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Operator: Good day, ladies and gentlemen, and welcome to the Tutor Perini Corporation Fourth Quarter 2024 Earnings Conference Call. My name is Stacy and I will be your coordinator for today. All participants are currently in a listen-only mode. Following management’s prepared remarks, we will be opening the call for a question-and-answer session. As a reminder, this conference call is being recorded for replay purposes. [Operator Instructions] I would now like to turn the conference over to your host for today, Mr. Jorge Casado, Vice President of Investor Relations. Please go ahead.

Jorge Casado: 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. 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. There is an inherent risk that our actual results could differ materially. You can find disclosures about risk factors that could contribute to such differences in our Form 10-K, which we are filing today. The company assumes no obligation to update forward-looking statements, whether due to new information, future events or otherwise other than as required by law. Thank you, and with that, I will turn the call over to Gary Smalley.

Gary Smalley: Thanks Jorge. Hello everyone and thank you all for joining us. First, let me begin by saying thank you to everyone who reached out to us during the recent wildfires in Los Angeles. We appreciate your support and concern. While our operations were not impacted, a few of our employees, unfortunately, lost their homes to the fires and are now dealing with the challenges of relocating and rebuilding. The scale of destruction in some areas of L.A. was truly devastating and unprecedented, and our hearts go out to everyone who has been and continues to be affected. We are committed to assisting our local community in the recovery and expect to participate in some of the debris removal activities are just getting started.

I’m pleased to be presenting to you for the first time in my new role as CEO. But it is important to me that I begin by recognizing the extraordinary contributions of Ron Tutor not just to Tutor Perini, but also to the entire engineering and construction industry. Ron is certainly an icon, really a legend in the industry. He has passionately given it his all every day for more than 61 years he has been leading our company. So, I’d like to congratulate Ron on an extraordinary career and express my gratitude for his leadership, mentorship, discipline and commitment to excellence as he transitions into his Executive Chairman role. I’ve learned a lot over the last decade by working closely with Ron so the transition to CEO has been as smooth as you can imagine.

I’m grateful that we will continue to have Ron with us for the rest of this year and all of next year as Executive Chairman. Since we have already gotten this question numerous times, let me summarize what Ron’s primary focus will be as Executive Chairman. First, he will continue to provide guidance and advice regarding the resolution of the shrinking list of our remaining legacy disputes. Second, Ron will continue to review the cost estimates and provide his input as to the bidding strategy for the major projects that we will be bidding over the next couple of years. That will give us the luxury of additional scrutiny and advice from the perspective of someone who has pretty much seen it all. Third, Ron is currently helping drive the setup of the major projects that we have already been awarded over the last several months.

The importance of proper project setup of these mega projects cannot be understated because it is the first key step towards the successful execution of this work. Ron will comment more on this shortly. And lastly, Ron will continue to serve as an adviser and sounding board to me and my leadership team as the company begins the next chapter of what should be unprecedented earnings growth and operational performance. Before I discuss our results, I’d like to briefly share with you some of my priorities as Tutor Perini’s new CEO. Certainly, one of my key priorities is the importance of our human capital and specifically, making sure that we continue to attract and retain the best talent in our industry. We work on some of the largest and most complex projects in the United States, and this is why we need the best of the best working for us and, quite frankly, why we have been able to attract the quality of employees that we have.

We want Tutor Perini to be the employer of choice in the construction industry. Another important priority, of course, is returning the company to profitability. Our record backlog, which I will discuss more in a moment, should provide us with a solid foundation for a profitable multiyear stream of growing revenue and earnings beginning in 2025, followed by far superior performance in 2026 and 2027. To achieve consistent profitability, we will closely manage project execution and performance against our cost budgets while enhancing our project risk management capabilities. We will also continue to focus on resolving our remaining legacy disputes as expeditiously as possible while still delivering outcomes that are in the best interest of the company and our shareholders.

Another priority is a sustained focus on cash generation. Our record backlog will also help in this regard as our elevated earnings from project execution are converted into cash. And our continued focus on negotiating improved and fair contractual terms should help reduce the likelihood of protracted disputes that have hindered historical cash generation at times. Next, it’s important to me that we set earnings goals that are ambitious yet reasonable that we consistently achieve and sometimes even exceed our guidance. I realize that we have not had a good track record of achieving our guidance over the past couple of years. But it is important to note that a lot of the causes of our earnings challenges in recent periods are behind us, so we are confident in our ability to more accurately forecast, given this lower risk of earnings volatility going forward.

