TUTOR PERINI CORP

Previous wording

The following discussion and analysis of our financial position as of March 31, 2025 and the results of our operations for the three months ended March 31, 2025 should be read in conjunction with other information, including the unaudited Condensed Consolidated Financial Statements and notes included in Part I, Item 1, Financial Information, of this Quarterly Report on Form 10‑Q, the audited consolidated financial statements and accompanying notes to our Annual Report on Form 10‑K for the year ended December 31, 2024, and the information contained under the heading “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2024 and in Part II, Item 1A below.

Current wording

The following discussion and analysis of our financial position as of June 30, 2025 and the results of our operations for the three and six months ended June 30, 2025 should be read in conjunction with other information, including the unaudited Condensed Consolidated Financial Statements and notes included in Part I, Item 1, Financial Information, of this Quarterly Report on Form 10‑Q, the audited consolidated financial statements and accompanying notes to our Annual Report on Form 10‑K for the year ended December 31, 2024, and the information contained under the heading “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2024 and in Part II, Item 1A below.

Previous wording

Consolidated revenue for the three months ended March 31, 2025 was $1.2 billion, up 19% compared to the same period in 2024. The Company experienced solid year-over-year growth in all three segments, primarily driven by increased project execution activities on certain newer, higher-margin projects, all of which have significant scope of work remaining. These projects included a detention facility in New York, which contributed to the revenue growth across all three segments, a Civil segment mass-transit project in Hawaii and increased project execution activities on certain other Civil segment mass-transit projects in California.

Current wording

Consolidated revenue for the three and six months ended June 30, 2025 was $1.4 billion and $2.6 billion, up 21.8% and 20.4% respectively, compared to $1.1 billion and $2.2 billion for the same periods in 2024. The Company experienced strong year-over-year growth in all three segments, primarily driven by increased project execution activities on certain newer, higher-margin projects, all of which have significant scope of work remaining. These projects included a detention facility in New York, which contributed to the revenue growth across all three segments, a Civil segment mass-transit project in Hawaii and increased project execution activities on certain other Civil segment mass-transit projects in California and the Northeast.

Previous wording

Income tax expense was $12.9 million for the three months ended March 31, 2025 compared to $7.3 million for the same period in 2024. See Corporate, Tax and Other Matters below for a discussion of the changes in the effective tax rate.

Current wording

Income tax expense was $22.0 million and $34.9 million for the three and six months ended June 30, 2025, respectively, compared to $7.3 million and $14.6 million for the same periods in 2024. See Corporate, Tax and Other Matters below for a discussion of the changes in the effective tax rate.

Previous wording

Diluted earnings per common share for the three months ended March 31, 2025 was $0.53 compared to diluted earnings per common share of $0.30 for the same period in 2024. The improvement for the first quarter of 2025 as compared to the same quarter last year was primarily due to the factors discussed above that resulted in the change in income from construction operations.

Current wording

Diluted earnings per common share for the three and six months ended June 30, 2025 was $0.38 and $0.90, respectively, compared to diluted earnings per common share of $0.02 and $0.31 for the same periods in 2024. Adjusted diluted earnings per common share, which is a non-GAAP financial measure and excludes share-based compensation expense (and the associated tax benefit)for the three and six months ended June 30, 2025 was $1.41 and $2.06, respectively. The improvement for both periods in 2025 was primarily due to the factors discussed above that resulted in the positive change in income from construction operations for such periods. Refer to the Non-GAAP Financial Measures section below for further information and a reconciliation of the Company's financial results reported under generally accepted accounting principles in the United States (“GAAP”) to the reported adjusted results.

Previous wording

Consolidated backlog as of March 31, 2025 was a record $19.4 billion, up 4% over the previous record backlog of $18.7 billion at the end of 2024. As of March 31, 2025, the mix of backlog by segment was approximately 50% for Civil, 35% for Building and 15% for Specialty Contractors.

