023[36] - Net loss attributable to common stock for the fiscal three months ended September 29, 2024, was $(3.7) million, compared to net income of $16.2 million for the same period in 2023[36] - Adjusted diluted earnings per share for the fiscal three months ended September 29, 2024, was $0.06, down from $0.33 for the same period in 2023[34] Revenue Breakdown - The U.S. Gas segment revenue decreased by $29.7 million, or 7.5%, to $366.1 million, primarily due to reduced net volumes under existing customer MSAs[11] - Revenue from the Canadian Gas segment was $126.0 million, a decrease of $16.0 million or 11.3% year-over-year, with gross profit increasing to 21.2% from 15.5%[17] - Revenue from the Union Electric segment totaled $499.7 million, down $128.3 million or 20.4% compared to the prior year, with gross profit increasing to 7.8% from 7.0%[18] - Revenue from the Non-Union Electric segment was $346.0 million, reflecting a decrease of $34.9 million or 9.2%, with gross profit decreasing to 11.7% from 13.6%[19] - The Non-Union Electric segment revenue increased by $18.1 million, or 16.4%, to $128.8 million, driven by storm restoration services[14] - Storm restoration services revenue for the Union Electric segment was $20.3 million, down from $24.2 million in the prior year[18] Backlog and New Business - The backlog at the end of the third quarter totaled $4.3 billion, with 87% related to Master Service Agreement (MSA) revenue[2] - The company secured approximately $350 million in new business during the quarter, including new and renewed MSAs[6] - The company secured approximately $350 million in potential revenue from awards in the quarter[23] Cash and Debt Management - The company ended the quarter with $52.5 million in cash and cash equivalents, and improved its leverage ratio from June 2024[9] - Cash and cash equivalents increased to $52.5 million as of September 29, 2024, from $33.4 million at the end of 2023[38] - Total current liabilities decreased to $386.2 million as of September 29, 2024, from $420.6 million at the end of 2023[38] - Long-term debt, net of current portion, decreased to $762.1 million as of September 29, 2024, from $1.0 billion at the end of 2023[38] Operating Performance - Operating income for the fiscal nine months ended September 29, 2024, was $53.1 million, a decline of 55.0% from $117.9 million for the same period in 2023[36] - The company reported a net cash provided by operating activities of $97.2 million for the fiscal nine months ended September 29, 2024, compared to $61.8 million for the same period in 2023[40] - Interest expense for the fiscal three months ended September 29, 2024, was $23.9 million, down from $26.1 million in the prior year[32] Strategic Focus - The company is focused on diversifying its business mix by pursuing additional strategic bid opportunities aligned with its risk profile and core competencies[23] - Adjusted EBITDA margin percentage outlook for the full year is estimated to be between 9.0% and 9.6%[10] - The revenue outlook for the full year 2024 is projected to be between $2.5 billion and $2.7 billion[10]

IPO and Financial Position - Centuri Holdings completed its IPO on April 22, 2024, selling 14,260,000 shares at an initial price of $21.00 per share, resulting in net proceeds of approximately $328.0 million after expenses[107]. - As of June 30, 2024, cash and cash equivalents were $30.9 million, down from $33.4 million on December 31, 2023[160]. - Net cash used in operating activities for the six months ended June 30, 2024 was $76.4 million, a decrease of $56.9 million compared to $19.5 million for the same period in 2023[164]. - Net cash provided by financing activities increased by $92.3 million during the six months ended June 30, 2024, primarily due to net proceeds from the Centuri IPO and private placement totaling $330.3 million[166]. - The company has a senior secured revolving credit and term loan facility with a total capacity of $400 million, with $143.6 million outstanding on the revolving credit facility as of June 30, 2024[168]. - The maximum amount outstanding on the combined credit facility was $1.117 billion during the six months ended June 30, 2024[168]. - The company is required to maintain a net leverage ratio of less than 5.00 to 1.00 from April 18, 2024 through June 30, 2024, following the completion of the Qualified IPO[170]. - Contractually obligated principal payments on long-term debt total approximately $1.056 billion, with $831.4 million due in 2028[171]. Revenue and Segment Performance - Consolidated revenue for the three months ended June 30, 2024, was $672.1 million, a decrease of $133.7 million or 16.6% compared to $805.8 million in the prior year[130]. - U.S. Gas segment revenue totaled $340.7 million, a decrease of $51.2 million or 13.1% compared to the prior year, with gross profit margin dropping to 7.4% from 11.2%[130][131]. - Canadian Gas segment revenue was $41.0 million, down $7.1 million or 14.8%, but gross