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What changed in Centuri Holdings, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Centuri Holdings, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+355 added−415 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-26)

Top changes in Centuri Holdings, Inc.'s 2025 10-K

355 paragraphs added · 415 removed · 245 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

32 edited+6 added−9 removed27 unchanged
Biggest changeAs of the closing of the Centuri IPO, Southwest Gas Holdings owned 71,665,592 shares of our common stock, or approximately 81% of the total outstanding shares of our common stock. Competition We operate in a highly competitive and highly fragmented industry, as we compete with many regional and local providers. Some national competitors do exist in our industry.
Biggest changeCompetition We operate in a highly competitive and highly fragmented industry, as we compete with many regional and local providers. Some national competitors do exist in our industry. These competitors include Quanta Services, Inc., MYR Group, Mastec, Inc., Primoris Services Corporation and Everus Construction Group, Inc.
Geographic footprint, size, contract type, internal sharing of resources, work mix and breadth of services are key differentiating characteristics in the industry and allow us to uniquely position ourselves to capture opportunities that arise. We are one of the few utility infrastructure service providers that is maintenance-oriented, distribution-focused and has no exposure to cross-country pipeline projects.
Geographic footprint, size, contract type, internal sharing of resources, work mix and breadth of services are key differentiating characteristics in the industry and allow us to uniquely position ourselves to capture opportunities that arise. We are one of the few utility infrastructure service providers that is maintenance-oriented, distribution-focused and have no exposure to cross-country pipeline projects.
Such metrics include Total Recordable Incident Rate (“TRIR”) and Days Away/Restricted/Transferred (“DART”), which are measures that are widely used in the utility infrastructure industry. We also maintain additional behavioral-based programs and extensive employee training initiatives to promote safe work, such as our “Think SAFE” and “Good Catch” programs.
Such metrics include Total Recordable Incident Rate and Days Away/Restricted/Transferred, which are measures that are widely used in the utility infrastructure industry. We also maintain additional behavioral-based programs and extensive employee training initiatives to promote safe work, such as our “Think SAFE” and “Good Catch” programs.
Additionally, the increased programmatic investment for upgrading or replacing older electric and gas utility infrastructure networks, as well as the deployment of “smart” systems and energy transition initiatives, provides a solid growth outlook for the utility services sector and opportunities for service diversification and continuous consolidation among the largest service providers, particularly as utilities reduce their work forces and rely more heavily on scaled service providers.
Additionally, the increased programmatic investment for upgrading or replacing older electric and gas utility infrastructure networks, as well as the deployment of “smart” systems, artificial intelligence (“AI”), and energy transition initiatives, provides a solid growth outlook for the utility services sector and opportunities for service diversification and continuous consolidation among the largest service providers, particularly as utilities reduce their work forces and rely more heavily on scaled service providers.
As part of our Good Catch program, crew members record safety observations to reinforce positive actions and identify the need for corrective action in a peer-to-peer setting. These programs encourage employees to open genuine lines of communication to promote EHSQ awareness on all job sites at all times.
As part of our Good Catch program, crew members record safety observations to reinforce positive actions and identify the need for corrective action in a peer-to-peer setting. These programs encourage employees to open genuine lines 10 Table of Contents of communication to promote EHSQ awareness on all job sites at all times.
We do not expect that continued compliance with such regulations will have a material effect upon capital expenditures, earnings, or our competitive position. Suppliers Under the terms of a majority of our MSAs, materials used in our utility infrastructure service activities are specified, purchased and supplied by our customers.
We do not expect that continued compliance with such regulations will have a material effect upon capital expenditures, earnings, or our competitive position. Suppliers Under the terms of a majority of our MSAs and other customer agreements, materials used in our infrastructure service activities are specified, purchased and supplied by our customers.
With our “Think Ahead” philosophy, we continue to advance our EHSQ goals with investment in programs and initiatives that ensure continuous improvement. Employees receive initial safety orientation training and 10 Table of Contents certifications to learn practices, procedures, and policies established by our businesses. New and recurring safety training occurs at regular intervals thereafter.
With our “Think Ahead” philosophy, we continue to advance our EHSQ goals with investment in programs and initiatives that ensure continuous improvement. Employees receive initial safety orientation training and certifications to learn practices, procedures, and policies established by our businesses. New and recurring safety training occurs at regular intervals thereafter.
We believe that increasing power demands driven by artificial intelligence, advanced manufacturing, and an increase in overall consumer energy use will also require additional infrastructure to support North American energy networks.
We believe that increasing power demands driven by AI, advanced manufacturing, and an increase in overall consumer energy use will also require additional infrastructure to support North American energy networks.
Our vision for building a sustainable business is guided by six guiding principles: ensure the safety of our employees and communities; maintain high standards for environmental stewardship; foster a positive impact in the communities in which we live and work; contribute to a sustained local economy by creating jobs and growing business; bring our differentiated expertise to every quality project we deliver; and maintain a diverse, fair, and welcoming work environment.
Our vision for building a sustainable business is guided by six guiding principles: ensure the safety of our employees and communities; maintain high standards for environmental 9 Table of Contents stewardship; foster a positive impact in the communities in which we live and work; contribute to a sustained local economy by creating jobs and growing business; bring our differentiated expertise to every quality project we deliver; and maintain an inclusive, fair, and welcoming work environment.
Our customers include American Electric Power, Enbridge, Entergy, Exelon, NiSource, National Grid, Sempra Energy and Southern Company, among others. Our top 20 customers are almost exclusively investment-grade utilities and represented 67% of our revenues during fiscal 2024.
Our customers include American Electric Power, Enbridge, Entergy, Exelon, NiSource, National Grid, Sempra Energy and Southern Company, among others. Our top 20 customers are almost exclusively investment-grade utilities and represented 65% of our revenues during fiscal 2025.
Item 1. Business Overview Centuri is a leading North American utility infrastructure services company with over 115 years of operating history that partners with regulated utilities to maintain, upgrade and expand the energy network that powers millions of homes and businesses.
Item 1. Business Overview We are a leading North American utility and energy infrastructure services company with over 115 years of operating history, and we partner with regulated utilities to maintain, upgrade and expand the energy network that powers millions of homes and businesses.
Guided by our values and unwavering commitment to serve as long-term partners to customers and communities, our more than 8,600 employees enable our customers to safely and reliably deliver electricity and natural gas and achieve their goals for environmental sustainability. During the fiscal year ended December 29, 2024 (“fiscal 2024”), we served over 400 customers.
Guided by our values and our unwavering commitment to serve as long-term partners to customers and communities, our more than 9,600 employees enable our customers to safely and reliably deliver electricity and natural gas and achieve their goals for environmental sustainability. During the fiscal year ended December 28, 2025 (“fiscal 2025”), we served over 400 customers.
We believe that the limited number of fixed-price contracts we work under, which represented the remaining 20% of our fiscal 2024 revenue, is among the lowest in the industry and serves to minimize execution risk across our operations.
We believe 7 Table of Contents that the limited number of fixed-price contracts we work under, which represented the remaining 21% of our fiscal 2025 revenue, is among the lowest in the industry and serves to minimize execution risk across our operations.
We currently operate across 87 locations in 45 U.S. states and two Canadian provinces, enabling us to support our customers across multiple geographies. The majority of our customer relationships are governed by long-term master service agreements (“MSAs”), comprising approximately 80% of our total revenue during fiscal 2024.
We currently operate across 97 locations in 46 U.S. states and six Canadian provinces, enabling us to support our customers across multiple geographies. The majority of our customer relationships are governed by long-term master service agreements (“MSAs”), comprising approximately 78% of our total revenue during fiscal 2025.
Gas performs other underground services outside of the gas sector, including water and fiber work, and has an in-house fabrication shop providing pipe and component assembly. The Company is able to cater to the needs of its gas utility services and energy customers by serving union and non-union markets.
In addition, U.S. Gas performs other underground services, including water and fiber, and has an in-house fabrication shop providing pipe and component assembly. This segment is able to cater to the needs of its gas utility services and energy customers by serving union and non-union markets.
Regulatory Environment We are not directly regulated by the state utilities commissions or by the FERC in any of our operating areas.
Regulatory Environment We are not directly regulated by the state utilities commissions or by the Federal Energy Regulatory Commission (“FERC”) in any of our operating areas.
Alternatively, these severe weather events can also delay projects, negatively impacting our results of operations. Severe weather events and the related impacts to our performance and results are not solely within the control of management and cannot always be predicted or mitigated. Sustainability Sustainability is ingrained in our business operations.
Severe weather events and the related impacts to our performance and results are not solely within the control of management and cannot always be predicted or mitigated. Sustainability Sustainability is ingrained in our business operations.
Canadian Gas Canadian Gas provides comprehensive services, including maintenance, replacement, repair and installation for LDCs focused on the modernization of customers’ infrastructure in Canada. The work performed within this segment includes solutions for all stages of utility work and is performed primarily within the distribution, urban transmission and end-user infrastructure, rather than large-scale, project-based, cross-country transmission.
Gas provides comprehensive services, including maintenance, replacement, repair, and installation for local natural gas distribution utilities (“LDCs”) focused on the modernization of customers’ infrastructure throughout the United States. The work performed within this segment includes solutions for all stages of utility work and is performed primarily within the distribution, utility-scale transmission and end-user infrastructure, rather than large-scale, project-based, cross-country transmission.
We regularly engage our various stakeholder groups to ensure our business processes align with their most pressing concerns while supporting our core business strategy. We track and measure an established set of sustainability performance metrics to help us understand and report our overarching impact.
We regularly engage our various stakeholder groups to ensure our business processes align with their most pressing concerns while supporting our core business strategy. We track and measure an established set of sustainability performance metrics to help us understand and report our overarching impact. Our most recent Corporate Sustainability Report can be found on our website at www.Centuri.com/Sustainability.
As of December 29, 2024, we had 8,687 regular full-time equivalent employees working in 45 U.S. states and two Canadian provinces. Employee counts fluctuate between seasonal periods and are typically highest in the summer and fall. Approximately 59% of our employees are represented by unions and covered by collective bargaining agreements.
As of December 28, 2025, we had 9,687 regular full-time equivalent employees working in 46 U.S. states and six Canadian provinces. Employee counts fluctuate between seasonal periods and are typically highest in the summer and fall. Approximately 57% of our employees are represented by unions and covered by collective bargaining agreements.
Since its inception in 2019, our Think SAFE program has proven to be one of our most successful leading indicator initiatives by establishing safety ownership at all levels within the organization from our senior leadership team to our front line. Through Think SAFE visits and activities, leaders encourage safety-focused dialogue with crew members through visible, felt leadership.
Since its inception in 2019, our Think SAFE program has established safety ownership at all levels within the organization from our senior leadership team to our front line. Through Think SAFE visits and activities, leaders encourage safety-focused dialogue with crew members through visible, felt leadership.
Our service offerings primarily consist of the modernization of utility infrastructure through the replacement, maintenance, retrofitting and installation of electric and natural gas distribution and utility-scale transmission networks to meet current and future demands. We also serve complementary, attractive and growing end markets such as renewable energy associated with the expected energy transition, data centers and 5G datacom.
Our service offerings primarily consist of the modernization of utility infrastructure through the replacement, maintenance, retrofitting, and installation of electric and natural gas distribution and utility-scale transmission networks and building capacity to meet current and future demands. We also serve complementary, attractive and growing end markets such as distributed power projects and data centers.
Further, an increased occurrence of extreme weather events has driven, and we believe will continue to drive, an immediate need for assistance from infrastructure providers with appropriate expertise and a large footprint to allow for a quick response.
Further, an increased occurrence of extreme weather events has driven, and we believe will continue to drive, an immediate need for assistance from infrastructure providers with appropriate expertise and a large footprint to allow for a quick response. Our Separation from Southwest Gas Holdings We were previously a privately held subsidiary of Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”).
Revenues typically improve as more favorable weather conditions occur during the summer and fall months. In cases of severe weather, such as following a regional storm, we may be engaged to perform restoration activities related to above-ground utility infrastructure, which typically results in higher margins due to higher equipment utilization and the absorption of fixed costs.
In cases of severe weather, such as following a regional storm, we may be engaged to perform restoration activities related to above-ground utility infrastructure, which typically results in higher margins due to higher equipment utilization and the absorption of fixed costs. Alternatively, these severe weather events can also delay projects, negatively impacting our results of operations.
Numerous infrastructure replacements or upgrades are needed to accommodate incremental demands from the broader transition to clean energy sources. We are strongly positioned to support this transition by providing the infrastructure needed to connect renewable energy to existing distribution systems, as well as expanding electric grid capacity and modernizing electric and gas delivery infrastructure to support future demand.
Numerous infrastructure replacements or upgrades are needed to support North America’s electric grid capacity and modernize electric and gas delivery systems to accommodate future demand. Additionally, we are strongly positioned to support the infrastructure needed to connect renewable energy to existing distribution systems.
Canadian Gas only serves union markets. Union Electric Union Electric provides a comprehensive set of electric utility services encompassing maintenance, replacement, repair, upgrade and expansion services for urban transmission and local distribution infrastructure within union markets.
This segment also provides storm response services and performs construction of electrical systems used in renewable energy projects. Union Electric Union Electric provides a comprehensive set of electric utility services encompassing maintenance, replacement, repair, upgrade, and expansion services for urban transmission and local distribution infrastructure within union markets.
Other Other primarily consists of corporate and non-allocated costs, including corporate facility costs, non-allocated corporate salaries, benefits and incentive compensation. 8 Table of Contents Our Industry Our industry encompasses a range of companies at national, regional and local levels, all of which specialize in providing infrastructure services to electric, gas and combination utilities.
Other Other consists of any corporate and non-allocated transactions. 8 Table of Contents Our Industry Our industry encompasses a range of companies at national, regional and local levels, all of which specialize in providing infrastructure services to electric, gas and combination utilities. The competitive landscape has been consolidating but remains regionally fragmented, with many smaller infrastructure service providers.
These competitors include Quanta Services, Inc., MYR Group, Mastec, Inc., and Primoris Services Corporation. 9 Table of Contents Seasonality Generally, our revenues are lowest during the first quarter of the year due to less favorable winter weather and related working conditions in various geographies within which we work.
Seasonality Generally, our revenues are lowest during the first quarter of the year due to less favorable winter weather and related working conditions in various geographies within which we work. Revenues typically improve as more favorable weather conditions occur during the summer and fall months.
Additionally, of the remaining 20% of our total revenue that was generated from bid contracts, 9% was generated from existing MSA customers. We predominantly perform smaller, lower-risk distribution projects for our customers.
Additionally, of the remaining 22% of our total revenue that was generated from bid contracts, 8% was generated from existing MSA customers. We predominantly perform smaller, lower-risk distribution projects for our customers. Our focus on MSA-driven work, long-term customer partnerships and recurring maintenance-oriented work orders provides us greater visibility to our demand outlook.
Our focus on MSA-driven work, long-term customer partnerships and recurring maintenance-oriented work orders provides us greater visibility to our demand outlook. 7 Table of Contents We maintained a favorable mix of contracts, with 80% of our fiscal 2024 revenue generated from variable-priced contracts (57% of revenue from unit-priced contracts and 23% from time and materials (“T&M”) contracts).
We maintained a favorable mix of contracts, with 79% of our fiscal 2025 revenue generated from variable-priced contracts (56% of revenue from unit-priced contracts and 23% from time and materials (“T&M”) contracts).
