Everus Construction Group, Inc.

Previous wording

Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those factors discussed in the following and elsewhere in this Quarterly Report, particularly in the section entitled “Cautionary Note Regarding Forward-Looking Statements”. Refer to the section titled “Risk Factors” included in our Registration Statement on Form 10 (“Form 10”), which is not incorporated by reference herein, for more information concerning our risk factors. References to the “Company,” “Everus,” “we,” “us,” and “our” refer to Everus Construction Group, Inc. and its consolidated subsidiaries, unless otherwise stated or indicated by context.

Current wording

Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to these differences include those factors discussed in the following and elsewhere in this Quarterly Report, particularly in the section entitled “Cautionary Note Regarding Forward-Looking Statements.” Refer to the section titled “Item 1A. Risk Factors” included in our 2024 Annual Report on Form 10-K (“2024 Annual Report”) for more information concerning our risk factors. References to the “Company,” “Everus,” “we,” “us,” and “our” refer to Everus Construction Group, Inc. and its consolidated subsidiaries, unless otherwise stated or indicated by context.

Previous wording

This Quarterly Report contains certain “forward-looking statements” within the meaning of the securities laws. All statements that reflect our expectations, assumptions or projections about the future, other than statements of historical facts, including, without limitation, statements regarding plans, trends, objectives, goals, business strategies, market potential, future financial performance and other matters are considered forward-looking statements. The words “believe,” “expect,” “estimate,” “could,” “should,” “would,” “intend,” “may,” “plan,” “predict,” “seek,” “anticipate,” “project” and similar expressions generally identify forward-looking statements, which speak only as of the date the statements were made. In particular, information included under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Quarterly Report contains forward-looking statements. The matters discussed in these forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those projected, anticipated or implied in the forward-looking statements. Although we believe that the expectations reflected in any forward-looking statements we make are based on reasonable assumptions as of the date they are made, we can give no assurance that the expectation will be attained and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties.

Current wording

This Quarterly Report contains certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements that reflect our expectations, assumptions or projections about the future, other than statements of historical facts, including, without limitation, statements regarding plans, trends, objectives, goals, business strategies, market potential, future financial performance and other matters are considered forward-looking statements. The words “believe,” “expect,” “estimate,” “could,” “should,” “would,” “intend,” “may,” “plan,” “predict,” “seek,” “anticipate,” “project” and similar expressions generally identify forward-looking statements, which speak only as of the date the statements were made. In particular, information included under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Item 3. Quantitative and Qualitative Disclosures about Market Risk” of this Quarterly Report contains forward-looking statements.

Previous wording

You should read this Quarterly Report completely and with the understanding that actual future results may be materially different from expectations. All forward-looking statements made in this Quarterly Report are qualified by these cautionary statements. These forward-looking statements are made only as of the date of this Quarterly

Current wording

You should read this Quarterly Report completely and with the understanding that actual future results may be materially different from expectations. All forward-looking statements made in this Quarterly Report are qualified by these cautionary statements. These forward-looking statements are made only as of the date of this Quarterly Report, and we do not undertake any obligation, other than as may be required by law, to update or revise any forward-looking or cautionary statements to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, and changes in future operating results over time or otherwise.

Previous wording

We provide specialty contracting services to commercial, industrial, institutional, service, renewables, utilities, transportation, manufacturing and governmental customers, among others. We operate throughout most of the United States through two operating segments:

Current wording

We are a leading construction solutions provider offering specialty contracting services to a diverse set of end markets, which are provided to commercial, industrial, institutional, renewables, service, utility, transportation and other customers. We operate throughout most of the United States through two reportable, operating segments:

Previous wording

Electrical & Mechanical (“E&M”): Contracting services including construction and maintenance of electrical and communication wiring and infrastructure, fire suppression systems, and mechanical piping and services.

Current wording

Electrical & Mechanical (“E&M”): Contracting services including construction and maintenance of electrical and communication wiring and infrastructure, fire suppression systems, and mechanical piping and services in both the public and private sectors.

Previous wording

We offer specialty contracting services under two reportable segments, Electrical & Mechanical and Transmission & Distribution, which provide services to a diverse set of end markets across most of the United States. We focus on safely executing projects; providing a superior return on investment by building new and strengthening existing customer relationships; ensuring quality service; effectively managing costs; retaining, developing and recruiting talented employees; growing through organic and strategic acquisition opportunities; and focusing efforts on projects that will permit higher margins while properly managing risk. The growth we have experienced in recent years is due in part to the project awards in the end markets and submarkets served and the ability to support national customers in most of the regions in which we operate.

