Brent Thielman • D.A. Davidson & Co.

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CEO Daniel Peyovich highlighted the $20 billion addressable market for data center connectivity, noting these complex projects are in early stages and will contribute more significantly starting next year. He clarified that these new opportunities are competed for in a similar margin range as the core business and should not be modeled differently.

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CEO Jeffrey Thiede explained that project timing can be variable, with shorter preconstruction phases sometimes accelerating work, as seen in Q2. He affirmed that the company is proactively planning resources and adding headcount to support continued growth, viewing their early project involvement and partnership approach as a key strategic strength.

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Executive Jeff Thiede explained that the complexity of large projects involves extended front-end design and constructability reviews, which can create 'bumpy' but valuable backlog conversion. He affirmed a positive outlook for the T&D segment, driven by undergrounding opportunities and strong customer relationships. Regarding high-tech manufacturing, Thiede noted that despite some cyclicality, Everus's long-term relationships and expertise in sophisticated projects ensure their continued role with key semiconductor clients.

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Executive Jeff Thiede explained that the complexity of large projects necessitates early involvement in design and constructability, which can extend front-end timelines. He affirmed a positive outlook for the T&D segment, highlighting growth in undergrounding work and strong, long-term customer relationships. Regarding high-tech manufacturing, Thiede noted that despite some cyclicality in client capital spending, Everus maintains a robust, 30-plus year relationship with a major semiconductor client and remains well-positioned due to its proven track record.

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Executive Jeff Thiede explained that as Everus takes on larger, more complex projects, particularly in the data center and industrial markets, the time to complete them naturally extends. Executive Maximillian Marcy added that this could change the backlog burn percentage by up to 10 points compared to the past. Regarding seasonality, Jeff Thiede noted that the business is not significantly impacted by weather, and he expressed optimism for achieving a book-to-bill ratio of at least 1x for 2025.

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Executive Jeff Thiede attributed strong E&M bookings to high demand in data centers and hospitality, while noting the T&D backlog weakness was a matter of project timing. He explained that Everus effectively pivots resources from completed projects to growth areas. Thiede also stated that disciplined project selection and execution through their 'repeatable playbook' are enhancing margins. On M&A, he emphasized the focus is on finding culturally aligned companies that offer strategic synergies, rather than targeting a specific transaction size.

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CEO Matt Tobolski described the Applied Digital partnership as a key entry into the pure-play AI data center market, positioning AAON as a long-term thermal management supplier. He stated the Q4 outlook is supported by strong backlog visibility, the realization of price increases, and the new Memphis facility coming online. He attributed the strong AAON brand bookings, which are outperforming the market, to the success of the national accounts strategy and the popular Alpha Class heat pump technology.

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President and COO Matthew Tobolski expressed confidence that the refrigerant-related supply chain issues are abating and will be resolved in the second half of the year, noting they did not affect the BasX segment. He stated that AAON is well-positioned against tariffs due to high vertical integration and a strong U.S. supply base. On customer mix, Tobolski acknowledged the concentration from a large order but emphasized that diversifying the customer base is a key focus, with significant new order activity and engagement with a spread of new customers.

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President and COO Matthew Tobolski confirmed that existing and planned facilities (Redmond, Longview, and Memphis) will provide total capacity of around $1.5 billion, sufficient to meet the goal. He noted the Memphis facility is ramping up aggressively and should have a meaningful financial impact by Q4 2025. Tobolski expects sequential margin improvement at the BASX Oregon facility throughout 2025, approaching normalized rates in 2026. Both Tobolski and CEO Gary Fields confirmed that rooftop order visibility is improving and normalizing, with bookings up mid-teens for the three months ending in January.

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President and COO Matthew Tobolski explained that the Q1 sequential softness is due to historical seasonality in the Oklahoma segment, which will be offset by accelerating data center revenue in Q2, leading to substantially stronger performance. He noted that BASX as a brand will leverage the entire manufacturing fleet, so its growth isn't limited to the Redmond facility. CEO Gary Fields attributed the rooftop business lull to all three factors he's previously cited: the refrigerant transition, interest rates impacting construction starts, and past election uncertainty, but noted these headwinds have limited duration.

