-
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)--
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.
|
|
|
Tutor Perini Corporation
|
|
Condensed Consolidated Statements of Operations
|
|
Unaudited
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
(in thousands, except per common share amounts)
|
|
|
2018
|
|
|
2017
|
|
REVENUE
|
|
|
$
|
1,028,156
|
|
|
|
$
|
1,117,361
|
|
|
COST OF OPERATIONS
|
|
|
|
(961,088
|
)
|
|
|
|
(1,014,641
|
)
|
|
GROSS PROFIT
|
|
|
|
67,068
|
|
|
|
|
102,720
|
|
|
General and administrative expenses
|
|
|
|
(67,993
|
)
|
|
|
|
(65,703
|
)
|
|
INCOME (LOSS) FROM CONSTRUCTION OPERATIONS
|
|
|
|
(925
|
)
|
|
|
|
37,017
|
|
|
Other income, net
|
|
|
|
780
|
|
|
|
|
417
|
|
|
Interest expense
|
|
|
|
(15,065
|
)
|
|
|
|
(15,564
|
)
|
|
INCOME (LOSS) BEFORE INCOME TAXES
|
|
|
|
(15,210
|
)
|
|
|
|
21,870
|
|
|
Income tax benefit (provision)
|
|
|
|
4,268
|
|
|
|
|
(8,106
|
)
|
|
NET INCOME (LOSS)
|
|
|
|
(10,942
|
)
|
|
|
|
13,764
|
|
|
LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
1,182
|
|
|
|
|
—
|
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO TUTOR PERINI CORPORATION
|
|
|
$
|
(12,124
|
)
|
|
|
$
|
13,764
|
|
|
BASIC EARNINGS (LOSS) PER COMMON SHARE
|
|
|
$
|
(0.24
|
)
|
|
|
$
|
0.28
|
|
|
DILUTED EARNINGS (LOSS) PER COMMON SHARE
|
|
|
$
|
(0.24
|
)
|
|
|
$
|
0.27
|
|
|
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
|
|
BASIC
|
|
|
|
49,814
|
|
|
|
|
49,282
|
|
|
DILUTED
|
|
|
|
49,814
|
|
|
|
|
50,948
|
|
|
|
|
Tutor Perini Corporation
|
|
Segment Information
|
|
Unaudited
|
|
|
|
|
|
|
Reportable Segments
|
|
|
|
|
|
|
|
|
|
|
|
Specialty
|
|
|
|
|
|
|
|
Consolidated
|
|
(in thousands)
|
|
|
Civil
|
|
Building
|
|
Contractors
|
|
Total
|
|
Corporate
|
|
Total
|
|
Three Months Ended March 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
|
|
$
|
325,400
|
|
|
$
|
490,617
|
|
|
$
|
274,801
|
|
$
|
1,090,818
|
|
|
$
|
—
|
|
|
$
|
1,090,818
|
|
|
Elimination of intersegment revenue
|
|
|
|
(62,286
|
)
|
|
|
(376
|
)
|
|
|
—
|
|
|
(62,662
|
)
|
|
|
—
|
|
|
|
(62,662
|
)
|
|
Revenue from external customers
|
|
|
$
|
263,114
|
|
|
$
|
490,241
|
|
|
$
|
274,801
|
|
$
|
1,028,156
|
|
|
$
|
—
|
|
|
$
|
1,028,156
|
|
|
Income (loss) from construction operations
|
|
|
$
|
2,839
|
|
|
$
|
6,425
|
|
|
$
|
7,235
|
|
$
|
16,499
|
|
|
$
|
(17,424
|
)
|
(a)
|
$
|
(925
|
)
|
|
Capital expenditures
|
|
|
$
|
19,196
|
|
|
$
|
278
|
|
|
$
|
419
|
|
$
|
19,893
|
|
|
$
|
77
|
|
|
$
|
19,970
|
|
|
Depreciation and amortization(b)
|
|
|
$
|
5,756
|
|
|
$
|
481
|
|
|
$
|
1,112
|
|
$
|
7,349
|
|
|
$
|
2,838
|
|
|
$
|
10,187
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue
|
|
|
$
|
338,108
|
|
|
$
|
515,251
|
|
|
$
|
315,696
|
|
$
|
1,169,055
|
|
|
$
|
—
|
|
|
$
|
1,169,055
|
|
|
Elimination of intersegment revenue
|
|
|
|
(33,533
|
)
|
|
|
(18,161
|
)
|
|
|
—
|
|
|
(51,694
|
)
|
|
|
—
|
|
|
|
(51,694
|
)
|
|
Revenue from external customers
|
|
|
$
|
304,575
|
|
|
$
|
497,090
|
|
|
$
|
315,696
|
|
$
|
1,117,361
|
|
|
$
|
—
|
|
|
$
|
1,117,361
|
|
|
Income from construction operations
|
|
|
$
|
31,888
|
|
|
$
|
5,242
|
|
|
$
|
14,762
|
|
$
|
51,892
|
|
|
$
|
(14,875
|
)
|
(a)
|
$
|
37,017
|
|
|
Capital expenditures
|
|
|
$
|
5,567
|
|
|
$
|
45
|
|
|
$
|
6
|
|
$
|
5,618
|
|
|
$
|
54
|
|
|
$
|
5,672
|
|
|
Depreciation and amortization(b)
|
|
|
$
|
16,318
|
|
|
$
|
518
|
|
|
$
|
1,192
|
|
$
|
18,028
|
|
|
$
|
2,968
|
|
|
$
|
20,996
|
|
|
(a) Consists primarily of corporate general and administrative
expenses.