Current wording

We focus on safely executing projects; providing a superior return on investment by building new and strengthening existing customer relationships; ensuring quality service; effectively managing costs; retaining, developing and recruiting talented employees; growing through organic and strategic acquisition opportunities; and focusing efforts on projects that will permit higher margins while properly managing risk. The growth we have experienced in recent years is due in part to the project awards in the end markets and submarkets served and the ability to support national customers in most of the regions in which we operate. Our strong presence in the Western, Midwestern and Eastern regions of the United States has driven opportunities in data centers, high-tech, hospitality and utilities, while customer expansion nationwide continues to extend our reach through partnerships through our 15 wholly-owned operating companies. At Everus, people are our core, and we prioritize integrity, safety and growth through comprehensive training, hands-on development, safety compliance metrics and strong union partnerships to instill a safety-first culture and ethical leadership across all levels.

Previous wording

We have experienced increased insurance costs and anticipate continued increases in insurance costs. Premiums in the insurance industry have risen due to many factors, such as economic inflation and a rise in insurance carriers’ losses, in particular for wildfire risks. We recently completed the renewal process for our insurance lines, which are on a standalone basis due to the Separation, and we experienced these aforementioned impacts. However, we are formulating strategies to minimize these costs and/or ensuring these costs are built into our bidding opportunities going forward.

Current wording

We have experienced increased insurance costs and anticipate continued increases in insurance costs. Premiums in the insurance industry have risen due to many factors, such as economic inflation and a rise in insurance carriers’ losses, in particular for wildfire risks. We experienced these aforementioned impacts with coverage for our insurance lines on a standalone basis following the Separation. However, we are formulating strategies to minimize these costs and/or ensuring these costs are built into our bidding opportunities going forward.

Previous wording

•Key economic factors. Many factors affect product demand, including public spending on infrastructure projects, general economic conditions, including population growth and employment levels, and prevailing interest rates.

Current wording

•Key economic factors. Many factors affect product demand, including public spending on infrastructure projects, general economic conditions, including population growth and employment levels, imposed and proposed tariffs, and prevailing interest rates.

Previous wording

•Seasonality. Activity in certain areas is seasonal due to the effects of weather, which can impact safety and efficiency of operations. At the same time, effects of weather can lead to increased demand for services in other areas. Our national footprint and service mix, particularly in our T&D segment, ensures exposure to a diverse set of geographies, climates and project work, mitigating the seasonality risk while providing opportunities across the United States.

Current wording

•Seasonality. Activity in certain areas is seasonal due to the effects of weather, which can impact safety and efficiency of operations but could also lead to demand for our services.

Previous wording

On November 2, 2023, MDU Resources announced its intention to pursue a tax-free spinoff of Everus Construction from MDU Resources (the “Separation”). In anticipation of the Separation, MDU Resources formed a new wholly owned subsidiary, Everus Construction Group, Inc., that would become the new parent company of Everus Construction.

Current wording

On November 2, 2023, MDU Resources Group, Inc. (“MDU Resources”) announced its intention to pursue a tax-free spinoff of Everus Construction, Inc. (formerly known as MDU Construction Services Group, Inc.) (“Everus Construction”) from MDU Resources (the “Separation”). Prior to the Separation, Everus Construction was the construction services segment of MDU Resources and operated as a wholly owned subsidiary of CEHI, LLC (“Centennial”), which is a wholly owned subsidiary of MDU Resources. In anticipation of the Separation, MDU Resources formed a new wholly owned subsidiary, Everus Construction Group, Inc., that became the new parent company of Everus Construction.

Previous wording

On October 31, 2024, MDU Resources completed the Separation by transferring Everus Construction, inclusive of all its assets and liabilities, to Everus and distributing 50,972,059 shares of Everus common stock ($0.01 par value) to MDU Resources stockholders of record as of October 21, 2024 (the “Distribution”). The Distribution was structured as a pro rata distribution of one share of Everus common stock for every four shares of MDU Resources common stock (such ratio, the “Distribution Ratio”). MDU Resources did not distribute any fractional shares of Everus common stock to its stockholders as part of the distribution. Instead, MDU Resources’ stockholders will receive cash in lieu of any fractional shares of Everus common stock that they would have received after application of the Distribution Ratio.

