False000198159900019815992024-05-082024-05-08

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM 8-K
______________________
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 8, 2024
______________________
Centuri Holdings, Inc.
(Exact Name of Registrant as Specified in its Charter)
______________________
Delaware001-4202293-1817741
(State or Other Jurisdiction of Incorporation)(Commission
File Number)		(IRS Employer
Identification No.)
19820 N 7th Avenue, Suite 120
Phoenix, Arizona 85027
(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (623) 582-1235
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
______________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of exchange
on which registered
Common Stock, $0.01 per share par valueCTRINew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o


Item 2.02            Results of Operations and Financial Condition.

We are furnishing the disclosure in this Item 2.02 in connection with the disclosure of information in the form of the textual information from a press release issued on May 8, 2024.

The information in this Item 2.02 (including Exhibit 99.1) is furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

We do not have, and expressly disclaim, any obligation to release publicly any updates or any changes in our expectations or any change in events, conditions, or circumstances on which any forward-looking statement is based.

The text included with this Current Report on Form 8-K is available on our website at www.centuri.com, although we reserve the right to discontinue that availability at any time.
Item 9.01            Financial Statements and Exhibits.
(d)Exhibits
Exhibit No.Exhibit
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CENTURI HOLDINGS, INC.
Date: May 8, 2024
By:
/s/ Gregory A. Izenstark
Gregory A. Izenstark
Executive Vice President and Chief Financial Officer


Exhibit 99.1
PRESS RELEASE
Contacts:For Centuri investors, contact:For Centuri media information, contact:
(623) 879-3700Jennifer Russo
Investors@Centuri.com(602) 781-6958
JRusso@Centuri.com
FOR IMMEDIATE RELEASE
May 8, 2024
CENTURI REPORTS FIRST QUARTER RESULTS
PHOENIX, AZ – May 8, 2024 - Centuri Holdings, Inc. (NYSE: CTRI) ("Centuri" or the "Company") today announced results for the first quarter, ended March 31, 2024.

Financial Highlights
•On April 22, 2024, completed an initial public offering ("IPO") of 14.3 million shares of common stock (including the underwriters' full exercise of their over-allotment options) at a price to the public of $21.00 per share. Additionally, completed a concurrent private placement of 2.6 million shares of common stock at a price per share equal to the IPO price.
•Total net proceeds from capital raise transactions after deducting underwriting discounts and commissions and estimated offering expenses were $329.3 million; funds were primarily used to pay down outstanding debt on our credit facility.
•In April 2024, paid $92.0 million to acquire the remaining 10% outstanding noncontrolling interest in Linetec Services, LLC
•Received over $40 million of new awards from existing master service agreements ("MSAs") customers supporting the work to advance critical reliability and integrity spending
•First quarter consolidated revenue of $528.0 million
•First quarter results include net loss attributable to common stock of $(25.1) million, adjusted net loss of $(14.4) million, and adjusted EBITDA of $20.2 million
•First quarter results included $8.3 million of nonrecurring strategic review and severance costs

First quarter 2024 revenue was $528.0 million, compared to $653.3 million in the first quarter of 2023. Revenue was down from the previous year primarily due to unfavorable weather which drove a reduction in volumes under existing customer MSAs, as well as the timing of bid projects, and lower offshore wind and storm restoration services revenue.
Net loss attributable to common stock was $(25.1) million for the first quarter of 2024, which included nonrecurring strategic review costs and severance costs of approximately $8.3 million on a pre-tax basis, compared to $(8.8) million in the prior year period. Adjusted net loss for the first quarter of 2024 was $(14.4) million, compared to $(1.9) million in the previous year. Current year results were negatively affected due to the aforementioned factors that impacted our revenue. Adjusted EBITDA was $20.2 million in the first quarter of 2024 compared to $49.2 million in the first quarter of 2023.
“Delivering our financial results for the first time as a public company after successfully completing our IPO in April is a major milestone for the Centuri team and a reflection of our team's dedication, commitment and hard work," said Bill Fehrman, President and CEO of Centuri. "Moving past the typical seasonality experienced by our business during the first quarter of the year, we expect to continue to build on our track record of delivering consistent growth by serving our customers across the utility value chain. We are confident in Centuri’s prospects to deliver value for our stockholders as a standalone company."
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Centuri Group, Inc. and Subsidiaries
Supplemental Segment Data
For the Fiscal Three Months Ended
March 31, 2024 and April 2, 2023
(In thousands, except percentages)
(Unaudited)
Segment Results
Revenue
Fiscal Three Months EndedChange
(dollars in thousands)March 31, 2024April 2, 2023$%
U.S. Gas$226,578 42.9 %$259,337 39.7 %$(32,759)(12.6 %)
Canadian Gas34,648 6.6 %39,303 6.0 %(4,655)(11.8 %)
Union Electric163,851 31.0 %205,669 31.5 %(41,818)(20.3 %)
Non-Union Electric96,615 18.3 %136,606 20.9 %(39,991)(29.3 %)
Other6,331 1.2 %12,378 1.9 %(6,047)(48.9 %)
Consolidated revenue, net$528,023 100.0 %$653,293 100.0 %$(125,270)(19.2 %)

