In the latest round of earnings reports, the large contractors – Fluor, Tutor Perini, Granite Construction and Skanska – are reporting revenue increases and strong backlogs, though not all reported a profitable quarter.
Fluor
Fluor reported just under $4 billion in first-quarter revenue for the year, representing a 6.6% year-over-year increase from last year’s first quarter.
Revenue from Fluor’s Urban Solutions division, which encompasses its engineering, procurement and construction services, brought in $2.2 billion in the first quarter, up 45.8% year-over-year.
Total profit in the quarter rose 11% to $131 million, while profit margin rose from 3.2% to 3.3%. In the Urban Solutions division, Fluor saw $70 million in profit (40% year-over-year) and a 3.2% profit margin (vs. 3.4% in last year’s first quarter).
The firm reported $5.3 billion in new awards in the quarter for its Urban Solutions division, representing a 9.4% year-over-year increase. The division’s backlog as of March 31 was $20.2 billion, up 8.3% from $18.6 billion in last year’s first quarter.
The firm reported a total net loss for the quarter of $232 million.
Fluor stated in its earnings release that it is not providing forward-looking guidance on net earnings because, “we are unable to predict with reasonable certainty all of the components required to provide such reconciliation without unreasonable efforts.” Fluor said it is working with its clients to address the potential impacts of rising economic uncertainty on their projects.
Tutor Perini
Revenue for Tutor Perini’s first quarter rose 19% to $1.3 billion vs. $1.1 billion in its previous first quarter. Net income in the first quarter rose 77% to $28 million.
Income in the quarter from construction operations rose 34% year-over-year to $65.3 million vs. $48.8 million last year.
Tutor Perini attributed growth in all its business segments to increased project execution activities on certain newer, higher-margin projects.
The company booked $2 billion in new awards and contract adjustments in its first quarter of this year. Notable new awards in the quarter included:
- The $1.2 billion Manhattan Tunnel project in New York
- $241 million of additional funding for the Apra Harbor Waterfront Repairs project in Guam
- $111 million of additional funding for certain healthcare facility projects in California
Tutor Perini’s backlog as of March 31 was $19.4 billion, up 94% year-over-year, and the company expects that backlog to remain strong throughout the year.
Tutor Perini also stated it does not anticipate any significant impact from recently announced tariffs or changes to federal funding allocations and still sees strong demand for its services.
Granite Construction
First quarter revenue for Granite Construction came in at $700 million, up 4.2% year-over-year from $672 million in last year’s first quarter.
The company’s Construction segment brought in $614.6 million in first-quarter revenue, up 3.3% year-over-year. Gross profit in this segment rose 50.3% year-over-year to $85.4 million. Gross profit margin rose from 9.5% to 13.9%. The company attributed the revenue growth primarily to several new projects ramping up and favorable weather conditions.
Looking at Granite Construction’s Materials segment, revenue in the quarter rose 10.2% year-over-year to $84.9 million, while gross loss in the quarter fell 37.5% to $1.6 million. Gross profit margin rose from 10.2% to 12.3%. Key factors included the company’s recent acquisition of aggregates, asphalt, and highway construction company Dickerson & Bowen and higher aggregates and asphalt volumes.
Total net loss in the quarter came in at $34 million, up from a loss of $31 million in last year’s first quarter.
Granite Construction’s revenue outlook for the year remains unchanged at $4.2 billion to $4.4 billion.
Skanska
Skanska’s construction revenue in its first quarter rose 15.6% to $4.4 billion vs. $3.8 billion in the previous first quarter.
Total operating income for the quarter was up 118% year-over-year to $113.2 million. Operating income in Skanska’s construction segment came in at $123.2 million for the quarter, up 76.2% year-over-year.
Total profit in the quarter rose 88.8% year-over-year to $103.5 million
Skanska stated the construction market had performed in line with its expectations in the first quarter. The company said it expects longer lead times in U.S. building investment decisions in the near future. However, the U.S. civil market is expected to remain strong as customers remain well funded.
Skanska also downgraded its construction market outlook in the U.S. from “strong” to “stable.”
Order backlog by the end of the first quarter amounted to $27.5 billion, up 4.9% from $26.3 billion in last year’s first quarter. Skanska reported $4.1 billion in bookings during the first quarter, down 16.2% year-over-year from $4.9 billion.
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