On April 17, 2024, the IPO Registration Statement was declared effective, and our common stock began trading on the New York Stock Exchange (the “NYSE”) under the ticker “CTRI” (the “Centuri IPO”) on April 18, 2024.
On April 17, 2024, we completed an initial public offering (the “Centuri IPO”) and began trading on the New York Stock Exchange (the “NYSE”) under the ticker “CTRI”. As of the closing of the Centuri IPO, Southwest Gas Holdings owned 71,665,592 shares of our common stock, or approximately 81% of the total outstanding shares of our common stock.
Gas Utility Services (“U.S. Gas”); (ii) Canadian Gas Utility Services (“Canadian Gas”); (iii) Union Electric Utility Services (“Union Electric”); and (iv) Non-Union Electric Utility Services (“Non-Union Electric”). U.S. Gas U.S. Gas provides comprehensive services, including maintenance, replacement, repair and installation for local natural gas distribution utilities (“LDCs”) focused on the modernization of customers’ infrastructure throughout the United States.
Gas Utility Services (“U.S. Gas”); (ii) Canadian Utility Services (“Canadian Operations”); (iii) Union Electric Utility Services (“Union Electric”); and (iv) Non-Union Electric Utility Services (“Non-Union Electric”). Canadian Operations was previously known as Canadian Gas Utility Services or “Canadian Gas”.
Removed
Examples of this work include supporting installation and maintenance of the infrastructure needed to transport renewable natural gas from dairy farms and landfills, enabling grid connectivity for wind and solar energy, and building out infrastructure for electric vehicle (“EV”) charging stations and battery storage facilities.
Added
We renamed the segment to reflect the expanded scope of services offered by the segment following our acquisition of Connect Atlantic Utility Services Corporation (“Connect”), which is included in this segment. The addition of Connect was the only change in the composition of this segment.
Removed
The work performed within this segment includes solutions for all stages of utility work and is performed primarily within the distribution, utility-scale transmission and end-user infrastructure, rather than large-scale, project-based, cross-country transmission, which we believe substantially limits our execution risk. In addition, U.S.
Added
For additional information regarding the acquisition of Connect and its impact on our results, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Acquisitions” and “Note 8 — Acquisitions” to the consolidated financial statements. U.S. Gas U.S.
Removed
The competitive landscape has been consolidating but remains regionally fragmented, with many smaller infrastructure service providers.
Added
Canadian Operations Canadian Operations provides comprehensive services, including maintenance, replacement, repair, and installation for local gas and electric utilities and energy providers. A majority of the work performed in this segment is focused on distribution, urban transmission and end-user interface under MSAs for gas and electric utilities.
Removed
The top five largest utility service providers in North America, which include Centuri, collectively produced 14% of the 2023 revenues in this industry, while the remaining 86% of those revenues were either produced by a large number of independent, regional providers or represent work self-performed by utilities, according to the ENR Top 600 Specialty Contractors 2024 Report and S&P Global Market Intelligence.
Added
Subsequent to the Centuri IPO, Southwest Gas Holdings fully divested its ownership in us through a series of transactions detailed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview”. Prior to these transactions, Southwest Gas Holdings’ chief executive officer and director, Karen Haller, served as Chair of our Board of Directors (the “Board”).
Removed
Our Separation from Southwest Gas We were incorporated in Delaware in June 2023 as a wholly owned subsidiary of Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”). We were formed for the purpose of completing an initial public offering, facilitating the separation of Centuri Group, Inc.
Added
As a result of Southwest Gas Holdings’ ownership exit, our Board appointed Christopher Krummel as the independent Chair of our Board, effective September 15, 2025, replacing Ms. Haller, who remains a member of our Board. Ms. Haller also resigned from our Board’s compensation committee.
Removed
(“Centuri Group”) from Southwest Gas Holdings and other related transactions in order to carry on the business of Centuri Group, our predecessor for financial reporting purposes. Prior to April 13, 2024, Southwest Gas Holdings owned 1,000 shares of our common stock, representing 100% of the issued and outstanding shares of our common stock.
Added
The information on our website and Sustainability Report does not constitute a part of, and is not incorporated by reference into, this report or any other report we file with (or furnish to) the SEC, whether made before or after the date of this report.
Removed
On April 13, 2024, we issued 71,664,592 shares of common stock to Southwest Gas Holdings as consideration for the transfer of assets and assumption of liabilities of Centuri Group (the “Separation”). Following the completion of the Separation, Centuri Group became our wholly owned subsidiary, and all of our operations are conducted through Centuri Group.
Removed
On April 22, 2024, the Centuri IPO was completed through the sale of 14,260,000 shares of our common stock, par value $0.01 per share, including the underwriters’ full exercise of their option to purchase 1,860,000 shares to cover over-allotments.
Removed
On the same day, the Icahn Group purchased 2,591,929 shares of our common stock in a concurrent private placement at a price per share equal to the Centuri IPO price. The total net proceeds to us from the Centuri IPO and the concurrent private placement, after deducting underwriting discounts and commissions and offering expenses were $327.7 million.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

107 edited+30 added−107 removed302 unchanged
Biggest changeOur operations are reliant on skilled personnel who are trained and qualified to work on utility infrastructure under established safety protocols and operator qualification programs, and in conformance with customer-mandated engineering design specifications. Lapses in judgment or failure to follow protocol could lead to warranty and indemnification liabilities or catastrophic accidents, causing property damage or personal injury.
Biggest changeThe nature of our operations presents inherent risk of loss that could materially and adversely affect our results of operations and financial condition, earnings, and cash flows. Our operations are reliant on skilled personnel who are trained and qualified to work on utility infrastructure under established safety protocols and operator qualification programs, and in conformance with customer-mandated engineering design specifications.
Annual and quarterly results may also be adversely affected by: • changes in our mix of customers, projects, contracts and business; • regional or national and/or general economic conditions and demand for our services; • inability to meet project schedule requirements or achieve guaranteed performance or quality standards for a project, resulting in increased costs through rework, replacement, accelerated work or otherwise, or the payment of liquidated damages to the customer or contract termination, based on the terms of the contract; • variations and changes in the margins of projects performed during any particular quarter; • failure to accurately estimate project costs or accurately establish the scope of our services or make judgments in accordance with applicable professional standards (e.g., engineering standards); • unforeseen circumstances or project modifications not included in our cost estimates or covered by the terms of our contract for the project for which we cannot obtain adequate compensation, including concealed or unknown environmental, geological or geographical site conditions and technical problems such as design or engineering issues; • the termination or expiration of existing agreements or contracts; • the budgetary spending patterns of customers; • changes in the cost or availability of equipment, commodities, materials or labor that we may be unable to pass through to our customers; 13 Table of Contents • cost or schedule overruns on fixed- or unit-price contracts or MSAs, including delays in the delivery or management of design or engineering information, equipment or materials; • our or a customer’s failure to appropriately manage a project, including the inability to timely obtain permits or rights of way or meet other permitting, regulatory or environmental requirements or conditions; • labor shortages, due to disputes with labor unions or other impacts; • inability to negotiate reasonable agreements or contracts with subcontractors, vendors, or other suppliers; • our suppliers’ or subcontractors’ failure to perform; • changes in laws or permitting and regulatory requirements during the course of our work; • natural disasters or emergencies, including wildfires and earthquakes, as well as significant weather events (e.g., hurricanes, tropical storms, tornadoes, floods, droughts, blizzards ice storms, and extreme temperatures) and adverse weather conditions (e.g., prolonged rainfall or snowfall, or early thaw in Canada and the northern United States); • difficult terrain and site conditions where delivery of materials and availability of labor are impacted or where there is exposure to harsh and hazardous conditions; • changes in bonding requirements and bonding availability for existing and new agreements; • the need and availability of letters of credit; • costs we incur to support growth, whether organic or through acquisitions; • protests, legal challenges or other political activity or opposition to a project; • other factors such as terrorism, military action and public health crises (e.g., the conflicts in the Middle East and the ongoing war in Ukraine and associated sanctions severely limiting Russian natural gas or other exports); • the timing and volume of work under contract; and • losses experienced in our operations.
Annual and quarterly results may also be adversely affected by: • changes in our mix of customers, projects, contracts and business; • regional or national and/or general economic conditions and demand for our services; • inability to meet project schedule requirements or achieve guaranteed performance or quality standards for a project, resulting in increased costs through rework, replacement, accelerated work or otherwise, or the payment of liquidated damages to the customer or contract termination, based on the terms of the contract; • variations and changes in the margins of projects performed during any particular quarter; • failure to accurately estimate project costs or accurately establish the scope of our services or make judgments in accordance with applicable professional standards (e.g., engineering standards); • unforeseen circumstances or project modifications not included in our cost estimates or covered by the terms of our contract for the project for which we cannot obtain adequate compensation, including concealed or unknown environmental, geological or geographical site conditions and technical problems such as design or engineering issues; • the termination or expiration of existing agreements or contracts; • the budgetary spending patterns of customers; • changes in the cost or availability of equipment, commodities, materials or labor that we may be unable to pass through to our customers; • cost or schedule overruns on fixed- or unit-price contracts or MSAs, including delays in the delivery or management of design or engineering information, equipment or materials; • our or a customer’s failure to appropriately manage a project, including the inability to timely obtain permits or rights of way or meet other permitting, regulatory or environmental requirements or conditions; • labor shortages, due to disputes with labor unions or other impacts; • inability to negotiate reasonable agreements or contracts with subcontractors, vendors, or other suppliers; • our suppliers’ or subcontractors’ failure to perform; • changes in laws or permitting and regulatory requirements during the course of our work; • natural disasters or emergencies, including wildfires and earthquakes, as well as significant weather events (e.g., hurricanes, tropical storms, tornadoes, floods, droughts, blizzards ice storms, and extreme temperatures) and adverse weather conditions (e.g., prolonged rainfall or snowfall, or early thaw in Canada and the northern United States); • difficult terrain and site conditions where delivery of materials and availability of labor are impacted or where there is exposure to harsh and hazardous conditions; • changes in bonding requirements and bonding availability for existing and new agreements; • the need and availability of letters of credit; • costs we incur to support growth, whether organic or through acquisitions; • protests, legal challenges or other political activity or opposition to a project; • other factors such as terrorism, military action and public health crises (e.g., the conflicts in the Middle East and the ongoing war in Ukraine and associated sanctions severely limiting Russian natural gas or other exports); 13 Table of Contents • the timing and volume of work under contract; and • losses experienced in our operations.
If our claims costs exceed our estimates of liability exposures, if our claims increase, or if our insurance coverage proves to be inadequate or becomes unavailable, we could experience increased exposure to risk and/or a decline in profitability and liquidity.
If our claims costs exceed our estimates of liability exposures, if our claims increase, or if our insurance coverage proves to be inadequate or becomes unavailable, we could experience increased exposure to risk and/or a decline in profitability and liquidity.
We have and continue to experience pressures on fuel, materials, and certain labor costs as a result of the inflationary environment and current general labor shortage, which has resulted in increased competition for skilled labor and wage inflation.
We have and continue to experience pressures on fuel, materials, and certain labor costs as a result of the inflationary environment and current general labor shortage, which labor shortage has resulted in increased competition for skilled labor and wage inflation.
Under the Code and the related rules and regulations, each corporation that was a member of the Southwest Gas Holdings consolidated group during any part of the consolidated return year is severally liable for the U.S. federal income tax liability of the entire Southwest Gas Holdings consolidated group for that year.
Under the Code and the related rules and regulations, each corporation that was a member of the Southwest Gas Holdings consolidated group during any part of any consolidated return year is severally liable for the U.S. federal income tax liability of the entire Southwest Gas Holdings consolidated group for that year.
In addition, our operating results could be below the expectations of public market analysts and investors due to a number of potential factors, including variations in our quarterly operating results or dividends, if any, to stockholders, additions or departures of key management personnel, failure to meet analysts’ earnings estimates, publication of research reports about our industry, litigation and government investigations, changes or proposed changes in laws or regulations or differing interpretations or enforcement thereof affecting our business, adverse market reaction to any indebtedness we may incur or securities we may issue in the future, changes in market valuations of similar companies or speculation in the press or investment community, announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments, adverse publicity about the industries we participate in or individual scandals, and in response the market price of shares of our common stock could decrease significantly.
In addition, our operating results could be below the expectations of public market analysts and investors due to a number of potential factors, including variations in our quarterly operating results or dividends, if any, to stockholders, additions or departures of key management personnel, failure to meet analysts’ earnings estimates, publication of research reports about our industry, litigation and government investigations, changes or proposed changes in laws or regulations or differing interpretations or enforcement thereof affecting our business, adverse market reaction to any indebtedness we may incur or securities we may issue in the future, changes in market valuations of similar companies, investments by activist investors in our common stock or speculation in the press or investment community, announcements by us or our competitors of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures or capital commitments, adverse publicity about the industries we participate in or individual scandals, and in response the market price of shares of our common stock could decrease significantly.
Competition for senior management is intense, and we may not be able to adequately incentivize or retain our personnel. For example, we recently appointed a new Chief Executive Officer, who joined the Company on December 3, 2024.
Competition for senior management is intense, and we may not be able to adequately incentivize or retain our personnel. For example, we appointed a new Chief Executive Officer, who joined the Company on December 3, 2024.
Our Charter provides that, unless we consent otherwise, the Court of Chancery of the State of Delaware or, if the Court of Chancery of the State of Delaware determines that it does not have subject matter jurisdiction, another state court located within the State of Delaware (or, if no state court located within the State of Delaware has jurisdiction, the federal court for the District of Delaware), will be the sole and exclusive forum for any (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any current or former director or officer or other employee or stockholder of Centuri in such capacity to Centuri or to Centuri stockholders, including a claim alleging the aiding and abetting of such a breach of fiduciary duty, (iii) any action asserting a claim against us or any current or former director or officer or other employee or stockholder of Centuri in such capacity arising pursuant to any provision of the DGCL or our Charter or Bylaws, (iv) any action asserting a claim relating to or involving 41 Table of Contents Centuri governed by the internal affairs doctrine, or (v) any action asserting an “internal corporate claim” as such term is defined in Section 115 of the DGCL.
Our Charter provides that, unless we consent otherwise, the Court of Chancery of the State of Delaware or, if the Court of Chancery of the State of Delaware determines that it does not have subject matter jurisdiction, another state court located within the State of Delaware (or, if no state court located within the State of Delaware has jurisdiction, the federal court for the District of Delaware), will be the sole and exclusive forum for any (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any current or former director or officer or other employee or stockholder of Centuri in such capacity to Centuri or to Centuri stockholders, including a claim alleging the aiding and abetting of such a breach of fiduciary duty, (iii) any action asserting a claim against us or any current or former director or officer or other employee or stockholder of Centuri in such capacity arising pursuant to any provision of the DGCL or our Charter or Bylaws, (iv) any action asserting a claim relating to or involving Centuri governed by the internal affairs doctrine, or (v) any action asserting an “internal corporate claim” as such term is defined in Section 115 of the DGCL.
Furthermore, completed acquisitions may expose us to operational challenges and risks, including, among others: • the diversion of management’s attention from the day-to-day operations of the combined company; • managing a larger company than before completion of an acquisition; 18 Table of Contents • the assimilation of new employees and the integration of business cultures; • training and facilitating our internal control processes within the acquired organization; • retaining key personnel; • the integration of information, accounting, finance, sales, billing, payroll and regulatory compliance systems; • challenges in keeping existing customers and obtaining new customers; • challenges in combining service offerings and sales and marketing activities; • the assumption of liabilities of the acquired business for which there are inadequate reserves; • the potential impairment of acquired goodwill and intangible assets; and • the inability to enforce covenants not to compete.
