Centuri Holdings, Inc. ((CTRI)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Centuri Holdings, Inc. recently held its third-quarter earnings call, revealing a strong performance with record revenue and significant growth in its base business and bookings. Despite these achievements, the company faced challenges such as a decline in gross profit margins, negative free cash flow, and a reduced EBITDA guidance due to storm activity.
Record Revenue and Base Profitability Improvement
Centuri Holdings reported record revenue for Q3 2025, with an 18% increase to $850 million. This impressive growth was accompanied by a notable improvement in base profitability, as adjusted net income rose to $16.7 million, marking an increase of $11.4 million from the previous year.
Significant Base Business Growth
The company experienced a 25% increase in base revenue and a 28% rise in base gross profit compared to the previous year. These figures reflect Centuri’s strong operational performance and strategic growth initiatives.
Robust Bookings and Backlog
Centuri’s Q3 bookings reached approximately $815 million, maintaining a book-to-bill ratio of almost 1. The backlog hit a record high of $5.9 billion, up from $5.3 billion last quarter, indicating strong future demand and a solid pipeline of opportunities.
Strategic Fleet Optimization
The company has initiated strategic fleet optimization efforts, expected to improve fleet efficiency by over 20% and enhance cash generation. This includes entering into operating lease agreements totaling $50 million for equipment.
Strong Segment Growth
Centuri reported strong growth across its segments, with U.S. Gas revenue increasing by 13%, Canadian Gas by nearly 40%, and Union Electric by 25% year-over-year.
Decline in Gross Profit Margin
Despite the overall positive performance, Centuri’s consolidated gross profit margin decreased to 9.2% in Q3 2025 from 10.5% in the prior year. Non-Union Electric margins were particularly impacted by new and expanding MSAs.
Negative Free Cash Flow
The company reported a negative free cash flow of $16.3 million in Q3 2025, primarily due to increased accounts receivable balances. However, normalization is expected in the fourth quarter.
Reduced EBITDA Guidance Due to Storm Activity
Centuri reduced its full-year adjusted EBITDA guidance by $15 million due to lower-than-expected storm activity, which affected its financial outlook.
Forward-Looking Guidance
Looking ahead, Centuri provided updated guidance and key financial metrics. The company revised its full-year revenue guidance to a range of $2.8 billion to $2.9 billion and expects adjusted EBITDA between $240 million and $250 million. With a focus on improving fleet efficiency and strategic growth initiatives, Centuri is optimistic about achieving double-digit revenue growth in 2026.
In summary, Centuri Holdings, Inc.’s earnings call highlighted a strong quarter with record revenue and significant growth in its base business. Despite facing challenges such as a decline in gross profit margins and negative free cash flow, the company remains optimistic about its future prospects, supported by a robust backlog and strategic initiatives aimed at sustaining growth.