Hudson Yards - Multiple Projects - New York, NY - Total $2.3 Billion

Tutor Perini Reports Second Quarter 2021 Results

August 4, 2021
  • Income from construction operations of $68.8 million, increased 19% over prior year, driven by a continued shift toward higher-margin projects within the Civil segment
  • Diluted earnings per share (“EPS”) of $0.61, up 65% compared to $0.37 in Q2 2020
  • Backlog remains healthy at $7.5 billion, with 58% comprised of higher-margin Civil projects
  • Affirming 2021 EPS guidance of $1.80 to $2.20

LOS ANGELES--(BUSINESS WIRE)-- Tutor Perini Corporation (the “Company”) (NYSE: TPC), a leading civil, building and specialty construction company, reported results today for the second quarter of 2021. Revenue was $1.22 billion, down modestly compared to $1.28 billion for the second quarter of last year. Reduced activities mostly on Building segment projects were partially offset by increased volume on Specialty Contractors segment projects. Despite the lower revenue, income from construction operations for the second quarter of 2021 was $68.8 million, up 19% compared to $57.7 million for the second quarter of last year. The increase was principally driven by a continued shift toward higher-margin projects within the Civil segment. In addition, the Company experienced improved overall results for the Specialty Contractors segment in the second quarter of 2021, mostly due to the resolution of various contract disputes that had a net favorable impact in 2021 and the absence of the impact of an unfavorable arbitration ruling in 2020. Net income attributable to the Company for the second quarter of 2021 was $31.2 million, or $0.61 per diluted share, compared to $18.7 million, or $0.37 per diluted share, for the second quarter of 2020. The strong increase in net income attributable to the Company, and correspondingly EPS, was driven by the higher income from construction operations.

Second quarter 2021 backlog remained healthy at $7.5 billion compared to $8.3 billion at the end of 2020. As anticipated, backlog continued to decline in the second quarter as a result of revenue that solidly outpaced the volume of new awards. The COVID-19 pandemic has negatively impacted the volume and timing of new awards in recent quarters. New awards in the second quarter of 2021 totaled $0.6 billion and included a $152 million courthouse project in California and $88 million for various civil projects in the Midwest. The Company recently received a letter of intent to award a $471 million contract for the LAX Airport Metro Connector project and will be booking the project into backlog in the third quarter of 2021, along with the $220 million I-70 Missouri River Bridge project. The Company also anticipates being awarded a significant new health care facility project in California. The Company is also preparing to bid on several large projects this year and during the first half of 2022, and anticipates backlog growth to resume later this year to levels that will support future revenue growth.

Outlook and Guidance

“We delivered strong EPS results for the second quarter and first six months of 2021, which were ahead of expectations,” remarked Ronald Tutor, Chairman and Chief Executive Officer. Tutor continued, “Demand for our construction services remains very strong, with an ever-expanding list of prospective projects. For as long as I have been in this business, this is the most vibrant market yet in terms of opportunities, with the potential to grow even more should the federal government pass a major program to invest significantly in our country's infrastructure. We are optimistic about the future and expect to capture our share of the many large opportunities ahead, which will support our growth over the coming years.”

Based on the Company’s year-to-date results in 2021 and the current outlook for the remainder of the year, the Company is affirming its EPS guidance and still expects EPS to be in the range of $1.80 to $2.20.

Second Quarter 2021 Conference Call

The Company will host a conference call at 2:00 PM Pacific Time on Wednesday, August 4, 2021, to discuss the second quarter 2021 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. 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 customers 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 planning and scheduling of 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 customers 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, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, 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: the COVID-19 pandemic, which has adversely impacted, and could continue to adversely impact, our business, financial condition and results of operations; revisions of estimates of contract risks, revenue or costs, the timing of new awards, the pace of project execution or economic factors, including inflation, which may result in losses or lower than anticipated profit; unfavorable outcomes of existing or future litigation or dispute resolution proceedings against customers (project owners, developers, general contractors, etc.), subcontractors or suppliers, as well as failure to promptly recover significant working capital invested in projects subject to such matters; the requirement to perform extra, or change order, work resulting in disputes or claims and adversely affecting our working capital, profits and cash flows; increased competition and failure to secure new contracts; a significant slowdown or decline in economic conditions; risks and other uncertainties associated with assumptions and estimates used to prepare financial statements; 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 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; client cancellations of, or reductions in scope under, contracts reported in our backlog; possible systems and information technology interruptions, including due to cyberattack, systems failures or other similar events; decreases in the level of government spending for infrastructure and other public projects; 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 and/or reputational harm; economic, political, regulatory 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; the impact of inclement weather conditions on projects; risks related to government contracts and related procurement regulations; violations of the U.S. Foreign Corrupt Practices Act and similar worldwide anti-bribery laws, which could result in unanticipated losses; adverse health events, such as an epidemic or a pandemic; failure to meet our obligations under our debt agreements; downgrades in our credit ratings; impairment of our goodwill or other indefinite-lived intangible assets; uncertainty from the expected discontinuance of the London Interbank Offered Rate and transition to any other interest rate benchmark; 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, 2020 filed on February 24, 2021 and in other reports that we file with the Securities and Exchange Commission from time to time. 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 Income

