Centuri Holdings, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share information)

Condensed Consolidated Statements of Operations

(In thousands, except per share information)

Condensed Consolidated Statements of Comprehensive Income (Loss)

(In thousands)

Condensed Consolidated Statements of Cash Flows

(In thousands)

Condensed Consolidated Statements of Changes in Equity

(In thousands, except share information)

Notes to Condensed Consolidated Financial Statements

1. Description of Business

Organization Structure

Centuri Holdings, Inc. (“Holdings” and, together with its consolidated subsidiaries, the “Company” or “Centuri”) is a holding company incorporated in Delaware. Substantially all of the Company’s operations are conducted through Centuri Group, Inc. (the “Operating Company”), which is a wholly owned subsidiary of Holdings.

Holdings completed an initial public offering (“IPO”) in April 2024. Following the IPO, the Company’s former parent, Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”), reduced its ownership interest through a series of secondary offerings and private placements which culminated in Southwest Gas Holdings no longer owning any equity interest in the Company effective September 5, 2025. Accordingly, the Company no longer qualifies as a “controlled company” under the New York Stock Exchange rules.

Description of Operations

The Company is a North American utility and energy infrastructure services company, and it partners with regulated utilities to maintain, upgrade, and expand the energy network that powers millions of homes and businesses. The Company’s service offerings primarily consist of the modernization of utility infrastructure through the replacement, maintenance, retrofitting and installation of electric and natural gas distribution and utility-scale transmission networks and building capacity to meet current and future demands. The Company operates through a family of complementary companies working together across different geographies to establish solid customer relationships and a strong reputation for a wide range of capabilities.

2. Basis of Presentation and Recent Accounting Pronouncements

Interim Condensed Consolidated Financial Information

The unaudited condensed consolidated financial statements and footnotes were prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete annual financial statements. Certain information and footnote disclosures, normally included in annual financial statements prepared in accordance with GAAP, have been condensed or omitted pursuant to those rules and regulations. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto as included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2025. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to fairly state the financial position, results of operations, comprehensive income (loss) and cash flows with respect to the interim condensed consolidated financial statements have been included. The results of operations and comprehensive income (loss) for the interim periods are not necessarily indicative of the results for the entire fiscal year. The results of the Company have historically been subject to significant seasonal fluctuations.

The Company uses a 52/53-week fiscal year that ends on the Sunday closest to the end of the calendar year. Unless otherwise stated, references to months, quarters and years in the Company’s condensed consolidated financial statements relate to fiscal months, quarters and years rather than calendar months, quarters and years. The first fiscal nine months of 2026 and 2025 ended on September 27, 2026 and September 28, 2025, respectively, and each period had 39 weeks. The third fiscal quarters of 2026 and 2025 each had 13 weeks.

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.” The update enhances the level of detail available related to reporting about expenses. This update will be effective for the Company beginning with the annual reporting for the fiscal year ending 2027. The Company is currently evaluating the impact the rules will have on its disclosures and expects to be prepared to adopt the standard upon its effective date.

3. Revenue and Related Balance Sheet Accounts

The following table presents the Company’s revenue from contracts with customers disaggregated by contract type (in thousands):

Contract assets and liabilities consisted of the following (in thousands):

Contract assets primarily consist of revenue recognized on contracts in progress in excess of billings, which relates to the Company’s rights to consideration for work completed but not yet billed or approved at the reporting date, including retention amounts. Revenue earned on contracts in progress in excess of billings is transferred to accounts receivable when the rights become unconditional. Contract assets that are not expected to be billed and collected within one year of the financial statement date (“Non-current contract assets”) are classified as other assets on the condensed consolidated balance sheets. The Company applies the same approach to accounts receivable it does not expect to collect within one year.

Current contract assets included retention balances of approximately $74.2 million and $40.6 million as of September 27, 2026 and December 28, 2025, respectively, which are typically billed and collected upon project completion.

On occasion, the Company recognizes revenue related to contract claims and unapproved change orders. Contract claims and unapproved change orders occur when there is a dispute between the Company and a customer regarding a change in the scope of work and associated price for work already performed, or when the Company otherwise performs work above the scope of the initial contract without customer approval. As of September 27, 2026 and December 28, 2025, the Company had recorded approximately $68.8 million ($24.5 million non-current in other assets) and $47.8 million ($19.7 million non-current in other assets), respectively, in contract assets related to contract claims and unapproved change orders.

Total contract assets increased $46.1 million during the fiscal nine months ended September 27, 2026 due primarily to increased revenue and the timing of billings, which is based on the achievement of certain milestones. This increase was net of a reversal of revenue of $9.0 million ($7.4 million of which was a reduction in non-current contract assets) related to a revision of estimated variable consideration on a bid contract for work performed prior to 2020. See "Note 15 — Commitments and Contingencies — Legal Proceedings" for additional information.