Gross profit
Fiscal Three Months EndedChange
(dollars in thousands)March 31, 2024April 2, 2023$%
U.S. Gas$(3,976)(1.8 %)$3,366 1.3 %$(7,342)(218.1 %)
Canadian Gas5,545 16.0 %4,476 11.4 %1,069 23.9 %
Union Electric11,369 6.9 %15,209 7.4 %(3,840)(25.2 %)
Non-Union Electric2,800 2.9 %18,487 13.5 %(15,687)(84.9 %)
Other(2,459)(38.8 %)411 3.3 %(2,870)NM
Consolidated gross profit$13,279 2.5 %$41,949 6.4 %$(28,670)(68.3 %)
NM — Percentage is not meaningful

•Revenue from our U.S. Gas segment totaled $226.6 million, reflecting a decrease of $32.8 million, or 12.6%, compared to the prior year. This decrease was primarily due to unfavorable winter weather which drove a reduction in net volumes under existing customer MSAs and timing of bid projects, as the prior year benefited from the commencement of a large project that has since been completed. As a percentage of revenue, gross profit decreased to (1.8%) in the current period from 1.3% in the prior period. Profitability was negatively affected by lower MSA volumes, unfavorable winter weather and the timing of bid projects.

•Revenue from our Canadian Gas segment totaled $34.6 million, reflecting a decrease of $4.7 million, or 11.8%, compared to the prior year. This decrease was primarily due to a reduction in net volumes under existing MSAs. As a percentage of revenue, gross profit increased to 16.0% in the current period as compared to 11.4% in the prior period primarily due to favorable changes in mix of work.

•Revenue from our Union Electric segment totaled $163.9 million, reflecting a decrease of $41.8 million, or 20.3%, compared to the prior year. This decrease was driven by a decline in offshore wind revenue of $12.6 million due to timing of project completion, as well as unfavorable winter weather conditions that led to a net reduction in volumes under other existing MSAs. Storm restoration services revenue for the Union Electric segment was $7.5 million for the first fiscal three months of 2024 compared to $8.3 million for the same period in 2023. As a percentage of revenue, gross profit decreased to 6.9% in the current period as compared to 7.4% in the prior period primarily due to changes in the mix of work, including less storm restoration services.

•Revenue from our Non-Union Electric segment totaled $96.6 million, reflecting a decrease of $40.0 million, or 29.3%, compared to the prior year. This decrease was primarily driven by a $20.4 million reduction in revenue from storm restoration services ($1.8 million for the first quarter of 2024 compared to $22.2 million for the same period in 2023), as well as a decrease in volumes under existing MSAs. As a percentage of revenue, gross profit decreased to 2.9% in the current period, compared to 13.5% in the prior period. Profitability was negatively affected by unfavorable changes in mix of work, including a reduction in storm restoration services revenue, which typically generates a higher profit margin than core infrastructure services, and lower MSA volumes.
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Conference Call Information
Centuri expects to hold its inaugural earnings conference call concurrent with the planned release of its second quarter 2024 financial results in August 2024. Additional information will be released closer to that time.

About Centuri
Centuri Holdings, Inc. was formed for the purpose of completing an IPO and other related transactions in order to carry on the business of Centuri Group, Inc., its predecessor for financial reporting purposes. Centuri Group, Inc. is a strategic utility infrastructure services company that partners with regulated utilities to build and maintain the energy network that powers millions of homes and businesses across the United States and Canada.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can often be identified by the use of words such as “will,” “predict,” “continue,” “forecast,” “expect,” “believe,” “anticipate,” “outlook,” “could,” “target,” “project,” “intend,” “plan,” “seek,” “estimate,” “should,” “may” and “assume,” as well as variations of such words and similar expressions referring to the future. The specific forward-looking statements made herein include (without limitation) statements regarding our confidence in our prospects to deliver value for our stockholders as an independent standalone company; our expectation to continue to build on our track record of delivering consistent growth by serving our customers across the utility value chain; our estimation of offering expenses, which impact the net proceeds from our IPO; and our expectation to hold our first earnings conference call when announcing our results for the second quarter of 2024. A number of important factors affecting the business and financial results of Centuri could cause actual results to differ materially from those stated in the forward-looking statements. These factors include, but are not limited to, capital market risks and the impact of general economic or industry conditions. Factors that could cause actual results to differ also include (without limitation) those discussed in Centuri’s filings filed from time to time with the SEC. The statements in this press release are made as of the date of this press release, even if subsequently made available by Centuri on its website or otherwise. Centuri does not assume any obligation to update the forward-looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future developments, or otherwise.