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President and CEO Antonio Carrillo expressed confidence in the 2026 outlook for wind, noting that while two plants need orders for 2026, they are actively working with customers and expect to fill that capacity. He explained the plant conversion was driven by accelerating demand for utility structures, faster permitting, and a trend toward larger poles, which fits Arcosa's manufacturing strengths. CFO Gail Peck added that it is a capital-efficient conversion of an idle plant into a high-growth, high-return business.

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CFO Gail Peck estimated the potential loss on tax credit sales at approximately $2 million per quarter. CEO Antonio Carrillo stated the margin target for utility structures is around 15%, with accretive results from Amaron and wind. He confirmed the Stavola ramp-up is on track with strong bidding activity. Regarding barges, Carrillo noted that while steel prices are high, demand is not strong enough to support them, and he sees significant underlying replacement demand for both tank and dry barges.

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Executive Gail Peck stated that with the Berlin facility fully ramped, Arcosa expects solid revenue growth from wind in 2025 and for wind to become a slightly larger, margin-accretive share of the segment. Executive Antonio Carrillo addressed the barge business, stating that tank barge capacity is fully booked for 2025, with hopper barge capacity booked into Q3 2025. He noted this backlog provides flexibility to focus on margins ahead of an expected strong multiyear replacement cycle.

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CEO Jule Smith highlighted strong growth across numerous Sunbelt markets, including Florida, Texas, and the Carolinas, driven by migration and robust state funding. He noted that the reshoring of American manufacturing is a significant future tailwind. He affirmed that the current acquisition strategy remains perfectly aligned, as the pipeline consists of traditional targets like good construction and service companies that fit their vertically integrated model and are located in these high-growth areas.

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CFO Gregory Hoffman reiterated the full-year CapEx guidance of $130-$140 million. Executive F. Smith characterized the M&A pipeline as active, with seller motivations focused on long-term planning. Hoffman outlined the plan to use strong cash flow for debt reduction to meet leverage targets, while maintaining cash at 3-5% of revenue. F. Smith described all state markets as healthy, with Texas and Florida being particularly strong, and noted a 'snowball effect' in contract awards across their footprint.

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President and CEO Kyle Larkin explained that construction revenue timing is influenced by project starts and finishes, with an acceleration expected in the second half due to a record Committed and Awarded Projects (CAP) balance. Regarding materials, he attributed the strong margin performance to sustainable factors like increased volumes in both asphalt and aggregates, driven by a healthy public market, and successful execution of the company's strategic plan. Larkin noted both segments are tracking well ahead of their full-year margin expansion targets.

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President and CEO Kyle Larkin confirmed that the public market is particularly strong, fueled by the IIJA, and he expects the record-high CAP balance to continue increasing throughout the year. Larkin attributed the robust Construction margins to improved project execution and a higher-quality project portfolio, stating the company is on track to improve the segment's gross profit margin by at least 1% in 2025 over 2024.

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CEO Kyle Larkin stated that minor, owner-driven project delays are not abnormal and the work remains in CAP, providing momentum for 2025. He clarified the 6-8% organic CAGR target uses 2024 as the baseline. Larkin expressed confidence in achieving high single-digit aggregate price increases in 2025, citing strong public market visibility from IIJA funding, a recovery in private markets, and rising 2025 asphalt order volumes.

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CFO Bruce Labovitz stated that while Q2's margin was a strong indicator, some labor inflation is expected, but the second-half collective margin should still be higher than the first half. He described the BIG Fund's capital deployment as 'opportunistically open-ended,' with pilot programs already underway. CEO Gary Bowman explained that the data center business is evolving from site development to encompassing the entire energy infrastructure, a shift accelerated by the E3i acquisition.

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CFO Bruce Labovitz confirmed the 70-80% backlog conversion rate within 12 months remains a good rule of thumb, though it may lengthen slightly as project sizes grow. Executive Gary Bowman stated that economic noise has not noticeably affected M&A dialogues, with no signs of distress selling or seller hesitation. Regarding AI, Bowman explained that while the company is beginning to integrate it, the technology has not yet fundamentally changed its operations or market position.

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CFO Bruce Labovitz stated that the strong new orders were broad-based across all markets, not concentrated in one area. He explained that the building infrastructure backlog can fluctuate due to its quicker project-turn characteristic. On capital allocation, Labovitz described it as an 'and' decision, not 'either/or,' balancing M&A, buybacks, and internal tech investments. He confirmed that acquisition integrations are progressing well, with most systems and operations fully integrated.