Furthermore, completed acquisitions may expose us to operational challenges and risks, including, among others: • the diversion of management’s attention from the day-to-day operations of the combined company; • managing a larger company than before completion of an acquisition; • the assimilation of new employees and the integration of business cultures; • training and facilitating our internal control processes within the acquired organization; • retaining key personnel; • the integration of information, accounting, finance, sales, billing, payroll and regulatory compliance systems; • challenges in keeping existing customers and obtaining new customers; • challenges in combining service offerings and sales and marketing activities; • the assumption of liabilities of the acquired business for which there are inadequate reserves; • the potential impairment of acquired goodwill and intangible assets; and • the inability to enforce covenants not to compete.
These prices could be materially impacted by general market conditions, inflationary pressures, and other factors, including U.S. trade relationships with other countries or the imposition or increase of tariffs.
These prices could be materially impacted by general market conditions, inflationary pressures, and other factors, including U.S. trade relationships with other countries or the imposition or future increase of tariffs.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Goodwill and Long-Lived Assets” for additional information. 27 Table of Contents Changes in applicable tax laws and regulations could adversely affect our business. We are currently subject to income and other taxes (including sales, excise, and value-added) in the United States and Canada.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates—Goodwill and Long-Lived Assets” for additional information. 26 Table of Contents Changes in applicable tax laws and regulations could adversely affect our business. We are currently subject to income and other taxes (including sales, excise, and value-added) in the United States and Canada.
While we have security, internal control and technology measures in place to protect our systems and network, if these measures fail as a result of a cyber attack, other third-party action, employee error, malfeasance or other security failure, 19 Table of Contents and someone obtains unauthorized access to our or our employees’ or customers’ information, our reputation could be damaged, our business may suffer and we could incur significant liability, or, in some cases, we may lose access to our business data or systems, incur significant remediation costs or be subject to demands to pay ransom.
While we have security, internal control and technology measures in place to protect our systems and network, if these measures fail as a result of a cyber attack, other third-party action, employee error, malfeasance or other security failure, and someone obtains unauthorized access to our or our employees’ or customers’ information, our reputation could be damaged, our business may suffer and we could incur significant liability, or, in some cases, we may lose access to our business data or systems, incur significant remediation costs or be subject to demands to pay ransom.
Generally, under our contracts we are responsible for any non-hazardous or hazardous substances and wastes we bring on to a jobsite 32 Table of Contents or that we generate secondary to the work we perform, which liabilities could arise from violations of environmental laws and regulations as a result of human error, equipment failure or other causes.
Generally, under our contracts we are responsible for any non-hazardous or hazardous substances and wastes we bring on to a jobsite or that we generate secondary to the work we perform, which liabilities could arise from violations of environmental laws and regulations as a result of human error, equipment failure or other causes.
This workforce competition, including that which exists for resources across our businesses, could materially and adversely impact our business, financial condition, results of operations, and cash flows. We may not be able to maintain an adequately skilled labor force necessary to operate efficiently and to support our growth strategy.
This workforce competition, including that which exists for resources across our businesses, could materially and adversely impact our business, financial condition, results of operations, and cash flows. 22 Table of Contents We may not be able to maintain an adequately skilled labor force necessary to operate efficiently and to support our growth strategy.
If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures, or to dispose of material assets or operations, alter our dividend policy (if we pay dividends), seek additional debt or equity capital or restructure or refinance our indebtedness.
If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures, or to dispose of material assets or operations, alter our dividend policy (if we pay dividends), seek additional debt or equity capital or restructure or 24 Table of Contents refinance our indebtedness.
An uninsured or underinsured claim could have an adverse impact on our business, financial condition, results of operations and cash flows. Many of our customers are regulated by federal and state government agencies and the addition of new regulations or changes to existing regulations may adversely impact demand for our services and the profitability of those services.
An uninsured or underinsured claim could have an adverse impact on our business, financial condition, results of operations and cash flows. 31 Table of Contents Many of our customers are regulated by federal and state government agencies and the addition of new regulations or changes to existing regulations may adversely impact demand for our services and the profitability of those services.
If we fail to integrate acquisitions successfully, we may experience operational challenges and risks which may have a material adverse effect on our business. As part of our growth strategy, we have and may continue to acquire companies that expand, complement or diversify our business. For example, we acquired Riggs Distler & Company, Inc.
If we fail to integrate acquisitions successfully, we may experience operational challenges and risks which may have a material adverse effect on our business. As part of our growth strategy, we have and may continue to acquire companies that expand, complement or diversify our business. For example, we acquired Connect in 2025, Riggs Distler & Company, Inc.
In addition, if our safety record were to substantially deteriorate, or if we suffered substantial penalties or criminal prosecution for violation of health and safety regulations, business customers could cancel existing contracts and not award future business to us, which could materially and adversely affect our liquidity, cash flows and results of operations.
In addition, if our safety record were to substantially deteriorate, or if we suffered substantial penalties or criminal prosecution for violation of health and safety 32 Table of Contents regulations, business customers could cancel existing contracts and not award future business to us, which could materially and adversely affect our liquidity, cash flows and results of operations.
The loss of work obtained through MSAs and long-term contracts or the reduced profitability of such work, could materially and adversely affect our business or results of operations. 14 Table of Contents Backlog may not be realized or may not result in revenue or profit. Backlog is measured and defined differently by companies within our industry.
The loss of work obtained through MSAs and long-term contracts or the reduced profitability of such work, could materially and adversely affect our business or results of operations. Backlog may not be realized or may not result in revenue or profit. Backlog is measured and defined differently by companies within our industry.
Legislative and regulatory proposals to address greenhouse gas emissions could result in a variety of regulatory programs, additional charges to fund energy efficiency activities, or other regulatory actions. Any of these actions could result in increased costs associated with our operations and impact the prices we charge our customers.
Federal, state, and local legislative and regulatory proposals to address greenhouse gas emissions could result in a variety of regulatory programs, additional charges to fund energy efficiency activities, or other regulatory actions. Any of these actions could result in increased costs associated with our operations and impact the prices we charge our customers.
For example, periodically there are shortages of project managers, field supervisors, linemen, 23 Table of Contents operators, welders, fusers, laborers and other skilled workers capable of working on and supervising the construction and maintenance of electric and natural gas utilities and infrastructure, as well as providing engineering services.
For example, periodically there are shortages of project managers, field supervisors, linemen, operators, welders, fusers, laborers and other skilled workers capable of working on and supervising the construction and maintenance of electric and natural gas utilities and infrastructure, as well as providing engineering services.
Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder, and as a result, the exclusive forum provision does not apply to actions arising under the Exchange Act or the rules and regulations thereunder.
Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations 36 Table of Contents thereunder, and as a result, the exclusive forum provision does not apply to actions arising under the Exchange Act or the rules and regulations thereunder.
Any delay or failure by suppliers or by third-party subcontractors in the completion of their portion of the project may result in delays in the overall progress of the project or may cause us to incur additional costs, or both. We may not be able to recover the costs we incur that are caused by delays.
Any delay or failure by suppliers or by third-party subcontractors in the completion of their portion of the project may result in delays in the overall progress of the project or may cause us to incur additional costs, or both. We may not be able 21 Table of Contents to recover the costs we incur that are caused by delays.
If any of the forgoing events occur, it could cause our stock price to fall and may expose us to lawsuits, including securities class action litigation, that, even if unsuccessful, could result in substantial costs and divert our management’s attention and 38 Table of Contents resources.
If any of the forgoing events occur, it could cause our stock price to fall and may expose us to lawsuits, including securities class action litigation, that, even if unsuccessful, could result in substantial costs and divert our management’s attention and resources.
A variety of factors could adversely affect the timing or profitability of our projects, which may result in additional costs to us, reductions or delays in revenues, the payment of liquidated damages or project termination. • We derive a significant portion of our revenues from long-term MSAs that may be cancelled by customers on short notice, or which we may be unable to renew on favorable terms or at all. • Backlog may not be realized or may not result in anticipated revenue or profit. • Our actual cost may be greater than expected in performing our contracts due to various factors, causing us to realize significantly lower profit or experience losses on our projects. • Fixed-price and unit-price contracts are subject to potential losses that could materially and adversely affect our results of operations. • The nature of our operations presents inherent risk of loss that could materially and adversely affect our results of operations and financial condition, earnings and cash flows. • We operate in a highly competitive industry, and competitive pressures could negatively affect our business, which is largely dependent on the competitive bidding process. • Challenges relating to supply chain constraints have negatively affected, and may in the future negatively affect, our work mix and volumes, which could materially and adversely affect our results of operations overall. • Our business could be negatively affected as a result of actions of activist stockholders. • Failure to attract and retain an appropriately qualified employee workforce could materially and adversely affect our collective operations.
A variety of factors could adversely affect the timing or profitability of our projects, which may result in additional costs to us, reductions or delays in revenues, the payment of liquidated damages or project termination. • We derive a significant portion of our revenues from long-term MSAs that may be cancelled by customers on short notice, or which we may be unable to renew on favorable terms or at all. • Backlog may not be realized or may not result in anticipated revenue or profit. • Our actual cost may be greater than expected in performing our contracts due to various factors, causing us to realize significantly lower profit or experience losses on our projects. 11 Table of Contents • Fixed-price and unit-price contracts are subject to potential losses that could materially and adversely affect our results of operations. • The nature of our operations presents inherent risk of loss that could materially and adversely affect our results of operations and financial condition, earnings and cash flows. • We operate in a highly competitive industry, and competitive pressures could negatively affect our business, which is largely dependent on the competitive bidding process. • Challenges relating to supply chain constraints have negatively affected, and may in the future negatively affect, our work mix and volumes, which could materially and adversely affect our results of operations overall. • Our business could be negatively affected as a result of action of activist stockholders. • Failure to attract and retain an appropriately qualified employee workforce could materially and adversely affect our collective operations. • Potential indemnification liabilities to Southwest Gas Holdings could materially and adversely affect our businesses, financial condition, results of operations and cash flows.
Weather-related events, changes in tariff-policy with the new administration, inflationary pressure, a fluctuating labor market, and geopolitical instability, among others, have also contributed to and exacerbated this strain within and outside the United States, and there can be no assurance that these impacts on the supply chain will not continue, or worsen, in the future, negatively impacting any of our operating business lines and their results.
Weather-related events, changes in U.S. tariff-policy, inflationary pressure, a fluctuating labor market, and geopolitical instability, among others, have also contributed to and exacerbated this strain within and outside the United States, and there can be no assurance that these impacts on the supply chain will not continue, or worsen, in the future, negatively impacting any of our operating business lines and their results.
Inflationary pressures and related recessionary concerns in light of governmental and central bank efforts to mitigate inflation could also cause uncertainty for our customers and affect the level of their project activity, which could also adversely affect our profitability and cash flows.
Inflationary pressures and related recessionary concerns in light of governmental and 28 Table of Contents central bank efforts to mitigate inflation could also cause uncertainty for our customers and affect the level of their project activity, which could also adversely affect our profitability and cash flows.
In addition, Southwest Gas Holdings’ insurance will not necessarily be available to us for liabilities associated with occurrences of indemnified liabilities prior to the Separation, and in any event Southwest Gas Holdings’ insurers may deny coverage to us for liabilities associated with certain occurrences of indemnified liabilities prior to the Separation.
In addition, Southwest Gas Holdings’ insurance will not necessarily be available to us for liabilities associated with occurrences of indemnified liabilities prior to the Separation, and in any event Southwest 27 Table of Contents Gas Holdings’ insurers may deny coverage to us for liabilities associated with certain occurrences of indemnified liabilities prior to the Separation.
This customer concentration could adversely affect operating results if construction work slowed or halted with one or more of these customers, if competition for work increased, or if existing contracts were terminated or not replaced or extended.
This customer concentration could adversely affect operating results if construction work slowed or halted with one or more of these customers, if competition for work increased, or if existing contracts were terminated or not replaced or 12 Table of Contents extended.
Additionally, the impact of new regulatory and compliance requirements could result in 28 Table of Contents productivity inefficiencies and have a material adverse effect on our results of operations and cash flows, or timing delays in their realization.
Additionally, the impact of new regulatory and compliance requirements could result in productivity inefficiencies and have a material adverse effect on our results of operations and cash flows, or timing delays in their realization.
In addition, we generally indemnify our customers for claims related to the services we provide and actions we and others take under our contracts, and, in some instances, we may be allocated risk through our contract terms for actions by our joint venture partners, equity investments, customers or other third parties.
In addition, we generally indemnify our customers for claims related to the services we provide and actions we and 30 Table of Contents others take under our contracts, and, in some instances, we may be allocated risk through our contract terms for actions by our joint venture partners, equity investments, customers or other third parties.
Because we do not intend to pay dividends on our common stock, any income derived from our common stock would only come from a rise in the market price of our common stock, which is uncertain and unpredictable. Our stockholders’ percentage ownership in us may be diluted in the future.
Because we do not intend to pay dividends on our common stock, any income derived from our common stock would only come from a rise in the market price of our common stock, which is uncertain and unpredictable. Our stockholders’ percentage ownership in us may be diluted in the future. We are not restricted from issuing additional common stock.
These conditions also 29 Table of Contents require certain areas to scale back their workforce at times during the winter season, presenting challenges associated with maintaining an adequately skilled labor force when it comes time to re-staffing work crews following the winter layoffs.
These conditions also require certain areas to scale back their workforce at times during the winter season, presenting challenges associated with maintaining an adequately skilled labor force when it comes time to re-staffing work crews following the winter layoffs.
In most cases, our subsidiaries continue to operate under the same brand names 16 Table of Contents they operated under before we acquired them. Our brands and reputation are among our most important assets, and our ability to attract and retain customers depends on brand recognition and reputation in the markets in which we operate.
In most cases, our subsidiaries continue to operate under the same brand names they operated under before we acquired them. Our brands and reputation are among our most important assets, and our ability to attract and retain customers depends on brand recognition and reputation in the markets in which we operate.
For example, we could grant the holders of preferred stock the right to elect some number of our directors in all events or on the occurrence of specified events or the right to veto specified transactions.
For example, we could grant the holders of preferred stock the right to elect some number of our 35 Table of Contents directors in all events or on the occurrence of specified events or the right to veto specified transactions.
Consequently, if Southwest Gas Holdings is unable to pay the consolidated U.S. federal income tax liability for a prior period, we could be required to pay the entire amount of such tax, which could be substantial and in excess of the amount that would be allocated to us under the Tax Matters Agreement.
Consequently, if Southwest Gas Holdings is unable to pay the consolidated U.S. federal income tax liability for a period in which we were a member of its consolidated group, we could be required to pay the entire amount of such tax, which could be substantial and in excess of the amount that would be allocated to us under the Tax Matters Agreement.
We also are exposed to currency risks relating to the translation of certain monetary transactions, assets and liabilities. In addition, U.S. relations with the rest of the world, including Canada, remains uncertain with respect to taxes, trade policies and tariffs, especially as the political landscape changes due to the recent U.S. presidential and congressional elections.
We also are exposed to currency risks relating to the translation of certain monetary transactions, assets and liabilities. In addition, U.S. relations with the rest of the world, including Canada, remains uncertain with respect to taxes, trade policies and tariffs, especially as the political landscape changes.
In addition, as of December 29, 2024, we had $125.0 million outstanding under our accounts receivable securitization facility, which is an off-balance sheet arrangement and not classified as debt on our balance sheet.