Contract assets are recoverable from the Company’s customers based upon various measures of performance, including achievement of certain milestones, completion of specified units or completion of a contract. In addition, many of the Company’s time and materials (“T&M”) contract arrangements are billed in arrears pursuant to contract terms that are standard within the industry, resulting in revenue earned on contracts in progress in excess of billings or unbilled receivables being recorded as revenue is recognized in advance of billings. The lag in billing due to the aforementioned contractual provisions may create circumstances in which material changes to a customer’s business, cash flows or financial condition, which may be impacted by negative economic or market conditions, could affect the Company’s ability to bill and subsequently collect amounts due. These changes may result in the need to record an estimate of the amount of loss from uncollectible receivables.

Contract liabilities primarily consist of amounts billed in excess of revenue earned related to the advance consideration received from customers for which work has not yet been completed. The increase in the contract liabilities balance of $40.5 million from December 28, 2025 to September 27, 2026 was primarily due to additional payments received in advance of work completed, net of approximately $39.3 million of revenue recognized that was included in the balance as of December 28, 2025.

The Company considers retention and unbilled amounts to customers to be conditional contract assets, as payment is contingent on the occurrence of a future event. Accounts receivable, net, includes only amounts that are unconditional in nature, which means only the passage of time remains and the Company has invoiced the customer. Contract liabilities include amounts billed in excess of revenue earned on contracts in progress related to fixed-price, unit-price and T&M contracts.

For contracts where payment is expected to be collected less than one year from when services are performed (as determined at contract inception), the Company uses the practical expedient and does not consider the time value of money. For contracts with an original duration of one year or less, the Company has not disclosed the transaction price for the remaining performance obligations as of the end of each reporting period or the related timing of revenue recognition.

As of September 27, 2026, the Company had 97 fixed-price contracts with an original duration of more than one year. The aggregate amount of the transaction price allocated to the unsatisfied performance obligations of these contracts as of September 27, 2026 was $398.5 million. The Company expects to recognize revenue for substantially all of these remaining performance obligations of these contracts over approximately the next three years; however, the timing of that recognition is largely within the control of the customer, including when the necessary equipment and materials required to complete the work will be provided by the customer.

Accounts receivable, net consisted of the following (in thousands):

4. Segment Information

The Company’s reportable segments are: (i) U.S. Gas Utility Services (“U.S. Gas”); (ii) Canadian Utility Services (“Canadian Operations”); (iii) Union Electric Utility Services (“Union Electric”); and (iv) Non-Union Electric Utility Services (“Non-Union Electric”). Union Electric includes the results of JJ White, Inc. (“JJ White”), which was acquired in July 2026, and Canadian Operations includes the results of Connect Utility Services Corporation (“Connect”), which was acquired in November 2025.

The Company’s president and chief executive officer serves as the Company's chief operating decision maker (the "CODM"). The Company’s reportable segments are established in consideration of differences in services, geographic areas and workforce composition (union vs. non-union). The Company has not aggregated any operating segments into reportable segments. The CODM reviews short-term and long-term trends and budget-to-actual variances in gross profit to assess performance across the different segments in determining where to allocate resources.

U.S. Gas

U.S. Gas provides comprehensive services, including maintenance, replacement, repair, and installation for local natural gas distribution utilities (“LDCs”) focused on the modernization of customers’ infrastructure throughout the United

States. The work performed within this segment includes solutions for all stages of utility work and is performed primarily within the distribution, utility-scale transmission and end-user infrastructure, rather than large-scale, project-based, cross-country transmission. In addition, U.S. Gas performs other underground services, including water and fiber, and has an in-house fabrication shop providing pipe and component assembly. The Company is able to cater to the needs of its gas utility services and energy customers by serving union and non-union markets.

Canadian Operations

Canadian Operations provides comprehensive services, including maintenance, replacement, repair, and installation for local gas and electric utilities and energy providers. A majority of the work performed in this segment is focused on distribution, urban transmission and end-user interface under master service agreements (“MSAs”) for gas and electric utilities. This segment also provides storm response services and performs construction of electrical systems used in renewable energy projects.

Union Electric

Union Electric provides a comprehensive set of electric utility services encompassing maintenance, replacement, repair, storm response, upgrade and expansion services for urban transmission and local distribution infrastructure within union markets. The work performed within this segment is focused primarily on recurring local distribution and urban transmission services under MSAs, as opposed to large-scale, project-based, cross-country transmission, and services are primarily focused on infrastructure between the substation and end-user meter. In addition to core electric utility infrastructure, this segment provides heavy industrial work, including civil, mechanical, electrical, and fabrication (component assembly) services.

Non-Union Electric

Non-Union Electric provides a comprehensive set of electric utility services encompassing maintenance, replacement, repair, storm response, upgrade and expansion services for urban transmission and local distribution infrastructure within non-union markets. The work performed within this segment is focused almost exclusively on recurring local distribution and urban transmission services under MSAs as opposed to large-scale, project-based, cross-country transmission, and services are primarily focused on infrastructure between the substation and end-user meter.

Other/Eliminations

Other consists of any corporate and non-allocated transactions, and eliminations represents the elimination of intersegment activity.

Revenue and gross profit by segment are presented below (in thousands).