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CFO Bruce Labovitz and Executive Gary Bowman cited several levers for margin expansion: achieving greater economies of scale, better overhead cost control, marginal improvements in contract multipliers, and a renewed focus on operational excellence. They pointed out that the Q3 margin of 16.7% is already within the 16-17% target range for 2025. On building infrastructure, Gary Bowman described the market as stable and stated that based on a notable uptick in proposal activity, they see "new energy" and anticipate an acceleration in 2025.

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CEO Brian Gray explained that Oregon's legislative funding issues are unlikely to be resolved in time to benefit 2025. He attributed lower backlog margins to a revenue mix shift away from high-margin Oregon and the nature of larger projects. Gray confirmed the Strata acquisition guidance is on track and credited strong aggregates pricing to disciplined dynamic pricing initiatives, which supported an increase in the full-year pricing outlook.

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President and CEO Brian Gray identified Hawaii, California, and Texas as strong private markets, while noting pressure primarily in Oregon. Gray stated the Strata integration is proceeding very well, is accretive to margins, and is a key driver behind the company's increased full-year guidance, which was timed well with new infrastructure funding in North Dakota.

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President and CEO Brian Gray responded that while all regions are improving, the aggregates product line offers the most opportunity for margin expansion. Geographically, he highlighted the newly formed West segment (formerly Pacific) as having the most upside. Regarding private work, Gray noted a significant increase in bidding activity for subdivisions, data centers, and energy projects, with the majority of the volume impact anticipated in the second half of 2025.

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EVP & CFO Ken Dodgen attributed strong Utility bookings to broad-based MSA growth, particularly in power delivery, with gas and communications now expected to see mid-single-digit growth. Chairman & Interim CEO David King added that the fixed-price power delivery pipeline is robust, with bookings expected in late Q3 or Q4. Regarding the pipeline business, management will be opportunistic, potentially growing revenue to $500-600 million, but sees it as more of a 2026-2027 opportunity.

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Chairman and Interim CEO David King explained that continued margin progress in Utilities is not dependent on booking more project work, though growth could accelerate with supply chain improvements. He also revealed that Primoris is currently vetting close to $1 billion in natural gas projects tied to data centers.

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CEO Tom McCormick clarified that they are self-performing substation and interconnect work on renewables projects, which enhances their offering without handicapping the core power delivery business; in fact, it builds competencies. Regarding pipelines, he explained that the growing need for natural gas to fuel new power generation plants and support LNG facilities is driving project discussions and activity.

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CEO Tom McCormick clarified that the improvements in the Power business are part of a multi-year plan and will continue through 2025, with targets likely being met in late 2025 or 2026. For the solar business, he emphasized a strategy of disciplined organic growth, focusing on select clients and contracts, while also expanding complementary offerings like battery storage and O&M services. He added that any acquisitions would be small and targeted to supplement their EPC capabilities.

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CEO & Director Joseph Cutillo expressed high confidence in continued margin expansion for E-Infrastructure, driven by larger, more complex projects with multiple phases. He noted that e-commerce projects are re-emerging stronger than anticipated, with larger scopes, and will begin contributing in late 2025. For Building Solutions, he acknowledged near-term headwinds but expects the segment to maintain double-digit operating margins for the year, believing the market is near its bottom.

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CEO Joseph Cutillo explained that the non-data center backlog is robust, driven by steady manufacturing, resurgent e-commerce, and strengthening small industrial warehouse activity. Regarding tariffs, he stated exposure is minimal across all segments due to factors like 'Made in America' requirements in Transportation, price-locking for materials, indexing clauses for items like fuel, and the phased nature of E-Infrastructure projects that allows for building current costs into pricing.

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CEO Joseph Cutillo stated that E-Infrastructure margins are benefiting from stable pricing and significant productivity gains on large, multi-phase projects. For Building Solutions, he anticipates a stronger second half of 2025 and highlighted growth initiatives like expanding with PPG in Fort Worth and adding plumbing services in Phoenix. He expressed confidence in the long-term outlook, noting that strong data center demand provides a solid foundation, while other manufacturing onshoring can fill any gaps if semiconductor projects are delayed.

