Q1 2025 Tutor Perini Corp Earnings Call
Sheri: Good day ladies and gentlemen and welcome to Tutor Perini Corporation, 1st quarter 2025 earnings conference call. My name is Sherry and I will be your coordinator for today. All participants are currently in a listen only mode.
Sheri: Following Management's prepared remarks, we will be opening the call for a question and answer session
Sheri: As a reminder, this conference call is being recorded for replay purposes [inaudible]
Speaker Change: If anyone wants to require operator assistance during the conference, please press star zero on your telephone keypad. I will now turn the conference over your host for today, Jorge Casado, vice president, investor relations, please proceed.
Speaker Change: Hello everyone and thank you for joining us. With us today are Gary Smalley, CEO and President, Ron Tutor, Executive Chairman, and Ryan Soroka, Executive Vice President and CFO .
Speaker Change: Before we discuss our results, I will remind everyone that during this call we will be making forward-looking statements which are based on management's current assessment of existing trends and information.
Speaker Change: There is an inherent risk that our actual results could differ materially. You can find our disclosures about risk factors that could contribute to such differences in our Form 10K, which we filed on February 27th, 2025, and in our Form 10Q that we are filing today.
Speaker Change: The company assumes no obligation to update for looking statements, whether due to new information, future events, or otherwise, other than as required by law.
Speaker Change: Thank you, and with that, I will turn the call over to Gary Smalley.
Thanks, Jorge.
Hello everyone and thank you all for joining us.
Speaker Change: We're off to a great start in 2025 without standing first quarter results, that highlight our strong growth and performance across all key metrics, and that we're quite frankly better than expected. Thank you very much.
Speaker Change: Specifically, your over-year, our first quarter revenue grew 19% to 1.25 billion, operating income was up 34% to 65 million, earnings per share increased 77% to 53 cents.
Speaker Change: and our backlog grew 94% to a new all-time record of 19.4 billion.
Speaker Change: In addition, our operating cash flow was $23 million, a solid result for the first quarter considering that historically our first quarter cash flow tends to be low and often negative due to seasonality.
Speaker Change: All in all, our first quarter EPS with the second best of any first quarter in Tutor Perini's history and our operating cash flow was a third best first quarter result ever.
Speaker Change: Our business is performing well and I am pleased to report that it was a clean first quarter with solid project execution and no material project adjustments even for dispute resolutions.
Speaker Change: Ryan will go over the specifics of our financial results, but overall our revenue and earnings were driven by increased project execution activities on certain newer, higher margin projects that all have substantial scope of work remaining.
Speaker Change: Our operating cash flow for the first quarter of 2025 was driven by collections from newer and ongoing projects, unlike last year's first quarter cash flow which included a large amount of collections related to dispute resolutions.
Speaker Change: We still expect to make progress this year resolving various other disputes and collecting significant associated cash, but those collections are expected later in the year.
Speaker Change: During the first quarter, we continue to win new projects, booking an impressive $2 billion of new awards and contract adjustments, adding to our already record backlog.
Speaker Change: Our book to burn ratio for the first quarter was a solid 1.6x.
Speaker Change: Backlogged for the civil and specialty contract for segments, also set new records.
Speaker Change: The most significant new awards and contract adjustments in the first quarter included.
Speaker Change: The $1.18 billion manhattan tunnel project in New York, which is a component of the broader gateway program that includes critical rail infrastructure along the northeast corridor between Newark and New York Penn Station.
Speaker Change: $241 million of additional funding for the Apra Harbor Waterfront repairs project in Guam, which brings the current value of this project to more than $570 million.
Speaker Change: 111 million dollars of additional funding for certain health care facility projects in California.
Speaker Change: An electrical project in Texas valued at more than $100 million and $99 million of additional funding for an existing electrical project in Texas.
Speaker Change: The outlook is excellent for strong, sustained backlog this year with a potential for further backlog growth
Speaker Change: Our new award bookings continue to be healthy in the second quarter, as we have already won a $500 million healthcare project in California that was recently awarded funding for the construction phase after having been in pre-construction for the past year.
