10-K: Centuri Holdings Reports Fiscal Year 2024 Results in First 10-K Filing

Centuri Holdings files its first 10-K report, detailing financial performance and strategic outlook for fiscal year 2024 following its separation from Southwest Gas Holdings.

Summary

• Centuri Holdings, Inc., a North American utility infrastructure services company, has filed its annual report on Form 10-K for the fiscal year ended December 29, 2024.
• The company partners with regulated utilities to maintain, upgrade, and expand energy networks.
• Centuri serves over 400 customers, including major utilities like American Electric Power and Sempra Energy.
• The top 20 customers accounted for 67% of the company's revenue in fiscal 2024.
• Approximately 80% of revenue was generated from variable-priced contracts.
• The company operates across 87 locations in 45 U.S. states and two Canadian provinces.
• Centuri reports results under four segments: U.S. Gas Utility Services, Canadian Gas Utility Services, Union Electric Utility Services, and Non-Union Electric Utility Services.
• The company is committed to sustainability and adheres to guiding principles for safety, environmental stewardship, and community impact.
• The company is not directly regulated by state utilities commissions or FERC.
• As of December 29, 2024, Centuri had 8,687 regular full-time equivalent employees.
• Approximately 59% of employees are represented by unions and covered by collective bargaining agreements.
• The company was incorporated in Delaware in June 2023 and completed its IPO on April 22, 2024.
• As of February 14, 2025, there were 88,517,521 shares of Common Stock of the Registrant outstanding.

Positives

• The company has long-standing relationships with many of its significant customers.
• The company has a favorable mix of contracts, with 80% of fiscal 2024 revenue generated from variable-priced contracts.
• The company is committed to sustainability through its work and operations.
• The company maintains a competitive market-based total rewards strategy to attract, retain, motivate and develop employees.
• The company has implemented a robust safety program that strives to ensure all projects are executed with the highest level of safety and quality standards.

Negatives

• The loss of, or reduction in business from, certain significant customers could have a material adverse effect on the company's business.
• The company's financial and operating results may vary significantly from quarter-to-quarter and year-to-year.
• The company derives a significant portion of its revenues from long-term MSAs that may be cancelled by customers on short notice, or which the company 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.
• The company's actual cost may be greater than expected in performing its contracts due to various factors, causing the company to realize significantly lower profit or experience losses on its projects.
• Fixed-price and unit-price contracts are subject to potential losses that could materially and adversely affect the company's results of operations.
• The nature of the company's operations presents inherent risk of loss that could materially and adversely affect its results of operations and financial condition, earnings and cash flows.
• The company operates in a highly competitive industry, and competitive pressures could negatively affect its 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, the company's work mix and volumes, which could materially and adversely affect its results of operations overall.
• The company's 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 the company's collective operations.

Risks

• Customer project scheduling and duration can impact results.
• Weather and general economic conditions can affect operations.
• Outcomes from contract and change order negotiations are uncertain.
• The company's ability to successfully procure new work and impacts from work awarded or failing to be awarded work from significant customers, the mix of work awarded, and the amount of work awarded to us following work stoppages or reduction can impact results.
• The results of productivity inefficiencies from regulatory requirements, customer supply chain challenges, or otherwise, delays in commissioning individual projects, the ability of management to successfully finance, close on and assimilate any acquired businesses, and changes in our mix of customers, projects, contracts and business can impact results.
• Regional or national and/or general economic conditions and demand for our services can impact results.
• Price, volatility, and expectations of future prices of natural gas and electricity can impact results.
• Increases in the costs to perform services caused by changing conditions can impact results.
• The termination, or expiration of existing agreements or contracts can impact results.
• Decisions of our customers as to whether to pursue capital projects due to economic impacts resulting from a pandemic or otherwise can impact results.
• The budgetary spending patterns of customers can impact results.
• Inflation and other increases in construction costs that we may be unable to pass through to our customers can impact results.
• Cost or schedule overruns on fixed-price contracts can impact results.
• Availability of qualified labor for specific projects can impact results.
• The need and availability of letters of credit, payment and performance bonds, or other security can impact results.
• Costs we incur to support growth, whether organic or through acquisitions can impact results.
• The timing and volume of work under contract can impact results.
• Losses experienced in our operations can impact results.
• The results of the review of prior period accounting on certain projects and the impact of adjustments to accounting estimates can impact results.
• Developments in governmental investigations and/or inquiries can impact results.
• Intense competition in the industries in which we operate can impact results.
• Existing or future litigation or regulatory proceedings, dispute resolution proceedings or claims, including claims for additional costs can impact results.
• Failure of our partners, suppliers or subcontractors to perform their obligations can impact results.
• Cyber-security breaches can impact results.
• Failure to maintain safe worksites can impact results.
• Risks or uncertainties associated with events outside of our control, including severe weather conditions, public health crises and pandemics, political crises or other catastrophic events, such as the conflict in the Middle East and the ongoing war in Ukraine can impact results.
• The impact of changes to federal policies, including those with respect to taxes, trade policies and tariffs, that affect U.S. relations with the rest of the world can impact results.
• Adverse developments affecting specific financial institutions or the broader financial services industry, including liquidity shortages or bank failures can impact results.
• Client delays or defaults in making payments can impact results.
• The cost and availability of credit and restrictions imposed by our debt agreements can impact results.
• The impact of credit rating actions and conditions in the capital markets on financing costs can impact results.
• Changes in construction expenditures and financing can impact results.
• Levels of or changes in operations and maintenance expenses can impact results.
• Our ability to continue to remain within the ratios and other limits in our debt covenants can impact results.
• Failure to implement strategic and operational initiatives can impact results.
• Risks or uncertainties associated with acquisitions, dispositions and investments can impact results.
• Possible information technology interruptions or inability to protect intellectual property can impact results.
• Our failure, or the failure of our agents or partners, to comply with laws can impact results.
• Our ability to secure appropriate insurance, licenses or permits can impact results.
• New or changing legal requirements, including those relating to environmental, health, licensing and safety matters can impact results.
• The loss of one or more clients that account for a significant portion of our revenue can impact results.
• Asset impairments can impact results.

Key Dates