In addition, as of December 28, 2025, we had $125.0 million outstanding under our accounts receivable securitization facility, which is an off-balance sheet arrangement and not classified as debt on our balance sheet.
Our unionized workforce and related obligations could materially and adversely affect our operations, lead to work stoppages or impact our ability to complete certain acquisitions. As of December 29, 2024, approximately 59% of our workforce was covered by collective bargaining agreements with labor unions, which is typical of the utility infrastructure services industry.
Our unionized workforce and related obligations could materially and adversely affect our operations, lead to work stoppages or impact our ability to complete certain acquisitions. As of December 28, 2025, approximately 57% of our workforce was covered by collective bargaining agreements with labor unions, which is typical of the utility infrastructure services industry.
We derive a significant portion of our revenues from long-term MSAs that may be cancelled by customers on short notice, or which we may be unable to renew on favorable terms or at all. During the fiscal year ended December 29, 2024, approximately 80% of our total revenue was generated from long-term MSAs.
We derive a significant portion of our revenues from long-term MSAs that may be cancelled by customers on short notice, or which we may be unable to renew on favorable terms or at all. During the fiscal year ended December 28, 2025, approximately 78% of our total revenue was generated from long-term MSAs.
Successful completion of our contracts may depend on whether our subcontractors successfully fulfill their contractual obligations. During the fiscal year ended December 29, 2024, we subcontracted approximately 16% of our services.
Successful completion of our contracts may depend on whether our subcontractors successfully fulfill their contractual obligations. During the fiscal year ended December 28, 2025, we subcontracted approximately 16% of our services.
In recent years, the Board of Governors of the United States Federal Reserve Bank (the “Federal Reserve”) has raised benchmark interest rates to combat continued inflation and may potentially continue to do so, which likely will cause our borrowing costs to increase over time.
In recent years, the Board of Governors of the United States Federal Reserve Bank (the “Federal Reserve”) has raised benchmark interest rates to combat inflation and may potentially do so again in the future, which likely would cause our borrowing costs to increase over time.
Warranty claims have historically not been material, but such claims could potentially increase. The costs associated with such warranties, including any warranty-related legal proceedings, could have a material adverse effect on our results of operations, cash flows and liquidity. Our business involves judgments regarding the planning, design, development, construction, operations and management of electric power transmission and commercial construction.
The costs associated with such warranties, including any warranty-related legal proceedings, could have a material adverse effect on our results of operations, cash flows and liquidity. Our business involves judgments regarding the planning, design, development, construction, operations and management of electric power transmission and commercial construction.
We could experience reduced profits, cost overruns or project losses if we fail to properly document the nature of change orders or claims or are otherwise unsuccessful in negotiating an expected settlement.
Similarly, we present change orders and claims to our subcontractors and suppliers. We could experience reduced profits, cost overruns or project losses if we fail to properly document the nature of change orders or claims or are otherwise unsuccessful in negotiating an expected settlement.
If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even if the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease. Our weighted average interest rate on our variable rate debt during the fiscal year ended December 29, 2024 was 8.05%.
If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even if the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease. Our weighted average interest rate on our variable rate debt during the fiscal year ended December 28, 2025 was 6.59%.
The instruments that will govern our indebtedness may restrict our ability to dispose of assets and may restrict the use of 25 Table of Contents proceeds from those dispositions. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet debt service obligations when due.
The instruments that will govern our indebtedness may restrict our ability to dispose of assets and may restrict the use of proceeds from those dispositions. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet debt service obligations when due. In addition, we conduct our operations through our subsidiaries.
Of the 324 collective bargaining agreements to which we currently are a party, 50 expire during 2025 and 21 expire during 2026 and require renegotiation. The terms of these agreements limit our discretion in the management of covered employees and our ability to nimbly implement changes to meet business needs.
Of the 332 collective bargaining agreements to which we currently are a party, 27 expire during 2026 and 14 expire during 2027 and require renegotiation. The terms of these agreements limit our discretion in the management of covered employees and our ability to nimbly implement changes to meet business needs.
The current supply chain challenges, including, for example, the recent efforts to impose tariffs on imported goods from certain countries outside of the United States, could also result in increased use of cash, engineering design changes, and delays in the completion of projects, each of which could adversely impact our business and results of operations.
The current supply chain challenges, including, for example, the imposition of expansive tariffs on imported goods to the United States, could also result in increased use of cash, engineering design changes, and delays in the completion of projects, each of which could adversely impact our business and results of operations.
We intend to grow our business organically as well as through acquisitions. Occasionally, we may issue shares of common stock as consideration in our acquisitions, and we may have the option to issue shares of our common stock instead of cash as consideration for future earn-out obligations.
Occasionally, we may issue shares of common stock as consideration in our acquisitions, and we may have the option to issue shares of our common stock instead of cash as consideration for future earn-out obligations.
Item 1A. Risk Factors Risk Factor Summary An investment in shares of our common stock is subject to a number of risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition.
Item 1A. Risk Factors Risk Factor Summary An investment in shares of our common stock is subject to a number of risks that may prevent us from achieving our business objectives or otherwise adversely affect our business, results of operations or financial condition. The following list contains a summary of some, but not all, of these risks.
These provisions include, among others: • the inability of our stockholders to call a special meeting; • after Southwest Gas Holdings no longer beneficially owns 50% of the total voting power of our outstanding shares, the inability of our stockholders to act by written consent; • rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; • the right of the Board to issue preferred stock without stockholder approval; • the ability of our directors, and not stockholders (other than Southwest Gas Holdings, which has a right to fill certain vacancies), to fill vacancies (including those resulting from an enlargement of the Board) on the Board; and • the requirement that the affirmative vote of stockholders holding at least two-thirds of our voting stock is required to amend certain provisions in our Bylaws and certain provisions in our Charter.
These provisions include, among others: • the inability of our stockholders to call a special meeting; • the inability of our stockholders to act by written consent; • rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; • the right of the Board to issue preferred stock without stockholder approval; • the ability of our directors, and not stockholders, to fill vacancies (including those resulting from an enlargement of the Board) on the Board; and • the requirement that the affirmative vote of stockholders holding at least two-thirds of our voting stock is required to amend certain provisions in our Bylaws and our Charter.
Our ability to generate internal growth may be adversely affected if, among other factors, we are unable to: • attract new customers; • increase the number of projects or amount of work performed for existing customers; • hire and retain qualified personnel; • secure appropriate levels of construction equipment; • successfully bid for new projects; or • adapt the range of services we offer to address our customers’ evolving needs. 17 Table of Contents In addition, our customers may reduce the number or size of projects available to us due to their inability to obtain capital.
Our ability to generate internal growth may be adversely affected if, among other factors, we are unable to: • attract new customers; • increase the number of projects or amount of work performed for existing customers; • hire and retain qualified personnel; • secure appropriate levels of construction equipment; • successfully bid for new projects; or • adapt the range of services we offer to address our customers’ evolving needs.
The annual effect on our pretax earnings of a hypothetical 100 basis point increase or decrease in variable interest rates would be approximately $8.2 million based on our December 29, 2024 balance of variable rate debt.
The annual effect on our pretax earnings of a hypothetical 100 basis point increase or decrease in variable interest rates would be approximately $7.1 million based on our December 28, 2025 balance of variable rate debt.
We also rely, in part, on third-party software and information technology to run certain of our critical accounting, project management, financial information, human resource information and risk management information systems. From time to time, we experience system interruptions and delays.
We are heavily reliant on information and communications technology, computer and other related systems in order to operate. We also rely, in part, on third-party software and information technology to run certain of our critical accounting, project management, financial information, human resource information and risk management information systems. From time to time, we experience system interruptions and delays.
Failure to complete the project as scheduled or at the contracted performance standards could result in additional costs or penalties, including liquidated damages, and such amounts could exceed expected project profit, which could have a material adverse impact on our financial condition, results of operations and cash flows. 15 Table of Contents The nature of our operations presents inherent risk of loss that could materially and adversely affect our results of operations and financial condition, earnings, and cash flows.
Failure to complete the project as scheduled or at the contracted performance standards could result in additional costs or penalties, including liquidated damages, and such amounts could exceed expected project profit, which could have a material adverse impact on our financial condition, results of operations and cash flows.
We are self-insured against many potential liabilities, and there can be no assurance that our insurance coverages will be sufficient under all circumstances or against all claims to which we may be subject, which could expose us to significant liabilities and materially and adversely affect our business, financial condition, results of operations and cash flows.
If the reputation or perceived quality of our brands decline or customers lose confidence in us, our business, financial condition, results of operations, or cash flows could be materially and adversely affected. 16 Table of Contents We are self-insured against many potential liabilities, and there can be no assurance that our insurance coverages will be sufficient under all circumstances or against all claims to which we may be subject, which could expose us to significant liabilities and materially and adversely affect our business, financial condition, results of operations and cash flows.
In addition, claims, lawsuits and proceedings may harm our reputation or divert management’s attention from our business or divert resources away from operating our business and cause us to incur significant expenses, any of which could have a material adverse effect on our business, results of operations or financial condition. 30 Table of Contents Our failure to recover adequately on claims against project owners, subcontractors or suppliers for payment or performance could have a material adverse effect on our financial results.
In addition, claims, lawsuits and proceedings may harm our reputation or divert management’s attention from our business or divert resources away from operating our business and cause us to incur significant expenses, any of which could have a material adverse effect on our business, results of operations or financial condition.
For example, during the fiscal year ended December 29, 2024, approximately 43% of our revenues were generated collectively from our top ten customers and approximately 67% of our revenues were generated collectively from our top 20 customers.
For example, during the fiscal year ended December 28, 2025, approximately 48% of our revenues were generated collectively from our top ten customers and approximately 65% of our revenues were generated collectively from our top 20 customers.
If we were to experience an interruption or reduction in the availability of bonding capacity as a result of these or any other reasons, we may be unable to compete for or work on certain projects that would require bonding.
If we were to experience an interruption or reduction in the availability of bonding capacity as a result of these or any other reasons, we may be unable to compete for or work on certain projects that would require bonding. 25 Table of Contents A downgrade in our debt rating could restrict our ability to access the capital markets.
As of December 29, 2024, we had outstanding indebtedness of approximately $898.2 million, including finance lease liabilities, and had the ability to incur approximately $151 million in additional indebtedness under our existing revolving 24 Table of Contents credit agreement when considering our covenants.
As of December 28, 2025, we had outstanding indebtedness of approximately $754.2 million, including finance lease liabilities, and had the ability to incur approximately $302.4 million in additional indebtedness under our existing revolving credit agreement when considering our covenants.
At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed or operating.
Further, we are also required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting, and our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed or operating.
If our work processes become obsolete, through technological advancements or otherwise, we may not be able to differentiate our service offerings and some of our competitors may be able to offer more attractive services to our customers, which could materially and adversely affect our business, financial condition, results of operations and cash flows.
If our work processes become obsolete, through technological advancements or otherwise, we may not be able to differentiate our service offerings and some of our competitors may be able to offer more attractive services to our customers, which could materially and adversely affect our business, financial condition, results of operations and cash flows. 18 Table of Contents Systems and information technology interruptions and/or data security breaches could materially and adversely affect our operating results and ability to operate, and could result in harm to our reputation.
We cannot predict the effect that future sales of our common stock or other equity-related securities would have on the market price of our common stock. 40 Table of Contents In addition, our Charter authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designation, powers, preferences and relative, participating, optional and other special rights, including preferences over our common stock respecting dividends and distributions, as the Board generally may determine.
In addition, our Charter authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designation, powers, preferences and relative, participating, optional and other special rights, including preferences over our common stock respecting dividends and distributions, as the Board generally may determine.
We cannot provide assurance that our current credit rating will remain in effect for any given period of time or that it will not be lowered or withdrawn entirely by a rating agency.
The terms of our financings are, in part, dependent on the credit ratings assigned to our debt by independent credit rating agencies. We cannot provide assurance that our current credit rating will remain in effect for any given period of time or that it will not be lowered or withdrawn entirely by a rating agency.
The decision to pay any dividends in the future, and the timing and amount thereof, to our stockholders will fall within the discretion of the Board, subject to certain consent rights held by Southwest Gas Holdings.
The decision to pay any dividends in the future, and the timing and amount thereof, to our stockholders will fall within the discretion of the Board.
These risk factors represent what we believe to be the known material risk factors with respect to us and our business. Our business, operating results, cash flows and financial condition are subject to these risks and uncertainties, any of which could cause actual results to vary materially from recent results or from anticipated future results.
Our business, operating results, cash flows and financial condition are subject to these risks and uncertainties, any of which could cause actual results to vary materially from recent results or from anticipated future results.
Future distributions or sales by Southwest Gas Holdings or sales by other holders of shares of our common stock, or the perception that such distributions and sales may occur, could cause the price of our common stock to decline, potentially materially.
Future sales by the Icahn Group and other holders of shares of our common stock, or the perception that such sales may occur, could cause the price of our common stock to decline, potentially materially. We have granted certain registration rights to the Icahn Group.
If our subcontractors fail to perform their contractual obligations as a result of financial or other difficulties, or if our subcontractors fail to meet the expected completion dates or quality standards, we may be required to incur additional costs or provide additional services in order to make up such shortfall and we may suffer damage to our reputation. 21 Table of Contents Project performance issues, including those caused by third parties, or certain contractual obligations may result in additional costs to us, reductions or delays in revenues or the payment of penalties, including liquidated damages.
If our subcontractors fail to perform their contractual obligations as a result of financial or other difficulties, or if our subcontractors fail to meet the expected completion dates or quality standards, we may be required to incur additional costs or provide additional services in order to make up such shortfall and we may suffer damage to our reputation.
In addition, any of these or similar events could result in legal and other claims against us, cause environmental pollution, damage to our properties or the properties of others, or loss of revenue by us or others.
Any such incident could have an adverse effect on our results of operations, financial condition, earnings, and cash flows. In addition, any of these or similar events could result in legal and other claims against us, cause environmental pollution, damage to our properties or the properties of others, or loss of revenue by us or others.
These difficult conditions may also cause us to incur additional, unanticipated costs that we might not be able to pass on to our customers, which could have a material adverse effect on our results of operations and financial condition, earnings, and cash flows.
These difficult conditions may also cause us to incur additional, unanticipated costs that we might not be able to pass on to our customers, which could have a material adverse effect on our results of operations and financial condition, earnings, and cash flows. 15 Table of Contents We operate in a highly competitive industry, and competitive pressures could materially and adversely affect our business, which is largely dependent on the competitive bidding process.
Current and potential legislative or regulatory actions may impact demand for our services, requiring utilities to meet reliability standards, and encourage installation of new electric transmission and distribution and renewable energy generation facilities.
Current and potential legislative or regulatory actions may impact demand for our services, requiring utilities to meet reliability standards, and encourage installation of new electric transmission and distribution and renewable energy generation facilities. However, it is unclear whether these initiatives will create sufficient incentives for projects or result in increased demand for our services.
If we are unsuccessful, we may not be able to achieve internal growth, expand our operations or grow our business which could have a material adverse effect on our financial condition, results of operations and cash flows.
If we are unsuccessful, we may not be able to achieve internal growth, expand our operations or grow our business which could have a material adverse effect on our financial condition, results of operations and cash flows. 17 Table of Contents Changes to renewable portfolio standards and decreased demand for renewable energy projects could materially and adversely impact our future results of operations, financial condition, cash flows and liquidity.