(1)U.S. Gas and Union Electric segment revenues included $11.7 million and $0.2 million of intersegment revenue, respectively, during the fiscal three- and nine-month periods ended September 27, 2026.

Gross profit represents the difference between revenue and cost of revenue. Cost of revenue is a significant expense that is regularly reported to the CODM by segment. Cost of revenue by segment was as follows (in thousands):

Depreciation expense, included in cost of revenue, by segment was as follows (in thousands):

(1)Depreciation expense within selling, general and administrative expense was excluded from the table above as it is not produced or utilized by management to evaluate segment performance.

Separate measures of the Company’s assets and cash flows, with the exception of capital expenditures, are not produced or utilized by the CODM to evaluate segment performance, as defined by Accounting Standards Codification Topic 280, “Segment Reporting.” The CODM does not use total assets by segment as a basis for decision making.

Capital expenditures by segment were as follows (in thousands):

Foreign Operations

The Company recorded revenue in Canada of approximately $98.5 million (8% of consolidated revenue) and $74.2 million (9% of consolidated revenue) during the fiscal three months ended September 27, 2026 and September 28, 2025, respectively, and $240.0 million (8% of consolidated revenue) and $169.0 million (8% of consolidated revenue) for the fiscal nine months ended September 27, 2026 and September 28, 2025, respectively.

5. Per Share Information

The amounts used to compute basic and diluted earnings (loss) per share attributable to common stock consisted of the following (in thousands):

Potentially dilutive securities that were antidilutive in the fiscal nine months ended September 28, 2025 due to the Company recording a net loss were not material.

6. Accounts Receivable Securitization Facility

In September 2024, the Company entered into athree-year, $125.0 million Receivables Purchase Agreement (as amended, the “Securitization Facility”), with PNC Bank, National Association (“PNC”), as administrative agent, to enhance the Company's financial flexibility by providing additional liquidity. On May 4, 2026, the Company entered into an amendment to the Securitization Facility which, among other things, increased the capacity from $125.0 million to $165.0 million.

Under the Securitization Facility, certain designated subsidiaries of the Company may sell or contribute their accounts receivable and contract assets generated in the ordinary course of their businesses and certain related assets to an indirect wholly owned bankruptcy-remote Special Purpose Entity (“SPE”) of the Company created specifically for this purpose. The SPE is a variable interest entity, and the Company is the primary beneficiary and therefore consolidates the SPE. The SPE transfers ownership and control of accounts receivable to PNC for payments as set forth in the agreement. The Company accounts for accounts receivable sold to the banking counterparty as a sale of financial assets and has derecognized the accounts receivable from the condensed consolidated balance sheet for the current period.

The total outstanding balance of accounts receivable that had been sold and derecognized was $165.0 million as of September 27, 2026. The increase in sold accounts receivable during the fiscal nine months ended September 27, 2026 resulted in an operating cash inflow of $40.0 million. The Company hadno unused capacity on the Securitization Facility as of both September 27, 2026 and December 28, 2025.

As of September 27, 2026, the SPE owned $187.7 million in accounts receivable and $147.3 million in contract assets that were not sold to PNC. As of December 28, 2025, the corresponding amounts were $60.2 million and $115.6 million. These balances are primarily included in accounts receivable, net and contract assets in the Company’s condensed consolidated balance sheet, with certain non-current balances included in other assets.

During the fiscal three and nine months ended September 27, 2026, the Company incurred yield fees under the Securitization Facility of $2.1 million and $5.4 million, respectively. These amounts were $1.8 million and $5.3 million, respectively, during the fiscal three and nine months ended September 28, 2025. Yield fees are recorded in interest expense, net on the Company’s condensed consolidated statements of operations.

7. Acquisitions

Connect

In November 2025, the Company completed the acquisition of all of the equity interests of Connect, a Canadian electric utility services provider. Connect’s revenue during the fiscal three and nine months ended September 27, 2026 was approximately $26.1 million and $71.6 million, respectively, and Connect’s earnings were not material. The Company recorded a measurement period adjustment related to the Connect acquisition that increased goodwill by approximately $1.7 million with a corresponding increase in deferred income tax liabilities, reflecting a refinement of the acquired deferred tax positions based on information obtained subsequent to the acquisition date. Due to the estimates made for purposes of purchase accounting, primarily with respect to liabilities existing as of the closing date, the final purchase accounting has not yet been completed and further refinements may occur, though future adjustments are not expected to be material.

JJ White

On July 20, 2026, the Company completed the acquisition of all of the equity interests in JJ White, a Pennsylvania-based provider of industrial and commercial construction and maintenance services, for an estimated $58.0 million in total cash consideration. Total consideration reflects net working capital adjustments and other post-closing adjustments from the $62.0 million base purchase price. The Company currently has a $0.2 million receivable recorded for consideration paid but expected to be refunded post-close. The Company acquired JJ White through Riggs Distler & Company, Inc., a consolidated subsidiary of the Company. The acquisition of JJ White expanded the Company’s core union electric capabilities across the Northeast and Midwest.