Non-GAAP Measures
We prepare and present our financial statements in accordance with GAAP. However, management believes that EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Loss, all of which are measures not presented in accordance with GAAP, provide investors with additional useful information in evaluating our performance. We use these non-GAAP measures internally to evaluate performance and to make financial, investment and operational decisions. We believe that presentation of these non-GAAP measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparisons of results. 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. Adjusted EBITDA is defined as EBITDA adjusted for (i) non-cash stock-based compensation expense, (ii) strategic review costs, and (iii) severance costs. Adjusted EBITDA Margin is defined as the percentage derived from dividing Adjusted EBITDA by revenue.

Adjusted Net Loss is defined as net loss adjusted for (i) strategic review costs, (ii) severance costs, (iii) amortization of intangible assets, (iv) non-cash stock-based compensation expense and (v) 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.

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. EBITDA excludes interest expense net of interest income; however, as we have borrowed money to finance transactions and operations, or invested available cash to generate interest income, interest expense and interest income are elements of our cost structure and can affect our ability to generate revenue and returns for our stockholders. Further, EBITDA excludes depreciation and amortization; however, as we use capital and intangible assets to generate revenues, depreciation and amortization are
3
necessary elements of our costs and ability to generate revenue. Finally, EBITDA excludes income taxes; however, as we are organized as a corporation, the payment of taxes is a necessary element of our operations. 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. When using EBITDA as a performance measure, management compensates for these limitations by comparing EBITDA to net loss in each period, to allow for the comparison of the performance of the underlying core operations with the overall performance of the company on a full-cost, after-tax basis.

As to certain of the items related to Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Loss: (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 costs related to the separation of Centuri are non-recurring; and (iii) severance costs relate to non-recurring restructuring activities. Because EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Loss, as defined, exclude some, but not all, items that affect net loss, such measures may not be comparable to similarly titled measures of other companies. The most comparable GAAP financial measure, net loss, and information reconciling the GAAP and non-GAAP financial measures, are set forth below.

Centuri Group, Inc. and Subsidiaries
Reconciliation of Non-GAAP Financial Measures
For the Fiscal Three Months Ended
March 31, 2024 and April 2, 2023
(In thousands)
(Unaudited)
Fiscal Three Months Ended
March 31, 2024April 2, 2023
Net loss$(25,233)$(7,105)
Interest expense, net24,099 22,376 
Income tax benefit(20,773)(4,208)
Depreciation expense27,651 31,203 
Amortization of intangible assets6,668 6,667 
EBITDA12,412 48,933 
Non-cash stock-based compensation(588)144 
Strategic review costs3,877 91 
Severance costs4,471 69 
Adjusted EBITDA$20,172 $49,237 
Adjusted EBITDA Margin (% of revenue)3.8 %7.5 %