Potential indemnification liabilities to Southwest Gas Holdings pursuant to the Separation Agreement could materially and adversely affect our businesses, financial condition, results of operations and cash flows.
Similar rules and consequences may apply under state, local or non-U.S. law. Potential indemnification liabilities to Southwest Gas Holdings pursuant to the Separation Agreement could materially and adversely affect our businesses, financial condition, results of operations and cash flows.
The specialty contracting business is served by numerous companies, from small, owner-operated private companies to large multi-national, public companies. Relatively few barriers prevent entry into some areas of our business, and as a result, any organization that has adequate financial resources and access to technical expertise may become one of our competitors.
Relatively few barriers prevent entry into some areas of our business, and as a result, any organization that has adequate financial resources and access to technical expertise may become one of our competitors.
The following 11 Table of Contents list contains a summary of some, but not all, of these risks. You should read this summary together with the more detailed description of each risk factor contained below before making an investment decision.
You should read this summary together with the more detailed description of each risk factor contained below before making an investment decision.
The actual cost of a project may be higher than the costs we estimate at the commencement of the agreement, and we may not be successful in recouping additional costs from our customers. These variations may cause gross profit for a project to differ from those we originally estimated.
In general, we must estimate the costs of completing a specific project to bid these types of contracts. The actual cost of a project may be higher than the costs we estimate at the commencement of the agreement, and we may not be successful in recouping additional costs from our customers.
(“Riggs Distler”) in 2021, Linetec Services, LLC (“Linetec”) in 2018 and New England Utility Constructors, Inc. (“Neuco”) in 2017. We may be unsuccessful in completing acquisition opportunities that we pursue, which would cause us to incur pursuit costs without the commensurate benefit of completing the acquisition.
(“Riggs Distler”) in 2021, and Linetec Services, LLC in 2018. We may be unsuccessful in completing acquisition opportunities that we pursue, which would cause us to incur pursuit costs without the commensurate benefit of completing the acquisition. Other interested parties may be more successful than us in executing and closing acquisitions in competitive auctions.
We and our customers are also exposed to the availability of these materials which have been impacted by the supply-chain disruptions arising from geopolitical instability, international sanctions, inflationary pressures, and regulatory slowdowns. In addition, our customers’ capital budgets may be impacted by the prices of certain materials, and reduced customer spending could lead to fewer project awards and more competition.
We and our customers are also exposed to the availability of these materials which have been impacted by the supply-chain disruptions arising from geopolitical instability, international sanctions, inflationary pressures, and regulatory slowdowns.
If, in the future, we choose to withdraw from a multiemployer pension plan, we will likely need to record significant withdrawal liabilities, which could adversely impact our financial conditions and results of operations.
If, in the future, we choose to withdraw from a multiemployer pension plan, we will likely need to record significant withdrawal liabilities, which could adversely impact our financial conditions and results of operations. 23 Table of Contents Risks Related to Our Indebtedness and Additional Capital Our existing indebtedness or ability to incur additional indebtedness could materially and adversely affect our businesses and our ability to meet our obligations and pay dividends.
If we fail to find a suitable replacement for any departing executive or senior officer on a timely basis, such departure could materially and adversely affect our ability to operate and grow our business. The successful transition to our new Chief Executive Officer will be critical to our success.
If we fail to find a suitable replacement for any departing executive or senior officer on a timely basis, such departure could materially and adversely affect our ability to operate and grow our business. Failure to attract and retain an appropriately qualified employee workforce could materially and adversely affect our collective operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs part of a standardized review process, our cybersecurity team maintains a Control Assurance Toolkit to review vendor activities, practices, and controls for alignment with our policies and procedures. Resulting control recommendations are coordinated to ensure appropriate implementation during integration activities. 42 Table of Contents We undertake vulnerability, attack, and penetration testing via a third-party audit.
Biggest changeAs part of a standardized review process, our cybersecurity team maintains a Control Assurance Toolkit to review vendor activities, practices, and controls for alignment with our policies and procedures. Resulting control recommendations are coordinated to ensure appropriate implementation during integration activities. We undertake vulnerability, attack, and penetration testing via a third-party audit.
In the last three fiscal years, we have not experienced any material cybersecurity incidents and the expenses we have incurred from cybersecurity incidents were immaterial. Governance The Centuri Cybersecurity Program operates under the auspices of our Board.
In the last three fiscal years, we have not experienced any material cybersecurity incidents and the expenses we have incurred from cybersecurity incidents were immaterial. 37 Table of Contents Governance The Centuri Cybersecurity Program operates under the auspices of our Board.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 29, 2024, Centuri maintained 104 long-term (greater than 12 months) facility leases across its areas of operations and eight owned properties. Centuri considers its facilities suitable and adequate for the purposes of which they are used and does not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities.
Biggest changeAs of December 28, 2025, Centuri maintained 117 long-term (greater than 12 months) facility leases across its areas of operations and eight owned properties. Centuri considers its facilities suitable and adequate for the purposes of which they are used and does not anticipate difficulty in renewing existing leases as they expire or in finding alternative facilities.
Item 2. Properties Centuri currently maintains its principal executive offices at 19820 North 7th Avenue, Suite 120, Phoenix, Arizona 85027. Including the principal office, Centuri operates in 87 primary locations across 45 states in the U.S. and two Canadian provinces, and these locations are used across our different reportable segments.
Item 2. Properties Centuri currently maintains its principal executive offices at 19820 North 7th Avenue, Suite 120, Phoenix, Arizona 85027. Including the principal office, Centuri operates in 97 primary locations across 46 states in the U.S. and six Canadian provinces, and these locations are used across our different reportable segments.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings For discussion regarding legal proceedings, please refer to “Note 18 — Commitments and Contingencies” in the accompanying notes to our consolidated financial statements. 43 Table of Contents Item 4. Mine Safety Disclosures Not applicable. 44 Table of Contents Part II
Biggest changeItem 3. Legal Proceedings For discussion regarding legal proceedings, please refer to “Note 18 — Commitments and Contingencies” in the accompanying notes to our consolidated financial statements. Item 4. Mine Safety Disclosures Not applicable. 38 Table of Contents Part II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+4 added−2 removed7 unchanged
Biggest changeThe following graph shows the cumulative total return to stockholders of our common stock between April 18, 2024 (the date that our common stock commenced trading on the NYSE) through December 29, 2024 relative to the cumulative total returns of the Standard & Poor’s 500 Index (“S&P 500”) and of the stock of a group of peer companies of the Company in the construction and engineering industry, consisting of Ameresco, Inc., Comfort Systems USA, Inc., Dycom Industries, Inc., EMCOR Group, Inc., Granite Construction Incorporated, IES Holdings, Inc., KBR, Inc., Mastec, Inc., MDU Resources Group, Inc., MYR Group Inc., Primoris Services Corporation, Sterling Infrastructure, Inc., Team, Inc., Tetra Tech, Inc., and Tutor Perini Corporation (“Peer Group Stock”).
Biggest changeThe following graph shows the cumulative total return to stockholders of our common stock between April 18, 2024 (the date that our common stock commenced trading on the NYSE) through December 28, 2025 relative to the cumulative total returns of the Standard & Poor’s 500 Index (“S&P 500”) and of the stock of a group of peer companies of the Company in the construction and engineering industry for both 2024 and 2025.
An investment of $100 (with reinvestment of all dividends) is assumed to have been made in our common stock and in each of S&P 500 and Peer Group Stock on April 18, 2024, the date our common stock began trading on the NYSE, and its relative performance is tracked through December 29, 2024, the end of our last fiscal year.
An investment of $100 (with reinvestment of all dividends) is assumed to have been made in our common stock, the S&P 500, and our 2025 Peer Group and 2024 Peer Group on April 18, 2024, the date our common stock began trading on 39 Table of Contents the NYSE, and the relative performance of each investment is tracked through December 28, 2025, the end of our last fiscal year.
The returns shown are based on historical results and are not intended to suggest future performance. 45 Table of Contents Comparison of Cumulative Total Return Among Centuri Holdings, Inc., the S&P 500 and a Peer Group Recent Sales of Unregistered Securities Except as previously disclosed in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, we had no sales of unregistered equity securities during the fiscal year ended December 29, 2024.
Comparison of Cumulative Total Return Among Centuri Holdings, Inc., the S&P 500 and a Peer Group Recent Sales of Unregistered Securities Except as previously disclosed in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, we had no sales of unregistered equity securities during the fiscal year ended December 28, 2025. Issuer Purchases of Equity Securities None.
Holders of Record As of February 14, 2025, there were four holders of record of our common stock, and the market price of our common stock was $20.71.
Holders of Record As of February 20, 2026, there were three holders of record of our common stock, and the market price of our common stock was $31.85.
The payment of any dividends in the future, and the timing and amount thereof, is within the discretion of the Board, subject to certain consent rights held by Southwest Gas Holdings.
The payment of any dividends in the future, and the timing and amount thereof, is within the discretion of the Board.
Removed
Use of Proceeds On April 17, 2024, the SEC declared our registration statement on Form S-1 (File No. 333-278178) (the “IPO Registration Statement”) relating to the Centuri IPO effective.
Added
In fiscal 2025, we established a new peer group consisting of Ameresco, Inc., APi Group Corporation, Arcosa, Inc., Comfort Systems USA, Inc., Construction Partners, Inc., Dycom Industries, Inc., Granite Construction Incorporated, IES Holdings, Inc., Mastec, Inc., MDU Resources Group, Inc., MYR Group Inc., NV5 Global, Inc., Primoris Services Corporation, Sterling Infrastructure, Inc., and Tutor Perini Corporation (“2025 Peer Group”).
Removed
There were no material changes in the use of proceeds from our IPO relative to the planned use of proceeds as described in our final prospectus filed with the SEC on April 18, 2024. Issuer Purchases of Equity Securities None.
Added
The change in peer group reflects changes within our industry and changes in market capitalizations.
Added
The 2024 Peer Group, presented for comparative purposes, consisted of Ameresco, Inc., Comfort Systems USA, Inc., Dycom Industries, Inc., EMCOR Group, Inc., Granite Construction Incorporated, IES Holdings, Inc., KBR, Inc., Mastec, Inc., MDU Resources Group, Inc., MYR Group Inc., Primoris Services Corporation, Sterling Infrastructure, Inc., Team, Inc., Tetra Tech, Inc., and Tutor Perini Corporation.
Added
The returns shown are based on historical results and are not intended to suggest future performance.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeEBITD A , Adjusted EBITDA and Adjusted EBITDA Margin The following table presents reconciliations of net loss to EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin for the specified periods: Fiscal Year Ended (dollars in thousands) December 29, 2024 December 31, 2023 January 1, 2023 Net loss $ (6,822) $ (184,506) $ (164,986) Interest expense, net 90,515 97,476 61,371 Income tax expense 3,466 9,530 1,298 Depreciation expense 108,703 118,776 125,594 Amortization of intangible assets 26,642 26,670 29,759 EBITDA 222,504 67,946 53,036 Non-cash stock-based compensation 2,231 1,851 1,652 Strategic review costs 2,010 3,365 1,853 Severance costs 8,028 4,028 4,199 Securitization facility transaction fees 1,393 — — CEO transition costs 2,060 — — Goodwill impairment — 213,992 177,086 Adjusted EBITDA $ 238,226 $ 291,182 $ 237,826 Adjusted EBITDA Margin (% of revenue) 9.0 % 10.0 % 8.6 % Adjusted Net Income and Adjusted Diluted Earnings Per Share: The following table presents reconciliations of net loss to Adjusted Net Income for the specified periods: Fiscal Year Ended (dollars in thousands) December 29, 2024 December 31, 2023 January 1, 2023 Net loss $ (6,822) $ (184,506) $ (164,986) Strategic review costs 2,010 3,365 1,853 Severance costs 8,028 4,028 4,199 Amortization of intangible assets 26,642 26,670 29,759 Securitization facility transaction fees 1,393 — — CEO transition costs 2,060 — — Loss on debt extinguishment 1,726 — — Non-cash stock-based compensation 2,231 1,851 1,652 Goodwill impairment — 213,992 177,086 Income tax impact of adjustments (1) (11,025) (13,808) (13,379) Adjusted Net Income $ 26,243 $ 51,592 $ 36,184 (1) Calculated based on a blended statutory tax rate of 25%. 55 Table of Contents The following table presents reconciliations of diluted loss per share attributable to common stock to Adjusted Diluted Earnings Per Share: Fiscal Year Ended (dollars per share) December 29, 2024 December 31, 2023 January 1, 2023 Diluted loss per share attributable to common stock (GAAP as reported) $ (0.08) $ (2.60) $ (2.35) Add-back net income attributable to noncontrolling interests — 0.02 0.04 Strategic review costs 0.02 0.05 0.03 Severance costs 0.10 0.06 0.06 Securitization transaction fees 0.02 — — CEO transition costs 0.02 — — Loss on debt extinguishment 0.02 — — Amortization of intangible assets 0.32 0.36 0.42 Non-cash stock-based compensation 0.03 0.03 0.02 Goodwill impairment — 2.99 2.47 Income tax impact of adjustments (0.13) (0.19) (0.19) Adjusted Diluted Earnings per Share $ 0.32 $ 0.72 $ 0.50 56 Table of Contents Liquidity and Capital Resources Sources and Uses of Liquidity Our primary liquidity needs have historically related to supporting working capital requirements, funding capital expenditures and servicing our debt.
Biggest changeThe most comparable GAAP financial measure and information reconciling the GAAP and non-GAAP financial measures are set forth below. 48 Table of Contents EBITD A , Adjusted EBITDA and Adjusted EBITDA Margin The following table presents reconciliations of net income (loss) to EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin for the specified periods: Fiscal Year Ended (dollars in thousands) December 28, 2025 December 29, 2024 December 31, 2023 Net income (loss) $ 22,650 $ (6,822) (184,506) Interest expense, net 78,428 90,515 97,476 Income tax (benefit) expense (8,063) 3,466 9,530 Depreciation expense 111,512 108,703 118,776 Amortization of intangible assets 27,281 26,642 26,670 EBITDA 231,808 222,504 67,946 Non-cash stock-based compensation 8,079 2,231 1,851 Acquisition costs 2,231 — — Separation-related costs 5,518 — — Strategic review costs — 2,010 3,365 Severance costs — 8,028 4,028 Securitization facility transaction fees — 1,393 — Other professional fees 1,379 — — CEO transition costs — 2,060 — Goodwill impairment — — 213,992 Adjusted EBITDA $ 249,015 $ 238,226 $ 291,182 Adjusted EBITDA Margin (% of revenue) 8.3 % 9.0 % 10.0 % Adjusted Net Income and Adjusted Diluted Earnings per Share : The following table presents reconciliations of net income (loss) to Adjusted Net Income for the specified periods: Fiscal Year Ended (dollars in thousands) December 28, 2025 December 29, 2024 December 31 2023 Net income (loss) $ 22,650 $ (6,822) (184,506) Separation-related costs 5,518 — — Strategic review costs — 2,010 3,365 Severance costs — 8,028 4,028 Amortization of intangible assets 27,281 26,642 26,670 Securitization facility transaction fees — 1,393 — Other professional fees 1,379 — — CEO transition costs — 2,060 — Loss on debt modification and extinguishment 8,240 1,726 — Non-cash stock-based compensation 8,079 2,231 1,851 Tax asset allocation (23,738) — — Acquisition costs 2,231 — — Goodwill impairment — — 213,992 Income tax impact of adjustments (1) (12,625) (11,025) (13,808) Adjusted Net Income $ 39,015 $ 26,243 $ 51,592 (1) Calculated based on a blended statutory tax rate of 25% applied to adjustments except for: tax asset allocation, acquisition costs, and a majority of goodwill impairment as these items generally do not impact taxable income. 49 Table of Contents The following table presents reconciliations of diluted earnings (loss) per share attributable to common stock to Adjusted Diluted Earnings Per Share: Fiscal Year Ended (dollars per share) December 28, 2025 December 29, 2024 Diluted earnings (loss) per share attributable to common stock $ 0.25 $ (0.08) Separation-related costs 0.06 — Strategic review costs — 0.02 Severance costs — 0.10 Securitization transaction fees — 0.02 Other professional fees 0.02 — CEO transition costs — 0.02 Loss on debt modification and extinguishment 0.09 0.02 Amortization of intangible assets 0.30 0.32 Non-cash stock-based compensation 0.09 0.03 Tax asset allocation (0.26) — Acquisition costs 0.02 — Income tax impact of adjustments (0.14) (0.13) Adjusted Diluted Earnings per Share $ 0.43 $ 0.32 Base Revenue and Base Gross Profit The following table presents reconciliations of revenue, net to Base Revenue and gross profit to Base Gross Profit and Base Gross Profit Margin.