Another important priority deals with making optimal capital allocation decisions that are best for the company and that will ultimately create long-term value for our shareholders. Specifically, as we build up excess cash from continued cash generation, we will look at returning capital to shareholders. And we’ll also be looking to refinance our senior notes sometime next year after the two-year non-callable period has passed. We’re also focused on finding ways where we can leverage technology, including artificial intelligence to help us better plan, track, and execute projects. The construction industry has historically been less forward-looking than other industries when it comes to technology, but we are exploring available solutions and we’ll continue to identify and make investments that can improve our operations and productivity.

As you can tell, all my priorities are intended to significantly increase short and long-term value to our shareholders while maintaining Tutor Perini as the preeminent leader of our industry. Now, given recent market concerns regarding the Trump administration’s scrutiny of federal spending and implementation of new tariffs, it is important to point out that we do not, repeat, do not anticipate any significant impacts to our business related to these factors. From a funding perspective, we do not see the risk of any of our major projects being canceled, delayed, or defunded at this time. Some of our major projects are state- or local-funded or are a combination of state and local funding. The ones with federal money in whole or in part have funding that has already been committed and/or the projects are strategically important to the United States.

In terms of potential tariffs, we frequently buy out materials such as steel and concrete as well as large equipment items like tunnel boring machines at the onset of projects, which mitigates the risk of future equipment and commodity price increases. In addition, many of our contracts have, by American provisions, promote the use of domestic products, and many have allowances or escalation clauses that can protect us from certain unforeseen cost increases, including those associated with new tariffs. Turning now to our financials. We had another year of largely mixed results in 2024 as we settled or otherwise resolved various legacy disputes. With that said, our record cash generation, enormous debt paydown, record backlog, and double-digit revenue growth all represent significant improvements over 2023.

Beginning with cash. As we had anticipated and previously communicated, we closed the year with extremely strong operating cash flow, generating $330 million of cash in the fourth quarter alone and $504 million for the full year of 2024. This was our third consecutive year of record operating cash flow, shattering the prior year’s record by approximately $200 million. Our operating cash flow for just the fourth quarter of 2024 alone exceeded our previous record for annual operating cash flow for the full year of 2023. As we announced last week, we have continued to strengthen our balance sheet by utilizing our record cash to substantially lower our debt. We have now paid off our Term Loan B in its entirety and have exceeded the pace of our debt reduction commitments.

Specifically, we have reduced our total debt by $477 million or 52% since the end of 2023. We finished 2024 with a new all-time record backlog of $18.7 billion, which grew an amazing 84% year-over-year. Backlog grew 33% in the fourth quarter alone, far exceeding the previous record of $14 billion that we just set last quarter. Our book to burn ratio for the fourth quarter was an almost unheard of 5.4x, an impressive 3x for the full year. Also, the Civil, Building, and Specialty Contractors segments all ended the year with backlog that exceeded each of their previous record highs. Regarding revenue, we achieved 12% growth in 2024. Of course, this is a positive, but it’s just a drop in the bucket compared to what we foresee for revenue growth for future years beginning in 2025 as the newer projects and our record backlog start to contribute more meaningfully to revenue.

Importantly, we also made excellent progress during 2024 in resolving various legacy disputes. As you will see in our Form 10-K, our 2024 operating income was negatively impacted by a net total of $347 million due to various adverse legal judgments or decisions throughout the year and charges that resulted from the expedited settlement or resolution of disputed matters, as well as changes in estimates on various projects, some of which resulted in temporary impacts that will reverse themselves in the future. As we said last quarter, a couple of these legacy disputes resulted in very unexpected and rather inexplicable legal decisions that we strongly disagree with and are appealing. We expect to continue making substantial progress this year and next year in resolving and collecting on the remainder of our legacy disputes, about a dozen or so that are significant.

Had it not been for the charges to earnings that reduced revenue, our revenue growth for 2024 would have been substantially more than the reported 12%, which demonstrates that our core business is growing at a healthy rate. And if not for the magnitude of all the net charges, we believe that we would have exceeded our previously provided EPS guidance for 2024. So, this provides us confidence as to how our core business is performing from a profitability standpoint. It is also important to note that many of the dispute resolutions contributed to a record cash flow in 2024. Our extraordinary backlog growth in 2024 was driven by $12.8 billion of new awards and contract adjustments, with the largest being the $3.76 billion Manhattan Jail project in New York, the $1.66 billion City Center Guideway and Stations Project in Hawaii, a $1.4 billion health care campus project in California, the $1.13 billion Newark AirTrain Replacement Project in New Jersey, the $1.1 billion Kensico Eastview Connection tunnel project in New York, $479 million of additional funding for certain mass transit projects in California, $449 million for two healthcare facility projects in California, $331 million for the initial award of the Apra Harbor Waterfront Repairs project in Guam, a $229 million airport terminal connectors project at the Fort Lauderdale Hollywood International Airport in Florida, and the company’s proportionate share of the Connecticut River Bridge Replacement mega project.

