Tutor Perini Corporation
) gained nearly 4% to close at $28.78 after yesterday's trading
session on the back of 81% year-over-year improvement in its
second-quarter 2014 earnings to 58 cents per share, announced on
Aug 5. The earnings increase was driven by revenue growth and
strong profitability in the Civil segment. Earnings also surpassed
the Zacks Consensus Estimate of 50 cents.
Tutor Perini Corporation - Earnings Surprise |
Total revenue went up 3% year over year to $1.08 billion, driven by
increased activity on civil and building projects at Hudson Yards
in New York and on certain electrical and mechanical projects on
the East Coast. Revenues however missed the Zacks Consensus
Estimate of $1.15 billion.
Barring Building segment which witnessed a 12% year-over-year
decline in revenues to $390 million, revenues grew across the other
two segments. Specialty Contractors recorded the highest increase
in revenue of around 13.4% year over year to $390 million, followed
by Civil which posted 11.6% improvement to $398 million from $356.7
million in the year-ago quarter.
Cost of sales went up 0.8% to $955 million from $947 million in the
year-ago quarter. Gross profit rose 22% year over year to $129.5
million. Gross margin improved 180 basis points (bps) to 11.9%.
General and administrative expenses decreased 3.6% year over year
to $64 million. Operating profit was $65 million, increasing 66%
from $39.5 million in the year-ago quarter. Operating margin was
6%, expanded 220 bps from 3.8% in the year-ago quarter.
Tutor Perini ended the quarter with cash and cash equivalents of
$140 million versus $120 million as of 2013-end. Cash used in
operating activities was $20.3 million in the second quarter
compared with cash from operating activities of $45.9 million in
the year-ago quarter. Cash usage in the second quarter was due to
the timing of payments primarily in Specialty Contractors and
Long-term debt, excluding the current portion, amounted to $761
million as of Jun 30, 2014, compared with $619 million as of Dec
31, 2013. The debt-to-capitalization ratio was at 39% as of Jun 30,
2014 compared with 37% as of Dec 31, 2013.
Backlog and Pending Orders
Total backlog as of Mar 31, 2014, was $7.8 billion, up 18% year
over year. In the quarter, additions to backlog worth mentioning
were a $255 million multi-unit residential tower project in
Florida, a $120 million retail development project in California,
an hospitality and gaming development project in Mississippi for
$113 million and a $67 million excavation and tunnel project in
On Jul 2, 2014, the company was awarded a contract valued at
approximately $267 million by the Port Authority of New York and
New Jersey for the John F. Kennedy (JFK) International Airport
Runway 4L-22R Runway Safety Area Compliance/Runway Reconstruction
project. Value of the contract will be included in the
Tutor Perini maintained its earnings per share guidance range of
$2.20 to $2.40 in 2014. The company trimmed its revenues guidance
in the range of $4.5-$4.7 billion from $4.5-$5 billion.
Tutor Perini is expected to benefit from its strong backlog and new
contracts. The company continues to win contracts and has the
prospects of winning future awards, given its significant volume of
Sylmar, CA-based Tutor Perini Corp. is a leading civil and building
construction company offering diversified general contracting and
design-build services to private clients and public agencies
Tutor Perini currently holds a Zacks Rank #4 (Sell). Other stocks
worth considering in the sector include Quanex Building Products
), Boise Cascade Co. (
) and PGT, Inc. (
). All these stocks carry a Zacks Rank #2 (Buy).
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