Current wording

Consolidated backlog as of June 30, 2025 was a record $21.1 billion, up 9% over the previous record backlog of $19.4 billion at the end of the first quarter of 2025. As of June 30, 2025, the mix of backlog by segment was approximately 53% for Civil, 33% for Building and 14% for Specialty Contractors. Backlog for the Civil and Specialty Contractors segments as of June 30, 2025 also set new records.

Previous wording

The outlook for the Company’s revenue growth over the next several years remains favorable, particularly due to strong new award bookings in 2024 and through the first quarter of 2025, as well as other significant new awards that could be booked over the remainder of 2025. For example, the Company recently bid the multi-billion-dollar Midtown Bus Terminal Replacement project in New York and is awaiting contractor selection by the owner. Many of the Company’s newer projects are design-build projects that have an initial design phase over the first six to eighteen months during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. Revenue growth could be impacted by unanticipated project delays or the timing of project bids, awards, commencements, ramp-up activities and completions. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by state, local and federal customers, as well as limited competition for many of the larger project opportunities.

Current wording

The outlook for the Company’s revenue growth over the next several years remains highly favorable due to strong new award bookings of large, long-duration projects over the past two years, as well as other significant new awards that are expected to be booked over the remainder of 2025. For example, the Company has various building projects in California, mostly in the healthcare sector, that are in the preconstruction phase. These projects are expected to move from preconstruction to construction later this year or in 2026, and they include a large healthcare project that is anticipated to be awarded the construction phase later in 2025 at a value of nearly $1 billion. Many of the Company’s newer projects are design-build projects that have an initial design phase over the first six to eighteen months during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by state, local and federal customers, as well as limited competition for many of the larger project opportunities.

Previous wording

Nationally, support for transportation-related ballot measures has remained high over the last decade. Since 2014, voters in 43 states approved 84 percent of nearly 3,000 state and local measures on general election ballots. The largest of these was in Los Angeles County, where in 2016 Measure M, a half-cent sales tax increase, was approved and is expected to generate $120 billion of funding over 40 years. Funding from this measure is supporting, and is expected to continue to support, several of the Company’s current and prospective projects. More recently, in the November 2024 elections, voters approved 77 percent of 370 transportation funding measures on state and local ballots throughout the country. These measures are expected to generate an estimated $41.4 billion in new and renewed funding for roads, bridges, rail and other infrastructure. Additionally, interest rates were lowered in September 2024, and some economists expect further rate reductions in 2025, though the actual timing and extent of any future rate reductions remains uncertain. Lower interest rates could support additional demand for continued infrastructure spending. In contrast, should interest rates rise, they could reach levels that may negatively impact demand, especially for certain types of Building segment projects that have already been experiencing such impacts, such as commercial offices and tenant improvement projects, which tend to be more economically sensitive than projects handled by our Civil segment.

Current wording

Nationally, support for transportation-related ballot measures has remained high over the last decade. Since 2014, voters in 43 states approved 84 percent of nearly 3,000 state and local measures on general election ballots. The largest of these was in Los Angeles County, where in 2016 Measure M, a half-cent sales tax increase, was approved and is expected to generate $120 billion of funding over 40 years. Funding from this measure is supporting, and is expected to continue to support, several of the Company’s current and prospective projects. More recently, in the November 2024 elections, voters approved 77 percent of 370 transportation funding measures on state and local ballots throughout the country. These measures are expected to generate an estimated $41.4 billion in new and renewed funding for roads, bridges, rail and other infrastructure. Additionally, interest rates were lowered in the fall of 2024, and some economists expect further rate reductions in 2025, though the actual timing and extent of any future rate reductions remains uncertain. Lower interest rates could support additional demand for continued infrastructure spending. In contrast, should interest rates rise, they could reach levels that may negatively impact demand, especially for certain types of Building segment projects that have already been experiencing such impacts, such as commercial offices and tenant improvement projects, which tend to be more economically sensitive than projects handled by our Civil segment.