Our new award activity to begin 2025 also continues to be impressive. We recently announced two major new awards that were both booked in the first quarter: the $1.18 billion Manhattan Tunnel project in New York and $232 million for several owner-approved scope options on the Apra Harbor project in Guam, which brings the total value of that project to $563 million. I’ll now pass the call over to Ron, who will discuss our major bidding opportunities and the setup of our newer projects.

Ronald Tutor: Thanks Gary. Our bidding pipeline, as we discussed continually, continues to be full of opportunities as we move forward in the year. Our record backlog enables us to be even more selective than previously as to which of the opportunities we will pursue and focus on bidding projects that have positive contractual terms and consistent with our operational capacities as a general contractor. We will also look at the competition, as we always do, for each targeted opportunities as we assess our chances of success in the project’s potential margin. In the near-term, we are tracking various prospective projects across our businesses, including those in California, the East Coast, the Midwest, and Guam, the largest of which is the multibillion-dollar Midtown Bus Terminal Replacement in New York City for the Port Authority of New York and New Jersey now expected to bid in March.

Other potential new projects that we are following include the $3.8 billion Southeast Gateway Line Transit project in Southern California, the $1.8 billion South Jersey Light Rail in New Jersey, as well as numerous major projects that continue to propose in Guam and the Pacific region. I would also mention that if the U.S. government participates in the rebuilding of Ukraine after the war is over, we believe our PMSI group is extremely well-positioned to participate in that effort, having had significant experience in both Iraq and Afghanistan in post-war repairs. I’ve been spending a significant amount of my time being sure that our new major projects are properly set up. As Gary mentioned, project setup is critical to project execution, particularly on these very large mega projects.

Working closely with Gary in the various operational executives, we are bringing certainty to these projects getting off to a good start, including both Brooklyn and Manhattan, the Honolulu Rail Project, the Kensico and Manhattan Tunnel projects, the Apra Harbor project, and the Newark AirTrain. I’m extremely satisfied the progress to date, including certain renegotiations of contracts, purchasing of equipment and the overall setup and mobilization associated with these mega projects. I’m more than ever convinced that the projects will be successful and they continue to execute as well as we could anticipate. I will now hand it back to you, Gary.

Gary Smalley: Thank you, Ron. Let’s shift gears and spend a few minutes on our outlook, guidance and what we see further down the road for the company. While our Civil business is expected to continue to drive most of our future growth and profitability as it typically does, I’m also excited about the expected contributions from our Building segment. Much of our Building segment backlog is now operating at significantly higher margins than what we have done historically. For example, our two New York Jail mega projects carry margins that are consistent with large complex building projects of a fixed price nature. Also, many of today’s health care projects are larger and more technically complex than, say, traditional commercial office building projects of the past and therefore also command higher margins.

So, with this in mind and as a reminder to what we discussed last quarter, Rudolph and Sletten, our major California building subsidiary, has various health care and education projects in California that are in the preconstruction phase, with only a small amount of current backlog recorded for them. Some of these are rather large projects that are soon expected to advance to the construction phase, and we anticipate that we will book significant additional backlog for them in 2025 when this happens. One of them is a large hospital project in Northern California valued at nearly $1 billion, for which we expect a modest amount of backlog to be booked in the second quarter but the remainder to be booked in the third quarter. And another is a large health care lab building in Southern California valued at more than $500 million, which is expected to be booked in the second quarter of this year.

The cash expected from the continued resolution of various legacy disputes discussed earlier, combined with cash generated from normal project operations, should drive strong cash flow over the next couple of years with cash generation from ongoing projects continuing to be strong even beyond that. For our guidance, based on our assessment of the current market and business outlook, we are expecting a return to profitability with EPS for 2025 in the range of $1.50 to $1.90, combined with double-digit revenue growth. As in prior years, our revenue and earnings are expected to be weighted more heavily to the second half of the year due to typical business seasonality that is affected by the weather. This earnings trend is expected to be even more pronounced this year due to the timing of when some of our recent new awards will start to contribute more meaningfully to operating results.