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CEO Joe Cutillo expressed high confidence that E-Infrastructure margins would continue to improve into 2025, driven by large, mission-critical data center projects that offset lower-margin work. He noted that while organic expansion has been successful, acquisitions are being evaluated to fill geographic gaps. For Building Solutions, Cutillo described softness in Dallas due to affordability issues but noted a recent positive uptick in plumbing starts. He confirmed continued growth in Houston and Phoenix, despite some volatility, and mentioned that homebuilders are very bullish for a 2025 rebound.

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CEO José R. Mas confirmed that MasTec is investing to grow its data center-related work, which has expanded from civil work to include associated power and telecom infrastructure. He stated that the company is more optimistic than ever about the long-term opportunities in this market and expects to provide more specific details on services in the coming quarters.

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CEO Jose Mas pointed to the strong non-pipeline growth (14% revenue, 26% EBITDA) and suggested the outlook may be conservative for renewables, the ramp-up of new communications contracts, and the Greenlink project. For wireless, he expressed long-term bullishness, citing the multi-year AT&T network swap and the eventual return of spending from Verizon and T-Mobile, for which MasTec is well-positioned.

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CFO Paul Dimarco projected a sustainable long-term cash conversion rate of 60% to 65% of adjusted EBITDA. CEO Jose Mas confirmed that the Communications segment's significant growth over the past three years has been primarily driven by wireline, a trend he expects to continue, though he also anticipates a recovery in wireless spending.

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EVP & CFO Matthew Jacobsen attributed the expected 50-100 basis points of Q3 margin expansion to ongoing improvements in delivery and installation margins from insourcing initiatives and some SG&A leverage, similar to the drivers seen from Q1 to Q2. President & COO Timothy Boswell addressed the high-growth products, stating that while a 30% rate may not be sustained indefinitely, the order book for Flex remains encouraging, and order rates for climate-controlled storage were up 60% YoY, indicating continued strong trends.

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President & COO Timothy Boswell explained that the lower starting point for modular units on rent was due to activation levels between Q3 and Q4 2024, but noted that current quarter-to-date activity is in line with their forecast. CFO Matt Jacobsen addressed storage rates, stating that assumptions for core container rate growth are subdued compared to prior years. He indicated the base case assumes a modest increase in core rates, with an additional contribution from VAPS penetration.

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CEO Tony Guzzi described the M&A environment as active, noting that EMCOR's criteria for cultural fit and fair value remain constant even as deal sizes increase. Regarding margins, Guzzi credited the impressive mechanical segment performance to productivity gains from VDC, BIM, and prefabrication rather than just pricing. He also confirmed that the Building Services segment is at an inflection point and is expected to return to growth.

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Chairman, President & CEO Tony Guzzi explained that EMCOR's M&A criteria remain focused on cultural fit and fair value, noting that larger deals are driven by owners seeking growth capital and risk mitigation. On margins, Guzzi attributed the strength to productivity gains from VDC, BIM, and prefabrication rather than just pricing, a point echoed by CFO Jason Nalbandian who suggested looking at 12-24 month rolling averages for sustainability. Guzzi also confirmed that the Building Services segment is at an inflection point and expected to return to growth.

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CEO Tony Guzzi explained the guidance reflects general macroeconomic uncertainty, not specific growth headwinds, and that the potential impact of tariffs is already factored into the range. He expressed strong optimism for the high-tech manufacturing sector, driven by reshoring and new drug development. CFO Jason Nalbandian clarified that the Miller acquisition was dilutive to the Electrical segment's reported margin due to intangible amortization, but CEO Tony Guzzi added that on an adjusted basis, its margins are neutral with the segment.

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Tony Guzzi, Chairman, President and CEO, explained that Miller Electric offers additive capabilities with minimal market overlap and will serve as a platform for further Southeast expansion. He noted that while EMCOR is in the 'early innings' of the AI data center buildout, the mix is shifting towards higher-power AI projects. Guzzi was cautious about building on record electrical margins but expressed confidence in their stability, attributing them to operational excellence, prefabrication, and strong labor management rather than pricing power. CFO Jason Nalbandian added that trailing 12-24 month performance is a good indicator of the segment's margin range.