Previous wording

Revenue for the three months ended March 31, 2025 increased 29% compared to the same period in 2024, primarily due to increased project execution activities on certain large mass-transit projects in California and Hawaii, the Civil segment’s share of a detention facility project in New York and a mass-transit project in the Northeast, most of which have substantial scope of work remaining.

Current wording

Revenue for the three and six months ended June 30, 2025 increased 34.3% and 32.0%, respectively, compared to the same periods in 2024. For both periods of 2025, the substantial growth was primarily due to increased project execution activities on certain large mass-transit projects in California and Hawaii, the Civil segment’s share of a detention facility project in New York and two mass-transit projects in the Northeast, all of which have substantial scope of work remaining.

Previous wording

Backlog for the Civil segment was $9.7 billion as of March 31, 2025, up 136% compared to $4.1 billion as of March 31, 2024, and set a new all-time record for the segment. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, supported by substantial anticipated funding from various voter-approved transportation measures, the Bipartisan Infrastructure Law, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to capture its share of these prospective projects.

Current wording

Backlog for the Civil segment was $11.2 billion as of June 30, 2025, up 156% compared to $4.4 billion as of June 30, 2024, and set a new all-time record for the segment. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, supported by substantial anticipated funding from various voter-approved transportation measures, the bipartisan Infrastructure Investment and Jobs Act, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to continue capturing its share of these prospective projects, with the majority of near-term opportunities on the West Coast, in the Midwest, and in the Indo-Pacific region.

Previous wording

Revenue for the three months ended March 31, 2025 increased 12% compared to the same period in 2024, primarily due to increased project execution activities on a detention facility project in New York and a healthcare facility project in California, both of which have substantial scope of work remaining, partially offset by reduced project execution activities on a mass-transit project in California that is nearing completion.

Current wording

Revenue for the three and six months ended June 30, 2025 increased 10.6% and 11.1%, respectively, compared to the same periods in 2024, primarily due to increased project execution activities on a detention facility project in New York and a healthcare facility project in California, both of which have substantial scope of work remaining, partially offset by reduced project execution activities on a mass-transit project in California that is nearing completion.

Previous wording

Income from construction operations for the three months ended March 31, 2025 increased 13% compared to the same period in 2024. The increase was due to contributions related to the increased project execution activities discussed above.

Current wording

Income from construction operations for the three and six months ended June 30, 2025 was $22.5 million and $32.9 million, up 344.8% and 55.5%, respectively, compared to $5.0 million and $21.2 million for the same periods in 2024. The increase for both periods was primarily due to contributions related to the increased project execution activities discussed above.

Previous wording

Operating margin was 13.0% for the three months ended March 31, 2025 compared to 15.0% for the same period in 2024. The change in operating margin was principally due to the above-mentioned factors that drove the changes in revenue and income from construction operations.

Current wording

Operating margin was 4.9% and 3.6% for the three and six months ended June 30, 2025 compared to 1.2% and 2.6% for the same periods in 2024. The increased operating margins were principally due to the above-mentioned factors that drove the increases in revenue and income from construction operations.

Previous wording

Backlog for the Building segment was $6.7 billion as of March 31, 2025 up 61% compared to $4.2 billion as of March 31, 2024. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets and geographic locations. In addition, there are various healthcare and education projects underway in California that are in the preconstruction phase, with only a modest amount of current backlog recorded for them. Most of these projects are expected to advance into the construction phase this year, and we anticipate that we will book significant additional backlog for these projects in 2025 as a result.

Current wording

Backlog for the Building segment was $6.9 billion as of June 30, 2025 up 65% compared to $4.2 billion as of June 30, 2024. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets and geographic locations. In addition, there are various healthcare and education projects underway in California that are in the preconstruction phase, with only a portion of their full anticipated value included in our reported backlog. These projects are expected to soon advance to the construction phase — most of them later this year and a few in 2026, and consequently we anticipate that we will book significant additional backlog for these projects in 2025 and 2026.

