Core Insights - A new pediatric hospital project in Dallas, Texas, is being developed by a joint venture between Children's Health and UT Southwestern Medical Center, with Jacobs selected as the owner's program manager [1][2] - The new campus aims to address the anticipated doubling of the pediatric population in the region by 2050, increasing bed capacity by 38% and expanding emergency department space [2][3] - The facility will feature the largest Level IV Neonatal Intensive Care Units in Dallas, along with a new fetal care center and over 20 acres of green space [2][3] Company Overview - Jacobs is a global company with approximately $12 billion in annual revenue and a workforce of nearly 45,000, providing end-to-end services across various sectors including advanced manufacturing, energy, and life sciences [4] - The company has extensive experience in program management, having delivered 50 academic research centers and 15 children's hospital campuses globally [2][4] - Jacobs emphasizes the importance of healthcare infrastructure in supporting community wellbeing and regional economic vitality [3]

Group 1 - Bowman Consulting Group Ltd. has entered a $4.5 million master service agreement with the DuPage Water Commission for construction engineering services for Section 2 of the WaterLink Pipeline Project, which is valued at $250 million [1][2] - The WaterLink Pipeline Project aims to expand potable water services in growing suburban communities in Illinois, involving a 30-mile pipeline extension with approximately six miles of new 54-inch diameter water transmission main [2][3] - The project will require complex construction methods due to its proximity to high-tension overhead electrical lines and the need to cross highways, rail lines, utility corridors, and streams [2][3] Group 2 - The project is expected to enhance Bowman's role in large-scale municipal infrastructure, providing multi-year revenue visibility and contributing to margin-accretive growth [3] - The WaterLink initiative will bring Lake Michigan drinking water to the Kendall County communities of Montgomery, Oswego, and Yorkville, with construction scheduled to begin in 2025 and continue through 2028 [3] - Bowman Consulting Group operates over 100 locations in the United States, employing more than 2,400 staff and offering a range of engineering and project management services [4]

Core Insights - Willdan Group and Sterling Infrastructure exceeded Q2 expectations, reporting record revenue and net income driven by strong performance in high-growth infrastructure sectors [1][2] - Both companies raised their full-year guidance following strong Q2 results, indicating confidence in continued growth [3] Willdan Group Summary - Willdan raised its full-year targets for net revenue to $340-$350 million, Adjusted EPS to $3.50-$3.65, and Adjusted EBITDA to $70-$73 million [4] - The company secured significant contracts, including a $30 million deal with the City of Fairfield and a $20 million contract with National Grid [4] - Willdan's stock has increased nearly +200% year to date, with a three-year growth of over +380% [9] Sterling Infrastructure Summary - Sterling raised its full-year revenue guidance to $2.10-$2.15 billion, net income to $243-$252 million, and adjusted EPS to $9.21-$9.47 [5] - The company has a backlog exceeding $2 billion, focusing on high-margin projects in states like Utah, Colorado, and Texas [5] - Sterling's stock has risen over +70% year to date, with a three-year increase of over +260% [9] Strategic Acquisitions - Both companies are expanding into data center infrastructure, capitalizing on advancements in artificial intelligence [6] - Willdan acquired Alternative Power Generation to enhance its capabilities for AI data centers and EV charging stations [7] - Sterling plans to acquire CEC Facilities Group to expand its electrical contracting services for semiconductors and data centers [8] Valuation Analysis - Both companies forecast high-double digit EPS growth, with Sterling having a P/E valuation of 34X forward earnings compared to Willdan's 40.3X [10] - Willdan's stock is closer to an optimal sales level of less than 2X, while Sterling's is at 4.3X [11] - Despite raising guidance, Willdan's top line is expected to dip at least 38% after a record year, while Sterling is projected to maintain or reach peak annual sales [11] Conclusion - Willdan Group and Sterling Infrastructure are positioned as top engineering companies for investment, with Sterling's stronger financials offering more appeal [12] - Both companies' ventures into data center infrastructure suggest long-term viability as investments [13]