Building on my earlier comments about lessons learned and the fresh approach we are taking to guidance, we have factored a more significant amount of contingency for unknown or unexpected outcomes and developments in 2025, including a lower-than-anticipated success rate for future project pursuits, the potential for project and new award delays, slower ramp-ups for our newer projects, settlements and/or adverse legal decisions associated with the resolution of disputes, and any impacts associated with tariffs that again, we currently do not expect to significantly impact our results. We therefore believe that our guidance range appropriately considers all of these possibilities. We also believe that our record backlog will not only help us return to profitability in 2025 but will set the stage for significantly better results for the next several years.

As you know, we do not typically provide formal guidance beyond the current year. But internally, we do project financial results for two additional years as well. Without getting too far ahead of ourselves because our focus needs to be on delivering solid profits in 2025 and also with the understanding that there can always be unforeseen events that change expectations, internally, we are currently conservatively projecting our EPS in both 2026 and 2027 to be more than double our EPS guidance for 2025. To clarify, we are not putting out guidance for 2026 and 2027 at this time. But I wanted to make sure that you have some idea of the magnitude of the positive results that we’re expecting, largely as a result of profitable work that we already have in backlog.

Thank you. With that, I will turn the call over to Ryan to discuss our 2024 financial performance in more detail and our guidance assumptions.

Ryan Soroka: Thanks Gary and good afternoon everyone. I will begin by discussing our results for the year, including our record operating cash, after which I’ll review the fourth quarter. Then I’ll provide some commentary on our balance sheet and our 2025 guidance assumptions. Our operating cash was certainly one of the biggest highlights of 2024. As Gary mentioned, we generated a new record operating cash flow of $504 million for the year, which was up 63% compared to the previous record of $308 million for 2023. This was our third straight year of record operating cash, and it was driven by improved collection activities, including collections associated with payments on new and existing projects, and the continued resolution of certain legacy claims and unapproved change orders.

Using our strong cash flow, we’ve done an excellent job of reducing our debt since the end of 2023, paying down $477 million or 52% of our total debt, including the full payoff of our Term Loan B just last week. We expect to generate strong cash flow again in 2025, 2026, and 2027. Our cash flow should continue to be enhanced by dispute resolutions. However, we expect going forward that a larger proportion of our cash will be generated from organic operations, that is from new and existing projects. Revenue for 2024 was $4.3 billion, up 12% compared to $3.9 billion in 2023, primarily due to increased project execution activities on certain Building and Civil segment projects. Civil segment revenue was $2.1 billion, up 12% compared to $1.9 billion in 2023 due to a net increase in project execution activities driven by projects in California, New York, British Columbia, and the Asia-Pacific region.

Building segment revenue was $1.6 billion, up a strong 24% compared to $1.3 billion last year, primarily due to increased project execution activities on various health care and educational facility projects in California and the Brooklyn Jail project in New York, all of which have substantial scope of work remaining. We reported a loss from construction operations of $104 million in 2024 compared to $115 million loss in 2023. Our operating income in both years was negatively impacted by net unfavorable adjustments on various projects, primarily due to changes in estimates that resulted from judgments, settlements, and resolutions of certain legacy claims and unapproved change orders. I refer you to our 10-K, which we are filing today, for more details.

Civil segment income from construction operations for 2024 was $138 million compared to $199 million in 2023. The decrease was primarily due to a $102 million charge we took in the third quarter pertaining to an unexpected adverse arbitration decision related to a completed bridge project in California. As we mentioned last quarter, we are appealing this decision. The Building segment posted a loss from construction operations of $24 million for 2024 compared to a $91 million loss in 2023. The improvement was principally due to the absence of various prior year unfavorable adjustments as well as $27 million of profit contributions in 2024 associated with the increased revenue for the segment. The Specialty Contractors segment posted a loss from construction operations of $103 million in 2024 compared to a $145 million loss in 2023.

The improvement was primarily due to the absence of certain prior year unfavorable adjustments, partially offset by certain unfavorable adjustments in 2024 on several completed projects. Corporate G&A expense was $110 million in 2024 compared to $75 million in 2023, with the increase primarily due to higher compensation-related expenses, mainly attributable to higher share-based compensation expense. As we mentioned before, the increase in share-based compensation expense was primarily due to a substantial increase in the company’s stock price during 2024, which impacted the fair value of liability classified awards. We reported an income tax benefit of $51 million in 2024 due to our pre-tax loss for the year and an effective tax rate of 29.3% compared to a tax benefit of $55 million with an effective tax rate of 30.1% in 2023.