Previous wording

Revenue for the three months ended March 31, 2025 increased 7% compared to the same period in 2024, primarily due to increased project execution activities on the electrical and mechanical components of a mass-transit project in California and a detention facility project in New York, both of which have substantial scope of work remaining.

Current wording

Revenue for the three and six months ended June 30, 2025 increased 8.8% and 8.0%, respectively, compared to the same periods in 2024, primarily due to increased project execution activities on the electrical and mechanical components of certain newer projects in the Northeast, California and Florida, all of which have substantial scope of work remaining.

Previous wording

Operating margin was (4.0)% for the three months ended March 31, 2025 compared to (11.1)% for the same period in 2024. The change in operating margin was principally due to the aforementioned factors that drove the changes in revenue and loss from construction operations.

Current wording

Operating margin was (10.2)% and (7.1)% for the three and six months ended June 30, 2025 compared to (4.8)% and (8.0)% for the same periods in 2024. The changes in operating margin were principally due to the aforementioned factors that drove the changes in revenue and loss from construction operations.

Previous wording

Backlog for the Specialty Contractors segment was $3.0 billion as of March 31, 2025, up 75% compared to $1.7 billion as of March 31, 2024, and set a new all-time record for the segment. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. We believe that the segment remains well-positioned to capture its share of new projects, leveraging the size and scale of our business units that operate in New York, Texas, Florida and California and the strong reputation held by these business units for high-quality work on large, complex projects.

Current wording

Backlog for the Specialty Contractors segment was $3.0 billion as of June 30, 2025, up 61% compared to $1.9 billion as of June 30, 2024, and set a new all-time record for the segment. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. We believe that the segment remains well-positioned to continue capturing its share of other new projects, leveraging the strong reputation held by the business units in this segment for high-quality work on large, complex projects.

Previous wording

Interest expense for the three months ended March 31, 2025 decreased $4.9 million compared to the same period in 2024 primarily due to lower outstanding debt driven by the payoff of the Term Loan B in the first quarter of 2025, as discussed further in Liquidity and Capital Resources. The Company expects interest expense to decrease over the remainder of 2025 and beyond.

Current wording

Interest expense for the three and six months ended June 30, 2025 decreased $9.5 million and $14.5 million compared to the same periods in 2024 primarily due to lower outstanding debt driven by the payoff of the Term Loan B in the first quarter of 2025, as discussed further in Liquidity and Capital Resources.

Previous wording

The Company recognized an income tax expense of $12.9 million for the three months ended March 31, 2025 resulting in an effective income tax rate was 23.2%. The effective income tax rate for the three months ended March 31, 2025 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit) substantially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.

Current wording

The Company recognized income tax expense of $22.0 million and $34.9 million for the three and six months ended June 30, 2025 resulting in an effective income tax rate was 31.8% and 28.0%, respectively. The effective income tax rate for the three and six months ended June 30, 2025 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit), partially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.

Previous wording

The Company recognized an income tax expense for the three months ended March 31, 2024 of $7.3 million resulting in an effective income tax rate of 21.0%. The effective income tax rate for the three months ended March 31, 2024 was consistent with the 21.0% federal statutory rate as the impacts of rate reductions from earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits were offset by non-deductible expenses, share-based compensation adjustments and state income taxes (net of federal tax benefit).

Current wording

The Company recognized income tax expense of $7.3 million and $14.6 million for the three and six months ended June 30, 2024, respectively. The effective income tax rate was 31.3% and 25.1% for the three and six months ended June 30, 2024, respectively. The effective income tax rate for both the three and six months ended June 30, 2024 was higher than the 21.0% federal statutory rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit), partially offset by the earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company).