Speaker Change: In addition to this project, there are several other building segment projects currently in the pre-construction phase that we expect will soon also advance to the construction phase, including another healthcare project, also in California valued at $1 billion.
Speaker Change: Our bidding pipeline continues to be full of opportunities this year and over the next several years.
Speaker Change: Our record backlog enables us to be even more selective than before as to which of the opportunities we will pursue and to focus on bidding projects that have favorable contractual terms, limited competition and higher margins.
Speaker Change: Also, the Indo-Pacific region continues to be a major area of project opportunities, driven in large part by the US Military's Pacific Deterrence Initiative, which aims to enhance US Military Infrastructure in Readiness.
Speaker Change: Black Construction, our Guam-based subsidiary, has had tremendous success in capturing new projects and continues to be well-positioned to win other major projects in the region.
Speaker Change: Tutor Perini and Plac Construction together have been successful in capturing four recent multiple award construction contracts or max with a combined contract capacity of more than $32 billion over the next eight years.
Speaker Change: This capacity will be shared among us and the other firms that have been awarded these
Speaker Change: and the MAX essentially put us on the bidder's list enabling us to pursue the numerous project task quarters that will be ultimately awarded.
[inaudible]
Speaker Change: Ron, would you take a couple of minutes to discuss some of our other civil bidding opportunities on the horizon and also what you are seeing in the early stages of project execution as we kick off work on the major projects that have been awarded over the last few quarters.
[inaudible]
Ron Tutor: Certainly, Gary, we're about to submit our bid for the multi-billion-dollar mid-town bus terminal replacement project in New York and will await contractor selection by the owner during the next 30 days.
Speaker Change: If we are successful, this will add substantially to our existing record backlog.
Speaker Change: Apart from this, the most significant upcoming project opportunities include the $12 billion repulment of transit quarter.
The $3.8M Southeast Gateway Line
The $1 billion North Valley Rail Project.
Speaker Change: The $900 million dollar foot hill gold line light rail project, all of which by the way are in California and the $1.8 billion South Jersey light rail glass borough to cam the line in New Jersey.
Speaker Change: I continue to work with Gary and our operations executives to help ensure that our newer major projects, including the Brooklyn,
and Manhattan Jails, the Honolulu Rail Transit Line.
Speaker Change: The Kenzico and Manhattan Tunnels, the Afra Harbor breakwater and the Newark Airtron train are properly set up to maximize the likelihood of success.
Speaker Change: We're still in the early stages of many of these projects but they are all going extremely well and anticipate this will continue to be the case. Thank you and I will now hand it back to you, Gary.
Thanks Ron.
Speaker Change: As a result for a strong start to the year and continued confidence in what we expect to achieve for the rest of this year, we are increasing our 2025 EPS guidance to the range of $1.60 to $1.95 up from the initial guidance of $1.50 to $1.90 that we provided in late February .
Speaker Change: Project delays for existing or prospective work, lower than expected wind rates for future bids, and settlements or adverse legal decisions associated with the resolution of disputes.
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Speaker Change: The future continues to look very bright for Tutor Perini beyond 2025, and we are still anticipating that our earnings in 26 and 27 will be more than double our increased EPS guidance for 2025.
Speaker Change: We also continue to expect strong operating cash flow for 2025 and beyond.
[inaudible]
Speaker Change: Now, with respect to potential concerns regarding US trade policy and various federal spending programs, I will reiterate that we do not currently anticipate any significant impacts to our business related to these factors.
Speaker Change: From a project funding perspective, we do not currently foresee the risk of any of our major projects and backlog being cancelled, delayed or defunded [inaudible]
Speaker Change: Most of our major projects are funded at the state or local level or with some combination of federal, state and local funding. For projects that are wholly or partly funded with federal dollars, the funding for these projects has already been committed and or these projects are strategically important to the United States.
Speaker Change: Specifically related to potential tariff impacts, we utilize a pre-award and post-award strategy.
Speaker Change: As part of our pre-award strategy, our detailed estimating process includes consideration of anticipated cost increases over the performance period of our contracts, as well as additional contingencies to address other potential incremental costs related to unforeseen risks.
Speaker Change: Prior to our bid or proposal submission, we also work to negotiate favorable contract provisions that provide entitlement for certain compensable events, which may include price escalations and allowances.