Financial Performance - Gross Contract Revenue increased by 17% year-over-year, reaching $122.1 million in Q2 2025 compared to $104.5 million in Q2 2024 [11, 12] - Net Service Billing grew by 15% year-over-year, amounting to $108.0 million in Q2 2025 versus $94.0 million in Q2 2024 [11, 12] - Adjusted EBITDA saw a significant increase of 51% year-over-year, reaching $20.2 million in Q2 2025 compared to $13.4 million in Q2 2024 [11, 12] - Adjusted EBITDA Margin improved to 18.7% in Q2 2025, a 440 basis point increase from 14.3% in Q2 2024 [11, 12] - Net Income increased by 386%, reaching $6.0 million in Q2 2025 compared to a loss of $2.1 million in Q2 2024 [12] - Organic Net Service Billing grew by 8.4% year-over-year [11] Backlog and Capital Allocation - Gross Backlog increased by 25% year-over-year, reaching $438 million in Q2 2025 compared to $351 million in Q2 2024 [11, 19] - The company repurchased $6.7 million of common stock in Q2 and has a remaining $25 million repurchase plan approved [22] - The company established a $25 million Bowman Innovative Growth Fund (BIG Fund) [22] Guidance - The company raised its FY 2025 Net Revenue guidance to $430 - $442 million and Adjusted EBITDA guidance to $71 - $77 million [31]

Core Insights - Bowman Consulting Group Ltd. reported strong financial results for the second quarter of 2025, highlighting significant growth and strategic progress driven by high demand in core verticals such as transportation, renewables, and energy transmission [2][3][11]. Financial Performance - Gross contract revenue for Q2 2025 was $122.1 million, a 17% increase from $104.5 million in Q2 2024 [7]. - Net service billing reached $108.0 million, up 15% from $94.0 million year-over-year [7]. - Adjusted EBITDA for Q2 2025 was $20.2 million, reflecting a 50.7% increase from $13.4 million in Q2 2024 [7]. - The adjusted EBITDA margin improved to 18.7%, a 440-basis point increase from 14.3% in the previous year [7]. - Net income for Q2 2025 was $6.0 million, compared to a net loss of $2.1 million in Q2 2024 [7]. Year-to-Date Performance - For the first six months of 2025, gross contract revenue was $235.0 million, an 18% increase from $199.4 million in the same period of 2024 [7]. - Net service billing for the first half of 2025 was $208.1 million, a 16% increase from $179.7 million [7]. - Adjusted EBITDA for the first six months was $34.7 million, a 36.1% increase from $25.5 million [7]. - The adjusted EBITDA margin for the first half improved to 16.7%, up 250 basis points from 14.2% [7]. Backlog and Future Outlook - The gross backlog increased to $438.2 million, a 24.7% rise from $351.4 million year-over-year [7]. - The company anticipates net revenue for fiscal year 2025 to be between $430 million and $442 million, with adjusted EBITDA expected to be between $71 million and $77 million [11]. Stock Repurchase and Capital Management - During Q2 2025, Bowman repurchased $6.7 million of common stock, with an average price of approximately $22.19 per share [8]. - A new share repurchase program was authorized, allowing for the repurchase of up to $25 million of common stock over a 12-month period starting June 9, 2025 [9]. Adjusted Earnings Per Share - For Q2 2025, the basic adjusted earnings per share (non-GAAP) was $0.56, compared to a loss of $0.03 in Q2 2024 [10]. - For the first half of 2025, the diluted adjusted earnings per share was $0.62, up from $0.16 in the same period of 2024 [10].