profit margin increased to 22.8% from 15.8%[131]. - Union Electric segment revenue decreased by $54.0 million or 24.8% to $164.2 million, with gross profit margin declining to 7.4% from 7.8%[132]. - Non-Union Electric segment revenue was $120.5 million, a decrease of $13.0 million or 9.8%, with gross profit margin dropping to 13.5% from 15.4%[133]. - Consolidated revenue dropped by $258.9 million, or 17.7%, to $1,200.1 million, with consolidated gross profit decreasing to $73.8 million[142]. Profitability and Expenses - Gross profit for the same period was $60.5 million, representing a gross margin of 9.0%, down from 11.2% in the prior year, reflecting a decrease of $29.5 million or 32.8%[130]. - Selling, general and administrative expenses decreased by $9.4 million or 31.2% compared to the prior year, primarily due to lower incentive compensation and reductions in corporate salary and benefit costs[135]. - Selling, general and administrative expenses decreased by $4.4 million, or 8.2%, primarily due to lower incentive compensation and corporate salary reductions[147]. - Interest expense decreased due to a reduction in average debt balance, with $156.0 million paid down under the revolving credit facility and $160.0 million under the term loan facility[137]. - The effective tax rate for the fiscal three months ended June 30, 2024, was (4.2%), significantly impacted by nondeductible expenses in relation to income before income taxes[138]. - The effective tax rate increased to 61.1% from 37.4%, significantly impacted by nondeductible expenses[150]. - Net income for the three months ended June 30, 2024, was $11.7 million, a decrease of $6.8 million or 36.9% compared to $18.5 million in the prior year[130]. - Adjusted Net Income for the fiscal six months ended June 30, 2024, was $2.6 million, compared to $23.1 million for the same period in the prior year[158]. Operational Challenges and Market Conditions - Rising fuel, labor, and material costs have negatively impacted operations, with the company unable to fully pass these costs to customers[112]. - Inflation and rising interest rates could negatively affect the company's financial condition and results of operations[123]. - Seasonal demand affects revenue, typically lowest in the first quarter due to winter conditions, with higher revenue expected in summer and fall[121]. - The company has taken steps to secure equipment availability and does not anticipate significant disruptions in the near term[114]. - The company is well-positioned to benefit from increased demand for utility infrastructure services due to aging infrastructure and regulatory requirements[111]. Strategic Initiatives - The company aims to support customers' environmental goals, including reducing methane emissions and enhancing renewable energy infrastructure[118]. - The company reported a reorganization of its reportable segments from two to four, now including U.S. Gas, Canadian Gas, Union Electric, and Non-Union Electric[109]. - The company expects separation-related costs to continue through at least fiscal year 2025 as it establishes itself as a standalone public entity[108].

Financial Performance - Centuri reported Q2 2024 revenue of $672.1 million, a decrease of $133.7 million or 16.6% compared to Q2 2023[3]. - Net income attributable to common stock was $11.7 million, with diluted earnings per share of $0.14; adjusted net income was $17.0 million, or adjusted diluted earnings per share of $0.20[3]. - Adjusted EBITDA for Q2 2024 was $68.6 million, with an adjusted EBITDA margin of 10.2%[3]. - Full year 2024 revenue guidance is projected between $2.5 billion and $2.7 billion, with an adjusted EBITDA margin of 9.0% to 9.6%[7]. - Adjusted EBITDA for the fiscal three months ended June 30, 2024, was $68.6 million, down from $92.9 million in the same period of the prior year[28]. - Free Cash Flow for the fiscal three months ended June 30, 2024, was $48.6 million, compared to $64.4 million in the same period of the prior year[29]. - Free Cash Flow Conversion was 70.8% for the fiscal three months ended June 30, 2024, compared to 69.3% in the same period of the prior year[29]. - Adjusted Net Income for the fiscal three months ended June 30, 2024, was $16.99 million, compared to $25.02 million in the same period of the prior year[30]. - Total revenue for the fiscal three months ended June 30, 2024, was $672,075,000, a decrease of 16.5% compared to $805,779,000 for the same period in 2023[33]. - Adjusted diluted earnings per share for the fiscal three months ended June 30, 2024, was $0.20, down from $0.35 in the same period last year, representing a decline of 42.9%[31]. - Net income for the fiscal three months ended June 30, 2024, was $11,697,000, compared to $18,527,000 for the same period in 2023, a decrease of 36.8%[33]. - Gross profit for the fiscal three months ended June 30, 2024, was $60,504,000, down 32.8% from $89,972,000 in the same period last year[33]. - Operating income for the fiscal