Financial Performance - Operating revenues for Q1 2025 were $826.6 million, a 32.1% increase from $625.7 million in Q1 2024[194] - E&M revenues grew by $207.2 million, or 47.0%, driven by increased activity in data centers and hospitality, while T&D revenues decreased by $3.5 million, or 1.9%[195][196] - Gross profit for Q1 2025 was $92.5 million, reflecting a 23.8% increase from $74.7 million in Q1 2024[194] - Operating income for Q1 2025 reached $51.0 million, a 31.1% increase compared to $38.9 million in Q1 2024[194] - Net income for Q1 2025 was $36.7 million, representing a 30.1% increase from $28.2 million in Q1 2024[194] - Gross profit for Q1 2025 was $92.5 million, a 23.8% increase from $74.7 million in Q1 2024, with a gross profit margin of 11.2% compared to 11.9% in Q1 2024[199] - Operating income for Q1 2025 was $51.0 million, up 31.1% from $38.9 million in Q1 2024, maintaining an operating income margin of 6.2%[201] - Net income increased to $36.7 million, a 30.1% rise from $28.2 million in Q1 2024, with a net income margin of 4.4% compared to 4.5% in Q1 2024[207] - EBITDA for Q1 2025 was $61.8 million, compared to $46.9 million in Q1 2024, with an EBITDA margin of 7.5%[224] Costs and Expenses - Cost of sales for Q1 2025 was $734.1 million, up 33.2% from $551.0 million in Q1 2024, primarily due to higher operating costs from increased E&M workloads[198] - Selling, general and administrative expenses rose to $41.5 million, a 15.9% increase from $35.8 million in Q1 2024, driven by higher labor and professional service-related expenses[200] - Interest expense, net for Q1 2025 was $4.7 million, a 74.1% increase from $2.7 million in Q1 2024, due to higher average debt balances[202] - Income taxes for Q1 2025 were $13.6 million, a 36.0% increase from $10.0 million in Q1 2024, with an effective tax rate of 27.0% compared to 26.1% in Q1 2024[205] Market and Strategic Outlook - The company anticipates continued strong project opportunities in specialty contracting markets, particularly in data centers and utility infrastructure investments[182] - The company is focused on managing costs and generating cash to increase operating income despite rising insurance costs[178] - The U.S. construction services industry remains highly fragmented, with competition influenced by technical expertise and service pricing[179] - The company is well-positioned to benefit from favorable demand drivers, including high-tech reshoring and utility infrastructure investments, as evidenced by a strong backlog of projects[182] Separation and Corporate Structure - The company completed its separation from MDU Resources on October 31, 2024, becoming an independent publicly traded entity[185] - The Separation and Distribution of Everus Construction from MDU Resources was completed on October 31, 2024, with 50,972,059 shares of Everus common stock distributed to MDU Resources stockholders[184][185] Cash Flow and Capital Expenditures - Free cash flow for Q1 2025 was $(8.1) million, a decrease from $15.4 million in Q1 2024[227] - Cash provided by operating activities decreased to $7.1 million in Q1 2025 from $21.9 million in Q1 2024, a decline of 67.5%[241] - Capital expenditures for Q1 2025 were $18.5 million, compared to $9.2 million in Q1 2024, an increase of 101.1%[237] - Working capital increased to $425.0 million as of March 31, 2025, from $403.9 million as of December 31, 2024[236] - As of March 31, 2025, the company had $74.0 million in cash, cash equivalents, and restricted cash, down from $86.0 million at the end of 2024[228] - The company expects full-year 2025 gross capital expenditures to be in the range of $65.0 million to $70.0 million[238] Backlog and Investments - Backlog as of March 31, 2025, was $2,546.7 million, down from $3,057.5 million as of December 31, 2024, reflecting fluctuations in contract awards[216] - Income from equity method investments increased to $3.4 million, a rise of $2.3 million from $1.1 million in Q1 2024, attributed to joint venture activity[206] - Surety bonds outstanding for projects totaled approximately $2.07 billion as of March 31, 2025, with a potential maximum payment of $758.8 million[247] - The company has guaranteed obligations of subsidiaries totaling $616.2 million as of March 31, 2025[249]
Everus Construction Group, Inc.(ECG) - 2025 Q1 - Quarterly Report