Fiscal Three Months Ended
March 31, 2024April 2, 2023
Net loss$(25,233)$(7,105)
Strategic review costs3,877 91 
Severance costs4,471 69 
Amortization of intangible assets6,668 6,667 
Non-cash stock-based compensation(588)144 
Income tax impact of adjustments(1)
(3,607)(1,743)
Adjusted net loss$(14,412)$(1,877)
(1)Calculated based on a blended statutory tax rate of 25%.
4
Centuri Group, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
For the Fiscal Three Months Ended
March 31, 2024 and April 2, 2023
(In thousands, except per share information)
(Unaudited)
Fiscal Three Months Ended
March 31, 2024April 2, 2023
Revenue, net$504,745 $624,489 
Revenue, related party23,278 28,804 
Total revenue528,023 653,293 
Cost of revenue (including depreciation)492,853 584,115 
Cost of revenue, related party (including depreciation)21,891 27,229 
Total cost of revenue514,744 611,344 
Gross profit13,279 41,949 
Selling, general and administrative expenses28,550 23,539 
Amortization of intangible assets6,668 6,667 
Operating (loss) income(21,939)11,743 
Interest expense, net24,099 22,376 
Other (income) expense, net(32)680 
Loss before income tax benefit(46,006)(11,313)
Income tax benefit(20,773)(4,208)
Net loss(25,233)(7,105)
Net (loss) income attributable to noncontrolling interests(175)1,739 
Net loss attributable to common stock$(25,058)$(8,844)
Loss per share attributable to common stock:
Basic$(242,060)$(85,433)
Diluted$(242,060)$(85,433)
Shares used in computing earnings per share:
Weighted average basic shares outstanding0.10.1
Weighted average diluted shares outstanding0.10.1
5
Centuri Group, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
March 31,
2024		December 31,
2023
ASSETS
Current assets:
Cash and cash equivalents$18,405 $33,407 
Accounts receivable, net279,406 335,196 
Accounts receivable, related party, net8,409 12,258 
Contract assets254,369 266,600 
Contract assets, related party3,461 3,208 
Prepaid expenses and other current assets48,951 32,258 
Total current assets613,001 682,927 
Property and equipment, net537,682 545,442 
Intangible assets, net361,911 369,048 
Goodwill, net373,646 375,892 
Right-of-use assets under finance leases41,089 43,525 
Right-of-use assets under operating leases117,827 118,448 
Other assets74,150 54,626 
Total assets$2,119,306 $2,189,908 
LIABILITIES, TEMPORARY EQUITY AND EQUITY
Current liabilities:
Current portion of long-term debt$42,770 $42,552 
Current portion of finance lease liabilities11,092 11,370 
Current portion of operating lease liabilities19,940 19,363 
Accounts payable114,613 116,583 
Accrued expenses and other current liabilities238,134 187,050 
Contract liabilities13,648 43,694 
Total current liabilities440,197 420,612 
Long-term debt, net of current portion1,021,318 1,031,174 
Line of credit125,229 77,121 
Finance lease liabilities, net of current portion21,670 24,334 
Operating lease liabilities, net of current portion104,110 105,215 
Deferred income taxes134,939 135,123 
Other long-term liabilities69,564 71,076 
Total liabilities1,917,027 1,864,655 
Temporary equity:
Redeemable noncontrolling interests4,511 99,262 
Equity:
Common stock, $0.01 par value, 1,000 shares authorized, and 103.52 shares issued and outstanding
— — 
Additional paid-in capital373,351 374,124 
Accumulated other comprehensive loss(6,568)(4,025)
Accumulated deficit(169,015)(144,108)
Total equity197,768 225,991 
Total liabilities, temporary equity and equity$2,119,306 $2,189,908 
6
Centuri Group, Inc. and Subsidiaries
Condensed Statements of Cash Flows
For the Fiscal Three Months Ended
March 31, 2024 and April 2, 2023
(In thousands)
(Unaudited)
Fiscal Three Months Ended
March 31, 2024April 2, 2023
Cash flows from operating activities:
Net loss$(25,233)$(7,105)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation27,651 31,203 
Amortization of intangible assets6,668 6,667 
Amortization of debt issuance costs1,318 1,260 
Non-cash stock-based compensation expense(588)144 
Gain on sale of equipment(944)(661)
Amortization of right-of-use assets5,100 3,712 
Deferred income taxes(1,600)(5,267)
Changes in assets and liabilities, net of non-cash transactions(34,585)21,925 
Net cash (used in) provided by operating activities(22,213)51,878 
Cash flows from investing activities:
Capital expenditures(30,499)(23,237)
Proceeds from sale of property and equipment1,624 2,666 
Net cash used in investing activities(28,875)(20,571)
Cash flows from financing activities:
Proceeds from line of credit borrowings55,896 8,137 
Payment of line of credit borrowings(5,931)(71,017)
Principal payments on long-term debt(10,557)(13,207)
Principal payments on finance lease liabilities(2,914)(3,056)
Redemption of redeemable noncontrolling interest(37)— 
Other(173)(213)
Net cash provided by (used in) financing activities36,284 (79,356)
Effects of foreign exchange translation(198)104 
Net decrease in cash and cash equivalents(15,002)(47,945)
Cash and cash equivalents, beginning of period33,407 63,966 
Cash and cash equivalents, end of period$18,405 $16,021 





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v3.24.1.u1
Document and Entity Information
May 08, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date May 08, 2024
Entity Registrant Name Centuri Holdings, Inc.
Entity Incorporation State Country Code DE
Entity File Number 001-42022
Entity Tax Identification Number 93-1817741
Entity Address, Address Line One 19820 N 7th Avenue
Entity Address, Address Line Two Suite 120
Entity Address, City or Town Phoenix
Entity Address, State or Province AZ
Entity Address, Postal Zip Code 85027
City Area Code 623
Local Phone Number 582-1235
Written Communications false
Soliciting Material false
Pre Commencement Tender Offer false
Pre Commencement Issuer Tender Offer false
Security 12b Title Common Stock, $0.01 per share par value
Trading Symbol CTRI
Security Exchange Name NYSE
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0001981599
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