three months ended June 30, 2024, was $33,145,000, a decrease of 37.7% compared to $53,202,000 in the same period last year[33]. Segment Performance - The U.S. Gas segment revenue decreased by $51.2 million, or 13.1%, to $340.7 million compared to the prior year[8]. - The Canadian Gas segment revenue decreased by $7.1 million, or 14.8%, totaling $41.0 million, while gross profit increased to 22.8%[9]. - The Union Electric segment revenue decreased by $54.0 million, or 24.8%, to $164.2 million, primarily due to a decline in offshore wind revenue[10]. - Revenue from the Union Electric segment totaled $328.1 million, a decrease of $95.8 million, or 22.6%, compared to the prior year period[14]. - Revenue from the Non-Union Electric segment totaled $217.1 million, reflecting a decrease of $53.0 million, or 19.6%, compared to the prior year period[15]. - Gross profit as a percentage of revenue decreased to 7.1% for the Union Electric segment and 8.8% for the Non-Union Electric segment, down from 7.6% and 14.5% respectively in the prior year[14][15]. Strategic Initiatives - The company secured multi-year customer awards with an estimated revenue potential exceeding $400 million, resulting in a backlog of $4.7 billion at the end of Q2 2024[3]. - Cost reduction initiatives are expected to generate approximately $29 million in annualized savings starting in 2025[3]. - The company expects annual savings of $29 million from its review of corporate and operating company overhead[18]. - The company is well positioned to implement cost-focused initiatives while growing the business under the leadership of the incoming Interim CEO[18]. Leadership Changes - The company initiated a national search for a permanent CEO following the resignation of Bill Fehrman, with Paul Caudill appointed as Interim President and CEO[3][4]. Cash Flow and Assets - The company reported a net cash used in operating activities of $76,411,000 for the fiscal six months ended June 30, 2024, compared to $19,487,000 for the same period in 2023[37]. - Total assets as of June 30, 2024, were $2,221,620,000, an increase from $2,189,908,000 as of December 31, 2023[35]. - Current liabilities decreased to $353,534,000 as of June 30, 2024, from $420,612,000 as of December 31, 2023, a reduction of 16%[35]. - Cash and cash equivalents at the end of the period were $30,919,000, down from $33,407,000 at the beginning of the period[37]. - The company raised $330,343,000 from its initial public offering and private placement, net of offering costs paid[37].

IPO and Financial Position - Centuri Group completed its IPO on April 22, 2024, selling 14,260,000 shares at an initial price of $21.00 per share, resulting in net proceeds of approximately $329.3 million after expenses[106]. - The company received total net proceeds of $329.3 million from the Centuri IPO, with $316.0 million used to pay down existing debt[154]. - As of March 31, 2024, the maximum amount outstanding on the combined credit facility was $1.117 billion, with $991.4 million on the term loan portion[162]. - The company amended its revolving credit facility to increase the maximum net leverage ratio to 5.75 to 1.00 through March 31, 2024[163]. Revenue and Segment Performance - Consolidated revenue for the first fiscal three months of 2024 was $528,023, a decrease of $125,270 or 19.2% compared to $653,293 in the same period of 2023[127]. - U.S. Gas segment revenue decreased by $32.8 million, or 12.6%, primarily due to unfavorable winter weather and the completion of a large project[129]. - Canadian Gas segment revenue decreased by $4.7 million, or 11.8%, attributed to a reduction in net volumes under existing MSAs[130]. - Union Electric segment revenue decreased by $41.8 million, or 20.3%, driven by a decline in offshore wind revenue and unfavorable winter weather conditions[131]. - Non-Union Electric segment revenue decreased by $40.0 million, or 29.3%, primarily due to a reduction in storm restoration services revenue[132]. - Revenue from Canadian operations accounted for approximately 8% of total revenue for both the fiscal three months ended March 31, 2024, and April 2, 2023[161]. Profitability and Expenses - Consolidated gross profit was $13,279, a decrease of $28,670 or 68.3% compared to $41,949 in the prior year[134]. - Selling, general and administrative expenses increased by $5.0 million, or 21.3%, due to higher strategic review and severance costs[138]. - Interest expense increased by $1,723, or 7.7%, primarily due to higher interest rates on variable-rate borrowings[140]. - Net loss attributable to common stock was $(25,058), an increase of $16,214 or 183.3% compared to $(8,844) in the prior year[127]. - For the fiscal three months ended March 31, 2024, the net loss was $25.2 million, compared to a net loss of $7.1 million for the same period in 2023, representing an increase in net loss of 254.8%[149]. - Adjusted EBITDA for the fiscal three months ended March 31, 2024, was $20.2 million, down