Current wording

On October 31, 2024, MDU Resources completed the Separation by transferring Everus Construction, inclusive of all its assets and liabilities, to Everus and distributing 50,972,059 shares of Everus common stock ($0.01 par value) to MDU Resources stockholders of record as of October 21, 2024 (the “Distribution”). The Distribution was structured as a pro rata distribution of one share of Everus common stock for every four shares of MDU Resources common stock (such ratio, the “Distribution Ratio”). MDU Resources did not distribute any fractional shares of Everus common stock to its stockholders as part of the distribution. Instead, MDU Resources’ stockholders received cash in lieu of any fractional shares of Everus common stock that they would have received after application of the Distribution Ratio.

Previous wording

As a result of the Separation and Distribution, Everus is now a separate, independent publicly traded company and its common stock is listed under the symbol “ECG” on the New York Stock Exchange. More information on the Separation and Distribution, as well as the our historical results, can be found within our Form 10.

Current wording

As a result of the Separation and Distribution, Everus is an independent publicly traded company and our common stock is listed under the symbol “ECG” on the New York Stock Exchange.

Previous wording

The Separation was completed pursuant to a separation and distribution agreement and other agreements with MDU Resources related to the Separation, including, but not limited to, a transition services agreement, a tax matters agreement and an employee matters agreement. We have incurred costs related to becoming an independent public entity and expect additional ongoing expenses related to our continued operations as such.

Current wording

The Separation and Distribution was completed pursuant to a separation and distribution agreement and other agreements with MDU Resources, including, but not limited to, a transition services agreement, a tax matters agreement and an employee matters agreement. Refer to Note 14 – Related-Party Transactions in the unaudited condensed consolidated financial statements contained elsewhere in this Quarterly Report for additional information on the transition services agreement. We have incurred costs related to becoming an independent public entity and expect additional ongoing expenses related to continued operations as such.

Previous wording

For a complete discussion of all the conditions, pursuant to the separation and distribution agreement, and the associated risks and uncertainties, associated with the separation and distribution, see “The Separation and Distribution—Conditions to the Distribution” and “Risk Factors—Risks Related to the Separation and Distribution” in our Form 10.

Current wording

For a complete discussion of the associated risks and uncertainties associated with the Separation and Distribution, see “Risk Factors—Separation and Distribution Risks” in our 2024 Annual Report.

Previous wording

Prior to the Separation, Everus Construction historically operated as a wholly owned subsidiary of Centennial and an indirect, wholly owned subsidiary of MDU Resources and not as a standalone company. The accompanying unaudited condensed consolidated financial statements and footnotes included in this Quarterly Report were prepared on a “carve-out” basis in connection with the Separation and were derived from the unaudited condensed consolidated financial statements of MDU Resources as if we operated on a standalone basis during the periods presented. However, the unaudited condensed consolidated financial statements do not necessarily reflect what our results of operations, financial position and cash flows would have been had we operated as a separate, publicly traded company during the periods presented and may not be indicative of our future performance. For additional information related to our basis of presentation, see Note 2 – Basis of Presentation in the unaudited condensed consolidated financial statements contained elsewhere in this Quarterly Report.

Current wording

Prior to the Separation, Everus Construction historically operated as a wholly owned subsidiary of Centennial and an indirect, wholly owned subsidiary of MDU Resources and not as a standalone company. For periods prior to the Separation, financial information included in the accompanying unaudited condensed consolidated financial statements and related footnotes of this Quarterly Report were prepared on a “carve-out” basis in connection with the Separation and were derived from the unaudited condensed consolidated financial statements of MDU Resources as if we operated on a standalone basis during the periods presented. However, the financial information included in unaudited condensed consolidated financial statements and related footnotes for periods prior to the Separation do not necessarily reflect what our results of operations, financial position and cash flows would have been had we operated as a separate, publicly traded company and may not be indicative of our future performance. For additional information related to our basis of presentation, see Note 2 – Basis of Presentation and Summary of Significant Accounting Policies in the unaudited condensed consolidated financial statements contained elsewhere in this Quarterly Report.