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Chairman, President and CEO Tony Guzzi explained that data center growth is over 90% new build, driven by customer requests for EMCOR to expand into new geographic markets. CFO Jason Nalbandian and Tony Guzzi clarified that while current electrical margins are strong due to mix and execution, a single quarter is not an indicator, and a longer-term rolling average is a better way to view performance. They attributed the strength in traditional manufacturing to reshoring, automation, and energy efficiency projects.

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President & CEO Stuart Bradie stated that an increased award cadence is a reasonable expectation for the second half, given the record pipeline and forthcoming budget resolutions. EVP & CFO Mark Sopp added that timing could be affected by staffing changes in government contracting offices. To achieve 2027 targets, Bradie and Sopp highlighted the importance of pipeline conversion, growth from a lower post-EUCOM base, increased international defense spending, and capturing opportunities from the Reconciliation Act, which directs funds to KBR's core RDT&E and O&M areas.

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EVP & CFO Mark Sopp detailed the 2025 revenue growth, attributing approximately 5 percentage points each to HomeSafe ($300M-$500M) and the LinQuest acquisition (around $400M). He noted the LinQuest integration is performing well. President & CEO Stuart Bradie added that the success at Plaquemines and strong global demand for LNG are leading to increased early engagement from multiple customers, including new market entrants and those with existing facilities looking to expand.

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CEO Travis Boone attributed the Marine segment's strong performance to multiple large projects contributing simultaneously, not just the two major ones from last year. He confirmed that while the Hawaii and Grand Bahama projects will wind down later, other projects are ramping up to smooth the transition. Regarding military opportunities, Boone stated that award timings have shifted, with nothing expected in the current fiscal year. Despite some private sector delays, he remains optimistic about building backlog through the end of the year.

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CFO Scott Thanisch attributed the Concrete segment's Q1 loss to typical seasonality and lower productivity, confirming that the business is expected to return to profitability as the year progresses. He affirmed the expectation for a back-half weighted year and stated the balance sheet is strong, with no draws on the revolver and $40-$60 million of capacity to fund growth.

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CFO Scott Thanisch stated that the increased CapEx is expected to be funded largely by operating cash flow. CEO Travis Boone outlined the 2025 cadence as a buildup from Q1 through Q3, with Q4 potentially being less strong than the prior year as a major project concludes. Regarding Concrete margins, Boone believes they will get close to the target but may not fully reach it in 2025, with Thanisch adding that increased scale is the final step. Thanisch also confirmed they have not seen government spending concerns delay the timing of bids for Pacific projects.

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EVP & COO Trent McKenna clarified that the manufacturing pipeline remains strong, but the company is prioritizing the best opportunities, which are currently in technology. CEO Brian Lane praised the operating companies' project selection. EVP & CFO William George explained that while opportunities with new customers exist, they prioritize working with collaborative partners and estimated modular would remain a similar percentage of the overall growing business.

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EVP & COO Trent McKenna clarified that the manufacturing pipeline remains strong, but the company is prioritizing technology projects due to better opportunities. EVP & CFO William George stated that while opportunities with new hyperscalers exist, the company is focused on serving existing customers who are strong partners. He estimated modular would remain near its current percentage of the business. CEO Brian Lane confirmed that customer conversations are actively looking out to 2026 and 2027, with the company being 'full' for 2025.

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CFO William George clarified that the dip in manufacturing revenue was not due to weak demand but a strategic allocation of resources to more profitable tech-sector projects. CEO Brian Lane added that large manufacturing projects are inherently lumpy. Regarding the refrigerant transition, Lane stated it has had no impact and is expected to remain neutral. On the balance sheet, CFO William George asserted there is no minimum cash target, expressing a preference for deploying capital, including opportunistic share repurchases as seen in Q1.

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CEO Brian Lane attributed the strong margins to disciplined project selection, excellent execution by their field workforce, and working with good customers. COO Trent McKenna was not on the call. CFO William George explained that modular growth will be gradual and focused on productivity and automation, supporting overall margins. He also noted that higher CapEx reflects reinvestment in the business, including opportunistically purchasing operational facilities.