|
|
(b) Depreciation and amortization is included in income from
construction operations.
|
|
|
|
|
|
Tutor Perini Corporation
|
|
Condensed Consolidated Balance Sheets
|
|
Unaudited
|
|
|
|
|
|
|
As of March, 31
|
|
As of December 31,
|
|
(in thousands, except share and per share amounts)
|
|
|
2018
|
|
2017
|
|
ASSETS
|
|
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
Cash and cash equivalents ($52,871 and $53,067 related to variable
interest entities (VIEs))
|
|
|
$
|
174,340
|
|
|
$
|
192,868
|
|
|
Restricted cash
|
|
|
|
4,090
|
|
|
|
4,780
|
|
|
Restricted investments
|
|
|
|
53,161
|
|
|
|
53,014
|
|
|
Accounts receivable ($28,076 and $30,003 related to VIEs)
|
|
|
|
1,236,818
|
|
|
|
1,265,717
|
|
|
Retainage receivable ($18,627 and $12,410 related to VIEs)
|
|
|
|
530,897
|
|
|
|
535,939
|
|
|
Costs and estimated earnings in excess of billings
|
|
|
|
980,896
|
|
|
|
932,758
|
|
|
Other current assets ($30,093 and $0 related to VIEs)
|
|
|
|
132,298
|
|
|
|
89,316
|
|
|
Total current assets
|
|
|
|
3,112,500
|
|
|
|
3,074,392
|
|
|
PROPERTY AND EQUIPMENT, net of accumulated depreciation
of $328,443 and $359,188 ($25,072 and $11,641 related to VIEs)
|
473,178
|
|
|
|
467,499
|
|
|
GOODWILL
|
|
|
|
585,006
|
|
|
|
585,006
|
|
|
INTANGIBLE ASSETS, NET
|
|
|
|
88,568
|
|
|
|
89,454
|
|
|
OTHER ASSETS
|
|
|
|
48,877
|
|
|
|
47,772
|
|
|
TOTAL ASSETS
|
|
|
$
|
4,308,129
|
|
|
$
|
4,264,123
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
Current maturities of long-term debt
|
|
|
$
|
27,165
|
|
|
$
|
30,748
|
|
|
Accounts payable ($9,183 and $19,243 related to VIEs)
|
|
|
|
659,290
|
|
|
|
699,971
|
|
|
Retainage payable
|
|
|
|
246,033
|
|
|
|
261,820
|
|
|
Billings in excess of cost and estimated earnings ($199,618 and
$120,952 related to VIEs)
|
508,616
|
|
|
|
456,869
|
|
|
Accrued expenses and other current liabilities
|
|
|
|
118,334
|
|
|
|
132,438
|
|
|
Total current liabilities
|
|
|
|
1,559,438
|
|
|
|
1,581,846
|
|
|
LONG-TERM DEBT, less current maturities, net of unamortized
discounts and debt issuance costs totaling $43,064 and $45,631
|
790,119
|
|
|
|
705,528
|
|
|
DEFERRED INCOME TAXES
|
|
|
|
106,763
|
|
|
|
108,504
|
|
|
OTHER LONG-TERM LIABILITIES
|
|
|
|
166,205
|
|
|
|
163,465
|
|
|
TOTAL LIABILITIES
|
|
|
|
2,622,525
|
|
|
|
2,559,343
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
|
Stockholders' Equity:
|
|
|
|
|
|
|
|
|
Preferred stock - authorized 1,000,000 shares ($1 par value), none
issued
|
|
|
|
—
|
|
|
|
—
|
|
|
Common stock - authorized 75,000,000 shares ($1 par value),
issued and outstanding 49,913,003 and 49,781,010 shares
|
49,913
|
|
|
|
49,781
|
|
|
Additional paid-in capital
|
|
|
|
1,087,164
|
|
|
|
1,084,205
|
|
|
Retained earnings
|
|
|
|
606,199
|
|
|
|
622,007
|
|
|
Accumulated other comprehensive loss
|
|
|
|
(43,596
|
)
|
|
|
(42,718
|
)
|
|
Total stockholders' equity
|
|
|
|
1,699,680
|
|
|
|
1,713,275
|
|
|
Noncontrolling interests
|
|
|
|
(14,076
|
)
|
|
|
(8,495
|
)
|
|
TOTAL EQUITY
|
|
|
|
1,685,604
|
|
|
|
1,704,780
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
|
$
|
4,308,129
|
|
|
$
|
4,264,123
|
|
|
|
|
|
|
Tutor Perini Corporation
|
|
Condensed Consolidated Statements of Cash Flows
|
|
Unaudited
