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    Earnings call· Dec 2025(Q4 FY25)

    Everus Construction Group Q4 FY25 earnings call ECG

    Feb 25, 2026 Source

    Executive summary

    Everus Construction Group Q4 FY25 — Record Revenue and Backlog Drive Strong Outlook

    Everus Construction Group delivered record Q4 FY25 revenues and full-year EBITDA, driven by robust end markets and strong project execution. The company enters 2026 with a record backlog and a clear growth strategy focused on organic expansion, strategic M&A, and disciplined capital allocation, while actively managing labor availability.

    Highlights

    5

    • Q4 revenue exceeded $1 billion for the first time, up 33% from the prior year period.

    • Full year 2025 adjusted EBITDA increased 52% to $320 million compared to 2024.

    • Backlog reached a record $3.23 billion at year-end 2025, up 16% from the prior year.

    • Q4 EBITDA margin expanded by 70 basis points to 8.4% driven by strong execution.

    • Employee count grew by 8.5% to 9,400, supporting organic growth initiatives.

    Concerns

    3

    • Full year 2025 operating cash flow decreased to $156.8 million from $163.4 million in 2024 due to working capital investment.

    • Free cash flow for 2025 was $100 million, down from $128.8 million in 2024, reflecting increased investments.

    • 2026 EBITDA guidance midpoint (2% growth) is slightly below the long-term model due to difficult comparison with strong 2025 execution.

    Guidance & targets

    6
    CategoryTargetConfidence
    Full-year 2026 Revenue
    $4.1 billion to $4.2 billion
    high materiality
    High
    Full-year 2026 EBITDA
    $320 million to $335 million
    high materiality
    High
    Long-term Capital Spending as % of Revenue
    2% to 2.5%
    medium materiality
    High
    Long-term Net Leverage (Net Debt to TTM EBITDA)
    1.5x to 2x
    high materiality
    High
    Full-year 2026 EBITDA Margin
    just under 8%
    high materiality
    High
    Long-term Revenue Growth
    5% to 7%
    high materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    E&M
    Q4 revenue and EBITDA increased significantly, driven by strong growth in commercial and renewables markets, with data centers being a key driver. EBITDA margin expanded due to strong revenue growth and higher gross margin from project timing and efficient execution, partially offset by higher SG&A.
    EBITDA margin: 8.5%EBITDA margin change YoY: +70 bpsFull year revenue growth: 44%Key driver: data center submarketGrowth drivers: commercial and renewables markets
    		$791.6 million44%—$67.1 million (EBITDA)
    T&D
    Q4 revenue increased, driven by growth in transportation and utility end markets. However, EBITDA was essentially flat as higher revenues were offset by project mix and increased SG&A expenses, leading to a slight contraction in EBITDA margin.
    EBITDA margin: 13.4%EBITDA margin change YoY: -90 bpsGrowth drivers: transportation and utility segment end marketsOffsetting factors: project mix and higher SG&A expenses
    		$227.7 million6.8%—$30.5 million (EBITDA)

    Operational metrics

    16
    Q4 Revenue
    $1.01 billionup 33% YoY
    Q4 FY25

    First time exceeding $1 billion in quarterly revenue.

    Full Year Revenue
    $3.75 billionup 31.5% YoY
    FY25

    Driven by continued momentum in E&M business.

    Q4 EBITDA
    $84.8 millionup 45% YoY
    Q4 FY25

    Driven by solid revenue growth and strong project execution.

    Full Year EBITDA
    $319.8 millionup 37.7% YoY
    FY25

    Due to revenue growth and strong project execution, partially offset by full year impact of incremental stand-alone operating costs.

    Q4 EBITDA Margin
    8.4%up 70 bps YoY
    Q4 FY25

    Compared to 7.7% in Q4 2024.

    Full Year EBITDA Margin
    up 40 bpsYoY
    FY25

    Reported margin increase, with a larger increase when adjusted for stand-alone costs.

    Full Year Capital Expenditures
    $66.8 millionup from $43.8 million in 2024
    FY25

    Consistent with strategy to increase investments supporting organic growth, including the Kansas City prefab facility and T&D equipment.

    Unrestricted Cash and Cash Equivalents
    $152.7 million
    Dec 31, 2025

    Balance sheet position at year-end.

    Gross Debt
    $285 million
    Dec 31, 2025

    Balance sheet position at year-end.

    Available Credit Facility
    $222.8 million
    Dec 31, 2025

    Part of total liquidity.

    Net Leverage (Net Debt to TTM EBITDA)
    0.4x
    Dec 31, 2025

    Well below long-term target of 1.5x to 2x, providing significant financial flexibility.

    Full Year Employee Count
    9,400up from 8,700 at FY24 end
    FY25 end

    Workforce growth to support organic growth initiatives.

    Full Year Annualized Stand-alone Operating Costs
    $28 million
    FY25

    In line with expectations.

    Backlog Burn-off Rate
    80%consistent over many years
    annual

    Approximately 80% of backlog converts to revenue within 12 months.

    Cost-plus Work Share
    50%
    current

    About half of the company's work is cost-plus, typically for large, complex projects.

    T&D MSA Work Share
    55%-60%
    current

    Master Service Agreement (MSA) work provides stability in the T&D segment.