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CFO William George explained the dip in manufacturing revenue was a strategic choice to pursue more attractive data center work, while the pipeline in food and pharma remains strong. CEO Brian Lane confirmed that early involvement in large, multi-phase projects provides strong visibility and confidence. George noted that favorable payment terms are being negotiated broadly due to strong bargaining power. On M&A, he argued that the focus is on the quality of future earnings, not just the multiple, and that they continue to find deals at what they consider reasonable prices.

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CEO Ty Silberhorn explained that the Glass segment's pipeline is strengthening due to increased rigor, a strategic pivot to smaller jobs to fill market gaps, and ongoing productivity improvements, with revenue growth anticipated in Q3 and Q4. For other segments, Silberhorn noted that Metals and Services face tariff headwinds, making it a struggle to reach the bottom of their target margin ranges, while Performance Surfaces is expected to operate within its range. He clarified that the Performance Surfaces gains involve regaining and expanding shelf space in retail and custom framing shops. CFO Matt Osberg added that the focus is on growing absolute EBITDA dollars and that the Services segment's margin would have improved year-over-year without the tariff impact.

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CEO Ty Silberhorn confirmed that Services trends align with forecasts showing market softness, but noted the business is seeing a 'flight to quality'. CFO Matt Osberg expressed confidence that the Glass segment will operate within its 10-15% margin range in fiscal 2026 due to structural productivity and efficiency improvements. Ty Silberhorn added that the M&A pipeline is 'very active' and the company is focused on acquiring differentiated, higher-margin products that open up new growth areas.

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CEO Ty Silberhorn explained that UW Solutions and Apogee have minimal customer overlap, which he views as a positive for creating new opportunities, particularly in HD Printable Materials. He noted UW focuses on premium market segments. CFO Matt Osberg addressed the Architectural Glass segment, stating that while margins have been exceptionally strong due to favorable pricing and mix, the company's pipeline visibility suggests a moderation toward the upper end of the 10-15% target range in the second half of the year.

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Executive Christian Daes described the planned U.S. facility as complementary, starting with producing billets and eventually expanding, with a long-term goal of it representing 30-40% of future growth. CFO Santiago Giraldo added that residential orders were up 17% year-over-year since the quarter's end. Executive Jose Daes confirmed that business is "booming," with strong deal flow both within Florida and in new regions like Washington, New York, Boston, and Texas, leading to continued backlog growth and diversification.

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Executive Jose Daes described early 2025 single-family growth as "extraordinary" compared to the prior year. CFO Santiago Giraldo quantified lighter commercial projects as roughly 20-25% of total commercial revenue, with activity remaining stable. Jose Daes also confirmed strong demand from other states, including New Jersey, New York, Washington, California, and Texas, indicating geographic expansion.

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Executive Jim Mintern explained that the positive outlook is driven by several factors. He noted a recovery from trough activity levels in Western Europe, continued strong growth in Central and Eastern Europe underpinned by EU infrastructure funding, and early signs of a residential recovery in some markets. This, combined with commercial excellence and self-help measures, supports the division's performance.

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Chair and CEO Ward Nye expressed strong confidence in state funding, noting that 8 of Martin Marietta's top 10 states have increased their DOT budgets year-over-year. He provided specific examples: Texas's 10-year program is up to $104 billion, Colorado has $3.7 billion available for FY25, and North Carolina has a mechanism to shift sales tax revenue to its highway fund. Nye emphasized that the company's strategy since 2010 has been to focus on states with strong fiscal conditions, which is now proving to be a key advantage.

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CEO C. Nye confirmed that there will be a ramp-up period for the new capacity. He stressed the importance of the North Texas market and stated that the company will be very methodical and thoughtful in bringing the incremental volume to market over time, rather than all at once next year.

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CEO Avner Applbaum identified a slow start in Asia-Pacific, particularly in Australia's lighting market, but noted that order rates are now improving and factored into guidance. Regarding Brazil, he stated the market appears to have bottomed out, with stabilizing order activity and volume growth in Q1. While margins remain pressured, he expressed long-term optimism, adding that a robust project pipeline in the Middle East is helping to offset other regional weaknesses.

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President and CEO Avner Applbaum confirmed Valmont is not seeking transformational M&A, but rather bolt-on acquisitions that are tied to the core business and can make a meaningful contribution. On Agriculture pricing, he stated that despite market challenges, the company is not seeing pricing pressure due to its leadership position and the strong value proposition of its technology offerings like Agsense 365, which resonates with dealers and growers.