Previous wording

Prior to the Separation, we historically participated in MDU Resources’ centralized cash management program through Centennial, including its overall financing arrangements. We had related-party agreements in place with Centennial for the financing of our capital needs, which were reflected as Related-party notes payable on the unaudited condensed consolidated balance sheets. Interest expense in the unaudited condensed consolidated statements of income reflected the allocation of interest on borrowing and funding associated with the related-party agreements.

Current wording

Prior to the Separation, we historically participated in MDU Resources’ centralized cash management program through Centennial, including its overall financing arrangements. We had related-party agreements in place with Centennial for the financing of our capital needs, which were reflected as Related-party notes payable on the unaudited condensed consolidated balance sheets for periods prior to the Separation. Interest expense, net in the unaudited condensed consolidated statements of income reflected the allocation of interest on borrowing and funding associated with the related-party agreements for periods prior to the Separation. Refer to Note 14 – Related-Party Transactions in the unaudited condensed consolidated financial statements contained elsewhere in this Quarterly Report for additional information. Following the Separation, we rely on our own credit and financing arrangements and incur interest expense associated with those arrangements. For additional information related to our current credit and financing arrangements, refer to Note 6 – Debt in the unaudited condensed consolidated financial statements contained elsewhere in this Quarterly Report.

Previous wording

Cash-settled related-party transactions between Everus, MDU Resources, Centennial, and other MDU Resources subsidiaries were included in the unaudited condensed consolidated financial statements. For additional information regarding the agreements between us, MDU Resources and Centennial, see “Certain Relationships and Related Person Transactions” in our Form 10.

Current wording

Cash-settled related-party transactions between Everus, MDU Resources, Centennial, and other MDU Resources subsidiaries were included in the unaudited condensed consolidated financial statements for periods prior to the Separation. For additional information regarding the agreements between us, MDU Resources and Centennial, refer to the “Certain Relationships and Related Person Transactions, and Director Independence” section in our 2024 Annual Report.

Previous wording

Consolidated Results of Operations For the Three and Nine Months Ended September 30, 2024 and 2023

Current wording

Consolidated Results of Operations For the Three Months Ended March 31, 2025 and 2024

Previous wording

The following table sets forth our consolidated selected statements of income data, as well as the percentage change from the prior comparative interim periods.

Current wording

The following table sets forth our consolidated selected statements of income data, as well as the percentage change from the prior comparative interim period.

Previous wording

Operating revenues for the three months ended September 30, 2024, were $761.0 million, an increase of $43.6 million, or 6.1%, from $717.4 million for the three months ended September 30, 2023. E&M revenues grew $20.0 million, or 3.9%, and T&D revenues rose $24.0 million, or 11.7%.

Current wording

Operating revenues for the three months ended March 31, 2025, were $826.6 million, an increase of $200.9 million, or 32.1%, from $625.7 million for the three months ended March 31, 2024. E&M revenues grew $207.2 million, or 47.0%, partially offset by a decline in T&D revenues of $3.5 million, or 1.9%.

Previous wording

•Utility revenues increased from higher workloads and submarket activity across transmission, telecommunication and substation, partially offset by lower workloads due to timing of project availability in the storm and government submarkets.

Current wording

•Utility revenues decreased from lower workloads due to weather-related impacts and timing of project availability in the storm, distribution, transmission and substation submarkets, partially offset by increased project activity across the underground and construction submarkets.

Previous wording

•Transportation had higher revenues due to submarket activity, with higher workloads in traffic signalization and street lighting.

Current wording

•Transportation had higher revenues due to higher workloads in the traffic signalization submarket, partially offset by reduced project activity in the street lighting submarket.

Previous wording

Cost of sales for the three months ended September 30, 2024, was $671.1 million, an increase of $38.6 million, or 6.1%, from $632.5 million for the three months ended September 30, 2023. This increase primarily related to higher operating costs from increased E&M and T&D workloads, partially offset by project efficiencies. Subcontractor costs, material costs and other job expenses increased $25.2 million, $10.0 million and $6.4 million, respectively, partially offset by lower labor costs of $3.0 million.

Current wording

Cost of sales for the three months ended March 31, 2025, was $734.1 million, an increase of $183.1 million, or 33.2%, from $551.0 million for the three months ended March 31, 2024. This increase primarily related to higher operating costs from increased E&M workloads and changes in project mix, partially offset by lower T&D operating costs from reduced workloads. Labor, material, and subcontractor costs increased $100.5 million, $40.6 million and $33.2 million, respectively, along with higher other job expenses of $8.8 million.