Financial Data and Key Metrics Changes - The company reported total revenue of $1.6 billion, a decrease of 5% from the prior year period and down 9% on an organic basis. Excluding a confidential contract, total revenue grew 138% on an organic basis, driven by growth in transportation and cyber markets [28][29] - Adjusted EBITDA was $149 million, comparable to 2024, with an adjusted EBITDA margin expanding by 40 basis points to 9.4%, a second quarter record [29][30] - The company achieved a free cash flow conversion rate of 151% for the quarter and 125% on a trailing twelve-month basis [8][34] Business Line Data and Key Metrics Changes - In the Federal Solutions segment, total revenue decreased 19% from the prior year period but increased 88% on an organic basis when excluding the confidential contract, driven by growth in cyber and intelligence markets [30][15] - The Critical Infrastructure segment saw a revenue increase of $97 million or 14% from 2024, with organic growth of 8% and adjusted EBITDA increasing 73% [32][33] Market Data and Key Metrics Changes - Total infrastructure revenue grew 148% on an organic basis in the second quarter, with North America revenue growing 177% [10][11] - The Middle East infrastructure business is expected to grow over 10% in 2025, marking the fourth consecutive year of double-digit organic revenue growth in the region [12][13] Company Strategy and Development Direction - The company is focused on hard infrastructure projects, aligning with bipartisan support and administration priorities, particularly in North America and the Middle East [11][12] - The acquisition of Chesapeake Technology International is expected to enhance capabilities in electronic warfare, cyber, and autonomous systems, strengthening relationships with key customers [23][24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth, citing a robust backlog of nearly $9 billion, with 70% funded, and a pipeline of $55 billion [26][37] - The company anticipates a stronger Q3, traditionally the strongest quarter for federal business, and expects to maintain a book-to-bill ratio of 1.0 or better [51][40] Other Important Information - The company won three contracts over $100 million in the second quarter, including a $176 million contract with the U.S. Army Corps of Engineers [10] - The reconciliation bill is expected to provide significant funding for defense and infrastructure projects, aligning with the company's capabilities [18][21] Q&A Session Summary Question: Opportunities regarding Golden Dome and FAA procurement - Management highlighted strong past performance with the FAA and readiness to pursue the integration contract, emphasizing their partnership with IBM and capabilities in system engineering [42][45] Question: Expectations for Q3 book-to-bill ratio - Management expects a robust Q3, with a book-to-bill ratio of 1.0 for the full year, driven by task orders and new large awards [50][51] Question: Impact of the One Big Beautiful Bill on infrastructure - Management noted a shift in funding priorities towards hard infrastructure, which aligns well with the company's portfolio [56][57] Question: Organic growth outlook and contributors - Excluding the confidential contract, management expects 18% organic growth in the second half, driven by existing contracts and strong hiring [64][65] Question: Unbooked backlog and funding environment - The unbooked backlog is over $11 billion, with strong funding alignment and cash flow [102][105] Question: Federal Solutions margin and performance - Management indicated that margins were impacted by lower volume on the confidential contract but expect improvements in the second half due to new business wins [83][84]

Financial Performance - Q3 FY25 revenue reached $3.6 billion, a 2% increase compared to $3.49 billion in Q3 FY24[43] - Adjusted EBITDA for Q3 FY25 was $274 million, up 7% from $257 million in Q3 FY24[43] - Adjusted Diluted EPS increased to $0.56 in Q3 FY25, compared to $0.51 in Q3 FY24[43] - Free Cash Flow for Q3 FY25 was $100 million[13] Business Development and Backlog - Backlog remained strong at $45 billion[13] - The company secured a Space Force Range Contract worth $4 billion, although it is currently under protest and not included in the backlog[22] - The company received multiple intelligence awards totaling over $500 million[24] - On-contract growth modifications and extensions provided a $2+ billion benefit in bookings[25] Debt and Deleveraging - Net leverage reduced to 3.5x, driven by operating and investing activity contributions[12, 52] - The company targets net leverage of less than 3x by FY26 year-end[54] - The company has $738 million in cash on hand and an $850 million undrawn revolving credit facility[57] Guidance - The company raised its FY25 organic revenue guidance to $13.975 - $14.175 billion[12, 58] - The company anticipates interest expense of $345M - $355M and capital expenditures of $35M - $40M for FY25[66] Nuclear Market - The global nuclear market demand is projected to reach $91 billion by FY2026 and $68 billion by FY2030[33] - The company's total addressable market in the nuclear sector is expected to more than double by 2035, reaching ~$20 billion[40]

Core Insights - Jacobs Solutions reported Q3 FY2025 results with Non-GAAP EPS of $1.62, exceeding the consensus of $1.53, while GAAP revenue was $3.03 billion, slightly below the estimate of $3.07 billion [1][2] - The company achieved a 24.6% year-over-year growth in adjusted EPS, despite a decline in free cash flow [1][2] - Strategic focus remains on high-growth areas such as smart infrastructure, sustainability, and digital transformation [4][15] Financial Performance - Non-GAAP EPS reached $1.62, a 24.6% increase from $1.30 in Q3 FY2024 [2] - GAAP revenue grew 5.1% year-over-year from $2.88 billion in Q3 FY2024 [2][6] - Adjusted net revenue was $2.23 billion, up 7.2% from $2.08 billion in Q3 FY2024 [2] - Adjusted EBITDA increased by 13.5% year-over-year [5] - Free cash flow (non-GAAP) fell 39.1% to $271 million from $445 million [2][8] Business Overview and Strategic Focus - The company operates in infrastructure, advanced facilities, and digital consulting, focusing on sectors like water, energy, and life sciences [3] - Recent strategic initiatives include targeting energy transition, water infrastructure, and digital transformation [4] - The company has made strategic acquisitions and divestitures to enhance its portfolio [4] Market Demand and Growth Drivers - Strong demand in the I&AF division was driven by life sciences, data centers, energy, and transportation [6] - Backlog reached a record $22.7 billion, up 14.3% year-over-year, indicating healthy order intake [7] - PA Consulting segment reported 15% revenue growth year-over-year [6] Capital Returns and Shareholder Value - The company repurchased $653 million in shares, retiring about 4% of shares outstanding in FY2025 [7] - Dividends increased from $0.29 to $0.32 per share, marking consecutive years of dividend growth [9][10] - A 10% dividend increase is planned for FY2025 [15] Future Outlook - Adjusted EPS guidance for FY2025 is raised to $6.00 to $6.10, with a target of approximately 5.5% adjusted net revenue growth [15] - Free cash flow conversion is expected to exceed 100% of net income for FY2025 [15] - Key areas to monitor include backlog conversion, free cash flow generation, and performance in digital and consulting businesses [15]

