Tutor Perini(US:TPC)2024-02-29 00:46Financial Data and Key Metrics Changes - The net loss attributable to Tutor Perini for Q4 2023 was $48 million, or a loss of $0.91 per share, compared to a net loss of $93 million, or a loss of $1.80 per share in Q4 2022 [1] - The net loss for the full year 2023 was $171 million, or a loss of $3.30 per share, compared to a net loss of $210 million, or a loss of $4.09 per share in 2022 [37] - Operating cash flow reached a record $308 million in 2023, nearly 50% higher than the previous record of $207 million in 2022 [11][51] - Consolidated revenue for 2023 was $3.9 billion, slightly up from $3.8 billion in 2022 [52] Business Line Data and Key Metrics Changes - Civil segment revenue was $1.9 billion in 2023, up 9% compared to the previous year, driven by increased project execution activities [25] - Building segment revenue was $1.3 billion, up 5%, primarily due to increased activities on various projects in California [30] - Specialty Contractors segment revenue was $694 million, down 15% due to decreased activities on electrical and mechanical components of a completed transportation project [30] - In Q4 2023, Civil segment revenue was $459 million, up 5% from $440 million in Q4 2022, while Building segment revenue was $376 million, up 15% from $327 million [38] Market Data and Key Metrics Changes - The year-end backlog stood at $10.2 billion, up 28% year-over-year, largely driven by the award of the $2.95 billion Brooklyn Jail project [16] - The company is tracking over $75 billion in project opportunities over the next three to four years, with $32 billion expected in the next two years [18] Company Strategy and Development Direction - The company anticipates significant double-digit revenue growth in 2024, with 80% sourced from existing backlog [21] - The strategic focus includes resolving legacy disputes and capturing a share of the $1.2 trillion Bipartisan Infrastructure Law funding [17] - The company expects to conclude refinancing of its senior notes by the end of April 2024 [46] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in earnings due to adverse legal judgments and write-downs but expressed optimism for a return to profitability in 2024 [12][37] - The company expects to resolve most remaining legacy disputes in 2024, leading to substantial cash collections [14][59] - Management highlighted a strong bidding environment and limited competition for upcoming projects, which is expected to enhance margins and working capital requirements [78][124] Other Important Information - Corporate G&A expenses increased to $75 million in 2023 from $62 million in 2022, primarily due to higher compensation-related expenses [34] - Interest expense for 2023 was $85 million, up from $70 million in 2022, driven by higher borrowing rates [35] Q&A Session Summary Question: Can you elaborate on the losses in the Building and Specialty Contractors segments? - Management noted losses in the Building segment were due to an unbonded subcontractor issue and significant write-downs in the Specialty Contractors segment [64][68] Question: What is the expected growth by segment for 2024? - Management indicated strong growth in Civil and Building segments, with expectations for modest profitability in the first quarter [86] Question: How does the EPS guidance account for potential settlements? - Management stated that the EPS guidance includes allowances for potential settlements and adverse judgments, aiming for reasonable profitability [83][84] Question: What is the expected structure of the refinancing? - Management is exploring various options for refinancing, including potential reductions in bond issuance and loans, depending on market conditions [108]