Speaker Change: Once a project is awarded, our strategy shifts to entering into purchase orders or buyouts of materials such as steel and concrete, as well as large pieces of equipment.
Speaker Change: which mitigates the risk of future equipment and commodity price increases.
Speaker Change: Also at the onset of projects, we enter into fixed price contracts with our key project subcontractors whereby the risk of unforeseen escalation is transferred to the subcontractor.
Speaker Change: Thank you, and with that, I will now turn the call over to Ryan to discuss the details of our first quarter results.
Ryan Soroka: Thanks, Gary. Good afternoon, everyone. I will begin by discussing our results for the first quarter, after which I will provide some commentary on our bounce sheet and our updated 2025 guidance assumptions.
Ryan Soroka: Revenue for the first quarter of 2025 was $1.25 billion, up 19% compared to $1.05 billion for the first quarter of 2024.
Ryan Soroka: Civil Segment Revenue was 610 million up a strong 29% compared to 472 million last year.
Ryan Soroka: Building segment revenue was 460 million, up 12% compared to 412 million last year, and specialty contractor segment revenue was 177 million, up 7% compared to $165 million last year.
Ryan Soroka: A revenue growth was broad-based and driven by increased project execution activities on certain newer, higher margin projects that all have substantial scope of work or mating.
Ryan Soroka: These projects included the Brooklyn Jail, which contributed to the revenue growth across all three segments, the Honolulu Rail Project, and certain mass transit projects in California.
[inaudible]
Ryan Soroka: Civil segment income from construction operations was $80 million dollars in the first quarter of 2025 compared to $71 million dollars for the first quarter last year. With the increase driven by contributions related to the strong revenue growth I mentioned for the segment.
Ryan Soroka: Building segment income from construction operations was $10 million in the first quarter of 2025 compared to $16 million last year.
Ryan Soroka: with the decrease primarily due to the absence of a prior year immaterial favorable adjustment that resulted from a legal ruling related to a completed hospitality and gaming project. Offset by contributions associated with the higher first quarter revenue for the segment this year.
Ryan Soroka: The specialty contractor segment posted a loss of $7 million in the first quarter of 2025 compared to a loss of $18 million last year.
Ryan Soroka: The improvement was primarily due to the absence of a prior year in material unfavorable adjustment pertaining to an arbitration ruling on a completed electrical project in New York, and to a lesser extent, contributions related to the higher first quarter revenue for the segment this year.
Ryan Soroka: We still anticipate improved operating income over the course of this year for the specialty segment, as our revenue volume is expected to gradually increase, which will help to cover the segment's DNA costs.
Ryan Soroka: Segment operating margins worth 13%, 2.3%, and negative 4% to the civil, building, and specialty contractor segments respectively.
Ryan Soroka: These margins are trending well, and we anticipate further margin improvement ahead this year, especially for the building and specialty contractor segment.
Ryan Soroka: Other income was $5 million. Level with the other income reported for the first quarter last year. Interest expense was $14 million, down 26% compared to $19 million for the same period last year, due to our substantial debt reduction completed since last year.
Ryan Soroka: Income Tax Expense for the first quarter of 2025 was $13 million, with a corresponding effective tax rate of 23.2%, compared to $7 million for the same period last year, with a corresponding effective tax rate of 21%.
Ryan Soroka: Net income, a Tribunal Tutor Perini for the first quarter of 2025 was $28 million, or 53 cents of earnings per share compared to $16 million or 30 cents of earnings per share in last year's first quarter.
Ryan Soroka: As Gary indicated, our operating cash flow for the first quarter was solid at $23 million.
Ryan Soroka: Looking back historically at the period between 2009 and 2024, on average, we have reported a usage of cash of approximately $22 million in the first quarter.
Ryan Soroka: So a positive cash flow of $23 million for the first quarter of this year was certainly another highlight and it was our third best first quarter result ever.
Ryan Soroka: We expect that our operating cash flow will be strong for 2025 as well as for the next several years driven largely by our organic cash collections [inaudible]
Ryan Soroka: That is, from new and existing projects, and augmented from time to time by collections related to dispute resolutions
[inaudible]
Now I will address the balance sheet.