Previous wording

Liquidity is provided by available cash and cash equivalents, cash generated from operations, credit facilities and access to capital markets. We have a committed line of credit totaling $170.0 million, which may be used for revolving loans, letters of credit and/or general purposes. We believe that cash generated from operations, along with our unused credit capacity and available cash balances as of March 31, 2025, will be sufficient to fund working capital needs and debt maturities for the next 12 months and beyond, as discussed further below in Debt below. During the first quarter of 2025, we voluntarily repaid the remaining $121.9 million outstanding balance of the Term Loan B. We expect strong operating cash flow to continue in 2025 based on projected cash collections, both from project execution activities and the resolution of outstanding claims and change orders. In addition, we expect to benefit from the utilization of available net operating loss carryforwards to reduce our cash outflows for income taxes.

Current wording

Liquidity is provided by available cash and cash equivalents, cash generated from operations, credit facilities and access to capital markets. We have a committed line of credit totaling $170.0 million, which may be used for revolving loans, letters of credit and/or general purposes. We believe that cash generated from operations, along with our unused credit capacity and available cash balances as of June 30, 2025, will be sufficient to fund working capital needs and debt maturities for the next 12 months and beyond, as discussed further below in Debt below. During the first quarter of 2025, we voluntarily repaid the remaining $121.9 million outstanding balance of the Term Loan B. We generated a record amount of operating cash in the first six months of 2025, as discussed below in Cash and Working Capital. We expect strong operating cash flow to continue for the remainder of 2025 based on projected cash collections, both from project execution activities and the resolution of outstanding claims and change orders. In addition, we expect to benefit from the utilization of available net operating loss carryforwards to reduce our cash outflows for income taxes.

Previous wording

Cash and cash equivalents were $276.5 million as of March 31, 2025 compared to $455.1 million as of December 31, 2024. The decrease in cash and cash equivalents during the period was primarily due to the early payoff of the Term Loan B. Cash immediately available for general corporate purposes was $64.2 million and $265.6 million as of March 31, 2025 and December 31, 2024, respectively, with the remainder being amounts held by our consolidated joint ventures and also our proportionate share of cash held by our unconsolidated joint ventures. Cash held by our joint ventures is available only for joint venture-related uses, including distributions to joint venture partners. In addition, our restricted cash and restricted investments totaled $175.9 million as of March 31, 2025 compared to $149.1 million as of December 31, 2024. Restricted cash and restricted investments at March 31, 2025 were primarily held to secure insurance-related contingent obligations and deposits.

Current wording

Cash and cash equivalents were $526.1 million as of June 30, 2025 compared to $455.1 million as of December 31, 2024. Cash immediately available for general corporate purposes was $231.1 million and $265.6 million as of June 30, 2025 and December 31, 2024, respectively, with the remainder being amounts held by our consolidated joint ventures and also our proportionate share of cash held by our unconsolidated joint ventures. Cash held by our joint ventures is available only for joint venture-related uses, including distributions to joint venture partners. In addition, our restricted cash and restricted investments totaled $178.4 million as of June 30, 2025 compared to $149.1 million as of December 31, 2024. Restricted cash and restricted investments at June 30, 2025 were primarily held to secure insurance-related contingent obligations and deposits.

Previous wording

During the three months ended March 31, 2025, net cash provided by operating activities was $22.9 million. The net cash provided by operating activities for the 2025 period was primarily due to cash generated by earnings sources, partially offset by an increase in net project working capital. The increase in net project working capital was primarily due to an increase in accounts receivable, partially offset by an increase in billings in excess of costs and estimated earnings (“BIE”) primarily due to advanced payments on newer projects for mobilization and other initial project costs, and an increase in accounts payable, as a result of the timing of payments to subcontractors and vendors. As of March 31, 2025, BIE of $1.4 billion exceeded costs and estimated earnings in excess of billings of $947.5 million resulting in a net BIE position. During the three months ended March 31, 2024, net cash provided by operating activities was $98.3 million. The net cash provided by operating activities for the 2024 period was primarily due to cash generated by earnings sources and a decrease in investment in project working capital. The decrease in investment in project working capital was primarily due to an increase in accounts payable, as a result of the timing of payments to subcontractors and vendors, partially offset by a decrease in BIE.