Previous wording

Selling, general and administrative expenses for the nine months ended September 30, 2024, were $109.3 million, an increase of $6.8 million, or 6.6%, from $102.5 million for the nine months ended September 30, 2023. The increase was driven primarily by higher payroll-related expenses of $1.8 million to support the operational growth of the business, higher professional service-related expenses of $4.2 million and higher general expenses of $5.2 million including office, rent and insurance expense. Partially offsetting these increases was lower provision for expected credit losses of $4.4 million.

Current wording

Selling, general and administrative expenses for the three months ended March 31, 2025, were $41.5 million, an increase of $5.7 million, or 15.9%, from $35.8 million for the three months ended March 31, 2024. The increase was driven primarily by higher labor and professional service-related expenses of $4.8 million and $1.9 million, respectively, including incremental stand-alone operating costs, to support the operational growth of the business, and higher general expenses of $0.3 million, including higher corporate overhead expenses. Partially offsetting these increases was lower provision for expected credit losses of $1.3 million.

Previous wording

Operating income for the three months ended September 30, 2024, was $53.7 million, an increase of $3.6 million, or 7.2%, from $50.1 million for the three months ended September 30, 2023. The increase was primarily driven by increased gross profit due to higher revenues, partially offset by increased selling, general and administrative expenses as discussed above. Operating income, as a percentage of revenues, remained relatively consistent at 7.1% for the three months ended September 30, 2024 compared to 7.0% for the three months ended September 30, 2023.

Current wording

Operating income for the three months ended March 31, 2025 was $51.0 million, an increase of $12.1 million, or 31.1%, from $38.9 million for the three months ended March 31, 2024. The increase was primarily driven by increased gross profit, partially offset by increased selling, general and administrative expenses, both of which are discussed above. Operating income, as a percentage of revenues, was 6.2% for the three months ended March 31, 2025, consistent with the three months ended March 31, 2024.

Previous wording

Income taxes for the three months ended September 30, 2024, were $14.0 million, an increase of $2.6 million, or 22.8%, from $11.4 million for the three months ended September 30, 2023, reflecting higher income before taxes for the period. The effective tax rate was 25.1% for the three months ended September 30, 2024, compared to 24.1% for the three months ended September 30, 2023.

Current wording

Income taxes for the three months ended March 31, 2025, were $13.6 million, an increase of $3.6 million, or 36.0%, from $10.0 million for the three months ended March 31, 2024, reflecting higher income before taxes for the period. The effective tax rate was 27.0% for the three months ended March 31, 2025, compared to 26.1% for the three months ended March 31, 2024.

Previous wording

Income from equity method investments for the three months ended September 30, 2024, was $3.8 million, an increase of $3.0 million, from $0.8 million for three months ended September 30, 2023. This increase primarily related to increased progress on joint venture activity.

Current wording

Income from equity method investments for the three months ended March 31, 2025, was $3.4 million, an increase of $2.3 million from $1.1 million for the three months ended March 31, 2024. The increase primarily related to increased progress on joint venture activity.

Previous wording

Segment Results of Operations For the Three and Nine Months Ended September 30, 2024 and 2023

Current wording

Segment Results of Operations For the Three Months Ended March 31, 2025 and 2024

Previous wording

We report our results under two reportable segments: Electrical & Mechanical, and Transmission & Distribution. The following table sets forth segment revenues and segment operating income for the periods indicated, as well as the percentage change from the prior comparative interim periods:

Current wording

We report our results under two reportable, operating segments: E&M and T&D. The following table sets forth segment revenues, segment operating income and “Corporate and Other” category operating income for the periods indicated, as well as the percentage change from the prior comparative interim period:

Previous wording

•Institutional revenues increased $79.7 million with higher workloads in the government, education and healthcare submarkets.

Current wording

•Institutional revenues increased $19.6 million from higher workloads in the government and education submarkets.

Previous wording

The increase in corporate and other costs during the three months ended September 30, 2024 was primarily due to higher labor costs of $1.2 million to support the operational growth of the business, higher professional services of $0.4 million and general expenses of $0.9 million including office, charitable contribution and insurance expense.

