DEF: Centuri Holdings Annual Meeting Proxy Statement

Centuri Holdings, Inc. has issued its definitive proxy statement for the 2026 Annual Meeting of Stockholders, scheduled for May 19, 2026, detailing director elections, executive compensation, and stock purchase plan proposals.

Summary

• Centuri Holdings, Inc. is holding its Annual Meeting of Stockholders on May 19, 2026, in a virtual format.
• The meeting agenda includes the election of nine directors, an advisory vote on executive compensation, approval of the Centuri Employee Stock Purchase Plan, and ratification of PricewaterhouseCoopers LLP as the independent auditor.
• The Board of Directors recommends a vote FOR all proposals.
• Stockholders of record as of March 23, 2026, are entitled to vote.
• Proxy materials will be available online and mailed around April 6, 2026.
• The company highlights its 2025 achievements, including record revenue and improved earnings, following its separation from Southwest Gas Holdings.
• Key executive compensation elements include base salary, annual cash incentives tied to financial and safety metrics, and long-term equity incentives (PSUs and RSUs).
• The proposed Employee Stock Purchase Plan aims to allow eligible employees to purchase company stock at a discount.
• PricewaterhouseCoopers LLP has served as the company's auditor since 2002.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this filing as moderately positive, highlighting strong financial performance in 2025, successful separation from its former parent, and strategic growth initiatives. The forward-looking statements are optimistic, though the underperformance relative to peer TSR is a point of caution.

Positives

• Record annual revenue of $2,983 million in 2025, a 13% increase over 2024.
• Gross Profit increased by 12% to $247 million in 2025.
• Base Revenue and Base Gross Profit saw significant year-over-year increases of 18% and 35%, respectively.
• Base Gross Profit Margin improved to 8.0% in 2025 from 6.9% in 2024.
• Achieved Adjusted EBITDA of $249.0 million in 2025.
• Annual bookings reached $4.5 billion, with a strong mix of new awards and MSA renewals.
• Backlog expanded by 59% year-over-year to $5.9 billion.
• Successful completion of full separation from Southwest Gas Holdings.
• Strong performance in 2025, with executive compensation payouts reflecting achievement of financial and safety goals.
• The company's stock ownership policy encourages alignment between executives and stockholders.

Negatives

• James W. Connell Jr., Former Executive Vice President, Chief Commercial and Strategy Officer, resigned effective January 31, 2026, and did not receive severance benefits.
• The 2024 Cash Award for long-term incentives did not achieve threshold performance, resulting in no cash awards earned for that period.
• The company's TSR has underperformed its peer group in 2024 and 2025.

Risks

• Potential for accounting restatements to trigger clawbacks of incentive compensation.
• The company's executive compensation program is subject to advisory stockholder votes, which could influence future compensation decisions.
• The Employee Stock Purchase Plan has limitations on employee contributions and potential for disqualifying dispositions.
• The Tax Matters Agreement with Southwest Gas Holdings imposes certain restrictions on the company to preserve tax-free treatment of a distribution, with potential indemnification obligations if these are breached.
• The company's stock ownership policy requires executives and directors to accumulate stock, which could be a risk if stock prices decline.

Future Outlook

The company is well-positioned to capitalize on strong sector tailwinds, focusing on capital discipline and operational execution to achieve profitable growth and deliver enduring value. The 2026 outlook anticipates continued growth and value creation.

Management Comments

• "2025 was a pivotal year for Centuri as we realized full separation from our former parent company. Reflecting on the years end, we are proud of our achievements, which included record revenue for the year and improved company earnings and balance sheet health, as well as the expansion of our operations through the acquisition of Connect Utility Services in Atlantic Canada."
• "Now, charting our course as a standalone public company, we are well positioned to capitalize on the strong tailwinds in our sector while staying focused on capital discipline and strong work execution."
• "We are actively mapping a deliberate strategy to achieve profitable growth while delivering enduring value and meeting commitments to all of our stakeholders."
• "We believe that we can deliver sustained growth, underpinned by strong end-market fundamentals and our solid positioning, One Centuri approach, and ability to execute."
• "We've established a differentiated position as a top tier growth company while staying within our core competencies and maintaining a low-risk profile through long-term MSA contracts with high quality utility customers, complemented by a diverse portfolio of bid projects."
• "We are very well positioned heading into 2026 and we look forward to delivering for our stakeholders."

