Tutor Perini Corp. (TPC)
Q2 2009 Earnings Call
August 06, 2009; 4:30 pm ET
Ronald Tutor - Chairman & Chief Executive Officer
Robert Band - President & Chief Operating Officer
Kenneth Burk - Senior Vive President & Chief Financial Officer
John Rogers - D A Davidson & Co
Richard Paget - Morgan Joseph
Steven Fisher - UBS
Avi Fisher - BMO Capital Market
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I would now like to turn the presentation over to your host for today’s call, Mr. Ken Burk, Executive Vice President and Chief Financial Officer. Please proceed.
Good afternoon, everyone. Thanks for joining us on Tutor Perini’s second quarter 2009 conference call. With us today are Ronald Tutor, Chairman and CEO; and our President, Robert Band.
Before we start, I’d like to remind our listeners that our comments today will contain forward-looking statements, including statements about future guidance. Management may also make additional forward-looking statements in response to your questions. These types of written and oral disclosures are made pursuant to the Safe Harbor provision contained in the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from anticipated results. The company cautions that any such forward-looking statements are based upon assumptions that the company believes are reasonable, but are subject to a wide range of risk and actual results may differ materially.
These risks and uncertainties are discussed in detail in our filings with the SEC, including Tutor Perini’s Annual Report on Form 10-K for the fiscal year ended ‘08, our definitive proxy statement filed on April 17, 2009, as well as in today’s news release. Our statements on this call are made as of today, August 6, 2009, and the company undertakes no obligation to update any of these forward-looking statements contained in the call, whether as a result of new information, future events, changes and expectations or otherwise.
With those formalities out of the way, it’s my pleasure to turn the call over to Ronald Tutor.
Thank you. Good afternoon everyone and thank you for joining us on the call. This was another very good quarter for Tutor Perini with revenues of $1.38 billion, net income of $39 million and diluted earnings per share of $0.79. The backlog of uncompleted construction work at June 30, 2009 was $5.1 billion. New awards this quarter included $270 million Courthouse in Southern California, and $204 million runway reconstruction projects at JFK Airport in New York, and approximately $70 million in building projects in Florida and Pennsylvania.
Currently, we have approximately $2 billion of pending awards for which we have received positive indication from our customers who have designated us as their preferred contractor. In fact, we just signed a contract worth $240 million energy manufacturing facility in Northern California this week. This project will enter backlog in the third quarter. Most of the other pending awards should enter our backlog this year with the balance in the first half of 2010.
Regarding the broader markets, we continue to see private customers sitting on the sidelines, but there seems to be signs that the credit markets are improving. Contrary to the commercial building market, our civil business continues to add significant opportunities in public work for major infrastructure projects that will continue to be bid throughout the balance of the year.
On Tuesday, August 4, we bid a large segment of bridge project in Northern California, to the California Department of Transportation, and we were the low bidder at a price of $124.5 million. Given our expertise and geographic position, we continue to believe that we would be very competitive in landing a significant share of the new work we are bidding.
As for Management Services, we continue to look forward to our domination of the work program in Guam, with all of the pending awards related to the US movement of the marines to Guam. Our work at MGM City Center and Cosmopolitan continues to make progress toward completion, with no real financing issues or issues of any significance with our owners, other than the usual difficulties of getting multi billion dollar jobs completed.
We will begin a phase completion schedule with MGM for the fourth quarter of this year and are in agreement with most of the dates of delivery. Based on current plans, we believe Cosmopolitan will be completed in the second half of 2010. Further, our work at McCarran Airport Terminal 3, continues to move forward and is currently 28% complete and on track for completion in early 2012.
It has been a very pleasing project and we have developed an excellent rapport with the construction manager and the owner, in what we believe will be an extremely successful project, both as to cost and to schedule completion. Our civil work group continues to improve their performance and is preparing for what we deem to be the significant growth in the near future. Our pipeline of civil projects is absolutely full on both coasts and we continue to work toward that end.
Finally, Management Services still continues to deliver outstanding results, both in the Iraq and Guam. They too are prepared for the dramatic increase in opportunities that the Guam market promises. We believe our strategy to self perform a higher content of work and grow our public works in civil business is continuing to be demonstrative.