Dive Brief:
- Tutor Perini this week announced second quarter 2020 earnings of double-digit, year-over-year revenue growth across all segments despite the COVID-19 pandemic. Revenue rose 13% to $1.3 billion since the second quarter of 2019 thanks to a 20% year-over-year increase in civil projects.
- Income from construction operations was $57.7 million compared to a loss of $341.7 million in Q2 2019 that stemmed primarily from a $380 million pre-tax non-cash goodwill impairment charge. Although Tutor Perini missed Q2 2020 earnings estimates, the company's revenues exceeded analyst expectations.
- Much of Tutor Perini's work, which is in the infrastructure sector, has been deemed essential and allowed to move forward. However, it did not emerge from Q2 unaffected by the novel coronavirus, saying revenue was reduced by an estimated $130 million due to a reduction in productivity and the temporary halt to some projects, mostly in its Building and Specialty Contractor segments.
Dive Insight:
Tutor Perini also said its operating cash flow of $92.2 million was the highest second-quarter result since 2008. In addition, it announced it has a $10 billion backlog, a "robust" figure almost on par with the $11.4 billion backlog the company had in Q2 2019, according to a press release from the company.
Some projects that Tutor Perini said is driving its growth are:
- Los Angeles MTA Purple Line Sections 2 & 3 Joint Venture — $3.1 billion
- California High-Speed Rail Joint Venture — $2.2 billion
- East Side Access projects for the New York MTA—$1.9 billion
- Newark Airport Terminal One Joint Venture — $1.4 billion
Tutor Perini said that the civil segment was the company's driver of profitability and that the firm was uniquely positioned as one of the few capable of taking on large-scale projects successfully in this sector. During its earnings call, Ronald Tutor, chairman and CEO, underscored that point using the last leg of the Honolulu Authority for Rapid Transportation's $9 billion rail project as an example.
Tutor said that the company was one of only two to bid on the project's public-private partnership (P3) last week and that its proposal was more than $2 billion. This is higher than the $1.4 billion HART had previously estimated it would take to complete the 4-mile unfinished piece of the 20-mile rail as a P3.
Tutor did not name the companies involved in the competing consortium but said it "consisted of a Spanish company and two Japanese companies in a joint venture." HART has not yet released the names of the bidders or their bid amounts.
