News Release
Tutor Perini Reports First Quarter 2018 Results
| · | | New awards of $2.2 billion, the largest volume of quarterly new awards in more than six years |
| · | | Backlog of $8.5 billion, a record high, with 53% of backlog comprised of higher-margin Civil projects |
LOS ANGELES – (BUSINESS WIRE) – May 9, 2018 – Tutor Perini Corporation (NYSE: TPC), a leading civil, building and specialty construction company, today reported results for the three months ended March 31, 2018. Revenue for the first quarter of 2018 was $1,028.2 million compared to $1,117.4 million for the first quarter of last year. The revenue decrease was primarily attributable to various electrical projects in New York that are completed or nearing completion, as well as reduced project execution activity on a large tunnel project on the West Coast that is also nearing completion. Net loss attributable to the Company for the first quarter of 2018 was $12.1 million, or $0.24 per diluted share, compared to net income attributable to the Company for the first quarter of 2017 of $13.8 million, or $0.27 per diluted share. The results for the first quarter of 2018 were negatively impacted by an unfavorable pre-tax charge of $17.8 million (an after-tax impact of $12.7 million, or $0.25 per diluted share), which was due to the unexpected outcome of an arbitration decision related to a subcontractor dispute on a Civil segment project in New York that was completed in 2013. The volume reduction mentioned above also contributed to the lower net income for the first quarter of 2018.
Backlog as of March 31, 2018 was $8.5 billion, a record high, and up 18% compared to $7.2 billion as of March 31, 2017. New awards and adjustments to contracts in process totaled $2.2 billion in the first quarter of 2018. Significant new awards included the previously announced $1.4 billion Newark Liberty International Airport Terminal One Design-Build project, a government office building project in California valued at $215 million, and various electrical projects in New York and in the western and southern United States collectively valued at $147 million.
Demand for Tutor Perini’s construction services remains strong, especially in the civil and specialty end markets. Subsequent to the first quarter, the Company was identified as the low bidder on several new civil projects, including the $800 million Southwest Light Rail Transit (METRO Green Line Extension) project in Minneapolis, a $109 million tunneling project in Los Angeles and a $93 million bridge project in New York City. The Company anticipates booking the contract awards for these projects as soon as the second quarter of 2018.
“Our earnings for the first quarter of 2018 were below expectations, largely because of the unexpected arbitration decision. However, we anticipate that stronger performance later this year should offset the weakness experienced this quarter,” remarked Ronald Tutor, Chairman and Chief Executive Officer. “Our record backlog and $1 billion of pending civil awards reflect our continued success in capturing significant project opportunities. We believe that we are well positioned to win even more, sizable civil awards as long-term funding is released, which should result in continued backlog growth.”
Outlook and Guidance
Based on the current backlog and market outlook, the Company is affirming its guidance for 2018, with diluted earnings per share (EPS) expected in the range of $1.90 to $2.30. As previously noted in our earnings release for the fourth quarter and full year 2017, earnings in 2018 are anticipated to be weighted towards the second half of the year, consistent with the cyclicality of the Company’s business.
First Quarter Conference Call
The Company will host a conference call at 2:00 PM Pacific Time on Wednesday, May 9, 2017, to discuss the first quarter 2018 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 15 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, building and specialty 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.
Forward-Looking Statements
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. While 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, inaccurate estimates of contract risks, revenue or costs, the timing of new awards or the pace of project execution; the requirement to perform extra, or change order, work resulting in disputes or claims, which may adversely affect our working capital, profits and cash flows; unfavorable outcomes of existing or future litigation or dispute resolution proceedings against project owners, subcontractors or suppliers, as
well as failure to promptly recover significant working capital invested in projects subject to such matters; a significant slowdown or decline in economic conditions; increased competition and failure to secure new contracts; client cancellations of, or reductions in scope under, contracts reported in our backlog; actual results could differ from the assumptions and estimates used to prepare financial statements; failure to meet contractual schedule requirements, which could result in higher costs and reduced profits or, in some cases, exposure to financial liability for liquidated damages and/or damages to customers; failure of our joint venture partners to perform their venture obligations, which could impose additional financial and performance obligations on us, resulting in reduced profits or losses; decreases in the level of government spending for infrastructure and other public projects; inability to retain key members of our management, to hire and retain personnel required to complete projects or implement succession plans for key officers; failure to meet our obligations under our debt agreements; possible systems and information technology interruptions; failure to comply with laws and regulations related to government contracts; inclement weather; conversion of our outstanding Convertible Notes that could dilute ownership interests of existing stockholders and could adversely affect the market price of our common stock; the potential dilutive impact of our Convertible Notes in our diluted earnings per share calculation; economic, political and other risks, including civil unrest, security issues, labor conditions, corruption and other unforeseeable events in countries where we do business, resulting in unanticipated losses; impairment of our goodwill or other indefinite-lived intangible assets; 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, 2017 filed with the Securities and Exchange Commission on February 27, 2018. 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