Industry Context

StockSavvy.ai notes that Centuri Holdings' proxy statement reflects a company navigating its first full year as a standalone entity post-separation from Southwest Gas Holdings. The focus on record revenue, improved earnings, and strategic acquisitions like Connect Utility Services aligns with industry trends of consolidation and expansion in the utility and energy infrastructure services sector. The company's emphasis on capital discipline and profitable growth is a common strategic imperative for companies in this capital-intensive industry.

Comparison to Industry Standards

• Centuri's 2025 revenue of $2.983 billion and 13% year-over-year growth are strong indicators, though direct comparison to specific industry benchmarks requires access to competitor filings for the same period.
• The improvement in Base Gross Profit Margin to 8.0% from 6.9% is a positive operational development. Industry standard margins can vary significantly by sub-sector (e.g., transmission vs. distribution, new build vs. maintenance).
• The 59% increase in backlog to $5.9 billion suggests robust demand for services, which is generally positive across the utility and energy infrastructure sector, driven by aging infrastructure and renewable energy transition needs.
• The company's peer group for executive compensation includes companies like MasTec, Inc., MYR Group Inc., and Primoris Services Corporation, which are direct competitors in the utility and energy infrastructure services market. Analysis of their compensation structures and performance metrics would provide a more detailed comparison.
• The proposed Employee Stock Purchase Plan, offering a discount of 15% (85% of the lower of grant or exercise date fair market value), is a common practice in the industry to incentivize employee ownership.

Corporate Governance

Related Party Transactions

• Centuri continues to perform construction services for Southwest Gas Corporation, a subsidiary of Southwest Gas Holdings. Approximately $97.6 million of revenue and $6.6 million of gross profit in fiscal 2025 were related to contracts with Southwest Gas Corporation.
• Karen S. Haller, a member of Centuri's Board, has an indirect interest in transactions involving Southwest Gas Holdings due to her executive positions there. She is retiring from Southwest Gas Holdings in May 2026.
• Centuri entered into a common stock purchase agreement with Icahn Partners LP and Icahn Partners Master Fund LP (affiliated with Carl C. Icahn) in November 2025, issuing approximately $75 million of common stock.
• Centuri granted resale registration rights to Icahn Investors for shares purchased in private placements.
• Certain members of Riggs Distler's management team acquired a 1.42% interest in Drum Parent LLC (former parent of Riggs Distler) in November 2021. Centuri has the right to purchase this interest, and the noncontrolling party has the right to require Centuri to purchase it under certain conditions.

Stakeholder Impact

• Shareholders: The election of directors, advisory vote on executive compensation, and approval of the ESPP directly impact shareholder governance and potential equity dilution. The company's financial performance and strategic direction, as outlined, are key to shareholder value.
• Employees: The proposed Employee Stock Purchase Plan offers an opportunity for eligible employees to acquire company stock, potentially increasing their financial stake and alignment with the company's success. Executive compensation structures are designed to motivate and retain key talent.
• Creditors: The company's financial health, as indicated by revenue, profit, and balance sheet improvements, is relevant to creditors. The company's debt structure and capital allocation strategies are implicitly important.
• Suppliers: While not explicitly detailed, the company's operational performance and growth (e.g., increased backlog) suggest continued demand for services, which would benefit suppliers in the utility and energy infrastructure sector.

Next Steps

• Stockholders to vote on proposals at the Annual Meeting on May 19, 2026.
• Election of nine directors to serve until the next annual meeting.
• Advisory vote on executive compensation.
• Approval of the Centuri Employee Stock Purchase Plan.
• Ratification of PricewaterhouseCoopers LLP as the independent registered public accounting firm for fiscal 2026.
• Company to report voting results in a Form 8-K filing with the SEC within four business days of the meeting.

Key Dates

Recommendation

The filing indicates a company in a stable operational phase with positive financial results and strategic growth initiatives. However, the underperformance of Centuri's Total Shareholder Return (TSR) relative to its peer group in recent years, as highlighted in the Pay Versus Performance section, suggests that while the company is executing operationally, market sentiment or broader economic factors may be weighing on its stock price. The proposed ESPP and routine director elections are not strong catalysts. Therefore, a 'hold' recommendation is appropriate, pending further evidence of TSR improvement or a more significant strategic catalyst.

Keywords

Centuri Holdings, Proxy Statement, Annual Meeting, Director Election, Executive Compensation, Employee Stock Purchase Plan, Independent Auditor, PricewaterhouseCoopers, Corporate Governance, SEC Filing