Centuri Holdings Reports Decline in Financial Performance for Third Quarter and Nine Months Ended September 29, 2024

Centuri Holdings, Inc. reported a decline in financial performance for the fiscal three and nine months ended September 29, 2024, compared to the same periods in 2023. Total revenue for the third quarter was $720.1 million, down 7.1% from $774.9 million in the prior year. For the nine-month period, revenue decreased by 14.0% to $1.92 billion from $2.23 billion. The company attributed these declines to lower revenue in its U.S. Gas and Union Electric segments, particularly impacted by reduced offshore wind revenue and lower margins on bid work.

Gross profit for the third quarter fell to $75.8 million, a decrease of 13.5% from $87.6 million in the previous year. The gross profit margin improved slightly to 23.4% from 18.4%, reflecting favorable changes in the mix of work. However, operating income also declined to $41.9 million, down 20.8% from $53.0 million. The company reported a net loss of $3.6 million for the third quarter, a significant drop from net income of $16.9 million in the same period last year. For the nine-month period, the net loss totaled $17.2 million, compared to a net income of $28.3 million in 2023.

Centuri's cash and cash equivalents increased to $52.5 million as of September 29, 2024, up from $33.4 million at the end of 2023. The company generated $97.2 million in net cash from operating activities, a notable increase from $61.8 million in the prior year. This improvement was bolstered by $125 million received from a new accounts receivable securitization facility.

The company underwent a significant reorganization in January 2024, expanding its reportable segments from two to four, which now include U.S. Gas Utility Services, Canadian Gas Utility Services, Union Electric Utility Services, and Non-Union Electric Utility Services. This restructuring aims to better align with market demands and operational efficiencies.

Centuri's long-term debt decreased to $762.1 million as of September 29, 2024, down from $1.03 billion at the end of 2023, following substantial debt repayments using proceeds from its initial public offering (IPO) in April 2024. The IPO generated net proceeds of $328 million, which were primarily used to pay down existing debt.

The company’s backlog as of September 29, 2024, was approximately $4.3 billion, a decrease from $5.1 billion at the end of 2023, with about 87% related to Master Service Agreements. The company continues to navigate challenges such as inflation, rising labor costs, and regulatory influences, which may impact future financial results.