As a result of these exclusions from EBITDA, any measure that excludes interest expense net of interest income, depreciation and amortization and income taxes has material limitations as compared to net loss.
As a result of these exclusions from EBITDA, any measure that excludes interest expense net of interest income, depreciation and amortization and income taxes has material limitations as compared to net income (loss).
Se e “Cautionar y Not e Regardin g Forward-Lookin g Statements.” We use a 52/53-week fiscal year that ends on the Sunday closest to the end of the calendar year. Unless otherwise stated, references to months and years throughout relate to fiscal months and years rather than calendar months and years.
Se e “Cautionar y Not e Regardin g Forward-Lookin g Statements.” We use a 52/53-week fiscal year that ends on the Sunday closest to the end of the calendar year. Unless otherwise stated, references to months, quarters and years throughout relate to fiscal months, quarters and years rather than calendar months, quarters and years.
Seasonality and Severe Weather Events Generally, our revenue is lowest during the first quarter of the year due to less favorable winter weather and related working conditions in many of the areas where we perform work. Revenue typically improves as more favorable weather conditions occur during the summer and fall months.
Seasonality and Severe Weather Events Generally, our revenue is lowest during the first fiscal quarter of the year due to less favorable winter weather and related working conditions in many of the areas where we perform work. Revenue typically improves as more favorable weather conditions occur during the summer and fall months.
The discount rate used in the assessment was 12.5%, and the control premium supportable by market research and available data was 15.0%. The assessment resulted in the fair value of Riggs Distler being below its carrying value. As a result, we recognized an impairment charge of $214.0 million in the fourth quarter of 2023 .
The discount rate used in the assessment was 12.5% , and the control premium supportable by market research and available data was 15.0% . The assessment resulted in the fair value of the Riggs Distler reporting unit being below its carrying value. As a result, we recognized an impairment charge of $214.0 million in the fourth quarter of 2023 .
For the Union Electric reporting unit in fiscal year 2024 (and in fiscal years 2023 and 2022, the Riggs Distler reporting unit), we determined that triggering events occurred, and performed a quantitative assessment as of each of the fiscal year 2024, 2023, and 2022 assessment dates utilizing a weighted combination of the income approach (discounted cash flow method) and a market approach (guideline public company method).
For the Union Electric reporting unit in fiscal year 2024 (and in fiscal year 2023 the Riggs Distler reporting unit), we determined that triggering events occurred, and performed a quantitative assessment as of each of the fiscal year 2024 and 2023 assessment dates utilizing a weighted combination of the income approach (discounted cash flow method) and a market approach (guideline public company method).
We record estimated claims as variable consideration based on the most likely amount we expect to receive, and to the extent it is probable that a 61 Table of Contents significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.
We record estimated claims as variable consideration based on the most likely amount we expect to receive, and to the extent it is probable that a 56 Table of Contents significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.
We identify our most critical accounting policies as those that are the most pervasive and important to the portrayal of our 60 Table of Contents financial position and results of operations, and that require the most difficult, subjective and/or complex judgments by management regarding estimates about matters that are inherently uncertain.
We identify our most critical accounting policies as those that are the most pervasive and important to the portrayal of our 55 Table of Contents financial position and results of operations, and that require the most difficult, subjective and/or complex judgments by management regarding estimates about matters that are inherently uncertain.
During fiscal 2024, certain of our subsidiaries sold and/or contributed their accounts receivable and contract assets generated in the ordinary course of their business and certain related assets to an indirect wholly owned bankruptcy-remote SPE created specifically for this purpose.
During fiscal 2025, certain of our subsidiaries sold and/or contributed their accounts receivable and contract assets generated in the ordinary course of their business and certain related assets to an indirect wholly owned bankruptcy-remote SPE created specifically for this purpose.
Although certain of our customers have experienced recent disruptions in their supply chain for certain project materials, most of our customers have generally been able to procure the necessary materials in a timely manner. Our operations also depend on the availability of certain equipment to perform services.
Although certain of our customers have experienced previous disruptions in their supply chain for certain project materials, most of our customers have generally been able to procure the necessary materials in a timely manner. Our operations also depend on the availability of certain equipment to perform services.
We attempt to recover anticipated increases in the cost of labor, equipment, fuel and materials through price escalation provisions that allow us to adjust billing rates for certain major contracts annually; by considering the estimated effect of such increases when bidding or pricing new work; or by entering into back-to-back contracts with suppliers and subcontractors.
We attempt to recover anticipated increases in the cost of labor, equipment, fuel and materials not purchased by customers through price escalation provisions that allow us to adjust billing rates for certain major contracts annually; by considering the estimated effect of such increases when bidding or pricing new work; or by entering into back-to-back contracts with suppliers and subcontractors.
These fluctuations, as well as the highly competitive nature of our industry, can result in changes in the levels of activity, project mix and moreover the profitability of the services we provide. Utilities continue to implement or modify system integrity management programs to enhance safety pursuant to federal and state mandates.
These fluctuations, as well as the highly competitive nature of 43 Table of Contents our industry, can result in changes in the levels of activity, project mix and moreover the profitability of the services we provide. Utilities continue to implement or modify system integrity management programs to enhance safety pursuant to federal and state mandates.
Such differences will be reflected as increases or decreases to income tax expense in the period in which they are determined. 63 Table of Contents Management intends to continue to permanently reinvest any future foreign earnings in Canada. Distributions of cash to the U.S. as dividends generally will not be subject to U.S. federal income tax.
Such differences will be reflected as increases or decreases to income tax expense in the period in which they are determined. Management intends to continue to permanently reinvest any future foreign earnings in Canada. Distributions of cash to the U.S. as dividends generally will not be subject to U.S. federal income tax.
Key drivers of the impairment included the cancellation of an offshore wind project in the fourth quarter of fiscal year, as well as lower than expected earnings during fiscal 2023. The goodwill impairment charge did not affect our compliance with our financial covenants and conditions under our credit agreements.
Key drivers of the impairment included the cancellation 57 Table of Contents of an offshore wind project in the fourth quarter of fiscal year, as well as lower than expected earnings during fiscal 2023. The goodwill impairment charge did not affect our compliance with our financial covenants and conditions under our credit agreements.
Backlog differs from remaining performance obligations disclosed in “Note 3 — Revenue and Related Balance Sheet Accounts” to the consolidated financial statements, as remaining performance obligations are limited to contractually obligated revenue on our contracts that exceed one year, which is typically only bid projects, whereas backlog is inclusive of all contracts regardless of length and includes estimated future work under MSAs.
Backlog differs from remaining performance obligations disclosed in “Note 3 — Revenue and Related Balance Sheet Accounts” to the consolidated financial statements, as remaining performance obligations are limited to contractually obligated revenue on our contracts that exceed one year, which is typically only bid projects, whereas backlog is inclusive of all contracts regardless of length and includes estimated future work over the contractual life of MSAs.
We believe we have taken steps to secure delivery of a sufficient amount of equipment and do not anticipate any significant disruptions with respect to our fleet in the near-term. 48 Table of Contents Demand for Services The seasonal nature of the industry we serve affects demand for our services.
We believe we have taken steps to secure delivery of a sufficient amount of equipment and do not anticipate any significant disruptions with respect to our fleet in the near-term. Demand for Services The seasonal nature of the industry we serve affects demand for our services.
Factors Affecting Our Results of Operations Our financial results may be impacted by economic conditions that impact businesses generally, such as inflationary impacts on goods and services consumed in the business, regulatory or environmental influences, rising interest rates, labor markets and costs (including in regard to contracted or professional services), and the availability of those resources.
Factors Affecting Our Results of Operations Our financial results may be impacted by economic conditions that impact businesses generally, such as inflationary impacts on goods and services consumed in the business, regulatory or environmental influences, seasonality and severe weather events, rising interest rates, labor markets and costs (including in regard to contracted or professional services), and the availability of those resources.
Fixed-rate interest payments assume that principal payments are made as originally scheduled. Estimated interest payments on variable-rate debt is based on the interest rates in effect as of December 29, 2024 . (2) Includes related interest. Certain leases require property tax payments, insurance and maintenance costs that have been excluded from the above table as they are variable in nature.
Fixed-rate interest payments assume that principal payments are made as originally scheduled. Estimated interest payments on variable-rate debt is based on the interest rates in effect as of December 28, 2025 . (2) Includes related interest. Certain leases require property tax payments, insurance and maintenance costs that have been excluded from the above table as they are variable in nature.
Under the Securitization Facility, certain designated subsidiaries of the Company have sold and/or contributed, and will continue to sell and/or contribute, their accounts receivable and contract assets generated in the ordinary course of their business and certain related assets to an indirect wholly owned bankruptcy-remote Special Purpose Entity (“SPE”) of the Company created specifically for this purpose.
Under the Securitization Facility, certain of our designated subsidiaries have sold and/or contributed, and will continue to sell and/or contribute, their accounts receivable and contract assets generated in the ordinary course of their business and certain related assets to the indirect wholly owned bankruptcy-remote Special Purpose Entity (“SPE”) we created specifically for this purpose.
Management believes that EBITDA helps investors compare our performance to our peers and gain an understanding of the factors affecting our ongoing cash earnings from which capital investments are made and debt is serviced, and that Adjusted EBITDA provides additional insight by removing certain expenses that are non-recurring and/or non-operational in nature.
Management believes that EBITDA helps investors gain an understanding of the factors affecting our ongoing cash earnings from which capital investments are made and debt is serviced, and that Adjusted EBITDA provides additional insight by removing certain expenses that are non-recurring and/or non-operational in nature.
(“the Operating Company”). Thi s discussio n contain s forward-loo k in g statement s tha t ar e base d upo n curren t expectation s and ar e subjec t t o uncertaint y an d change s i n circumstances .
Thi s discussio n contain s forward-loo k in g statement s tha t ar e base d upo n curren t expectation s and ar e subjec t t o uncertaint y an d change s i n circumstances .
Other than the Union Electric reporting unit in fiscal year 2024 and the Riggs Distler reporting unit in fiscal year 2023 and 2022 , the results of the qualitative assessment did not indicate that it was more likely than not that the fair value of each reporting unit analyzed was less than the carrying value including goodwill, and no goodwill impairment was recognized.
Other than the Union Electric reporting unit in fiscal year 2024 and the Riggs Distler reporting unit in fiscal year 2023, the results of the qualitative assessment did not indicate that it was more likely than not that the fair value of each reporting unit analyzed was less than the carrying value including goodwill, and no goodwill impairment was recogniz ed.
We account for accounts receivable sold to the banking counterparty as a sale of financial assets and have derecognized the accounts receivable from the consolidated balance sheet for the current period. The total outstanding balance of accounts receivable that have been sold and derecognized is $125.0 million as of December 29, 2024.
We account for accounts receivable sold to the banking counterparty as a sale of financial assets and have derecognized the accounts receivable from the consolidated balance sheet for the current period. The total outstanding balance of accounts receivable that have been sold and derecognized is $125.0 million as of December 28, 2025.
Guided by our values and our unwavering commitment to serve as long-term partners to customers and communities, our more than 8,600 employees enable our customers to safely and reliably deliver electricity and natural gas and achieve their goals for environmental sustainability.
Guided by our values and our unwavering commitment to serve as long-term partners to customers and communities, our employees enable our customers to safely and reliably deliver electricity and natural gas and achieve their goals for environmental sustainability.
As of December 29, 2024, we had no available capacity under the Securitization Facility. We have concluded that there is generally no material risk of loss to us from non-payment of the sold receivables.
As of December 28, 2025, we had no available capacity under the Securitization Facility. We have concluded that there is generally no material risk of loss to us from non-payment of the sold receivables.
Rising fuel, labor and material costs have had, and could continue to have, a negative effect on our results of operations, to the extent we cannot pass these costs through to our customers.
Rising fuel, labor and material costs have in the past had, and could in the future have, a negative effect on our results of operations, to the extent we cannot pass these costs through to our customers.
These amounts have been excluded from the above table as we are unable to reasonably estimate the timing of the resolution of the underlying tax positions with the relevant tax authorities. We have various other noncancellable obligations consisting primarily of software licensing fees and consulting and other outsourced services.
These amounts have been excluded from the above table as we are unable to reasonably estimate the timing of the resolution of the underlying tax positions with the relevant tax authorities. We have various other noncancellable obligations consisting primarily of software licensing fees, consulting and other outsourced services, and deferred consideration related to our acquisition of Connect.
The assessment resulted in the fair value of Union Electric being significantly above its carrying value and no goodwill impairment was recognized. 62 Table of Contents For fiscal 2023 , the terminal growth rate used in the assessment was 3.0%.
The assessment resulted in the fair value of the Union Electric reporting unit being significantly above its carrying value and no goodwill impairment was recognized. For fiscal 2023 , the terminal growth rate used in the assessment was 3.0% .
These earnings could become subject to foreign withholding tax if they are remitted as dividends. See “ Note 14 — Income Taxes ” to the annual consolidated financial statements for further information on income taxes.
These earnings could become subject to foreign withholding tax if they are remitted as dividends. See “Note 14 — Income Taxes” to the consolidated financial statements for further information on income taxes.
The SPE transfers ownership and control of accounts receivable to PNC for payments as set forth in the agreement. The Company accounts for accounts receivable sold to the banking counterparty as a sale of financial assets and has derecognized the accounts receivable from the consolidated balance sheet for the current period.
The SPE transfers ownership and control of accounts receivable to PNC for payments as set forth in the agreement. We account for accounts receivable sold to the banking counterparty as a sale of financial assets and have derecognized the accounts receivable from our consolidated balance sheet for the current period.
Fees paid on our Securitization Facility are excluded from the table above, but would be approximately $8 million per year based on the interest rate in effect as of December 29, 2024 and assuming our balance of sold receivables stays consistent at $125.0 million.
Fees paid on our Securitization Facility are excluded from the table above, but would be approximately $6.5 million per year based on the interest rate in effect as of December 28, 2025 and assuming our balance of sold receivables stays consistent at $125.0 million.
In connection with the annual goodwill assessment for fiscal years 2024, 2023 and 2022, we performed a qualitative goodwill assessment of its reporting units.
In connection with the annual goodwill assessment for fiscal years 2025, 2024 and 2023, we performed a qualitative goodwill assessment of our reporting units.