As we return to profitability in 2025 and in future years, the net operating losses generated in the past three years will help reduce our cash outlays for future income taxes. Net loss attributable to Tutor Perini for 2024 was $164 million or a loss of $3.13 per share compared to a net loss of $171 million or a loss of $3.30 per share in 2023. Now, let’s turn to the fourth quarter results. Revenue was $1.1 billion, up 5% compared to $1 billion for the fourth quarter of 2023. Civil segment revenue was $554 million, up 21% compared to $459 million last year. Building segment revenue was $352 million compared to $376 million last year. The Specialty Contractors segment revenue was $161 million compared to $186 million last year. The overall revenue improvement was due to the increased project execution activities in the Civil and Building segments.

Civil segment income from construction operations was $4 million in the fourth quarter of 2024 compared to $28 million for the fourth quarter last year, with a significantly lower than normal income in the 2024 period due primarily to a temporary earnings reductions of $32 million that resulted from the successful negotiation of significant lower margin and lower risk change orders on a West Coast project. This temporary earnings reduction is expected to reverse itself over the remaining life of the project. The Building segment posted a loss from construction operations of $41 million in the fourth quarter of 2024 compared to a loss of $7 million last year, with the loss in the 2024 period mostly due to a $26 million unfavorable adjustment on a government building project in Florida that is nearing completion.

The Specialty Contractors segment posted a loss of $20 million in the fourth quarter of 2024 compared to a loss of $24 million last year. Net loss attributable to Tutor Perini for the fourth quarter of 2024 was $79 million or a loss of $1.51 per share compared to a net loss of $48 million or a loss of $0.91 per share in last year’s fourth quarter. Now, I’ll address the balance sheet. Our net debt as of December 31st, 2024, was just $79 million, down 85% compared to $519 million at the end of 2023. We have continued to reduce our debt in the first quarter of 2025 with the early payoff of our Term Loan B in its entirety just last week. All-in-all, we believe that our balance sheet is now healthier than it has ever been. Lastly, I’ll provide some assumptions regarding our guidance.

G&A expense for 2025 is expected to be between $310 million and $320 million. Depreciation and amortization expense is anticipated to be approximately $55 million in 2025, with depreciation at $53 million and amortization at $2 million. Our substantially reduced debt level will result in a significant decrease in interest expense going forward. Interest expense for 2025 is expected to be approximately $55 million, of which about $5 million will be noncash. This is $34 million or 38% lower than our interest expense of $89 million in 2024. And this reduced interest expense equates to about $0.50 of incremental EPS for us in 2025. Our effective income tax rate for 2025 is expected to be approximately 21% to 23%. We anticipate noncontrolling interest to be between $65 million and $75 million, significantly higher than last year due to certain large JV projects that are ramping up in 2025.

We expect approximately 53 million weighted average diluted shares outstanding for 2025. And capital expenditures are anticipated to be approximately $140 million to $150 million, with the vast majority of the CapEx in 2025, approximately $110 million to $120 million being project-specific and owner-funded for large equipment items on certain large new projects such as tunnel boring machines. Thank you and with that, I’ll turn the call back over to Gary.

Gary Smalley: Thanks Ryan. To recap, the last several quarters have been a truly impressive period of record cash generation, significant debt paydown, and unprecedented new award activity for the company. We firmly believe that we are at the dawn of a new era for Tutor Perini. Our record backlog of $18.7 billion 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 earnings stability for the foreseeable future while also serving as a catalyst for continued strong cash flow as our newer projects progress through design and into construction. And on top of this, as Ryan just mentioned, we have the healthiest balance sheet we probably have ever had.

When considering all of this and the significant progress that we have made in resolving legacy disputes, it is hard not to be genuinely excited about the future of Tutor Perini. For those of you who have persevered through some of the lean times, we thank you for your patience and look forward to rewarding you with vastly improved and more reliable operating performance. Thank you. And with that, I’ll turn the call over to the operator for your questions.

Operator: Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Your first question comes from Adam Thalhimer with Thompson, Davis & Company. Please go ahead.

Adam Thalhimer: Hey good afternoon guys.

Gary Smalley: Hi Adam.

Adam Thalhimer: Can you give us a little more help on how you see the cadence of the year playing out? I know you said it was kind of even more back half weighted than normal. Just curious if you could flesh that out a little more?