Unaudited

 

 

 

 

 

 

 

 

 



 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

(in thousands, except per common share amounts)

 

2021

 

2020

 

2021

 

2020

REVENUE

 

$

1,219,243

 

 

 

$

1,276,427

 

 

 

$

2,426,838

 

 

 

$

2,527,156

 

 

COST OF OPERATIONS

 

(1,091,754

)

 

 

(1,158,673

)

 

 

(2,188,894

)

 

 

(2,298,322

)

 

GROSS PROFIT

 

127,489

 

 

 

117,754

 

 

 

237,944

 

 

 

228,834

 

 

General and administrative expenses

 

(58,736

)

 

 

(60,058

)

 

 

(119,487

)

 

 

(123,911

)

 

INCOME FROM CONSTRUCTION OPERATIONS

 

68,753

 

 

 

57,696

 

 

 

118,457

 

 

 

104,923

 

 

Other income (expense)

 

1,431

 

 

 

(797

)

 

 

1,606

 

 

 

(316

)

 

Interest expense

 

(17,938

)

 

 

(16,464

)

 

 

(35,748

)

 

 

(32,900

)

 

INCOME BEFORE INCOME TAXES

 

52,246

 

 

 

40,435

 

 

 

84,315

 

 

 

71,707

 

 

Income tax expense

 

(10,635

)

 

 

(9,576

)

 

 

(17,599

)

 

 

(14,710

)

 

NET INCOME

 

41,611

 

 

 

30,859

 

 

 

66,716

 

 

 

56,997

 

 

LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS

 

10,446

 

 

 

12,150

 

 

 

19,517

 

 

 

20,917

 

 

NET INCOME ATTRIBUTABLE TO TUTOR PERINI CORPORATION

 

$

31,165

 

 

 

$

18,709

 

 

 

$

47,199

 

 

 

$

36,080

 

 

BASIC EARNINGS PER COMMON SHARE

 

$

0.61

 

 

 

$

0.37

 

 

 

$

0.93

 

 

 

$

0.71

 

 

DILUTED EARNINGS PER COMMON SHARE

 

$

0.61

 

 

 

$

0.37

 

 

 

$

0.92

 

 

 

$

0.71

 

 

WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING:

 

 

 

 

 

 

 

 

BASIC

 

50,999

 

 

 

50,667

 

 

 

50,956

 

 

 

50,502

 

 

DILUTED

 

51,375

 

 

 

50,935

 

 

 

51,362

 

 

 

50,885

 

 

Tutor Perini Corporation

Segment Information

Unaudited

 

 

 

 

 

 

 

 

 



Reportable Segments

 

 

 

 

(in thousands)

Civil

Building

Specialty
Contractors

Total

 

Corporate

 

Consolidated
Total

Three Months Ended June 30, 2021

 

 

 

 

 

 

 

 

Total revenue

$

643,055

 

 

$

415,801

 

 

$

281,370

 

 

$

1,340,226

 

 

$

 

 

 

$

1,340,226

 

 

Elimination of intersegment revenue

(87,703

)

 

(33,141

)

 

(139

)

 

(120,983

)

 

 

 

 

(120,983

)

 

Revenue from external customers

$

555,352

 

 

$

382,660

 

 

$

281,231

 

 

$

1,219,243

 

 

$

 

 

 

$

1,219,243

 

 

Income (loss) from construction operations

$

75,073

$

(2,488

)

$

9,960

$

82,545

(a)

$

(13,792)

(b)

$

68,753

Capital expenditures

$

8,616

 