Current wording

During the six months ended June 30, 2025, net cash provided by operating activities was $285.3 million, the largest result for the first six months of any year. The net cash provided by operating activities for the 2025 period was primarily due to cash generated by earnings sources and a decrease in net project working capital. The decrease in net project working capital was primarily due to an increase in billings in excess of costs and estimated earnings (“BIE”) largely due to advanced payments on newer projects for mobilization and other initial project costs, partially offset by an increase in accounts receivable. In addition, the Company's balance of costs and estimated earnings in excess of billings (“CIE”) was $856.4 million as of June 30, 2025, down $86.1 million (or 9%) compared to the balance at the end of 2024 and at the lowest level it has been since the second quarter of 2017. This reduction in CIE was primarily driven by the resolution and billing of various previously disputed matters. As of June 30, 2025, BIE of $1.7 billion exceeded CIE of $856.4 million resulting in a net BIE position. During the six months ended June 30, 2024, net cash provided by operating activities was $151.4 million. The net cash provided by operating activities for the 2024 period was primarily due to cash generated by earnings sources and a reduction in net project working capital. The reduction in net project working capital was primarily due to an increase in accounts payable, as a result of the timing of payments to subcontractors and vendors, partially offset by a decrease in BIE.

Previous wording

Cash flow from operating activities for the first three months of 2025 decreased $75.4 million compared to the same period in 2024. The decrease in cash flow from operating activities for the first three months of 2025 compared to 2024 primarily reflects an increase in net project working capital in the current period compared to a decrease in the prior-year period, partially offset by higher cash generated by earning sources in the current period compared to the prior-year period. The increase in net project working capital in the 2025 period was primarily due to a larger current-year increase in accounts receivable compared to last year, and a current-year increase in retention receivable compared to a decrease last year. The increase in net project working capital was partially offset by current-year increases in BIE and accrued expenses compared to decreases last year. While both periods were positively impacted by collections associated with previously disputed matters, such collections in the 2024 period were significant whereas such collections in the 2025 period were immaterial.

Current wording

Cash flow from operating activities for the first six months of 2025 increased $133.9 million compared to the same period in 2024. The increase in cash flow from operating activities for the first six months of 2025 compared to 2024 primarily reflects higher cash generated by earning sources in the current period compared to the prior-year period, as well as a larger decrease in net project working capital in the current period compared to the prior-year period. The decrease in net project working capital in the 2025 period was primarily due to a current-year increase in BIE compared to a decrease last year, partially offset by a larger current-year increase in accounts receivable compared to last year, and a current-year increase in other current assets compared to a decrease last year. While both periods were positively impacted by collections associated with previously disputed matters as mentioned above, such collections in the 2024 period were significant whereas such collections in 2025 were lower relative to total operating cash flow.

Previous wording

Net cash used in investing activities during the first three months of 2025 was $23.9 million primarily due to the acquisition of property and equipment for projects (i.e., capital expenditures) totaling $30.1 million, partially offset by net cash provided by investment transactions of $5.7 million and proceeds from the sale of property and equipment of $0.5 million. Net cash used in investing activities during the first three months of 2024 was $10.3 million primarily due to the acquisition of property and equipment for projects totaling $10.4 million.

Current wording

Net cash used in investing activities during the first six months of 2025 was $67.7 million primarily due to the acquisition of property and equipment for projects (i. e., capital expenditures) totaling $56.9 million and other net cash used in investment transactions of $15.0 million. Net cash used in investing activities during the first six months of 2024 was $24.0 million primarily due to the acquisition of property and equipment for projects totaling $21.4 million.