Gary Smalley: Yes, sure Adam. With respect to revenue, we expect to have quarter-over-quarter revenue growth as we go throughout the year. And as you would expect with our earnings, we’re going to be a little lower in the first quarter than the other quarters because of seasonality reasons. But expect, say, single-digit EPS in the first quarter and then a substantial improvement in second quarter and then further improvement in Q3 and Q4 as some of the newer work starts to ramp up and we get out of the bad weather.

Adam Thalhimer: Okay, great. And then–

Gary Smalley: And Adam, if I could just add that about two-thirds of our EPS is likely to be in the second half of the year if you’re looking for your models, if you want a little bit more guidance there.

Adam Thalhimer: Perfect. And then at this point, how many legacy claims are left and do you still think most of those are cleared up in 2025?

Ronald Tutor: It’s about a dozen left since I’ve been handling all our litigation. This is Ron Tutor. There’s about 12 to 14 left. Probably 75%, 80% will be cleared out in 2025. That’s been taken into consideration in our projection for earnings in 2025. In other words, we’ve established what we think is the appropriate contingencies to protect ourselves from damaging our earnings projections.

Adam Thalhimer: Got it. And then last one for me. Curious if you can just talk high level about capital allocation, given the much more flexible balance sheet to get even more flexible?

Gary Smalley: Yes. Look, Adam, we’re a little early to talk a lot of details on that. We still need to discuss with the Board. We want to signal to everybody that it certainly is on the front of our minds. But as we progress through the year and we start to generate even more excess cash, we’ll have some more details to share. But right now, we’re looking at keeping all options open. And we will get back to you as soon as we get some finalization with the Board.

Ronald Tutor: And to add further clarity, I’d like to add because you heard capital expenditures at $140 million to $150 million, which is accurate. However, that isn’t on a basis of borrowing capital and financing long-term equipment. All of that equipment is funded by the contracts themselves and paid directly to us by the owner. So, in essence, when we buy $150 million worth of equipment, we bill those projects and those projects provide the funds. So that does not affect our cash flow even though in the traditional capital expenditure standpoint, it might.

Gary Smalley: Yes. So, as Ryan said in the prepared comments, if we’ve got CapEx of $140 million to $150 million, about $110 million to $120 million of that will be purely funded by the projects and will come directly from those project billings.

Adam Thalhimer: Okay. I’ll turn it over. Thank you.

Operator: Next question, Michael Dudas with Vertical Research Partners. Please go ahead.

Michael Dudas: Good afternoon gentlemen. You guys have been quite busy.

Gary Smalley: Yes, we have, Mike. Thanks.

Michael Dudas: Given the extraordinary growth in backlog and looking — and your outlook for 2025, relative to history, how much of 2025 revenues, profits are in the current backlog or near current backlog with the orders that have come in maybe the last couple of months? Is that relatively similar to other years? Is it a larger number? And as we move forward, does that number change a bit as you start to really start to ramp up on these projects in the next few years?

Gary Smalley: Yes, it’s largely similar to what we’ve seen in the past. And I wouldn’t expect it to really change until probably we’re into 2026, and then it’s going to be a higher amount that’s in backlog. That’s going to be–

Ronald Tutor: A key point of clarification is to understand that our backlog is so large, there’s very little anticipation of new work in those projections. The key element is, is we’re relying on contracted and executed backlog to provide the impetus of that explosion of revenue. And with very limited circumstances are we adding revenue now only as new work may get awarded.

Michael Dudas: Yes, understood. Thank you for that. That’s a good segue to my follow-up question. How you’re positioning and targeting these projects that are on the docket for the next few months relative to the types of terms and conditions. Are they stronger and better than what you’ve booked over the last several quarters in some of these large projects? I assume the competition is pretty low on some of this. So, you probably have some pretty good opportunity, given your competitive advantage. And how much capacity does Tutor look out several years, given all the business that you’re generating?

Gary Smalley: Yes. So, Mike, as we talked about, with $18.7 billion in backlog, we certainly can be more selective than we have been in the past. This new work that we’ve been booking, it’s better contractual terms than we used to have because now we’re finding that we’re being treated more fairly. So, are they going to be even better contractual terms going forward? Well, we do have the, again, the flexibility of being even more selective in what we pursue and how we negotiate things. But we’ve been so selective already. I can’t say that we’re going to have far improved contractual terms. We’re already getting the contractual terms that we really want.

Michael Dudas: Understood. Excellent. Thanks Gary, thanks Ron.

Operator: Thank you. I would like to turn the floor over to Gary Smalley for closing remarks.

Gary Smalley: Thank you. We’ll talk to you again in another quarter.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time and thank you for your participation.