Ryan Soroka: Our total debt as of March 31st, 2025 was $406 million, down 24% compared to $534 million at the end of 2024. As we mentioned on last quarter's earnings call, we paid off the remaining balance of our term won't be in February .
Ryan Soroka: With our near-term debt reduction goals now completed, our balance sheet remains healthier than it has ever been. And as we mentioned last quarter, as we accumulate more cash this year, we will be looking at shifting our capital allocation priorities towards returning capital to our shareholders.
Ryan Soroka: Finally, all the assumptions we provided last quarter regarding our guidance remain the same.
Speaker Change: Thank you. And with that, I'll turn the call back over to Gary.
Gary Smalley: Thanks, Ryan. To summarize, we delivered excellent first-quarter results that exceeded our expectations with strong revenue, operating income, and earnings growth, solid operating cash flow, and backlog that nearly doubled your year to a new all-time record of $19.4 billion.
Gary Smalley: As I mentioned last quarter, a record backlog has been largely built on new awards with better margins and improved contractual terms and we believe that this backlog will drive significant double digit revenue growth and generate strong earnings for the foreseeable future.
Gary Smalley: I'll also serve as a catalyst for continued strong cash flow as our newer projects progress through design and into construction.
Gary Smalley: Our strong performance to date, combined with our confidence in how the rest of the year should unfold, has enabled us to increase our 2025 EPS guidance.
Gary Smalley: while still maintaining what we believe is an appropriate amount of contingency for unknown or unanticipated developments.
Gary Smalley: Our business is performing well and I am encouraged by what we have accomplished in the first quarter and excited for what should be a very bright future.
Gary Smalley: Reiterating what I recently stated in my shareholder letter published with our annual report, there has never been a better time to be a Tutor Perini shareholder as we believe we are at the dawn of a new era for the company.
Gary Smalley: Thank you and with that I will turn the call over to the operator for your questions.
Gary Smalley: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue and for a participant using speaker equipment and maybe necessary to pick up your handset before pressing the star keys. One moment while we pull for questions.
[inaudible]
Speaker Change: Our first question is from Steven Fisher with UBS, please proceed.
Stephen Fisher: Thanks, good afternoon, and congratulations on the strong results. Gary, I thought I heard you say that this quarter was clean and there wasn't any kind of particular close-outs or kind of...
Stephen Fisher: contract settlements or arbitration awards or anything like that. You just confirmed that because I thought you were supposed to have maybe one that was coming to fruition there. And if not, if it was clean.
Stephen Fisher: Then I guess I'm curious how as we compare Q1 with what you might expect for Q2, given that it sounds like more of the closeout activity might be later in the year.
Stephen Fisher: What do you think would be different between Q-1 versus Q-2 other than typical seasonality where Q-2 should theoretically be even better than Q-1.
Yeah, thanks, Steve. Excuse me, when I was talking about...
Stephen Fisher: The Quarter B and Cling. It's really clean from any significant impact of the dispute resolution activity that we had underway. We actually made a very good progress on
Some of our larger claims
Stephen Fisher: We settled up some things, the cast didn't flow in the first quarter, that's coming in the second quarter, but we were able to do that with...
Stephen Fisher: in some cases a slight uptick in earnings, in one case a slight downtick in earnings, but net neutral impact to earnings for really three fairly sizable resolutions.
Stephen Fisher: So it's quiet from, again, the impact on earnings, but not quiet from, you know, effort and progress being made.
Also, you know, on the second quarter...
Some more things in the second quarter [inaudible]
Our expectation is similar with respect to the earnings outcome.
Stephen Fisher: We feel really good about how things are progressing there. You know, I'd like to say one other thing that's a little off from your question but make sure that everyone understands this is that the the profits that we we budgeted by quarter for the year. [inaudible]
the progress that we made in the first quarter.
Stephen Fisher: is not from an acceleration of the profits later in the year bringing them forward.
Stephen Fisher: The quarter really was strong on its own, the strength is real, so it's not a shift forward of profits to come. Much of the improvement over budget is really due to the large projects that.