 

$

51

 

 

$

19

 

 

$

8,686

 

 

$

339

 

 

 

$

9,025

 

 

Depreciation and amortization(c)

$

31,178

 

 

$

424

 

 

$

892

 

 

$

32,494

 

 

$

2,767

 

 

 

$

35,261

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2020

 

 

 

 

 

 

 

 

Total revenue

$

644,685

 

 

$

490,317

 

 

$

234,497

 

 

$

1,369,499

 

 

$

 

 

 

$

1,369,499

 

 

Elimination of intersegment revenue

(75,709

)

 

(17,296

)

 

(67

)

 

(93,072

)

 

 

 

 

(93,072

)

 

Revenue from external customers

$

568,976

 

 

$

473,021

 

 

$

234,430

 

 

$

1,276,427

 

 

$

 

 

 

$

1,276,427

 

 

Income (loss) from construction operations

$

65,398

 

 

$

17,789

 

 

$

(11,388

)

 

$

71,799

(d)

 

$

(14,103

)

(b)

$

57,696

 

 

Capital expenditures

$

18,951

 

 

$

186

 

 

$

255

 

 

$

19,392

 

 

$

301

 

 

 

$

19,693

 

 

Depreciation and amortization(c)

$

21,775

 

 

$

428

 

 

$

995

 

 

$

23,198

 

 

$

2,767

 

 

 

$

25,965

 

 

____________________________

(a)

During the three months ended June 30, 2021, the Company recorded a reduction of $20.1 million in cost of operations (an after-tax impact of $14.6 million, or $0.28 per diluted share) due to a favorable legal judgment on a completed electrical project in New York in the Specialty Contractors segment. The judgment awarded the Company the recovery of certain costs previously incurred.

(b)

Consists primarily of corporate general and administrative expenses.

(c)

Depreciation and amortization is included in income (loss) from construction operations.

(d)

During the three months ended June 30, 2020, the Company recorded a charge of $13.2 million in income (loss) from construction operations (an after-tax impact of $9.5 million, or $0.19 per diluted share) due to an adverse arbitration ruling pertaining to an electrical project in New York in the Specialty Contractors segment.



Reportable Segments

 

 

 

 

(in thousands)

Civil

Building

Specialty
Contractors

Total

 

Corporate

 

Consolidated
Total

Six Months Ended June 30, 2021

 

 

 

 

 

 

 

 

Total revenue

$

1,226,199

 

 

$

872,971

 

 

$

606,318

 

 

$

2,705,488

 

 

$

 

 

 

$

2,705,488

 

 

Elimination of intersegment revenue

(195,272

)

 

(83,078

)

 

(300

)

 

(278,650

)

 

 

 

 

(278,650

)

 

Revenue from external customers

$

1,030,927

 

 

$

789,893

 

 

$

606,018

 

 

$

2,426,838

 

 

$

 

 

 

$

2,426,838

 

 

Income (loss) from construction operations

$

125,178

 

 

$

8,728

 

 

$

11,284

 

 

$

145,190

(a)

 

$

(26,733

)

(b)

 

$

118,457

 

 

Capital expenditures

$

18,180

 

 

$

124

 

 

$

164

 

 

$

18,468

 

 

$

392

 

 

 

$

18,860

 

 

Depreciation and amortization(c)

$

53,891

 

 

$

856

 

 

$

1,851

 

 

$

56,598

 

 

$

5,537

 

 

 

$

62,135

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2020

 

 

 

 

 

 

 

 

Total revenue

$

1,224,771

 

 

$

995,400

 

 

$

516,949

 

 

$

2,737,120

 

 

$

 

 

 

$

2,737,120

 

 

Elimination of intersegment revenue

(169,166

)

 

(40,615

)

 

(183

)

 

(209,964

)

 

 

 

 

(209,964

)

 

Revenue from external customers

$

1,055,605

 

 

$

954,785

 

 

$

516,766

 

 

$

2,527,156

 

 

$

 

 

 

$

2,527,156

 

 

Income (loss) from construction operations

$

111,519

 

 

$

21,305

 

 

$

(3,109

)

 

$

129,715

(d)

 

$

(24,792

)

(b)

 

$

104,923

 

 

Capital expenditures

$

30,143

 

 

$

198

 

 

$

728

 

 

$

31,069

 

 

$

317

 

 

 

$

31,386

 

 

Depreciation and amortization(c)

$

40,391

 

 

$

855

 

 

$

1,988

 

 

$

43,234

 

 

$

5,542

 

 

 

$

48,776

 

 

____________________________

(a)

During the six months ended June 30, 2021, the Company recorded a reduction of $20.1 million in cost of operations (an after-tax impact of $14.6 million, or $0.28 per diluted share) due to a favorable legal judgment on a completed electrical project in New York in the Specialty Contractors segment. The judgment awarded the Company the recovery of certain costs previously incurred.