from $49.2 million for the same period in 2023, reflecting a decrease of 58.9%[149]. - Adjusted EBITDA Margin as a percentage of revenue decreased to 3.8% for the fiscal three months ended March 31, 2024, compared to 7.5% for the same period in 2023[149]. Cash Flow and Capital Expenditures - Cash and cash equivalents decreased to $18.4 million as of March 31, 2024, from $33.4 million as of April 2, 2023[154]. - Net cash used in operating activities was $22.2 million for the fiscal three months ended March 31, 2024, compared to net cash provided of $51.9 million for the same period in 2023, a decrease of $74.1 million or 142.8%[158]. - Capital expenditures for the fiscal three months ended March 31, 2024, were $30.5 million, up from $23.2 million for the same period in 2023, an increase of 31.4%[159]. Operational Challenges and Market Position - Rising fuel, labor, and material costs have negatively impacted operations, with the company unable to fully pass these costs to customers[112]. - Inflationary pressures may impact operations, with the company attempting to recover costs through price adjustments in contracts[123]. - Seasonal demand fluctuations affect revenue, with typically lower revenue in the first quarter due to winter weather conditions[122]. - The company is positioned to benefit from increased demand for utility infrastructure services due to aging infrastructure and regulatory mandates[111]. - Centuri's services support environmental goals, including reducing methane emissions and enhancing electric infrastructure resilience[119]. - The company anticipates ongoing separation-related costs through at least fiscal year 2025 following its separation from Southwest Gas Holdings[108]. - The company has taken steps to secure equipment availability, mitigating potential disruptions in service delivery[115].

Financial Performance - Centuri reported first quarter 2024 consolidated revenue of $528.0 million, a decrease of 19.2% from $653.3 million in the first quarter of 2023[3]. - The net loss attributable to common stock for the first quarter of 2024 was $(25.1) million, compared to $(8.8) million in the prior year[2]. - Adjusted EBITDA for the first quarter of 2024 was $20.2 million, down from $49.2 million in the same period last year[2]. - Net loss for the fiscal three months ended March 31, 2024, was $25,233,000, compared to a net loss of $7,105,000 for the same period in 2023, representing an increase in loss of approximately 254%[17]. - Total revenue decreased to $528,023,000 for the fiscal three months ended March 31, 2024, down from $653,293,000 in the same period of 2023, reflecting a decline of about 19.2%[19]. - Adjusted EBITDA for the fiscal three months ended March 31, 2024, was $20,172,000, compared to $49,237,000 for the same period in 2023, indicating a decrease of approximately 59%[17]. - The adjusted EBITDA margin as a percentage of revenue was 3.8% for the fiscal three months ended March 31, 2024, down from 7.5% in the same period of 2023[17]. Segment Performance - The U.S. Gas segment revenue decreased by $32.8 million, or 12.6%, to $226.6 million due to unfavorable weather conditions[4]. - Revenue from the Union Electric segment fell by $41.8 million, or 20.3%, totaling $163.9 million, impacted by a decline in offshore wind revenue[6]. - The Non-Union Electric segment experienced a revenue drop of $40.0 million, or 29.3%, with revenue of $96.6 million, primarily due to reduced storm restoration services[7]. Cash Flow and Assets - Cash and cash equivalents decreased to $18,405,000 as of March 31, 2024, from $33,407,000 at the end of the previous period, representing a decline of approximately 44.9%[21]. - Net cash used in operating activities was $22,213,000 for the fiscal three months ended March 31, 2024, compared to net cash provided of $51,878,000 in the same period of 2023[23]. - Total assets decreased to $2,119,306,000 as of March 31, 2024, from $2,189,908,000 at the end of the previous period, indicating a reduction of about 3.2%[21]. Strategic Actions - Centuri completed an IPO on April 22, 2024, raising total net proceeds of $329.3 million, primarily used to pay down debt[2]. - The company paid $92.0 million to acquire the remaining 10% noncontrolling interest in Linetec Services, LLC in April 2024[2]. - Centuri received over $40 million in new awards from existing master service agreements customers during the quarter[2]. - The company reported strategic review costs of $3,877,000 for the fiscal three months ended March 31, 2024, compared to $91,000 in the same period of 2023, marking a significant increase[18]. - Capital expenditures for the fiscal three months ended March 31, 2024, were $30,499,000, an increase from $23,237,000 in the same period of 2023, reflecting a rise of approximately 31.2%[23]. Future Outlook - The company plans to hold its inaugural earnings conference call in August 2024, coinciding with the release of its second quarter 2024 financial results[8].