Current wording

The increase in corporate and other costs during the three months ended March 31, 2025 was primarily due to higher labor and professional service-related expenses of $1.9 million and $1.0 million, respectively, including incremental stand-alone operating costs, to support the operational growth of the business, partially offset by lower general expenses of $0.4 million. Lower general expenses were primarily due to lower office and charitable contribution expenses, partially offset by higher corporate overhead and rent expenses.

Previous wording

Backlog is a common measurement in the construction services industry. Our determination of backlog consists of the uncompleted portion of services to be performed under job-specific contracts. Contracts are subject to delays, defaults or cancellations; changes in scope of services to be provided; and adjustments to costs. Backlog may also be affected by project delays or cancellations resulting from weather conditions, external market factors and economic factors beyond our control, among other things. Accordingly, there is no assurance that backlog will be realized. For the periods presented in the backlog table below, we did not experience any material impacts related to delays or cancellations of planned projects that were included in backlog. The timing of contract awards, duration of large new contracts and the mix of services can significantly affect backlog. Backlog at any given point in time may not accurately represent the revenue or net income that is realized in any period, and backlog as of the end of the year may not be indicative of the revenue or net income expected to be realized in the following year. Backlog should not be relied upon as a standalone indicator of future results. Factors noted in “Risk Factors” included in our Form 10 could cause revenues to be realized in periods and at levels that are different from originally projected.

Current wording

Backlog is a common measurement in the construction services industry. Our determination of backlog can include projects that have a written award, a letter of intent, a notice to proceed, an agreed upon work order to perform work on mutually accepted terms, and conditions and change orders or claims to the extent management believes additional contract revenues will be earned and are deemed probable of collection. Contracts are subject to delays, defaults or cancellations; changes in scope of services to be provided; and adjustments to costs. Backlog may also be affected by project delays or cancellations resulting from weather conditions, external market factors and economic factors beyond our control, among other things. Accordingly, there is no assurance that backlog will be realized. For the periods presented in the backlog table below, we did not experience any material impacts related to delays or cancellations of planned projects that were included in backlog. The timing of contract awards, including contracts awarded pursuant to Master Service Agreements, duration of large new contracts and the mix of services can significantly affect backlog. Backlog at any given point in time may not accurately represent the revenue or net income that is realized in any period, and backlog as of the end of the period may not be indicative of the revenue or net income expected to be realized within the next 12 months. Backlog should not be relied upon as a standalone indicator of future results. Factors noted in “Item 1A. Risk Factors” included in our 2024 Annual Report could cause revenues to be realized in periods and at levels that are different from originally projected.

Previous wording

Changes in backlog from period to period are primarily the result of fluctuations in the timing of revenue recognition of contracts.

Current wording

Changes in backlog from period to period are primarily the result of fluctuations in the timing of contract awards and timing of revenue recognition of contracts.

Previous wording

The increase in E&M backlog from September 30, 2024, compared to December 31, 2023 and September 30, 2023, primarily reflected additional commercial, institutional and renewables projects, partially offset by completed or near completion projects during the period.

Current wording

The increase in E&M backlog from March 31, 2025, compared to December 31, 2024, primarily reflected additional project growth in the commercial and industrial end markets, partially offset by project declines in the institutional and renewables end markets during the period.

Previous wording

The decrease in T&D backlog from September 30, 2024, compared to December 31, 2023 and September 30, 2023, primarily reflected completed or near completion utility and transportation projects, partially offset by additional projects added during the period.

Current wording

The increase in T&D backlog from March 31, 2025, compared to March 31, 2024, primarily reflected additional utility and transportation end-market projects during the period.

Previous wording

EBITDA is calculated by adding back interest expense, income taxes, and depreciation and amortization to net income. EBITDA margin is calculated by dividing EBITDA by operating revenues. EBITDA and EBITDA margin are considered non-GAAP financial measures and are comparable to the corresponding GAAP measures of net income and net income margin, respectively.

Current wording

EBITDA is calculated by adding back interest expense, net of interest income, income taxes, and depreciation and amortization to net income. EBITDA margin is calculated by dividing EBITDA by operating revenues.

Previous wording

As of September 30, 2024 and December 31, 2023, we had cash and cash equivalents of$0.6 million and $1.6 million, respectively. We historically participated in MDU Resources’ centralized cash management program through Centennial, including its overall financing arrangements. After the Separation, we no longer rely on MDU Resources’ central cash management and financing program and instead rely on our own credit and financing arrangements. We have implemented our own centralized cash management model and will use cash on hand and third-party credit facilities to fund day-to-day operations.

