Everus Construction Group, Inc. Q4 2025 Earnings Call Summary

Record full-year performance was primarily driven by the Electrical & Mechanical (E&M) segment, which saw 44% revenue growth fueled by data center and high-tech demand.

Management attributes margin expansion of 110 basis points (on an adjusted basis) to strict adherence to an operational playbook focused on project selection and bidding discipline.

Strategic geographic expansion is being executed through a ‘satellite’ model, recently entering a new territory to support a large semiconductor client with plans to scale into a permanent presence.

The company successfully scaled its workforce by 8.5% to 9,400 employees, leveraging union partnerships to mitigate industry-wide skilled labor shortages.

Investments in prefabrication and modular construction facilities, including a new Kansas City site, are being used to improve project predictability and safety while lowering costs.

The Transmission & Distribution (T&D) segment benefited from utility end-market trends, specifically in undergrounding and transmission work, resulting in a 41% backlog increase.

2026 revenue guidance of $4.1 to $4.2 billion assumes continued momentum in data centers, hospitality, and semiconductor markets, supported by an 80% backlog burn rate.

EBITDA guidance of $320 to $335 million reflects a conservative comparison against 2025’s ‘exceptional’ execution upside while maintaining margins above historical mid-7% levels.

Capital expenditure is projected to remain at 2% to 2.5% of revenue to support organic growth, fleet requirements, and further prefab expansion.

Management expects free cash flow conversion to improve in 2026 as working capital requirements stabilize following the rapid revenue scale-up seen in 2025.

The strategic roadmap prioritizes accretive M&A that expands geographic footprint or deepens service offerings in electrical, gas, and mechanical sectors.

The company maintains a low net leverage of 0.4x, significantly below the long-term target of 1.5x to 2.0x, providing substantial capacity for future acquisitions.

Incremental stand-alone operating costs as a new public company totaled $28 million for the full year, in line with initial expectations.

Management explicitly stated there are currently no return of capital programs, as they believe reinvesting for growth is the highest and best use of capital.

Labor cost inflation is managed through a mix of cost-plus contracts (approximately 50% of work) and proactive forecasting in fixed-price bids.