Core Viewpoint - Fluor's disappointing second-quarter 2025 financial results and revised outlook have led to a significant drop in its stock price, reflecting investor concerns about the company's performance and future prospects [1][3][4]. Financial Performance - Fluor reported Q2 2025 revenue of $3.98 billion, missing analysts' expectations of $4.55 billion, representing a year-over-year decline of 5.9% [3]. - The company's adjusted earnings per share (EPS) was $0.43, falling short of the estimated $0.56 [3]. Revised Outlook - Management revised its 2025 adjusted EBITDA forecast from an initial range of $575 million to $675 million down to $475 million to $525 million, citing "client hesitation around economic uncertainty" as a key factor [4]. - The revision reflects concerns over new awards and project delays impacting the company's performance [4]. Investor Sentiment - Despite the steep decline in stock price, the company remains an industry leader in energy and infrastructure projects, suggesting potential for future growth [5]. - Investors are advised to maintain their positions rather than sell in response to the current downturn [5].

Financial Data and Key Metrics Changes - Revenue for Q2 2025 was $4 billion, with consolidated new awards of $1.8 billion, 72% of which were reimbursable [6][7] - Total backlog remains around $28 billion, with 80% being reimbursable [8] - Adjusted EBITDA for Q2 was $96 million, down from $165 million a year ago, and adjusted EPS was $0.43 compared to $0.85 [27][36] Business Segment Data and Key Metrics Changes - Urban Solutions reported a profit of $29 million, impacted by a $54 million net cost growth on three infrastructure projects [8][14] - Energy Solutions segment profit was $15 million, down from $75 million a year ago, due to nearing project completions and an arbitration ruling [16][17] - Mission Solutions reported a segment profit of $35 million, down from $41 million a year ago, due to a temporary stop work order [20] Market Data and Key Metrics Changes - New awards for the quarter totaled $7.6 billion for 2025, with a book-to-burn ratio above one [7] - The company noted a slowdown in capital spending in the Mining and Metals sector due to global trade uncertainty [12] - The infrastructure segment experienced cost growth on three projects, with significant impacts from design errors and material escalation [14][91] Company Strategy and Development Direction - The company is focusing on markets such as mining, advanced manufacturing, data centers, and life sciences for future growth [46][48] - Management expressed optimism about the long-term opportunities in the LNG market, particularly with the recent achievements in LNG Canada [19][81] - The company plans to convert 15 million NuScale Class B shares into Class A, viewing it as a positive step for shareholder value [5][34] Management's Comments on Operating Environment and Future Outlook - Management noted a short-term hesitation in client investment decisions due to trade policy uncertainties and cost escalations [22][23] - The company expects that once trade agreements stabilize, clients will accelerate investments in various end markets [23][102] - Management remains confident in the long-term growth strategy despite current market hesitations [100][102] Other Important Information - The company reported a cash and marketable securities balance of $2.3 billion as of June 30, down from $2.5 billion at the end of Q1 [30] - Operating cash flow for the quarter was an outflow of $21 million, significantly lower than the cash generation of $282 million a year ago [31] - The company plans to slow share repurchases in 2025, expecting total repurchases to be between $450 million to $500 million [32] Q&A Session Summary Question: Insights on the bookings environment and backlog growth - Management acknowledged that trade policy impacts client sentiment and investment decisions, but they are pursuing work in the right markets [41][46] Question: Details on NuScale conversion and tax implications - The conversion of Class B shares to A shares will have a tax gain associated with it, which can be shielded through tax credits [50][51] Question: Clarification on backlog adjustments - The $1.7 billion in positive backlog adjustments relates to ongoing reimbursable work, primarily in the Urban Solutions segment [63][64] Question: Comments on infrastructure project performance - Management expressed disappointment with the results of three infrastructure projects but is committed to addressing the issues and completing them [91][92]