In connection with the acquisition, the Company recognized indemnification assets of $3.1 million related to certain pre-acquisition liabilities for which the sellers have agreed to indemnify the Company and which were funded in escrow. The indemnification assets were recognized on the same basis as the related indemnified liabilities, subject to the contractual terms and limitations of the indemnification arrangements. The ultimate amounts recoverable under the indemnification arrangements will depend on the resolution of the underlying indemnified matters.

Assets acquired and liabilities assumed in the transaction were recorded at their acquisition date fair values except as otherwise required by applicable guidance. Differences between the fair value of accounts receivable, net acquired and the gross contractual amount of receivables acquired were not material. Transaction costs associated with the acquisition were expensed as incurred. The Company’s allocation of the purchase price was based on an evaluation of the appropriate fair values and represented management’s best estimate based on available data (including market data, data regarding customers of the acquired businesses, terms of acquisition-related agreements, analysis of historical and projected results, and other types of data). The analysis included consideration of types of intangibles that were acquired, including customer relationships, trade name, and backlog. These intangibles were valued utilizing a discounted cash flow method. Determining the fair values of these intangible assets is judgmental in nature and requires the use of significant estimates and assumptions, including the attrition rate, revenue growth rate, gross profit percentage, and discount rate for customer relationships intangible assets, gross profit percentage and timing of recognition for the backlog asset, and the royalty rate and discount rate for the trade name intangible asset.

The estimated value of assets acquired and liabilities assumed as of July 20, 2026 were as follows (in thousands):

The amounts allocated to major classes of intangible assets were as follows (gross carrying amount in thousands):

The Company recorded $27.8 million of goodwill as a result of the acquisition, which has been assigned to the Union Electric reporting unit. Goodwill consists of the value associated with the assembled workforce and the estimated economic value attributable to future opportunities related to the transaction. Goodwill acquired in the JJ White acquisition is not expected to be tax-deductible.

Due to the estimates made for purposes of purchase accounting, the final purchase accounting has not yet been completed and further refinements may occur. The primary areas of the preliminary estimates that are not yet finalized relate to accounts receivable, contract assets and liabilities, intangible assets, indemnification assets, tax assets and liabilities, and other liabilities existing as of the closing date. Purchase accounting will be completed no later than one year following the acquisition date.

Results attributable to JJ White subsequent to the acquisition and through September 27, 2026 included $86.4 million in revenue and $3.9 million in net income attributable to common stock, reflecting preliminary purchase accounting adjustments that remain subject to revision as described above. During the fiscal three and nine months ended September 27, 2026, the Company incurred acquisition costs of $3.4 million and $4.8 million, respectively, which were recorded within selling, general and administrative expenses within the consolidated statement of operations.

Unaudited pro forma information for JJ White acquisition

The table below reflects unaudited pro forma consolidated revenue and net income attributable to common stock assuming that JJ White had been acquired at the beginning of fiscal year 2025 (in thousands):

To calculate pro forma results, acquisition costs of $3.4 million and $4.8 million incurred during the fiscal three and nine months ended September 27, 2026, respectively, were excluded from those periods and the full $4.8 million was included in the fiscal nine months ended September 28, 2025, as if the acquisition had occurred at the beginning of fiscal year 2025.

This information is provided for informational purposes only and is not necessarily indicative of the results of operations that would have occurred had the acquisition been completed at that date, nor is it indicative of future results of operations.

8. Goodwill

Changes in the carrying amount of goodwill of each of the Company’s reportable segments were as follows (in thousands):

(1)Net of accumulated impairment of $10.8 million as of September 27, 2026 and December 28, 2025.

(2)Net of accumulated impairment of $391.1 million as of September 27, 2026 and December 28, 2025.

9. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

10. Long-Term Debt

Long-term debt, including outstanding amounts on the Company’s line of credit, consisted of the following (in thousands):

(1)Fair values as of September 27, 2026 and December 28, 2025 were determined using discount rates commensurate with the Company’s credit rating.

On August 27, 2021, the Company entered into an amended and restated credit agreement. The agreement provided for a $1.145 billion secured term loan facility, at a discount of 1.00%, and a $400 million secured revolving credit facility. On July 9, 2025, the Company signed the sixth amendment to its second amended and restated credit agreement to refinance and replace in full the existing term loan facility with an $800 million term loan facility, $93.6 million of which was comprised of new term loans used to refinance existing indebtedness and $706.4 million of which was used to refinance existing term loans. This amendment also increased the maximum principal amount of the senior secured revolving credit facility from $400 million to $450 million. On January 12, 2026, the Company entered into the seventh amendment to its amended and restated credit agreement, which (i) repriced the term loan, (ii) decreased the fixed margin for secured overnight financing rate (“SOFR”) loans from 2.25% to 2.00% and (iii) decreased the fixed margin for base rate loans from 1.25% to 1.00%. This multi-currency facility allows the Company to request loan advances in either Canadian dollars or U.S. dollars. Amounts borrowed and repaid under the revolving line of credit portion of the facility are available to be re-borrowed. The Company’s term loan facility is set to mature on July 9, 2032, and the revolving credit facility is set to mature on July 9, 2030.

