Tutor Perini(TPC)2025-02-28 10:22Financial Data and Key Metrics Changes - The company generated record operating cash flow of $504 million for the full year of 2024, up 63% from $308 million in 2023, marking the third consecutive year of record cash flow [22][46] - Total debt was reduced by $477 million or 52% since the end of 2023, with net debt at $79 million as of December 31, 2024, down 85% from $519 million at the end of 2023 [23][58] - The company reported a net loss of $164 million or a loss of $3.13 per share for 2024, compared to a net loss of $171 million or a loss of $3.30 per share in 2023 [54] Business Line Data and Key Metrics Changes - Civil segment revenue was $2.1 billion, up 12% from $1.9 billion in 2023, driven by increased project execution activities [48] - Building segment revenue increased by 24% to $1.6 billion from $1.3 billion, primarily due to health care and educational facility projects [48] - The Specialty Contractors segment posted a loss from construction operations of $103 million in 2024, an improvement from a $145 million loss in 2023 [52] Market Data and Key Metrics Changes - The company finished 2024 with a record backlog of $18.7 billion, growing 84% year-over-year, with a book-to-burn ratio of 5.4x for the fourth quarter [24][27] - New awards in 2024 included significant projects such as the $3.76 billion Manhattan Jail project and the $1.66 billion City Center Guideway project [28] Company Strategy and Development Direction - The company aims to return to profitability with EPS guidance for 2025 in the range of $1.50 to $1.90, expecting double-digit revenue growth [40] - A focus on cash generation and resolving legacy disputes is prioritized to enhance financial stability and operational performance [14][15] - The company is exploring technology investments, including artificial intelligence, to improve project planning and execution [17] Management's Comments on Operating Environment and Future Outlook - Management does not anticipate significant impacts from federal spending scrutiny or new tariffs on major projects [19] - The company expects to clear 75% to 80% of remaining legacy claims in 2025, which has been factored into earnings projections [74] - The outlook for 2026 and 2027 projects EPS to be more than double the 2025 guidance, driven by profitable backlog work [43] Other Important Information - Corporate G&A expenses increased to $110 million in 2024 from $75 million in 2023, primarily due to higher compensation-related expenses [53] - The effective income tax rate for 2025 is expected to be approximately 21% to 23% [60] Q&A Session Summary Question: Can you give us a little more help on how you see the cadence of the year playing out? - The company expects quarter-over-quarter revenue growth throughout the year, with a lower first quarter EPS due to seasonality, and significant improvements in the second half [70][72] Question: How many legacy claims are left and do you still think most of those are cleared up in 2025? - There are about 12 to 14 legacy claims remaining, with 75% to 80% expected to be resolved in 2025 [74] Question: Can you talk high level about capital allocation, given the much more flexible balance sheet? - The company is considering various options for capital allocation and will provide more details as they progress through the year [76]