Current wording

Prior to the Separation, we historically participated in MDU Resources’ centralized cash management program through Centennial, including its overall financing arrangements. After the Separation, we no longer rely on MDU Resources’ central cash management and financing program and instead rely on our own credit. We have implemented our own centralized cash management model and will use cash on hand and third-party credit facilities to fund day-to-day operations.

Previous wording

On October 31, 2024, we entered into a five-year senior secured credit agreement (“the Credit Agreement”), whereby we have the capacity to incur indebtedness of up to $525.0 million, consisting of $300.0 million in aggregate principal amount of term loans and a $225.0 million revolving credit facility. Letters of credit are available under the Credit Agreement in an aggregate amount of up to $50.0 million. The term loans and the revolving credit facility will both bear interest at an annual rate equal to adjusted term Secured Overnight Financing Rate, defined in a customary manner (“Term SOFR”) plus an applicable rate. The Credit Agreement contains financial covenants requiring us to maintain a maximum consolidated total net leverage ratio of 3.00:1.00 and a minimum interest coverage ratio of 3.00:1.00, in each case measured as of the last day of each fiscal quarter. The consolidated total net leverage ratio may be increased at our option to 3.50:1.00 in connection with certain qualifying material acquisitions. The covenants also include restrictions on the sale of certain assets, loans and investments.

Current wording

The Credit Agreement contains financial covenants requiring us to maintain a maximum consolidated total net leverage ratio of 3.00:1.00 and a minimum interest coverage ratio of 3.00:1.00, in each case, measured as of the last day of each fiscal quarter. The consolidated total net leverage ratio may be increased at our option to 3.50:1.00 in connection with certain qualifying material acquisitions. The covenants also include restrictions on the sale of certain assets, loans and investments.

Previous wording

Working capital, as defined as current assets minus current liabilities, was $327.0 million and $313.9 million as of September 30, 2024 and December 31, 2023, respectively. Our working capital requirements may increase when we commence multiple projects or particularly large projects because labor, subcontractor, inventory and certain other costs typically become payable before the receivables resulting from work performed are collected. Working capital may also increase when we incur costs for work that is the subject of unpaid retainage, change orders and claims. The typical payment billing terms are due within 30 days but may differ depending on contract terms. Retention on receivables can impact the cash collection cycle beyond expenses incurred. The timing of billings and project completions can contribute to changes in unbilled revenue. As of September 30, 2024, we expect that substantially all unbilled receivables will be billed to customers in the normal course of business within the next 12 months.

Current wording

Working capital, defined as current assets minus current liabilities, was $425.0 million and $403.9 million as of March 31, 2025 and December 31, 2024, respectively. Our working capital requirements may increase when we commence multiple projects or particularly large projects because labor, subcontractor, inventory and certain other costs typically become payable before the receivables resulting from work performed are collected. Working capital may also increase when we incur costs for work that is the subject of unpaid retainage, change orders and claims. The typical payment billing terms are due within 30 days but may differ depending on contract terms. Retention on receivables can impact the cash collection cycle beyond expenses incurred. The timing of billings and project completions can contribute to changes in unbilled revenue. As of March 31, 2025, we expect that substantially all unbilled receivables will be billed to customers in the normal course of business within the next 12 months.

Previous wording

Our cash capital expenditures for thenine months ended September 30, 2024, were$34.5 million, or $24.9 million net of proceeds from asset disposals, compared to$28.1 million, or$15.9 million net of proceeds from asset disposals, for thenine months ended September 30, 2023. Capital expenditures were funded by internal sources, and related-party borrowings from MDU Resources and Centennial. Capital expendituresfor the nine months ended September 30, 2024 and 2023, were primarily used for vehicle and equipment additions to support the growth of our business.

Current wording

Our cash capital expenditures for thethree months ended March 31, 2025, were$18.5 million, or $15.2 million net of proceeds from asset disposals, compared to$9.2 million, or$6.4 million net of proceeds from asset disposals, for thethree months ended March 31, 2024. Capital expenditures were primarily used for vehicle, equipment and building investments to support the growth of our business. For thethree months ended March 31, 2025, capital expenditures were funded by internal sources and borrowings under our credit and financing arrangements. Whereas, for thethree months ended March 31, 2024, capital expenditures were funded by internal sources and related-party borrowings from MDU Resources and Centennial.