    Industry KPIs

    8
    MetricValueDetails
    Total backlog$3.23 billionUSD
    12 month backlog80%%
    Book to bill ratio—
    End market pipelinerobust
    Acquisition contribution—
    Self perform activity mix50%%
    Same store organic revenue growth31.5%%
    Craft skilled labor headcount capacity9,400employees

    Orderbook & backlog

    3
    Total Backlog$3.23 billionDec 31, 2025

    up 16% YoY

    Approximately 80% of this backlog is expected to burn off within 12 months, providing clear line of sight for 2026 revenues.

    T&D Backlogup 41%Dec 31, 2025

    YoY

    Driven by increases in the utility end market, specifically undergrounding and transmission work.

    E&M Backlogup 13%Dec 31, 2025

    YoY

    Reflecting growth in data center, hospitality, and high-tech markets.

    Product announcements

    1
    ProductTypeDetails
    Kansas City Prefab Facilityexpansion

    Capital programs

    1
    Kansas City Prefab Facilityoperational

    Benefit: Improved safety, increased labor efficiency, lowered costs, improved project timelines, enhanced margins, and strengthened customer relationships.

    The purchase of this new prefab facility was included in the CapEx for 2025, supporting the company's organic growth strategy and expansion of modular construction capabilities.

    Risks & headwinds

    3
    Difficult comparison for 2026 EBITDA guidanceFY26

    2026 EBITDA guidance midpoint reflects 2% growth, below long-term model

    Mitigation: Management believes 2026 EBITDA margin of just under 8% is achievable due to incremental scale benefits and continued execution upside, reflecting a 25% 2-year CAGR adjusted for stand-alone costs.

    Working capital investment impacting cash flowFY25

    FY25 operating cash flow down to $156.8M from $163.4M; FCF down to $100M from $128.8M

    Mitigation: Expected less working capital investment in 2026 as revenue growth moderates, leading to FCF consistent with 2025 despite increased CapEx.

    Industry-wide skilled labor constraintsOngoing

    Labor is crucial for success and a real constraint for the whole industry

    Mitigation: Everus excels in attracting and retaining talent, growing employee count by 8.5% in 2025. They leverage union partnerships, industry relationships, and internal initiatives, and effectively price labor costs into projects.

    What to watch in Q1 FY26

    5

    M&A Execution

    Next quarter / upcoming months
    CurrentBroad and deep pipeline, ample financial flexibility with 0.4x net leverage
    TargetAnnouncement of strategic acquisitions

    Why it matters

    M&A is a key part of the growth playbook to expand geographic footprint, diversify business, or deepen market presence, and leverage the company's strong balance sheet.

    While we remain committed to our organic growth strategies, an important part of our growth playbook going forward⏳ will be strategic acquisitions. We have strengthened our corporate development team and have a broad and deep pipeline of potential deals we are evaluating. We look forward to updating you on our progress.

    Q&A highlights

    6

    Was 2025's exceptional execution repeatable, or is 2026 guidance conservative?

    Management stated that 2025's exceptional margin upside came from diversified contributions across multiple markets. They are confident in achieving the 7.9%-8% EBITDA margin target for 2026, reflecting continued focus on operational excellence and improved execution compared to 2024.

    “We had exceptional margin upside in 2025, and those were diversified contributions from a number of projects. And the 4 most notable ones are from 4 different markets: data center, institutional, transportation, industrial.”

    asked by Ian Zaffino · answered by Jeff Thiede

    2 min read5 chapters

    Detailed Narrative

    01

    Strategic Priorities and 4EVER Framework

    Everus achieved record full year 2025 results, its first year as a stand-alone public company, by focusing on its 4EVER strategic priorities. These priorities emphasize attracting and retaining skilled employees, creating value for customers and shareholders, delivering safe and high-quality execution, and maintaining strong customer relationships. This framework is designed to drive sustained profitable growth, operational excellence, and disciplined capital allocation, leading to strong financial performance.

    02

    Geographic Expansion and Labor Strategy

    The company successfully expanded its geographic footprint through satellite projects, replicating its Southwest entry model in a new location supporting a large semiconductor company. This initial large project is scaling up the new location, aiming for it to become a permanent geography. Everus ended 2025 with 9,400 employees, an 8.5% increase, demonstrating its ability to efficiently grow its workforce through union partnerships and internal initiatives, despite industry-wide labor constraints.

    03

    Operational Excellence and Prefabrication

    Strong execution in 2025 led to a 40 basis point increase in full year EBITDA margin (110 bps adjusted for stand-alone costs). The company's operational playbook, focusing on project selection, bidding discipline, and safety, was key to this success. Investments in prefabrication and modular construction, including a new operational facility in Kansas City, are improving safety, labor efficiency, lowering costs, and enhancing project timelines, which in turn strengthens margins and customer relationships.

    04

    Capital Allocation and M&A Strategy

    Everus prioritizes investments in organic growth and strategic acquisitions, while maintaining financial flexibility. With net leverage at 0.4x and ample credit facility capacity, the company is well-positioned for M&A. It is actively evaluating a broad and deep pipeline of potential deals, seeking accretive transactions that expand geographic footprint, diversify business, or deepen market presence, with a focus on companies providing similar services and sharing values of integrity and operational excellence.

    05

    End-Market Strength and Backlog Visibility

    The company entered 2026 with strong momentum, supported by a record $3.23 billion backlog, up 16% year-over-year. This backlog provides high visibility into 2026 revenues, with approximately 80% expected to convert within 12 months. A robust project pipeline across diverse markets, including data center, hospitality, semiconductor, transmission, and undergrounding, is expected to drive continued backlog growth, with data centers being the largest market in the current backlog.

    AI-generated summary of the company’s earnings call. Not investment advice.