The obligations under the amended and restated credit agreement are secured by present and future ownership interests in substantially all direct and indirect subsidiaries of the Company, substantially all of the tangible and intangible personal property of each borrower, and all products, profits, and proceeds of the foregoing. The Company’s assets securing the amended and restated credit agreement as of September 27, 2026 totaled $2.6 billion. The amended and restated credit agreement contains restrictive covenants, including a restriction on dividend payments with an available amount generally defined as $65.0 million plus 50% of the Company’s consolidated net income since the beginning of the third fiscal quarter of 2025 adjusted for certain items, such as parent capital contributions, redeemable noncontrolling interest payments, and dividend payments, among other adjustments, as applicable.

The applicable margin for the revolving credit facility ranges from 1.25% to 2.25% for SOFR and Canadian Overnight Repo Rate Average (“CORRA”) loans and from 0.25% to 1.25% for base rate loans, depending on the Company’s net leverage ratio. The term loan facility has a fixed margin of 1.00% for base rate loans and 2.00% for SOFR loans. The table below summarizes the weighted average interest rates on the term loan facility and revolving credit facility as of September 27, 2026 and December 28, 2025:

The Company was required to maintain a leverage ratio of 4.50 to 1.00 for fiscal quarters ending prior to September 30, 2026, and is required to maintain a leverage ratio of 4.00 to 1.00 for quarters ending on or after September 30, 2026. The Company is also required to maintain an interest coverage ratio of greater than a minimum of 2.50 to 1.00.

As of September 27, 2026, the Company was in compliance with all of the financial covenants under the revolving credit facility. The Company is required to pay a commitment fee on the unused portion of the commitments which ranges from 0.15% to 0.35% per annum, depending on the Company’s net leverage ratio.

As of September 27, 2026 and December 28, 2025, the Company had borrowings outstanding of $0.8 billion and $0.7 billion, respectively, under its amended and restated credit agreement. The amount available under the revolving line of credit is further reduced by the amount of any outstanding letters of credit issued by the Company under the agreement. Accordingly, there was $220.7 million of unused capacity on the revolving line of credit as of September 27, 2026, net of outstanding letters of credit. The Company had $74.3 million of unused letters of credit available as of September 27, 2026 and $68.6 million as of December 28, 2025. Debt issuance costs associated with the Company’s line of credit are amortized over the term of the related line of credit. As of September 27, 2026 and December 28, 2025, there was $2.4 million and $2.9 million, respectively, in debt issuance costs recorded in other assets on the condensed consolidated balance sheets.

As of September 27, 2026, the Company had $55.4 million of surety-backed letters of credit issued outside of its amended and restated credit agreement.

Debt issuance costs associated with the Company’s term loan facility are amortized over the term of the related debt, which approximates the effective interest method. As of September 27, 2026 and December 28, 2025, debt issuance costs of $9.6 million and $10.8 million, respectively, were recorded as a reduction to long-term debt on the condensed consolidated balance sheets.

Amortization expense related to debt issuance costs is recorded as a component of interest expense in the condensed consolidated statements of operations. Amortization of debt issuance costs was $0.6 million and $0.7 million for the fiscal three-month periods ended September 27, 2026 and September 28, 2025, respectively. During the fiscal nine months ended September 27, 2026 and September 28, 2025, amortization of debt issuance costs was $1.7 million and $3.1 million, respectively.

As of September 27, 2026, the Company hadsix U.S. equipment term loans with initial amounts totaling approximately $150.0 million, with certain owned equipment used as collateral. The loans are serviced in U.S. dollars.

The fair value of the Company’s debt as of September 27, 2026 and December 28, 2025 was $0.8 billion and $0.7 billion, respectively. The carrying value of the Company’s revolving credit facility approximates fair value given interest rates on the revolving credit facility approximate market rates, and draws on the revolving credit facility are typically paid back in a short period of time. The fair values of the Company’s term loan facility and equipment loans were determined utilizing a market-based valuation approach, where fair values are determined based on evaluated pricing data, and as such are categorized as Level 2 in the hierarchy.

11. Leases

The Company has operating and finance leases for corporate and field offices, equipment yards, construction equipment and transportation vehicles. The Company is currently not a lessor in any significant lease arrangements. The Company’s leases have remaining lease terms of up to 12 years. Some of these leases include options to extend, generally for optional terms of up tofive years, and some leases include options to terminate withinone year. The equipment leases may include variable payment terms in addition to the fixed lease payments if machinery is used in excess of the standard work periods. The occurrence of these variable payments is not probable under the Company’s current operating environment and has not been included in consideration of lease payments. Leases with an initial term of 12 months or less are classified as short-term leases and are not recognized on the condensed consolidated balance sheets unless the lease contains a purchase option that is reasonably certain to be exercised, or unless it is reasonably certain that the equipment or property will be leased for greater than 12 months. Due to the seasonality of the Company’s operations, expense for short-term leases will fluctuate throughout the year with higher expense typically incurred during the periods when revenue is the greatest. As of September 27, 2026, the Company didnot have any significant executed lease agreements that had not yet commenced.