Stephen Fisher: are cranking up, ramping up a lot faster than we expected, and that as well as we were maybe a little bit more conservative with what we expected on these speed resolutions, all those things together provided this type of quarter, and we hope to have a similar
OK, for results, it's not better in the second order.
Thank you.
Stephen Fisher: That's really helpful. And then you mentioned you have a number of things.
in pre-construction.
Stephen Fisher: and I guess I'm wondering just generally what has to happen to get those...
Stephen Fisher: and moving to construction phases. We know in the broader construction economy today there is.
A lot of things in pre-construction in pre-construction.
and given some of the uncertain macro environment.
Stephen Fisher: and cost, I guess there's some hesitation in some parts of the market.
Stephen Fisher: and maybe I think as you point it out into release.
Stephen Fisher: You know, some places where there's more confidence so I guess what what has to happen to get those projects into actual construction phase how much you know kind of concern from your customers is there and I guess I'm curious related to this. What are you seeing in terms of? [inaudible]
Construction costs in the last-
Stephen Fisher: Let's say since the end of March, have those in kind of rising in line with what we're seeing in terms of materials and tariff impact and how is that affecting these decisions kind of moving from pre-construction into construction?
Yeah, okay, good. I'll do the first part of the-
Stephen Fisher: The question, Steve, on the pre-construction, then let Ryan come and on the cost.
Speaker Change: But on the pre-construction, I don't want to trivialize it, but it's almost like just the passage of time has to occur. You know, we've got...
Speaker Change: We do certain pre-construction activities, but these are solid projects that we expect with the passage of time, too.
Speaker Change: for those two materialized into backlog. As an example, the last half of 2024, we had about 1.5 billion dollars in total of projects that moved into backlog.
in the second quarter. What we...
said on our earlier comments.
in the second quarter we have already. [inaudible]
Speaker Change: recorded from out of pre-construction into construction and into backlog over half a billion dollars in one of the projects.
who just paid a project close to a billion dollars to…
Speaker Change: to come out of pre-construction and to construction. So we're not seeing in this parking. These are all building segment projects. We are not seeing.
Speaker Change: The concern about these projects, not materializing that you might be concerned about, we are not.
Speaker Change: and then on the cross side, Ronald, I'll let you address that if you want.
Ron Tutor: Well, of course, they're constantly rising, particularly in New York, which is one of our biggest markets, but I can say having just turn in a bid for a multi-billion dollar project this week in New York.
Ron Tutor: There's nothing to do with tariffs that is affected as of yet other than threats. Our pricing remains the same. We have favorable contract terms that we believe protect us, even if there was tariff impact.
Ron Tutor: and there just hasn't been anything in a negative tone on any of our existing work. Now, I can't predict what impact if any it'll have on future work that we're tracking coming out to bid the latter part of this year and next.
Ron Tutor: But with the existing work programs, we're under contracts or purchase orders and most of the work and haven't haven't felt any pain from tariffs or any major increases that were unanticipated.
Ron Tutor: Okay, I'll turn it over. Thank you very much. Thank you.
Our next question is from Adam Thalhimer
Ron Tutor: and Extra. Thank you for joining us this afternoon. Take care!
Hansen Davis, please proceed. Anyone here?
Hey, good afternoon, guys. Great quarter.
Hi Adam. Thank you
Speaker Change: Can you give a little more color on the comment about doubling?
Speaker Change: The EPS got in for 2025 and 2026 and 27. Is that basically based on the timing of existing projects?
Speaker Change: Yeah, it's really the new projects as they continue to ramp up and you know these new larger projects with the better margins, better contractual terms that we've been talking about as they really get going then they're going to contribute even more.
Speaker Change: and we're building backlog and so that will contribute to some of it as well. The best way to look at that is to look at the midpoint and then double that. Obviously, if we continue to form like we expect to.
Speaker Change: in future quarters, then we'll have to soften that charge because we can't keep saying we're going to be doubling what the midpoint is right now. That still is the case, similar to what we had said.
Speaker Change: last quarter. We still feel that when we look at 26 and 27 where we are right there, we would expect to double what our pinpoint is with this guidance.
