Financial Data and Key Metrics Changes - Centuri Holdings reported record revenue of $850 million for Q3 2025, an 18% increase from Q3 2024 [12] - Adjusted net income for the quarter was $16.7 million, up from $5.3 million in the prior year [13] - Base revenue increased by 25% and base gross profit rose by 28% compared to the previous year [4][12] - The gross profit margin for the third quarter was 9.2%, down from 10.5% in the prior year [12] Business Line Data and Key Metrics Changes - US Gas revenue was $412.4 million, a 13% increase year-over-year, with a gross profit margin of 7.7% [13][14] - Canadian Gas revenue surged nearly 40% to $74.2 million, with a gross profit margin of 21.9% [14][15] - Union Electric revenue increased by 25% to $214.5 million, with base revenue reflecting a 29% year-over-year increase [15] - Non-union electric revenue rose 16% to $149 million, with a base revenue increase of 58% [16] Market Data and Key Metrics Changes - Total bookings for the year reached $3.7 billion, significantly ahead of the targeted book-to-bill ratio of 1.1 times [5][6] - The backlog reached a record high of approximately $5.9 billion, up from $5.3 billion last quarter [8] - The overall opportunity pipeline remains robust at about $13 billion, with over 600 strategic bid opportunities [8] Company Strategy and Development Direction - The company aims to build a premier standalone utility services company focused on sustainable and profitable growth [20] - A strategic fleet optimization initiative is underway to improve cash generation and fleet efficiency [9] - The company is focused on eliminating seasonality in the gas business and enhancing operational efficiency [41][50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving double-digit revenue growth in 2026, supported by strong backlog visibility and near-term booking expectations [9][20] - The company anticipates generating meaningful free cash flow in Q4 2025, despite a negative free cash flow of $16.3 million in Q3 [18][19] - Management highlighted the importance of storm work but emphasized that future planning will focus on base business performance [35] Other Important Information - The company completed its separation from Southwest Gas Holdings and appointed new leadership to drive operational excellence [10] - Adjusted EBITDA for Q3 2025 was $75.2 million, down from $78.8 million in the prior year [13] Q&A Session Summary Question: Impact of storm activity on EBITDA guidance - Management confirmed that the $15 million decline in guidance is entirely related to storm activities, with a split of approximately 60% for Q3 and 40% for Q4 [23][24] Question: Utilization of MSA contract work in non-union electric - Management indicated that there would be a lag in achieving full utilization, but expected improvements in Q4 as operations mature [25][26] Question: Difference in margins between data center opportunities and other bid work - Management noted that margins for data center-related work are generally higher than for MSAs, and they are now in a position to increase margins on new bids [28][30] Question: Strength of base revenue growth compared to expectations - Management stated that the base revenue growth exceeded internal expectations, driven by strong customer service and backlog management [37][39] Question: Focus on U.S. gas business and operational execution - Management highlighted improvements in the gas business and emphasized the need to address seasonality while maintaining strong margins [45][50] Question: Strategic bids and project mix - Management detailed that the $3 billion in strategic bids consists of 60% electrical work and 40% gas-related projects, with a focus on accretive bid work [52][53]