The components of lease expense were as follows (in thousands):

(1)Depreciation is included within cost of revenue in the accompanying condensed consolidated statements of operations.

(2)Short-term lease cost includes both leases and rentals with initial terms of 12 months or less.

Supplemental cash flow information related to leases was as follows (in thousands):

Supplemental information related to leases was as follows:

The following is a schedule of maturities of lease liabilities as of September 27, 2026 (in thousands):

Certain leases require the Company to pay variable property taxes, insurance and maintenance costs that have been excluded from the minimum lease payments presented in the above tables because they are variable in nature.

During the fiscal three months ended September 27, 2026, the Company entered into sale-leaseback transactions for certain of its machinery and equipment. These sales generated $18.7 million in proceeds and resulted in the addition of operating lease right-of-use assets and lease liabilities of approximately $15.1 million. The Company recorded a net gain of $1.9 million as a result of these transactions. The leases carry terms of 4 to 7 years.

12. Income Taxes

The Company’s current quarter provision for income taxes was prepared using the annual effective tax rate adjusted to remove discrete items, as those items will impact the quarter in which those items were reflected. The Company’s effective tax rate for the fiscal three months ended September 27, 2026 and September 28, 2025 was 44.7% and 78.9%, respectively, and for the fiscal nine months ended September 27, 2026 and September 28, 2025 was 46.1% and (14.4%), respectively.

For the fiscal three months ended September 27, 2026, discrete tax items impacting the effective tax rate were primarily due to acquisition and severance costs (the majority of both were not deductible). For the fiscal nine months ended September 27, 2026, discrete tax items impacting the effective tax rate were primarily due to the City of Chicago reversal and strategy implementation costs, as well as acquisition costs and severance costs (the majority of both were not deductible). For the fiscal three and nine months ended September 28, 2025, discrete tax items impacting the effective tax rate were primarily due to fees incurred in refinancing our debt and fees incurred in separating from Southwest Gas Holdings. Effective tax rates for all periods were impacted by U.S. tax on certain earnings of our foreign operations under the global intangible low-taxed income (“GILTI”) provisions of the Internal Revenue Code and the disproportionate amount of non-deductible expenses in relation to income (loss) before income taxes.

The Company regularly evaluates valuation allowances established for deferred tax assets for which future realization is uncertain, including in connection with changes in tax laws. The Company maintains a valuation allowance on certain state net operating loss carryforwards and for Canadian capital losses. Such valuation allowances are released as the related tax benefits are realized or when sufficient evidence exists to conclude that it is more likely than not the deferred tax assets will be realized.

There wereno unrecognized tax benefits recorded relating to uncertain tax positions as of September 27, 2026 or December 28, 2025.

As of September 27, 2026, with certain exceptions, the Company is no longer subject to U.S. federal, state, local, or Canadian examinations for years before fiscal year 2019.

13. Supplemental Cash Flow Disclosures

The following table represents the Company’s supplemental cash flow information related to interest and cash taxes paid (in thousands):

Non-cash lease activity is disclosed in “Note 11 — Leases.” The following table represents the Company’s non-cash investing activity (in thousands):

(1)Represents approximately $0.7 million that is expected to be paid within the next fiscal quarter pursuant to working capital and other adjustments, as well as $1.4 million in non-current liabilities which is offset by restricted cash.

Following is a reconciliation of the cash-related captions in the consolidated balance sheets to the consolidated statements of cash flows (in thousands):

14. Related Parties

Southwest Gas Holdings

Overview

Southwest Gas Holdings was formerly the Company’s parent and held a controlling interest in the Company until August 11, 2025, when its ownership decreased to 31%. On September 5, 2025, Southwest Gas Holdings sold all of its remaining ownership interest in the Company. The Company still considers Southwest Gas Holdings to be a related party as Southwest Gas Holdings’ former chief executive officer and director, who is continuing to serve as an advisor to Southwest Gas Holdings through the end of 2026, is a member of the Company’s Board of Directors.

Related Party Transactions

The Company performs various construction services for Southwest Gas Corporation, a wholly owned subsidiary of Southwest Gas Holdings. The following table represents the Company’s revenue in dollars and as a percentage of total revenue as well as gross profit in dollars and as a percentage of total gross profit relating to contracts with Southwest Gas Corporation (in thousands):

As of September 27, 2026 and December 28, 2025, approximately $22.6 million (4%) and $11.9 million (4%) of the Company’s accounts receivable, respectively, and $1.6 million and $0.7 million of contract assets, respectively, were related to contracts with Southwest Gas Corporation. There were $3.8 million of contract liabilities as of September 27, 2026 andno significant contract liabilities as of December 28, 2025 that related to contracts with Southwest Gas Corporation.