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President and CEO Avner Applbaum advised a cautious view on Brazil for 2025, despite encouraging order rates. He noted that low soybean prices continue to pressure farmer profitability and sentiment, but affirmed the long-term growth outlook remains strong due to the value proposition of pivot irrigation. For L&T, Applbaum attributed the tough quarter to weakness in residential lighting, timing of DOT projects, and plant flexibility issues, which are not expected to repeat at the same magnitude. He expressed a positive outlook for 2025, citing strong DOT order rates, the expected rebound in residential lighting (which lags housing starts by 12 months), and progress in improving plant flexibility.

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Frank Renda, President & CEO, stated that tariffs are not expected to have a material impact, as most projects already require 'Made in America' materials and the company works to lock in material pricing early. Regarding seasonality, both Renda and CFO Cody Gallarda acknowledged some unusual weather, such as snow in Texas. However, they explained that the geographic diversity of their active projects helps mitigate widespread disruptions, and they do not foresee a significant impact on overall operations.

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President and CEO Frank Renda stated the non-M&P legacy projects were from the 2018-2019 timeframe and should be complete in 2025, noting the Civil segment performed well outside of these. He affirmed they will be highly selective with new work. EVP and CFO Cody Gallarda highlighted the company's strong cash position and confirmed a high probability of cash flow acceleration as new, smaller, quicker-turn projects bridge the gap to larger ones starting.

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CFO Cody Gallarda clarified that the real estate transaction netted about $25 million in cash after debt paydown but did not provide a full pro forma balance. CEO Frankie S. Renda identified a legacy bridge project in the Midwest as the source of a write-down, noting it's scheduled to open in November. Cody Gallarda added that while M&P operational work will finish by mid-2025, claim pursuits may continue, but they expect to collect what is recorded on the balance sheet.

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Executive Jeff Thiede explained that an increase in large, complex projects, particularly in data centers, is extending the backlog conversion timeline. He also expressed optimism about market demand and the company's ability to grow its bookings. Regarding seasonality, Thiede noted that the company is not significantly impacted by weather and works year-round, implying no major shifts in cadence. Executive Maximillian Marcy added that the backlog burn rate could differ by up to 10 percentage points from historical norms due to the project mix.

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CEO Jeff Thiede attributed strong E&M bookings to high demand in data centers and institutional markets, explaining the T&D backlog softness as a matter of project timing. He noted the company's ability to pivot resources from completed projects to growth areas. Thiede also stated that margin enhancement comes from disciplined project selection, favorable contract terms, and execution via their 'repeatable playbook.' On M&A, he confirmed they are seeking culturally aligned companies to expand geographically or strengthen market position, emphasizing a focus on the right value and metrics.

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Incoming CFO John Regan explained the lower interest income is due to the impact of the share repurchase program and, most significantly, the repatriation of large cash balances from joint ventures back to the JV partners, which had previously been earning interest for the consolidated company. Regarding the Energy Solutions backlog, COO James Breuer stated that 2025 is a 'reloading year' and that an upward inflection is more likely in 2026, as the timing of final investment decisions (FIDs) for large projects ultimately rests with clients.

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CFO D. Kesler confirmed a wallboard price increase was announced for early February but avoided speculating on realization. He highlighted that cement margins were impacted by an $8 million headwind from two large, non-typical maintenance projects. He noted that while weather is a factor in the current quarter, January is always a difficult month to use for trend analysis.

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CFO Craig Kesler attributed the Wallboard pricing timing to multiple factors, primarily the need for clarity on single-family construction demand. Executive Michael Haack noted that while Eagle doesn't carry formal cement backlogs, project discussions remain positive. Mr. Kesler added that the Texas Lehigh clinker cooler replacement is a major, infrequent project that should significantly improve the plant's reliability, implying a return to a more normal maintenance cadence thereafter.

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Jeffrey Thiede, President and CEO of Everus, explained that the record backlog is diversified across data centers, semiconductors, and industrial projects. He noted that while the market is competitive, margins are comparable and can be enhanced through operational excellence. Thiede also highlighted Everus's ability to pivot resources from slowing markets, like Las Vegas hospitality, to high-growth areas.

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