Primoris Services Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue for the three months ended September 30, 2026, was $1.95 billion, a 10.4% decrease compared to $2.18 billion in the prior year period.
• Net income was $51.3 million ($0.95 diluted EPS), a decrease of $43.3 million ($0.78 per share) from $94.6 million ($1.73 diluted EPS) in the prior year.
• Adjusted net income was $64.9 million ($1.20 diluted EPS), a decrease of $38.2 million ($0.68 per share) from $103.1 million ($1.88 diluted EPS) in the prior year.
• Adjusted EBITDA was $134.4 million, a 20.3% decrease from $168.7 million in the prior year.
• Gross profit margin decreased to 10.5% from 10.8% in the prior year.
• Operating income was $94.9 million, a 30.7% decrease from $137.0 million in the prior year.
• SG&A expenses were $109.0 million, an increase of $11.3 million from the prior year, representing 5.6% of revenue compared to 4.5%.
• Interest expense, net, increased to $14.3 million from $7.0 million in the prior year.
• For the nine months ended September 30, 2026, revenue was $5.20 billion, net income was $44.6 million, and adjusted net income was $82.4 million.

Guidance and Future Outlook:

• Full-year 2026 net income guidance updated to $65.2 million to $73.2 million ($1.20 to $1.35 diluted EPS).
• Full-year 2026 Adjusted EPS guidance updated to $2.10 to $2.25 per diluted share.
• Full-year 2026 Adjusted EBITDA guidance updated to $290.0 million to $310.0 million.
• Full-year 2026 SG&A expenses targeted in the low 6.0% range of revenue.
• Full-year 2026 gross margin targets set at 10.0% to 12.0% for the Utilities segment and 6.0% to 8.0% for the Energy segment.
• Full-year 2026 effective tax rate expected to be approximately 33.0%.
• Full-year 2026 interest expense, net, expected to be between $43 million and $47 million.
• Capital expenditures for the remainder of 2026 expected to total $30.0 million to $40.0 million.
• Management anticipates a return to growth in 2027 supported by a record backlog and improved project execution.

Business Segments and Product Lines:

• Utilities Segment: Revenue increased 4.5% to $770.9 million; operating income increased 27.2% to $70.1 million; gross profit margin improved to 13.0% from 11.7%. Growth driven by gas operations and power delivery, partially offset by decreased communications activity.
• Energy Segment: Revenue decreased 17.6% to $1.22 billion; operating income decreased 53.0% to $51.0 million; gross profit margin declined to 8.5% from 10.1%. Decreases attributed to slower renewable energy project starts and releases, partially offset by the May 1, 2026, acquisition of PayneCrest Electric, Inc. and increased power generation projects.
• Total backlog reached a record $14.1 billion as of September 30, 2026, including $8.5 billion in Master Service Agreement (MSA) backlog.
• Utilities backlog totaled $8.1 billion; Energy backlog totaled $6.0 billion.
• The Energy segment's fixed backlog includes approximately $593.6 million from the PayneCrest acquisition.

Market and Competitive Landscape:

• Demand for reliable and affordable energy infrastructure remains robust across end markets.
• Primoris maintains a leading position in utility-scale solar and battery storage solutions.
• The company faces challenges in the renewables market regarding project execution and margins, with six previously discussed challenged projects nearing completion.
• Lower than anticipated volumes in 2026 led to higher relative carrying costs for equipment and personnel in the Energy segment.

Risks and Challenges:

• Lower margins in the Energy segment due to operational challenges on renewable energy projects and lagging effects of project completions.
• Higher interest expense driven by increased average debt and accounts receivable securitization facility balances.
• Potential for project cancellations at customer convenience and scope definition issues in MSA backlog.
• Forward-looking statements involve risks including economic conditions, project timing, weather, labor availability, and geopolitical tensions.

Management Commentary and Tone:

• CEO Koti Vadlamudi stated that third-quarter results reflect progress in completing renewable energy projects that previously weighed on margins.
• Management expressed increasing confidence that the impacts of challenged projects will soon be behind the company.
• The company is well-positioned to capitalize on significant opportunities and return to profitable growth in 2027.
• Management highlighted the strength and resilience of the broader Primoris platform despite the challenging year.

Other Key Points:

• Announced a share purchase authorization of up to $250 million of common stock.
• Purchased 1,330,627 shares for $100.0 million in the third quarter, completing the full $150.0 million legacy share purchase program.
• Board declared a $0.08 per share cash dividend payable on January 15, 2027.
• Acquired PayneCrest Electric, Inc. on May 1, 2026, contributing to Energy segment revenue and backlog.
• Cash and cash equivalents were $203.5 million as of September 30, 2026.
• Capital expenditures for the nine months ended September 30, 2026, were $92.4 million.
• Conference call and webcast scheduled for November 4, 2026.