Agreements Related to the Separation from Southwest Gas Holdings

In connection with the Company’s IPO and separation from Southwest Gas Holdings, the Company previously entered into a Separation Agreement, Tax Matters Agreement, and Registration Rights Agreement with Southwest Gas Holdings. Following Southwest Gas Holdings’ disposition of its remaining ownership interest in the Company on September 5, 2025, many provisions of these agreements, including Southwest Gas Holdings’ governance rights and registration rights, have terminated or are no longer applicable.

The remaining provisions primarily relate to customary indemnification and cooperation obligations. As of the date of this report, there are no known claims, proceedings, or contingencies that would require indemnification by or to the Company under these agreements, and the ongoing obligations are not expected to have a material impact on the Company’s financial condition, results of operations, or cash flows.

On February 24, 2025, the Company entered into an Unutilized Tax Assets Settlement Agreement (the “Tax Assets Agreement”) with Southwest Gas Holdings, which governs the treatment of certain unutilized tax assets (the “Tax Assets”) retained by the Company following its deconsolidation from Southwest Gas Holdings for purposes of U.S. federal and relevant state income tax laws. Under the terms of the Tax Assets Agreement, such Tax Assets were initially treated as deemed capital contributions and recorded within additional paid‑in capital. After Southwest Gas Holdings’ ownership of the Company decreased below 50%, subsequent adjustments to Tax Assets were reflected as an adjustment to income tax benefit in the Company’s condensed consolidated statements of operations.

Tax Assets allocated to the Company remain subject to true‑up until after Southwest Gas Holdings files its U.S. federal and applicable state income tax returns for tax year 2025. Any future changes resulting from the true‑up process will be reflected in the Company’s condensed consolidated statements of operations. There were no changes during the fiscal nine months ended September 27, 2026.

Riggs Distler Noncontrolling Interest

In November 2021, certain members of management of Riggs Distler & Company, Inc. (“Riggs Distler”), a subsidiary of the Company, acquired a 1.42%interest in Drum Parent LLC (“Drum”), the parent company of Riggs Distler. The remaining noncontrolling interest in Drum outstanding as of September 27, 2026 was 0.80%.

15. Commitments and Contingencies

Legal Proceedings

The Company is a named party in various legal proceedings arising from the normal course of business. Although the ultimate outcomes of active matters are currently unknown, the Company does not believe any liabilities resulting from these known matters will have a material effect on its financial position, results of operations or cash flows, unless otherwise stated below.

NPL Construction Co. (“NPL”), a subsidiary of the Operating Company included in the U.S. Gas segment, is currently pursuing a contract claim for damages against the City of Chicago and related parties (collectively, the “City”), arising out of work that NPL performed for the City. NPL initiated this dispute through the City’s required administrative process on August 26, 2019. In response to NPL’s claim, the City has taken the position that it is entitled to withhold payments on amounts NPL believes it is owed for work already completed, claiming that further corrective work by NPL on the project is necessary and that withholding payment is appropriate until remediation is complete. On July 18, 2024, the administrative agency issued a decision denying NPL’s claim for damages. The Company disagrees with the decision of the administrative agency, and NPL filed a petition seeking a review of the administrative agency’s decision by the Circuit Court of Cook County Illinois on November 8, 2024.

On April 20, 2026, the Circuit Court entered an interlocutory memorandum opinion and order (the “Order”) addressing some, but not all, of NPL’s claims, with the remaining claims requiring later briefing and argument. Following further legal analysis of the Order, the Company disagrees with the Order and intends to continue to vigorously pursue this matter; however, based on the information available at this time, the Company reassessed its estimate of variable consideration under the contract in accordance with ASC 606 and reversed revenue of $9.0 million in the second fiscal quarter of 2026.

The Company may be entitled to additional revenue if future developments indicate a likelihood of collecting outstanding balances, or if NPL succeeds in its claims for damages. The Company can provide no assurance as to whether or when there will be material developments in this matter. The Company no longer has any amounts recorded as receivable or contract assets related to this matter, although NPL continues to assert its right to payment of the outstanding balances. The Company has no contingent liabilities accrued with respect to this matter.

The Company is the plaintiff in legal proceedings initiated during the fiscal three months ended September 27, 2026 against certain competitors and former operating company employees of the Company. In these lawsuits, the Company is seeking damages and injunctive relief for alleged breaches of restrictive covenants, breach of fiduciary duties, tortious interference, misappropriation of trade secrets, and related claims. The Company alleges that the competitors and former operating company employees diverted work crews, other personnel and future business to competing ventures, among other misconduct. In connection with these matters, the Company is incurring professional fees for litigation and investigation activities and employee retention expenses. These matters are at an early stage. Because litigation is inherently uncertain, the Company cannot predict the duration, total costs, or potential outcome related to the proceedings.

The Company maintains liability insurance for various risks associated with its operations. In connection with its liability insurance policies, the Company is responsible for an initial deductible or self-insured retention amount per occurrence, after which the insurance carriers would be responsible for amounts up to the policy limits.

