Tutor Perini Corporation provided an update on October 21, 2024, regarding recent developments, including the settlement of various project-related disputes. The company expects its operating cash flow for 2024 to be in the range of $425 million to $575 million, which would surpass its previous record for full-year operating cash generation in 2023.
The company plans to use this anticipated cash to prepay $100 million to $150 million of its Term Loan B debt by the end of 2024, with further prepayments of $50 million to $75 million in the first quarter of 2025. This debt reduction is a key capital allocation objective.
Significant new award activity is expected to result in a new record ending backlog of approximately $14 billion as of September 30, 2024, representing a 35% increase compared to the backlog reported as of June 30, 2024. However, due to net charges from dispute resolutions, the company expects to report a loss from construction operations and negative earnings per share for the third quarter of 2024, leading to the withdrawal of its 2024 EPS guidance.
The dispute resolutions included a non-cash, pre-tax charge of approximately $102 million from an unexpected adverse arbitration decision and a net pre-tax charge of approximately $43 million for other matters. Despite these charges, the resolutions are expected to result in a substantial net cash inflow of approximately $180 million, mostly anticipated in the fourth quarter of 2024. The company expects to return to profitability in 2025.
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