Management believes that Adjusted Net Income helps investors understand the profitability of our business when excluding certain expenses that are non-recurring and/or non-operational in nature. Adjusted Diluted Earnings per Share is defined as Adjusted Net Income divided by weighted average diluted shares outstanding.
Management believes that Adjusted Net Income helps investors understand the profitability of our business when excluding certain expenses that are non-recurring and/or non-operational in nature. Adjusted Diluted Earnings per Share is defined as Adjusted Net Income divided by weighted average diluted shares outstanding. Base Revenue is defined as revenue, net adjusted to exclude revenue attributable to storm restoration services.
The discussion that follows highlights key revenue and gross margin changes at the segment level. Changes in gross profit correspond with the discussed changes in revenue and gross margin. Fiscal Year Ended Change (dollars in thousands) December 29, 2024 December 31, 2023 $ % Revenue: U.S.
The discussion that follows highlights key revenue changes at the segment level. Changes in gross profit correspond with the discussed changes in revenue. Fiscal Year Ended Change (dollars in thousands) December 28, 2025 December 29, 2024 $ % Revenue: U.S.
As of December 29, 2024 and December 31, 2023 , we were in compliance with all of our debt covenants. Under the most restrictive of the covenants, as of December 29, 2024 and December 31, 2023 , we could have issued approximately $151 million and $108 million, respectively, in additional debt and met the leverage ratio requirement.
As of December 28, 2025 and December 29, 2024 , we were in compliance with all of our debt covenants. Under the most restrictive of the covenants, as of December 28, 2025 and December 29, 2024 , we could have issued approximately $302.4 million and $151 million, respectively, in additional debt and met the leverage ratio requirement.
At times, we also enter into transactions in foreign currencies, primarily in Canadian dollars, that subject us to currency risks. We regularly monitor our foreign currency exposure to determine the most effective foreign currency risk mitigation strategies. Currently, we are not party to any foreign currency exchange contracts.
At times, we also enter into transactions in foreign currencies, primarily in Canadian dollars, that subject us to currency risks. We regularly monitor our foreign currency exposure to determine the most effective foreign currency risk mitigation strategies.
Adjusted EBITDA is defined as EBITDA adjusted for (i) non-cash stock-based compensation expense, (ii) strategic review costs, (iii) severance costs, (iv) securitization facility transaction fees, (v) CEO transition costs and (vi) goodwill impairment. Adjusted EBITDA Margin is defined as the percentage derived from dividing Adjusted EBITDA by revenue.
Adjusted EBITDA is defined as EBITDA adjusted for (i) non-cash stock-based compensation, (ii) acquisition costs, (iii) separation-related costs, (iv) strategic review costs, (v) severance costs, (vi) securitization facility transaction fees, (vii) other professional fees, (viii) CEO transition costs, and (ix) goodwill impairment. Adjusted EBITDA Margin is defined as the percentage derived from dividing Adjusted EBITDA by revenue.
Investing Activities Net cash used in investing activities was $89.4 million in the fiscal year ended December 29, 2024 compared to $94.9 million for the fiscal year ended December 31, 2023, a decrease of $5.5 million. The construction industry is capital intensive, and we expect to continue to incur capital expenditures to meet anticipated needs for our services.
Investing Activities Net cash used in investing activities was $88.2 million in the fiscal year ended December 28, 2025 compared to $89.4 million for the fiscal year ended December 29, 2024, a decrease of $1.2 million. The construction industry is capital intensive, and we expect to continue to incur capital expenditures to meet anticipated needs for our services.
Adjusted Net Income is defined as net loss adjusted for (i) strategic review costs, (ii) severance costs, (iii) amortization of intangible assets, (iv) securitization facility transaction fees, (v) CEO transition costs, (vi) loss on debt extinguishment, (vii) non-cash stock-based compensation expense, (viii) goodwill impairment and (ix) the income tax impact of adjustments that are subject to tax, which is determined using the incremental statutory tax rates of the jurisdictions to which each adjustment relates for the respective periods.
Adjusted Net Income is defined as net income (loss) adjusted for (i) separation-related costs, (ii) strategic review costs, (iii) severance costs, (iv) amortization of intangible assets, (v) securitization facility transaction fees, (vi) other professional fees, (vii) CEO transition costs, (viii) loss on debt modification and extinguishment, (ix) non-cash stock-based 47 Table of Contents compensation, (x) tax asset allocation, (xi) acquisition costs, (xii) goodwill impairment, and (xiii) the income tax impact of adjustments that are subject to tax, which is determined using the incremental statutory tax rates of the jurisdictions to which each adjustment relates for the respective periods.
Actual future prices, operating expenses and discount rates could vary from the assumptions used in our estimates and may have a material impact on the assessment of the fair value of the respective assets and ultimately, our results of operations. Income Taxes We file income tax returns in various states and in Canada.
Actual future prices, operating expenses and discount rates could vary from the assumptions used in our estimates and may have a material impact on the assessment of the fair value of the respective assets and ultimately, our results of operations.
Cash Flows The following table presents a summary of our cash flows: Fiscal Year Ended (dollars in thousands) December 29, 2024 December 31, 2023 Net cash provided by operating activities $ 158,230 $ 167,465 Net cash used in investing activities (89,375) (94,850) Net cash used in financing activities (52,619) (103,447) Operating Activities Cash flows provided by operating activities are impacted by changes in the timing of demand for our services and related operating margins but can also be affected by working capital needs.
Cash Flows The following table presents a summary of our cash flows: Fiscal Year Ended (dollars in thousands) December 28, 2025 December 29, 2024 Net cash provided by operating activities $ 78,121 $ 158,230 Net cash used in investing activities $ (88,204) $ (89,375) Net cash provided by (used in) financing activities $ 88,758 $ (52,619) Operating Activities Cash flows provided by operating activities are impacted by changes in the timing of demand for our services and related operating margins but can also be affected by working capital needs.
Management also believes that providing these non-GAAP measures helps investors evaluate the Company’s operating performance, profitability and business trends in a way that is consistent with how management evaluates such matters. EBITDA is defined as earnings before interest, taxes, depreciation and amortization.
Management also believes that providing these non-GAAP measures helps investors evaluate the Company’s operating performance, profitability and business trends in a way that is consistent with how management evaluates such matters.
Non-GAAP Financial Measures We prepare and present our financial statements in accordance with GAAP. However, management believes that EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, and Adjusted Diluted Earnings per Share, all of which are measures not presented in accordance with GAAP, provide investors with additional useful information in evaluating our performance.
However, management believes that EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income, Adjusted Diluted Earnings per Share, Base Revenue, Base Gross Profit and Base Gross Profit Margin, all of which are measures not presented in accordance with GAAP, provide investors with additional useful information in evaluating our performance.
For the fiscal year ended December 29, 2024 and December 31, 2023, we had capital expenditures of $99.3 million and $106.7 million, respectively. These items were partially offset by proceeds from the sale of property and equipment of $10.0 million and $11.8 million for the fiscal years ended December 29, 2024 and December 31, 2023, respectively.
For the fiscal year ended December 28, 2025 and December 29, 2024, we had capital expenditures of $86.3 million and $99.3 million, respectively. These items were partially offset by proceeds from the sale of property and equipment of $44.0 million and $10.0 million for the fiscal years ended December 28, 2025 and December 29, 2024, respectively.
Consolidated Results Fiscal Year Ended December 29, 2024 compared to the fiscal year ended December 31, 2023 The following tables and discussion summarize our consolidated results of operations for the fiscal years ended December 29, 2024, and December 31, 2023 including as a percentage of revenue, as well as the dollar and percentage change between fiscal years.
Consolidated Results Fiscal year ended December 28, 2025 compared to fiscal year ended December 29, 2024 The following table summarizes our consolidated results of operations for the fiscal years ended December 28, 2025 and December 29, 2024, including as a percentage of revenue, as well as the dollar and percentage change between fiscal years.
Cash dividends are limited to a calculated available amount, generally defined as 50% of our net income since the beginning of the fourth fiscal quarter of 2020, adjusted for certain items, such as parent contributions, Linetec redeemable noncontrolling interest payments or dividend payments, among other adjustments, as applicable.
Cash dividends are limited to a calculated available amount, generally defined as $65.0 million plus 50% of our consolidated net income since the beginning of the third fiscal quarter of 2025 adjusted for certain items, such as parent capital contributions, redeemable noncontrolling interest payments, and dividend payments, among other adjustments, as applicable.
Also as of December 29, 2024 and December 31, 2023, there was approximately $226.1 million and $246.5 million, respectively, net of outstanding letters of credit, of unused capacity under the line of credit. We had $64.6 million and $48.6 million of unused letters of credit available as of December 29, 2024 and December 31, 2023, respectively.
Also, as of December 28, 2025 and December 29, 2024, there was approximately $302.4 million and $226.1 million, respectively, net of outstanding letters of credit, of unused capacity under the line of credit. We had $68.6 million and $64.6 million of unused letters of credit available as of December 28, 2025 and December 29, 2024, respectively.
As of December 29, 2024 and December 31, 2023, $113.5 million and $77.1 million, respectively, was outstanding on the revolving credit facility, in addition to $706.4 million and $994.2 million, respectively, that was outstanding on the term loan portion of the facility.
As of December 28, 2025 and December 29, 2024, $91.2 million and $113.5 million, respectively, was outstanding on the revolving credit facility, in addition to $616.0 million and $706.4 million that was outstanding on the term loan portion of the facility as of December 28, 2025 and December 29, 2024, respectively.
We serve as long-term strategic partners to, and an extension of, North America’s electric, gas and combination utility providers, delivering a wide range of infrastructure solutions.
We serve as a long-term strategic partner to, and an extension of, North America’s electric, gas and combination utility providers, delivering a wide range of infrastructure solutions to ensure safe, reliable and environmentally sustainable energy operations.
The obligations under the credit agreement are secured by present and future ownership interests in substantially all of our direct and indirect subsidiaries, substantially all of our tangible and intangible personal property, and all products, profits and proceeds of the foregoing.
The obligations under our credit agreement are secured by present and future ownership interests in substantially all of our direct and indirect subsidiaries, substantially all of our tangible and intangible personal property, and all products, profits and proceeds of the foregoing. Assets securing the facility totaled $2.3 billion as of December 28, 2025.
Net cash provided by operating activities for the fiscal year ended December 29, 2024 was $158.2 million, compared to $167.5 million for the fiscal year ended December 31, 2023, representing a decrease in operating cash flows of $9.3 million.
Net cash provided by operating activities for the fiscal year ended December 28, 2025 was $78.1 million, compared to $158.2 million for the fiscal year ended December 29, 2024, representing a decrease in operating cash flows of $80.1 million.
The liability for unrecognized tax benefits for uncertain tax positions was approximately $0.5 million as of December 29, 2024 and December 31, 2023 and is included in other liabilities on the consolidated balance sheets included elsewhere in this Annual Report on Form 10-K.
We had no liability for unrecognized tax benefits as of December 28, 2025, and a liability of approximately $ 0.5 million as of December 29, 2024, which was included in other liabilities on the consolidated balance sheet included elsewhere in this Annual Report on Form 10-K.
Therefore, changes in the value of Canadian dollars affect our financial statements when translated into U.S. dollars. The revenue from our Canadian operations was approximately 8% of total revenue for the fiscal years ended December 29, 2024, and December 31, 2023.
Foreign Operations While we primarily operate in the United States, we also have operations in Canada. Therefore, changes in the value of Canadian dollars affect our financial statements when translated into U.S. dollars. The revenue from our Canadian operations was approximately 8% of total revenue for each of the fiscal years ended December 28, 2025 and December 29, 2024.
The total outstanding balance of accounts receivable that have been sold and derecognized is $125.0 million as of December 29, 2024. As of December 29, 2024, we had no available capacity under the Securitization Facility.
The total outstanding balance of accounts receivable that had been sold and derecognized was $125.0 million as of December 28, 2025. We had no unused capacity on the Securitization Facility as of December 28, 2025.
Our service offerings primarily consist of the modernization of utility infrastructure through the replacement, maintenance, retrofitting and installation of electric and natural gas distribution and utility-scale transmission networks, and building capacity to meet current and future demands.
Our service offerings primarily consist of the modernization of utility infrastructure through the replacement, maintenance, retrofitting and installation of electric and natural gas distribution and utility-scale transmission networks and building capacity to meet current and future demands. We also serve complementary, attractive and growing end markets such as distributed power projects and data centers.
In September 2024, we entered into our Securitization Facility with PNC Bank, National Association ("PNC") to improve cash flows from trade accounts receivable and used all of the proceeds to pay down our existing debt.
As of January 12, 2026, the aggregate principal amount of the seventh amendment term loans was $616.0 million. Accounts Receivable Securitization In September 2024, we entered into our Securitization Facility with PNC Bank, National Association (“PNC”) to improve cash flows from trade accounts receivable and used all of the proceeds to pay down our existing debt.
Financing Activities Net cash used in financing activities was $52.6 million for the fiscal year ended December 29, 2024 compared to $103.4 million for the fiscal year ended December 31, 2023.
Financing Activities Net cash provided by (used in) financing activities was $88.8 million for the fiscal year ended December 28, 2025 compared to $(52.6) million for the fiscal year ended December 29, 2024.
Using EBITDA as a performance measure has material limitations as compared to net loss, or other financial measures as defined under GAAP, as it excludes certain recurring items, which may be meaningful to investors.
Management believes these Non-GAAP measures are more suitable disclosures for evaluating fundamental business performance and for comparison purposes. Using EBITDA as a performance measure has material limitations as compared to net income (loss), or other financial measures as defined under GAAP, as it excludes certain recurring items, which may be meaningful to investors.
Prior to April 13, 2024, Southwest Gas Holdings owned 1,000 shares of our common stock, representing 100% of the issued and outstanding shares of our common stock. On April 13, 2024, we issued 71,664,592 shares of common stock to Southwest Gas Holdings as consideration for the transfer of assets and assumption of liabilities of the Operating Company (the “Separation”).
On April 13, 2024, we issued 71,664,592 shares of common stock to Southwest Gas Holdings as consideration for the transfer of assets and assumption of liabilities of the Operating Company (the “Separation”). Following the completion of the Separation, the Operating Company became our wholly owned subsidiary, and all of our operations are conducted through the Operating Company.
Separation from Southwest Gas Holdings We were incorporated in Delaware in June 2023 as a wholly owned subsidiary of Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”).
Separation from Southwest Gas Holdings We were incorporated in Delaware in June 2023 as a wholly owned subsidiary of Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”). We were formed for the purpose of completing an initial public offering, facilitating the separation of Centuri Group, Inc.
This increase was primarily driven by an increase in emergency restoration services revenue of $47.9 million (which was $107.1 million in the fiscal year ended December 29, 2024 compared to $59.2 million in the prior year), partially offset by a decrease in volumes under existing MSAs.
This increase was primarily driven by an increase in volumes under new and existing MSAs, which was partially offset by a decline in storm restoration services revenue of $77.0 million ($30.1 million in the fiscal year ended December 28, 2025 compared to $107.1 million in the prior year period).
As a percentage of revenue, gross profit increased to 12.7% in the fiscal year ended December 29, 2024, compared to 12.3% in the prior year.
As a percentage of revenue, gross profit increased to 8.8% in the fiscal year ended December 28, 2025 as compared to 8.4% in the prior year period.
We believe our capital resources, including existing cash balances, together with our operating cash flows and borrowings under our credit facilities, are sufficient to meet our financial obligations for at least the next 12 months.