Speaker Change: Okay. And then, so that would imply EPS obviously above $3 per share. What's segment level operating margins would you expect to see associated with that level of EPS? And so that would imply EPS is the level of EPS is the level of EPS is the level of EPS
I'm sorry, could you repeat that please?
Speaker Change: Oh, I'm just curious, so the 26 and 27 guidance would imply EPS above $3, and I'm just curious to get to that level.
Speaker Change: Where the segment level margins need to be, so the civil margins, the building margins, the specialty margins.
Speaker Change: Yeah, the margins are similar to what we have talked about in the past. Of course, civil margins have been building from, you know, before we used to guide at 8 to 10, and then we were 8 to 12 and
and now we're seeing North of that.
Speaker Change: The building margins will be higher than the one, two, three percent.
Speaker Change: that we have historically had. We've been guiding toward 3% to 5% now and some of that is due to some of the work that we're doing is more complex, the margins are better and also some of it is fixed price and nature with some of the...
the only work that we're doing with the jails.
Speaker Change: on specialty. We hope to make those margins positive, which would be a big positive since they drag down.
Speaker Change: for some time now, but we're looking at somewhat around percent or two, something like that as we go forward into the end of 25 and into 26.
Okay.
Um...
Speaker Change: So, one to two percent for now is your thought on specialty.
Speaker Change: Yes, that's right, and I should say Adam that more than half of our expected earnings in 2025 will be in the second half of the year, that's similar to what we have.
Speaker Change: You know, always seen the past sometimes, it's, you know, two-thirds but we're looking at somewhere around half at this point because we're out of the gate so strong with the first quarter.
Speaker Change: Okay, and the Gary, I think it was a comment. I think you made it.
Speaker Change: You know, the net data at the end of the quarter was only $129 million and I think you said strong operating.
Cash, particularly in the back half of this year [inaudible]
Maybe just talk about the options there.
Speaker Change: Yeah, well, really, there are two major options. One would be to state dividends, and the other would be to buy back shares, and we're not quite have that point yet.
Speaker Change: We need to accumulate more cash before we feel comfortable. We've had conversations with the board. We have a board meeting next week. We'll talk further about that. It's on the agenda. So those are the options available and we are. Thank you very much.
Speaker Change: You know, we want to do the right thing, but we also want to make sure that we don't go down a path and have to pull back because we want to make sure that we have cash reserves in hand that make it a long-term place.
I'll turn it over. Thank you.
Thank you.
Speaker Change: Our next question is from Liam Burke with the Riley Securities, please proceed.
Thank you, good afternoon, Gary, good afternoon, Ryan [inaudible]
Good afternoon. Hi.
Speaker Change: Gary, everyone's talking about tariffs and regulatory uncertainty, but flipping the coin, the current policy now is less regulation. Are you seeing any speed up and project planning due to less regulation?
No.
Speaker Change: No, we haven't seen any speed up in planning, engineering, or anything in the process as of yet, but no matter how decisive government is, it takes a certain period of time before the words to come impact in real life.
Speaker Change: I'm sure it's impacting many of the environmental restrictions but we haven't seen any speed up but yet at this point
Speaker Change: We're so selective in what we're bidding. We're not looking for any speed up. Our challenge over the next few years is to manage the huge backlog that we've already got.
Speaker Change: Liam, one thing that is somewhat related to that but really more on the tariff front.
Liam: One of the things that we've seen is that with the talk of tariffs and where tariffs are, we've seen a few projects some of our smaller ones actually the timeline has sped up as our owners, our customers have wanted to push those along at an even quicker pace.
So that's interesting, right?
Liam: Great, thank you. And on Transit, Mass Transit, has there been any sentiment change on funding either repairs or rebuild on Mass Transit?
Liam: No, there has not been. What? Any funding changes as it relates to the transit.
No. Great. Thank you.
Thanks, Ben.
Speaker Change: Our next question is from Michael Dudas with Vertical Research Partners. Please proceed.
Good afternoon, gentlemen.
Hi there, are we doing Mike?
Speaker Change: I mean, very several reasons could be a lot more active as we move forward.
the...
Speaker Change: How is the visibility or the appetite to, you know, to for black to continue to really maybe step change some of the opportunities in that part of the world has it fits into what you have in capacity and where you are relative to.
and some of the discontent you guys put in.