Employment Agreements

The Company has employment agreements with certain executives and other employees, which provide for compensation and certain other benefits and for severance payments under certain circumstances. Certain employment agreements also contain severance clauses that become effective upon a change in control of the Company. Upon the occurrence of certain defined events in the various employment agreements, the Company would be obligated to pay varying amounts to the related employees, which vary with the level of the employees’ respective responsibilities.

Concentration of Credit Risk

The Company provides full-service utility infrastructure services to various customers, primarily utility companies that are located throughout the U.S. and Canada. The Company is subject to concentrations of credit risk related primarily to its revenue and accounts receivable and contract asset positions with customers, which is defined as greater than or equal to 10% of the Company’s consolidated balances. No customers accounted for more than 10% of revenue during the fiscal three or nine months ended September 27, 2026 or the fiscal three or nine months ended September 28, 2025. As of September 27, 2026 and December 28, 2025, one Non-Union Electric segment customer had a combined accounts receivable and contract assets balance above 10% of the consolidated accounts receivable and contract assets balance, which was $151.5 million and $131.9 million, respectively, or approximately 15% and 19%, respectively, of the consolidated balance of these accounts.

The Company primarily usestwo financial banking institutions. The Company’s cash on deposit with these financial institutions exceeded the federal insurability limits as of September 27, 2026. The Company believes its cash and cash equivalents are managed by high credit quality financial institutions.

Bonds and Parent Guarantees

Many customers, particularly in connection with new construction, require the Company to post performance and payment bonds. These bonds provide a guarantee that the Company will perform under the terms of a contract and pay its subcontractors and vendors. In certain circumstances, the customer may demand that the surety make payments under the bond, and the Company must reimburse the surety for any expenses or outlays it incurs. The Company may also be required to post letters of credit as collateral in favor of the sureties, which would reduce the borrowing availability under its revolving credit facility. As of September 27, 2026, the Company was not aware of any outstanding material obligations for payments related to these bond obligations.

Performance bonds expire at various times ranging from mechanical completion of a project to a period extending beyond contract completion in certain circumstances, and therefore a determination of maximum potential amounts outstanding requires certain estimates and assumptions. Such amounts can also fluctuate from period to period based upon the mix and level of the Company’s bonded operating activity. As of September 27, 2026, the estimated total amount of outstanding performance and payment bonds was approximately $907.0 million. The Company’s estimated maximum exposure related to the value of the performance bonds outstanding is lowered on each bonded project as the cost to complete is reduced, and each commitment under a performance bond generally extinguishes concurrently with the expiration of its related contractual obligation. The estimated cost to complete these bonded projects was approximately $366.6 million as of September 27, 2026.

Additionally, from time to time, the Company guarantees certain obligations and liabilities of its subsidiaries that may arise in connection with, among other things, contracts with customers, and equipment and real estate lease obligations. These guarantees may cover all of the subsidiary’s unperformed, undischarged and unreleased obligations and liabilities under or in connection with the relevant agreement. The Company is not aware of any claims under any guarantees that are material. The responsibility under a guarantee could exceed the amount recoverable from the subsidiary alone and could materially and adversely affect the Company’s consolidated financial condition, results of operations and cash flows.

16. Stock-Based Compensation

The Company maintains a stock-based compensation plan, which authorizes the granting of various equity-based incentives, including restricted stock units (“RSUs”) and performance stock units (“PSUs”). Stock-based compensation expense is amortized on a straight-line basis over the service period, which is generally the vesting period. The fair value of the Company’s RSU and PSU awards is measured at the market price of the Company’s common stock on the grant date. PSUs are earned based on the achievement of certain performance metrics in relation to a set target, and stock compensation expense may fluctuate based on the forecasted achievement prior to vesting or actual achievement of these target metrics upon vesting.

RSU grants to employees generally vest ratably on an annual basis over athree-year period following the grant date, although some awards may vest ratably on an annual basis overtwo years or cliff vest at the end of a shorter time period. RSU grants to non-employee directors typically vest at the end of aone-year period. PSU grants generally cliff vest at the end of athree-year period following the grant date. Forfeitures are recorded as they occur.

Non-cash stock-based compensation expense totaled approximately $2.2 million and $2.1 million for the fiscal three-month periods ended September 27, 2026 and September 28, 2025, respectively, and totaled approximately $8.5 million and $5.9 million for the fiscal nine-month periods ended September 27, 2026 and September 28, 2025, respectively.

The table below summarizes activity related to the Company’s stock-based compensation plans during the fiscal nine-month periods ended September 27, 2026 and September 28, 2025.

(1)PSUs granted under the Company’s 2025 Omnibus Incentive Plan were initially measured assuming target achievement of the applicable performance goals. One‑third of the total units were eligible to be earned based on performance for the fiscal year ended December 28, 2025. Following certification of performance results for this one-year period, earned units were converted into RSUs based on the certified level of achievement (105.1% of target), as only the passage of time remains.

As of September 27, 2026, total unearned compensation related to our common stock RSUs and PSUs was approximately $16.5 million and $10.1 million, respectively. These amounts are expected to be recognized over a weighted average period of approximately 1.5 years and 2.1 years, respectively.