(b)

Consists primarily of corporate general and administrative expenses.

(c)

Depreciation and amortization is included in income (loss) from construction operations.

(d)

During the six months ended June 30, 2020, the Company recorded a charge of $13.2 million in income (loss) from construction operations (an after-tax impact of $9.5 million, or $0.19 per diluted share) due to an adverse arbitration ruling pertaining to an electrical project in New York in the Specialty Contractors segment.

Tutor Perini Corporation

Condensed Consolidated Balance Sheets

Unaudited

(in thousands, except share and per share amounts)

 

As of June 30,
2021

 

As of December 31,
2020

ASSETS

CURRENT ASSETS:

 

 

 

 

Cash and cash equivalents ($91,700 and $105,735 related to variable interest entities (“VIEs”))

 

$

231,129

 

 

 

$

374,289

 

 

Restricted cash

 

2,884

 

 

 

77,563

 

 

Restricted investments

 

85,545

 

 

 

78,912

 

 

Accounts receivable ($85,873 and $86,012 related to VIEs)

 

1,372,054

 

 

 

1,415,063

 

 

Retainage receivable ($139,617 and $122,335 related to VIEs)

 

683,966

 

 

 

648,441

 

 

Costs and estimated earnings in excess of billings ($90,294 and $39,846 related to VIEs)

 

1,346,974

 

 

 

1,236,734

 

 

Other current assets ($49,867 and $51,746 related to VIEs)

 

252,735

 

 

 

249,455

 

 

Total current assets

 

3,975,287

 

 

 

4,080,457

 

 

PROPERTY AND EQUIPMENT ("P&E"), net of accumulated depreciation of $475,207 and $434,294 (net P&E of $4,550 and $12,840 related to VIEs)

 

456,693

 

 

 

489,217

 

 

GOODWILL

 

205,143

 

 

 

205,143

 

 

INTANGIBLE ASSETS, NET

 

105,801

 

 

 

123,115

 

 

OTHER ASSETS

 

149,176

 

 

 

147,685

 

 

TOTAL ASSETS

 

$

4,892,100

 

 

 

$

5,045,617

 

 

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

 

 

 

 

Current maturities of long-term debt, net of unamortized discount and debt issuance costs totaling $0 and $2,040

 

$

36,941

 

 

 

$

100,188

 

 

Accounts payable ($86,263 and $116,461 related to VIEs)

 

692,835

 

 

 

794,611

 

 

Retainage payable ($30,681 and $26,439 related to VIEs)

 

331,341

 

 

 

315,135

 

 

Billings in excess of costs and estimated earnings ($344,239 and $362,427 related to VIEs)

 

764,029

 

 

 

839,222

 

 

Accrued expenses and other current liabilities ($7,096 and $9,595 related to VIEs)

 

200,138

 

 

 

215,207

 

 

Total current liabilities

 

2,025,284

 

 

 

2,264,363

 

 

LONG-TERM DEBT, less current maturities, net of unamortized discount and debt issuance costs totaling $18,712 and $20,209

 

933,303

 

 

 

925,277

 

 

DEFERRED INCOME TAXES

 

85,386

 

 

 

82,966

 

 

OTHER LONG-TERM LIABILITIES

 

237,697

 

 

 

230,066

 

 

TOTAL LIABILITIES

 

3,281,670

 

 

 

3,502,672

 

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

EQUITY

 

 

 

 

Stockholders' equity:

 

 

 

 

Preferred stock - authorized 1,000,000 shares ($1 par value), none issued

 

 

 

 

 

 

Common stock - authorized 112,500,000 shares ($1 par value), issued and outstanding 51,072,182 and 50,827,205 shares

 

51,072

 

 

 

50,827

 

 

Additional paid-in capital

 

1,130,368

 

 

 

1,127,385

 

 

Retained earnings

 

469,584

 

 

 

422,385

 

 

Accumulated other comprehensive loss

 