Thank you for your support.
Let's tremendous opportunities in Guam and throughout the islands.
Speaker Change: We're monitoring seven and eight hundred million dollar jobs on the island of Palau in Crosor, all U.S. government funded.
Speaker Change: So there's no question the amount of major jobs as well as the routine government jobs that contribute to the multi billion dollar fundings that stay in place.
There's almost no limit.
Speaker Change: to what we can do there other than our capacities to hire and train people and management.
Speaker Change: but making no bones about it, being between the aegos, or see it, the entire Pacific.
and even the Philippines were undated with opportunities, in fact.
Speaker Change: Gary and I are making a trip with management to Guam in the near future to discuss how we man and support Guam as they face more and more demands in a marketplace where they're by far the most dominant player.
Speaker Change: We're inviting our prepared comments. We talked about four Macs and that was four out of four Macs that we have qualified for, but the total $32 billion of potential work for those contractors that are participants in the Mac.
Speaker Change: I think that's indicative of the type of work that's going through Guam but also our capabilities to be able to qualify for all four of those, obviously we can't support that much work, but we're not going to get that much work. That's just the total amount of programs that we feel like we're...
well positioned, better positioned than anybody else in the region.
Speaker Change: I agree. Thank you for that. As you look through new bookings, these project kids that are coming in support of already in a month or so, maybe a mix of like the pre-construction flow that you talk about through this quarter and some of what you have versus the new business and how I can, you know,
Mmm.
Speaker Change: Structure, what that love could be as we move towards year end and for that baseline to move forward for 26 years.
Speaker Change: Yeah, the 19.4 billion based on the activity that we've seen so far.
You know, we think that it's likely to grow.
Speaker Change: from the 19.4 at the end of the first quarter. It depends on success on the award that Ron indicated that we, the multi-billion dollar bill that we released this week.
Look, we have the potential to...
Speaker Change: Hold where we are probably long-term in the year if we could also grow it, it really depends on.
Speaker Change: on some of these bitting opportunities. But look, if it does grow, it's not going to grow significantly if it has more chance to grow significantly than it does.
Speaker Change: to declines against Italy. We think that the more likely scenarios that we're going to maintain backlog where it is somewhere within maybe a billion or two as we go into 26.
Speaker Change: Is that clear? No, that's very helpful. Thank you, Gary. And then maybe my final one has, as you look at the backlog and you're ramping up on some of these earlier projects with long scope, as you look at the rollouts today, where do you see a kind of...
Speaker Change: Peaking, or a real strong period of revenue conversion relative to where you're...
for Business Insight.
Yeah, this is Ron Tutor, it.
Speaker Change: There's no question that 2025 is the beginning of ramping up revenue 26 should be considerably more.
Twenty-seven even more than twenty-sixth [inaudible]
Speaker Change: I think we'll see peak revenues in 27 with significant increases in 26.
Speaker Change: As those billions of dollars of lump sum high margin work ramps up and generates the revenue and if you've got a five to six year contract and there are three billion apiece you don't have to be great with numbers to see they generate five to six hundred million of revenue each of them.
Speaker Change: So that's what's taken place. So you'll see that ramp up in 26 and again in 27 and then it levels in the 28 and 29. Well said.
Speaker Change: I think the math works for you, and Ron, thank you very much.
Thanks, Mike.
Speaker Change: There are no further questions at this time. I would like to turn the floor back over to Gary Smalley for closing comments.
Gary Smalley: Thank you very much. I appreciate everyone's time and your patience over the years with us.
Speaker Change: Look, this is the first time we've ever raised guidance at Tutor Perini, first time ever, and we hope it's not the last time this year. We look forward to talking to you again next quarter when we hope to have more good news to share with you.
Speaker Change: Thank you. This will conclude today's teleconference. You may disconnect your lines at this time and thank you for your participation.
I'm not sure if I'm right or not, I'm not sure if I'm right or not, I'm not sure if I'm right or not
Speaker Change: Ryan Soroka, Gary Smalley, Ryan Soroka, Gary Smalley, Ryan Soroka, Gary Smalley, Ryan
[inaudible]