News Release
Tutor Perini Reports Fourth Quarter and Full Year 2016 Results
| · | | Diluted earnings per share (EPS) of $0.60 for Q4 2016 compared to $0.18 for Q4 2015 |
| · | | Diluted EPS of $1.92 for 2016 compared to $0.91 for 2015 |
| · | | Cash flow from operations of $113.3 million for 2016; strongest annual result since 2008 |
| · | | Strong operating margins in the Civil and Building segments |
LOS ANGELES – (BUSINESS WIRE) – February 23, 2017 – Tutor Perini Corporation (NYSE: TPC), a leading civil and building construction company, today reported results for the fourth quarter and year ended December 31, 2016. Revenue was $1.2 billion and $5.0 billion for the fourth quarter and full year, respectively, compared to $1.2 billion and $4.9 billion for the same periods in 2015. Income from construction operations increased significantly to $52.1 million and $201.9 million for the fourth quarter and full year, respectively, compared to $15.5 million and $105.4 million for the comparable periods in 2015. Net income for the fourth quarter and full year 2016 also increased substantially to $30.3 million, or $0.60 per diluted share, and $95.8 million, or $1.92 per diluted share, respectively, compared to $8.7 million, or $0.18 per diluted share, and $45.3 million, or $0.91 per diluted share, for the comparable periods in the prior year. In 2015, adverse charges were recorded in all segments, which impacted income from construction operations and net income.
The increase in income from construction operations and net income for the fourth quarter and full year 2016 was due to improved operating performance in all segments. A favorable effective tax rate for 2016, driven by a shift in revenue mix between states and certain tax adjustments, was offset by expenses incurred for refinancing efforts undertaken during the year, including two credit facility amendments.
The Company generated $19.2 million of operating cash in the fourth quarter of 2016 and $113.3 million for the full year, which was the highest full year operating cash result in eight years. As expected, operating cash exceeded net income in 2016. The Company expects that cash generation will continue to be strong in 2017 and that cash flow from operations will again exceed net income for the year. Total unbilled costs decreased by $73.3 million in 2016. The Company expects continued progress in reducing unbilled costs over the next several quarters, which should contribute to substantial cash generation throughout 2017.
Backlog as of December 31, 2016 was $6.2 billion, compared to $7.5 billion as of December 31, 2015. New awards and adjustments to contracts in process during the fourth quarter and full year 2016 were $0.8 billion and $3.7 billion, respectively, compared to $1.1 billion and $4.6 billion for the same periods last year. The Civil and Building segments were the major contributors to new award activity in 2016 and are expected to continue driving backlog in 2017. The Company’s new awards have been strong to date in 2017 and include the previously announced $1.4 billion Purple Line Extension Section 2 contract for the Los Angeles Metropolitan Transportation Authority, three mechanical contracts in New York City worth $104 million and a U.S. Air Force design-build project valued at $80 million for work in Saudi Arabia.
“Our fourth quarter and full year results met our expectations and were within our original EPS guidance for 2016. The results were driven by good project execution in our Civil and Building segments. We experienced improved operating performance in 2016 across all segments compared to 2015 and expect to further improve the performance of our Specialty Contractors segment in 2017. The strong cash we generated in 2016 signals that our intense focus on reducing our unbilled costs and collecting cash is bearing results,” commented Ronald Tutor, Chairman and Chief Executive Officer. Tutor continued, “We believe that 2017 will be an even better year given the new awards we have already booked and others we hope to be awarded, together with the unprecedented volume of civil project opportunities.”
Outlook and Guidance
Based on the Company’s current backlog, which includes the significant new awards booked to date in 2017, together with the substantial volume of prospective opportunities, the Company sees a strong year ahead, which is reflected in the guidance for 2017. Revenue is expected to be in excess of $5.5 billion and diluted EPS is expected to be in the range of $2.10 to $2.40. The results are anticipated to be weighted towards the second half of 2017, as is typical given the seasonality of the Company’s business.
Fourth Quarter Conference Call
The Company will host a conference call at 2:00 PM Pacific Time on Thursday, February 23, 2017, to discuss the fourth quarter and full year results. To participate in the conference call, please dial 877-407-8293 five to ten minutes prior to the scheduled time. International callers should dial +1-201-689-8349.
The conference call will be webcast live over the Internet and can be accessed by all interested parties on Tutor Perini's website at www.tutorperini.com. To listen to the webcast, please visit the Company's website at least fifteen minutes prior to the start of the call to register and to download and install any necessary software. For those unable to participate during the live call, the webcast will be available for replay shortly after the call on the website.
About Tutor Perini Corporation
Tutor Perini Corporation is a leading civil and building construction company offering diversified general contracting and design-build services to private clients and public agencies throughout the world. We have provided construction services since 1894 and have established a strong reputation within our markets by executing large complex projects on time and within budget while adhering to strict quality control measures. We offer general contracting, pre-construction planning and comprehensive project management services, including the planning and scheduling of the manpower, equipment, materials and subcontractors required for a project. We also offer self-performed construction services including site work, concrete forming and placement, steel erection, electrical, mechanical, plumbing and heating, ventilation and air conditioning (HVAC). We are known for our major complex building project commitments, as well as our capacity to perform large and complex transportation and heavy civil construction for government agencies and private clients throughout the world.
The statements contained in this Release, including those set forth in the section “Outlook and Guidance,” that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including without limitation, statements regarding the Company’s expectations, hopes, beliefs, intentions or strategies regarding the future and statements regarding future guidance or estimates and non-historical performance. These forward-looking statements are based on the
Company’s current expectations and beliefs concerning future developments and their potential effects on the Company. The Company’s expectations, beliefs and projections are expressed in good faith and the Company believes there is a reasonable basis for them. There can be no assurance that future developments affecting the Company will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control of the Company) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the Company’s ability to win new contracts and convert backlog into revenue; the Company's ability to successfully and timely complete construction projects; increased competition and failure to secure new contracts; the outcomes of pending or future litigation, arbitration or other dispute resolution proceedings and the timing of related collections; the potential delay, suspension, termination or reduction in scope of construction projects; the continuing validity of the underlying assumptions and estimates of total forecasted project revenues, costs and profits and project schedules; the availability of borrowed funds on terms acceptable to the Company; failure to meet our obligations under our debt agreements; the ability to retain certain members of management; the ability to obtain surety bonds to secure the Company’s performance under certain construction contracts; possible labor disputes or work stoppages within the construction industry; changes in federal and state appropriations for infrastructure projects and the impact of changing economic conditions on federal, state and local funding for infrastructure projects; possible changes or developments in international or domestic political, social, economic, business, industry, market and regulatory conditions or circumstances; failure to comply with laws and regulations related to government contracts; actions taken or not taken by third parties, including the Company’s customers, suppliers, business partners, and competitors and legislative, regulatory, judicial and other governmental authorities and officials; impairments of our goodwill or other indefinite-lived intangible assets; possible systems and information technology disruptions; the impact of inclement weather conditions on projects; and other risks and uncertainties discussed under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission on February 23, 2017. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Contact:
Tutor Perini Corporation
Jorge Casado, 818-362-8391
Vice President, Investor Relations & Corporate Communications
www.tutorperini.com