As of December 28, 2025 and December 29, 2024, cash and cash equivalents were $126.6 million and $49.0 million, respectively. We believe our capital resources, including existing cash balances, together with our operating cash flows and borrowings under our credit facilities, are sufficient to meet our financial obligations for the next 12 months and the foreseeable future.
We also serve complementary, attractive and growing end markets such as renewable energy associated with the expected energy transition, data centers and 5G datacom. Our essential services enable our customers to enhance the safety, reliability and environmental sustainability of the electric and natural gas networks that consumers rely upon to meet their essential and evolving energy needs.
Our essential services enable our customers to enhance the safety, reliability and environmental sustainability of the electric and natural gas networks that consumers rely upon to meet their essential and evolving energy needs.
Fiscal years 2024, 2023 and 2022 ended on December 29, 2024, December 31, 2023 and January 1, 2023, respectively, and each year had 52 weeks. Overview Company Overview We are a leading North American utility infrastructure services company that partners with regulated utilities to maintain, upgrade and expand the energy network that powers millions of homes and businesses.
Overview Company Overview We are a leading North American utility and energy infrastructure services company, and we partner with regulated utilities to maintain, upgrade and expand the energy network that powers millions of homes and businesses.
As of December 29, 2024 and December 31, 2023 , we had approximately $28 million and $15 million, respectively, of cushion relating to the minimum interest coverage ratio requirement. Our revolving credit and term loan facilities are secured by our assets.
As of December 28, 2025 and December 29, 2024 , we had approximately $24.8 million and $28 million, respectively, of cushion relating to the minimum interest coverage ratio requirement.
As to certain of the items related to Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Diluted Earnings per Share: (i) non-cash stock-based compensation expense varies from period to period due to changes in the estimated fair value of performance-based awards, forfeitures and amounts granted; (ii) strategic review and related costs incurred in connection with the separation and stand up of Centuri as its own public company are non-recurring; (iii) severance costs relate to non-recurring restructuring activities, (iv) securitization facility transaction fees represent legal and other professional fees incurred to establish our Securitization Facility, (v) CEO transition costs represent incremental costs incurred to find and hire a replacement CEO, (vi) loss on debt extinguishment relates to the write-off of debt issuance costs on the Company’s term loan and (vii) goodwill impairment can vary from period to period depending on economic and other factors.
As to certain of the items related to these non-GAAP metrics: (i) non-cash stock-based compensation varies from period to period due to changes in the estimated fair value of performance-based awards, forfeitures and amounts granted; (ii) separation-related costs represent expenses incurred post-Centuri IPO in connection with the separation and stand up of Centuri as its own public company, including costs incurred in association with Southwest Gas Holdings’ sale of its holdings of our common stock, which are not reflective of our ongoing operations and will not recur following the full separation from Southwest Gas Holdings; (iii) strategic review costs represent expenses incurred during the Centuri IPO and related costs incurred to establish Centuri as a public company leading up to the IPO; (iv) severance costs relate to non-recurring restructuring activities; (v) securitization facility transaction fees represent legal and other professional fees incurred to establish our Securitization Facility; (vi) CEO transition costs represent incremental costs incurred to find and hire a replacement CEO; (vii) other professional fees are non-recurring costs associated with certain one-time events; (viii) loss on debt modification and extinguishment represents non-recurring professional fees expensed as part of our credit facility refinance as well as the non-cash write-off of unamortized debt issuance costs associated with debt extinguishments, (ix) acquisition costs vary from period to period depending on the level of our acquisition activity, (x) goodwill impairment charges can vary from period to period depending on economic and other factors, and (xi) tax asset allocation reflects true-ups to our estimated allocation of tax assets based on Southwest Gas Holdings’ revised estimates of taxable income by jurisdiction.
Backlog as of December 29, 2024 and December 31, 2023 was approximately $3.7 billion and $5.1 billion, respectively. For both periods, approximately 90% of backlog related to MSAs. Results of Operations Our results of operations, on a consolidated basis and by segment, for the fiscal years ended December 29, 2024 and December 31, 2023 are set forth and compared below.
Results of Operations Our results of operations, on a consolidated basis and by segment, for the fiscal years ended December 28, 2025 and December 29, 2024 are set forth and compared below.
Goodwill is required to be measured for impairment at the reporting unit level, which represents the operating entity level or one level below the operating entity level for which discrete financial information is available. During fiscal year 2024, we changed our reporting units to align with changes in our organization structure, and as a result, we have four reporting units.
Goodwill is required to be measured for impairment at the reporting unit level, which represents the operating entity level or one level below the operating entity level for which discrete financial information is available.
U nless the context otherwise requires, references to “we,” “is,” “our,” and “our company” refer to Centuri Holdings, Inc. and its consolidated subsidiaries. As discussed in “ Note 1 — Description of Business ” to the consolidated financial statements, all financial information presented herein is the financial information of Centuri Holdings, Inc. and its subsidiaries, including Centuri Group, Inc.
U nless the context otherwise requires, references to “we,” “is,” “our,” “the Company,” and “our company” refer to Centuri Holdings, Inc. and its consolidated subsidiaries.
Assets securing the facility totaled $2.0 billion as of December 29, 2024 and $2.1 billion as of December 31, 2023. During the fiscal year ended December 29, 2024, the maximum amount outstanding on the combined facility was $1.117 billion, at which point $991.4 million was outstanding on the term loan portion of the facility.
During the fiscal year ended December 28, 2025, the maximum amount outstanding on the combined facility was $958.9 million, at which point $800.0 million was outstanding on the term loan portion of the facility.
Because EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted Net Income, as defined, exclude some, but not all, items that affect net loss, such measures may not be comparable to similarly titled measures of 54 Table of Contents other companies.
Because these non-GAAP metrics, as defined, exclude some, but not all, items that affect comparable GAAP financial measures, these non-GAAP metrics may not be comparable to similarly titled measures of other companies. EBITDA is defined as earnings before interest, taxes, depreciation and amortization.
Revenue from Southwest Gas Corporation totaled $106.8 million for the fiscal year ended December 29, 2024 compared to $116.4 million in the prior year. • Revenue from our Canadian Gas segment totaled $197.9 million in the fiscal year ended December 29, 2024, reflecting a decrease of $36.9 million, or 15.7%, compared to the prior year.
Revenue from Southwest Gas Corporation totaled $97.6 million during the fiscal year ended December 28, 2025 compared to $106.8 million in the prior year period. • Revenue from our Canadian Operations segment totaled $246.9 million in the fiscal year ended December 28, 2025, reflecting an increase of $49.0 million, or 24.8%, compared to the prior year period.
Severe weather events and the related impacts on our performance and results are not solely within the control of management and cannot always be predicted or mitigated. Inflation Our operations are affected by increases in prices, whether caused by inflation, rising interest rates or other economic factors.
Severe weather events and the related impacts on our performance and results are not solely within the control of management and cannot always be predicted or mitigated. Inflation Under the terms of a majority of our MSAs and other customer agreements, materials used in our utility infrastructure service activities are specified, purchased and supplied by customers.
Following the completion of the Separation, the Operating Company became our wholly owned subsidiary, and all of our operations are conducted through the Operating Company. On April 17, 2024, the IPO Registration Statement was declared effective, and our common stock began trading on the NYSE under the ticker “CTRI” (the “Centuri IPO”) on April 18, 2024.
On April 17, 2024, the registration statement related to the initial public offering of our common stock was declared effective, and our common stock began trading on the New York Stock Exchange (the “NYSE”) under the ticker “CTRI” (the “Centuri IPO”) on April 18, 2024.
Fiscal Year Ended Change (dollars in thousands) December 29, 2024 December 31, 2023 $ % Revenue, net $ 2,637,229 100.0 % $ 2,899,276 100.0 % $ (262,047) (9.0 %) Cost of revenue (including depreciation) 2,416,557 91.6 % 2,625,834 90.6 % (209,277) (8.0 %) Gross profit 220,672 8.4 % 273,442 9.4 % (52,770) (19.3 %) Selling, general and administrative expenses 107,247 4.1 % 110,344 3.8 % (3,097) (2.8 %) Amortization of intangible assets 26,642 1.0 % 26,670 0.9 % (28) (0.1 %) Goodwill impairment — — % 213,992 7.4 % (213,992) (100.0 %) Operating income (loss) 86,783 3.3 % (77,564) (2.7 %) 164,347 (211.9 %) Interest expense, net 90,515 3.4 % 97,476 3.3 % (6,961) (7.1 %) Other income, net (376) 0.0 % (64) 0.0 % (312) 487.5 % Loss before income taxes (3,356) (0.1 %) (174,976) (6.0 %) 171,620 (98.1 %) Income tax expense 3,466 0.2 % 9,530 0.4 % (6,064) (63.6 %) Net loss (6,822) (0.3 %) (184,506) (6.4 %) 177,684 (96.3 %) Net (loss) income attributable to noncontrolling interests (98) — % 1,670 — % (1,768) (105.9 %) Net loss attributable to common stock $ (6,724) (0.3 %) $ (186,176) (6.4 %) $ 179,452 (96.4 %) 50 Table of Contents Revenue and Gross Profit The following table summarizes our revenue, gross profit and gross margin for the periods indicated by segment as well as the dollar and percentage change from the prior year period.
Fiscal Year Ended Change (dollars in thousands) December 28, 2025 December 29, 2024 $ % Revenue, net $ 2,982,781 100.0 % $ 2,637,229 100.0 % $ 345,552 13.1 % Cost of revenue (including depreciation) 2,736,215 91.7 % 2,416,557 91.6 % 319,658 13.2 % Gross profit 246,566 8.3 % 220,672 8.4 % 25,894 11.7 % Selling, general and administrative expenses 126,464 4.3 % 107,247 4.1 % 19,217 17.9 % Amortization of intangible assets 27,281 0.9 % 26,642 1.0 % 639 2.4 % Operating income 92,821 3.1 % 86,783 3.3 % 6,038 7.0 % Interest expense, net 78,428 2.6 % 90,515 3.4 % (12,087) (13.4 %) Other income, net (194) 0.0 % (376) 0.0 % 182 (48.4 %) Income (loss) before income taxes 14,587 0.5 % (3,356) (0.1 %) 17,943 NM Income tax (benefit) expense (8,063) (0.3 %) 3,466 0.2 % (11,529) (332.6 %) Net income (loss) 22,650 0.8 % (6,822) (0.3 %) 29,472 (432.0 %) Net income (loss) attributable to noncontrolling interests 255 0.0 % (98) 0.0 % 353 (360.2 %) Net income (loss) attributable to common stock $ 22,395 0.8 % $ (6,724) (0.3 %) $ 29,119 (433.1 %) 45 Table of Contents Revenue and Gross Profit The following table summarizes our revenue and gross profit for the periods indicated by segment, as well as the dollar and percentage change from the prior year period.
We were formed for the purpose of completing an initial public offering, facilitating the separation of the Operating Company from Southwest Gas Holdings and other related transactions in order to carry on the business of the Operating Company, our predecessor for financial reporting purposes.
(the “Operating Company”) from Southwest Gas Holdings and other related transactions in order to carry on the business of the Operating Company, our predecessor for financial reporting purposes. Prior to April 13, 2024, Southwest Gas Holdings owned 1,000 shares of our common stock, representing 100% of the issued and outstanding shares of our common stock.
Additionally, rising interest 49 Table of Contents rates on our variable-rate debt could have a negative effect on our business, financial condition and results of operations.
Additionally, rising interest rates on our variable-rate debt could have a negative effect on our business, financial condition and results of operations. Overall, our results for the fiscal year 2025 were not significantly impacted by increases in prices, including due to tariffs implemented by the Trump Administration.
We made additional prepayments on our term loan debt of $100.0 million in September 2024 and $25.0 million in November 2024 with the proceeds from our Securitization Facility. Equipment Term Loans We currently have seven equipment term loans with initial amounts totaling approximately $170 million, with certain owned equipment used as collateral. The loans are serviced in U.S. dollars.
Equipment Term Loans As of December 28, 2025, we had six U.S. equipment term loans with initial amounts totaling approximately $150 million, with certain owned equipment used as collateral. The loans are serviced in U.S. dollars. Financial Covenants Certain of our debt instruments have leverage ratio caps and interest coverage ratio requirements.
Gas $ 69,511 5.5 % $ 123,626 9.1 % $ (54,115) (43.8 %) Canadian Gas 31,306 15.8 % 33,095 14.1 % (1,789) (5.4 %) Union Electric 58,002 8.4 % 57,740 6.9 % 262 0.5 % Non-Union Electric 61,853 12.7 % 58,231 12.3 % 3,622 6.2 % Other — — % 750 NM (750) NM Consolidated gross profit $ 220,672 8.4 % $ 273,442 9.4 % $ (52,770) (19.3 %) NM — Percentage is not meaningful • Revenue from our U.S.
Gas $ 71,201 5.4 % $ 69,511 5.5 % $ 1,690 2.4 % Canadian Operations 45,826 18.6 % 31,306 15.8 % 14,520 46.4 % Union Electric 71,027 8.8 % 58,002 8.4 % 13,025 22.5 % Non-Union Electric 58,512 9.8 % 61,853 12.7 % (3,341) (5.4 %) Consolidated gross profit $ 246,566 8.3 % $ 220,672 8.4 % $ 25,894 11.7 % • Revenue from our U.S.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−1 removed3 unchanged
Biggest changeRevenue and expense related to our foreign operations are, for the most part, denominated in the functional currency of the foreign operation, which minimizes the impact that fluctuations in exchange rates would have on our results of operations.
Biggest changeRevenue generated from Canadian operations represented 8% of our total revenue during fiscal 2025, 2024 and 2023 . Revenue and expense related to our foreign operations are, for the most part, denominated in the functional currency of the foreign operation, which minimizes the impact that fluctuations in exchange rates would have on our results of operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to various forms of market risk, including interest rate risk and foreign currency exchange rate risk. Historically, we have not been parties to any derivative instruments and did not have any derivative financial instruments during fiscal years 2024 , 2023 or 2022 .
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to various forms of market risk, including interest rate risk and foreign currency exchange rate risk. Historically, we have not been parties to any derivative instruments and did not have any derivative financial instruments during fiscal years 2025 , 2024 or 2023 .
We seek to manage foreign currency exposure by minimizing our consolidated net asset and liability positions in currencies other than the functional currency, and in the future, we may enter into foreign currency derivative contracts to manage such exposure. Historically, we have not had significant exposure to foreign currency risk. 64 Table of Contents
We seek to manage foreign currency exposure by minimizing our consolidated net asset and liability positions in currencies other than the functional currency, and in the future, we may enter into foreign currency derivative contracts to manage such exposure. Historically, we have not had significant exposure to foreign currency risk. 60 Table of Contents
As of December 29, 2024, we had $819.9 million in variable-rate debt under our term facility. We estimate a 1% change in interest rates would impact annual interest expense by approximately $8.2 million, assuming the outstanding balance of such debt remains constant over the next twelve months. Foreign Currency Risk We have foreign operations in Canada.
As of December 28, 2025, we had $707.2 million in variable-rate debt under our term facility. We estimate a 1% change in interest rates would impact annual interest expense by approximately $7.1 million, assuming the outstanding balance of such debt remains constant over the next twelve months. 59 Table of Contents Foreign Currency Risk We have foreign operations in Canada.
Removed
Revenue generated from Canadian operations represented 8% of our total revenue during fiscal 2024 and 2023 , and 12% of our total revenue during fiscal 2022 .