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
(in thousands)
|
|
|
2018
|
|
|
2017
|
|
|
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
$
|
(10,942
|
)
|
|
$
|
13,764
|
|
|
Adjustments to reconcile net income (loss) to net cash used in
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
9,301
|
|
|
|
20,110
|
|
|
Amortization of intangible assets
|
|
|
|
886
|
|
|
|
886
|
|
|
Share-based compensation expense
|
|
|
|
6,081
|
|
|
|
4,306
|
|
|
Change in debt discounts and deferred debt issuance costs
|
|
|
|
2,927
|
|
|
|
3,836
|
|
|
Deferred income taxes
|
|
|
|
186
|
|
|
|
(526
|
)
|
|
Loss (gain) on sale of property and equipment
|
|
|
|
1,471
|
|
|
|
(131
|
)
|
|
Other long-term liabilities
|
|
|
|
1,139
|
|
|
|
(1,824
|
)
|
|
Other
|
|
|
|
(180
|
)
|
|
|
267
|
|
|
Changes in other components of working capital
|
|
|
|
(84,272
|
)
|
|
|
(73,533
|
)
|
|
NET CASH USED IN OPERATING ACTIVITIES
|
|
|
|
(73,403
|
)
|
|
|
(32,845
|
)
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
Acquisition of property and equipment excluding financed purchases
|
|
|
|
(19,970
|
)
|
|
|
(5,672
|
)
|
|
Proceeds from sale of property and equipment
|
|
|
|
3,303
|
|
|
|
259
|
|
|
Investment in securities, restricted
|
|
|
|
(3,288
|
)
|
|
|
—
|
|
|
Proceeds from maturities and sales of investments in securities
|
|
|
|
3,007
|
|
|
|
—
|
|
|
NET CASH USED IN INVESTING ACTIVITIES
|
|
|
|
(16,948
|
)
|
|
|
(5,413
|
)
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
Proceeds from debt
|
|
|
|
665,000
|
|
|
|
313,977
|
|
|
Repayment of debt
|
|
|
|
(586,559
|
)
|
|
|
(296,485
|
)
|
|
Issuance of common stock and effect of cashless exercise
|
|
|
|
(2,308
|
)
|
|
|
(10,809
|
)
|
|
Distributions paid to noncontrolling interests
|
|
|
|
(5,000
|
)
|
|
|
—
|
|
|
Debt issuance and extinguishment costs
|
|
|
|
—
|
|
|
|
(57
|
)
|
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
|
|
|
71,133
|
|
|
|
6,626
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash, cash equivalents and restricted cash
|
|
|
|
(19,218
|
)
|
|
|
(31,632
|
)
|
|
Cash, cash equivalents and restricted cash at beginning of period
|
|
|
|
197,648
|
|
|
|
196,607
|
|
|
Cash, cash equivalents and restricted cash at end of period
|
|
|
$
|
178,430
|
|
|
$
|
164,975
|
|
|
|
|
|
|
Tutor Perini Corporation
|
|
Backlog Information
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
|
|
|
|
New Awards in the
|
|
Recognized in the
|
|
|
|
|
|
|
Backlog at
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Backlog at
|
|
(in millions)
|
|
|
December 31, 2017
|
|
March 31, 2018(a)
|
|
March 31, 2018
|
|
March 31, 2018
|
|
Civil
|
|
|
$
|
4,118.2
|
|
$
|
620.3
|
|
$
|
(263.1
|
)
|
|
$
|
4,475.4
|
|
Building
|
|
|
|
1,701.4
|
|
|
1,025.9
|
|
|
(490.3
|
)
|
|
|
2,237.0
|
|
Specialty Contractors
|
|
|
|
1,463.8
|
|
|
576.0
|
|
|
(274.8
|
)
|
|
|
1,765.0
|
|
Total
|
|
|
$
|
7,283.4
|
|
$
|
2,222.2
|
|
$
|
(1,028.2
|
)
|
|
$
|
8,477.4
|
(a) New awards consist of the original contract price of projects added
to our backlog plus or minus subsequent changes to the estimated total
contract price of existing contracts.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180509006412/en/
Source: Tutor Perini Corporation