Previous wording

Net cash used in financing activities was $146.4 million for the first three months of 2025, which was primarily driven by a $129.5 million net repayment of debt (including the $121.9 million repayment of the remaining balance on the Term Loan B discussed below in Debt), and $11.8 million of net distributions to noncontrolling interests. Net cash used in financing activities was $109.6 million for the first three months of 2024, which was primarily driven by a $100.2 million net repayment of debt and $7.4 million of distributions to noncontrolling interests.

Current wording

Net cash used in financing activities was $134.7 million for the first six months of 2025, which was primarily driven by a $116.7 million net repayment of debt (including the $121.9 million repayment of the remaining balance on the Term Loan B discussed below in Debt). Net cash used in financing activities was $242.6 million for the first six months of 2024, which was primarily driven by a $202.9 million net repayment of debt and $25.1 million of payments for debt issuance costs related to debt transactions during the period.

Previous wording

At March 31, 2025, we had working capital of $0.9 billion, a ratio of current assets to current liabilities of 1.33 and a ratio of debt to equity of 0.34, compared to working capital of $1.0 billion, a ratio of current assets to current liabilities of 1.41 and a ratio of debt to equity of 0.46 at December 31, 2024.

Current wording

At June 30, 2025, we had working capital of $0.9 billion, a ratio of current assets to current liabilities of 1.32 and a ratio of debt to equity of 0.34, compared to working capital of $1.0 billion, a ratio of current assets to current liabilities of 1.41 and a ratio of debt to equity of 0.46 at December 31, 2024.

Previous wording

Borrowings under the 2020 Credit Agreement bear interest at variable rates, which have increased since the latter part of 2022 due to changes in market conditions that resulted in increases in the Secured Overnight Financing Rate (“SOFR”) (and the London Interbank Offered Rate (“LIBOR”) prior to the transition to SOFR), in the case of the Term Loan B, and the administrative agent’s prime lending rate, in the case of the Revolver. Effective May 2, 2023, the 2020 Credit Agreement was amended to transition the Company’s original LIBOR option in respect of the Term Loan B to Adjusted Term SOFR. The average borrowing rates on the Term Loan B and the Revolver for the three months ended March 31, 2025 were approximately 9.2% and 10.8%, respectively. At March 31, 2025, the borrowing rate on the Revolver was 10.8%. For more information regarding the terms of our 2020 Credit Agreement, refer to Note 9 of the Notes to Condensed Consolidated Financial Statements.

Current wording

Borrowings under the 2020 Credit Agreement bear interest at variable rates, which have increased since the latter part of 2022 due to changes in market conditions that resulted in increases in the Secured Overnight Financing Rate (“SOFR”) (and the London Interbank Offered Rate (“LIBOR”) prior to the transition to SOFR), in the case of the Term Loan B, and the administrative agent’s prime lending rate, in the case of the Revolver. Effective May 2, 2023, the 2020 Credit Agreement was amended to transition the Company’s original LIBOR option in respect of the Term Loan B to Adjusted Term SOFR. The average borrowing rates on the Term Loan B and the Revolver for the six months ended June 30, 2025 were approximately 9.2% and 10.8%, respectively. At June 30, 2025, the borrowing rate on the Revolver was 10.8%. For more information regarding the terms of our 2020 Credit Agreement, refer to Note 10 of the Notes to Condensed Consolidated Financial Statements.

Previous wording

(a) The ratio was negative because the Company’s cash and cash equivalents available for general corporate purposes exceeded Indebtedness, resulting in negative First Lien Net Indebtedness, both as defined in the 2020 Credit Agreement.

Current wording

(a) The ratio was negative because the Company’s cash and cash equivalents available for general corporate purposes exceeded secured Indebtedness, resulting in negative First Lien Net Indebtedness, both as defined in the 2020 Credit Agreement.