(46,526

)

 

 

(46,741

)

 

Total stockholders' equity

 

1,604,498

 

 

 

1,553,856

 

 

Noncontrolling interests

 

5,932

 

 

 

(10,911

)

 

TOTAL EQUITY

 

1,610,430

 

 

 

1,542,945

 

 

TOTAL LIABILITIES AND EQUITY

 

$

4,892,100

 

 

 

$

5,045,617

 

 

Tutor Perini Corporation

Condensed Consolidated Statements of Cash Flows

Unaudited



Six Months Ended June 30,

(in thousands)

2021

 

2020

Cash Flows from Operating Activities:

 

 

 

Net income

$

66,716

 

 

$

56,997

 

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

 

 

 

Depreciation

44,821

 

 

34,180

 

Amortization of intangible assets

17,314

 

 

14,596

 

Share-based compensation expense

5,033

 

 

8,264

 

Change in debt discounts and deferred debt issuance costs

3,868

 

 

7,046

 

Deferred income taxes

2,213

 

 

5,423

 

Loss on sale of property and equipment

360

 

 

31

 

Changes in other components of working capital

(278,943

)

 

(68,471

)

Other long-term liabilities

6,801

 

 

1,295

 

Other, net

515

 

 

(1,131

)

NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES

(131,302

)

 

58,230

 



 

 

 

Cash Flows from Investing Activities:

 

 

 

Acquisition of property and equipment

(18,860

)

 

(31,386

)

Proceeds from sale of property and equipment

3,623

 

 

1,082

 

Investments in securities

(18,096

)

 

(13,319

)

Proceeds from maturities and sales of investments in securities

10,497

 

 

10,985

 

NET CASH USED IN INVESTING ACTIVITIES

(22,836

)

 

(32,638

)



 

 

 

Cash Flows from Financing Activities:

 

 

 

Proceeds from debt

308,181

 

 

752,843

 

Repayment of debt

(367,007

)

 

(757,141

)

Cash payments related to share-based compensation

(1,625

)

 

(994

)

Distributions paid to noncontrolling interests

(7,250

)

 

(30,910

)

Contributions from noncontrolling interests

4,000

 

 

 

NET CASH USED IN FINANCING ACTIVITIES

(63,701

)

 

(36,202

)



 

 

 

Net decrease in cash, cash equivalents and restricted cash

(217,839

)

 

(10,610

)

Cash, cash equivalents and restricted cash at beginning of period

451,852

 

 

202,101

 

Cash, cash equivalents and restricted cash at end of period

$

234,013

 

 

$

191,491

 

Tutor Perini Corporation

Backlog Information

Unaudited



 

 

 

 

 

 

 

 

(in millions)

 

Backlog at
March 31, 2021

 

New Awards in the
Three Months Ended
June 30, 2021(a)

 

Revenue in the
Three Months Ended
June 30, 2021

 

Backlog at
June 30, 2021

Civil

 

$

4,765.0

 

 

$

119.3

 

 

$

(555.3

)

 

 

$

4,329.0

 

Building

 

1,639.3

 

 

386.1

 

 

(382.7

)

 

 

1,642.7

 

Specialty Contractors

 

1,692.5

 

 

137.4

 

 

(281.2

)

 

 

1,548.7

 

Total

 

$

8,096.8

 

 

$

642.8

 

 

$

(1,219.2

)

 

 

$

7,520.4

 



 

 

 

 

 

 

 

 

(in millions)

 

Backlog at
December 31, 2020

 

New Awards in the
Six Months Ended
June 30, 2021(a)

 

Revenue in the
Six Months Ended
June 30, 2021

 

Backlog at
June 30, 2021

Civil

 

$

4,783.6

 

 

$

576.3

 

 

$

(1,030.9

)

 

 

$

4,329.0

 

Building

 

1,702.3

 

 

730.3

 

 

(789.9

)

 

 

1,642.7

 

Specialty Contractors

 

1,859.8

 

 

294.9

 

 

(606.0

)

 

 

1,548.7

 

Total

 

$

8,345.7

 

 

$

1,601.5

 

 

$

(2,426.8

)

 

 

$

7,520.4

 

____________________________

(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.

 

Tutor Perini Corporation
Jorge Casado, 818-362-8391
Vice President, Investor Relations & Corporate Communications
www.tutorperini.com

Source: Tutor Perini Corporation

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