Jorge Casado - Vice President Investor Relations Ronald Tutor - Chairman and Chief Executive Officer Michael Kershaw - Executive Vice President and Chief Financial Officer

Steven Fisher - UBS Securities Financial Alexander Rygiel - FBR Capital Markets John Rogers - D.A. Davidson Michael Shlisky - Global Hunter Securities John D'Angelo - Macquarie Securities Group

Good day, ladies and gentlemen, and welcome to the Tutor Perini Corporation Second Quarter 2015 Earnings Conference Call. My name is Darrell, and I will be your coordinator for today. At this time, all participants are in a listen-only mode. Later we will be conducting a question-and-answer session. As a reminder, this conference is being recorded for replay purposes. [Operator Instructions] I would now like to turn the conference over to your host for today, Mr. Jorge Casado, Vice President of Investor Relations. Please proceed.

Good afternoon and thank you all for your interest and participation. Joining us on the call today are Ronald Tutor, our Chairman and CEO; and Michael Kershaw, Executive Vice President and CFO. Before we discuss our second quarter results, I’ll remind everyone that during today's call we will be making forward-looking statements which reflect our current analysis of existing trends and information. There is an inherent risk that actual results and experience could differ materially. You can find a discussion of our risk factors, which could potentially contribute to such differences, in our most recent Form 10-K which was filed on February 26, 2015. With that, I will turn the call over to our Chairman and CEO, Ronald Tutor.

Thanks, Jorge. Good afternoon and thank you for joining us. Our second quarter results were highlighted by strong revenue growth and stable backlog. The civil and building segments led those revenues growth due to significantly increased activity on various projects nationwide. The building segment continues to drive our largest recent new awards, which have sustained our backlog at a healthy level. We are experiencing strong demand for our services from customers across all our segments. But particularly, in New York, California, the Midwest and Florida. Our strong revenue and stable backlog were balanced by lower than expected operating income largely due to a major loss exceeding $22 million on a concrete subcontract, which was competitively bid for Tower C at Hudson Yards in New York City. Being that this was the first loss of any significance on a fixed price contract in the past 20 years of the company's history. We feel that it should be further explained, the loss was primarily have attributable to two severe winter seasons that dramatically impacted our cost beyond that which we anticipated, a very poor labor market exaggerated by the extraordinary amount of building work in New York City as well as the learning curve associated with building high-rise concrete in New York City with its attendant productivity issues and you and your requirements that very candidly we were not aware off. Our civil business experienced continued strong revenue growth due to a high level of activity on the JFK Runway project, New York City transit Authority CMO 06 project, the Hudson Yards platform and increased activity on various bridge and mass transit projects in the Midwest, New York and California. As expected we commenced construction work on the California High-Speed Rail project in June beginning with work on the Fresno River viaduct and continuing on a full-scale mode by Thanksgiving. We expect our activity on that project to gradually increase over the rest of the year and in the next year as this High-Speed Rail authority continues to provide the right away necessary to our construction work. After the SR99 project more damage to the tunnel boring machine was discovered and that was more extensive than we anticipated leading to an additional delay in the completion of the repairs. We added further safeguards to protect the TBM and are retesting, the necessary performance to resume tunneling. Consequently we now estimate that tunneling will resume in November rather than August. Our joint venture partner Seattle Tunnel Partners is working to complete the needed repairs and looking forward finally to the restart of tunneling. We continue to anticipate stronger civil revenue and profit performance during the balance of the year, when those projects as well as the San Francisco subway and other large projects in New York continue to contribute. Our building segment strong revenue growth was driven by increased activity on a variety of projects including the Scarlet Pearl Casino in Mississippi and the Chumash Casino Resort in California two large confidential technology projects in California and the reason they are confidential as the owner won't let me use their name. The San Diego Courthouse, the Broadway retail development and the Panorama Tower in Miami. We continue to have requests from customers throughout the country to speak to their plan developments, some of the most significant continuing to be in Miami and the attendant areas, the Bay Area and Los Angeles. Our specialty contractor segment experienced modest revenue growth in the second quarter, the largest contributor to their incremental revenue compared to last year were Five Star’s work on the MTA East Side Access C179 project. Specialty revenue is expected to grow to a large volume of work underway in New York and pending awards that are literally due at any time. We booked approximately $1.3 billion of new awards and adjustments to existing contracts during the quarter which resulted in ending backlog of $7.7 billion a level comparable to last quarter and last year. Our book-to-bill was approximately one-time and our current backlog mix stands at 40% civil, 32% building and 28% specialty. More than two thirds of our backlog continues to be comprised of higher margin civil and specialty work even though we continue to add a significant number of large building projects. Our pending awards at the end of the second quarter remained at $4.3 billion a level consistent with the end of the first quarter. Of the pending awards Hudson Yards Tower D, E in the retail gallery collectively represents up to $2.3 billion and those contracts are expected to be executed in the third quarter of 2015. Approximately $1 billion of the pending awards is for five building projects in California and another billion for various other smaller contracts including $100 million for two Maryland Highway in bid projects that we were recently low better. Looking at new awards and backlog by segment, the civil segment and second quarter new awards and adjustments totaling $251 million and ended with a backlog of $3.1 million down 16% compared to the second quarter last year. The largest civil awards included three bridge projects for London totaling $65 million and two projects would lack in Guam totaling $38 million. The building segment add new awards and adjustments totaling $680 million and ended the quarter with $2.5 billion in backlog up 24% compared to the second quarter last year. The largest awards included $455 million of initial funding for a confidential San Francisco area technology project whose contract value is expected to increase well above $600 million over the next 18 months and $72 million of incremental funding for a biotechnology project in California which anticipates receiving an additional $160 million of funding by year end. Last month, Tutor Perini Building Corp was awarded its latest project in South Florida, the Faena oversized residential towers in the Faena district of Miami Beach valued at $140 million. The project will complete a renovation and conversion of the existing 16-story historic hotel into an ultra-luxury condominium tower and the construction of the second 18-story contemporary luxury condominium. Full contract value is expected to be in the backlog in the fourth quarter. I am pleased to announce the Perini Management Services in a joint venture with PAE was recently one of eight awardees of a six-year multiple award IDIQ namely indefinite delivery, indefinite quantity contract for the U.S. Air Force Contract Augmentation Program otherwise known as AFCAP IV with the maximum value of $5 billion to be shared amongst the eight awardees. This new contract will provide past quarter bidding opportunities, covering a full range of base life and operating support, and logistics and construction services at locations worldwide. Specialty contractor segment had second quarter new awards and adjustments totaling $343 million and ended with a backlog of $2.1 billion up 4% compared to the second quarter last year. Significant new awards included three Five Star Electric projects in New York totaling $97 million, a $36 million WDF mechanical subcontract work on the Panorama Towers in Miami and a $20 million WDF mechanical contractor on the retail gallery at Hudson Yards. Next I will update you on our bidding pipeline, the civil segment continues to have a sizable pipeline of approximately $16 billion of prospective work to be bid and awarded over the next 12 months to 18 months. Large of these projects include $2 billion highway projects in Virginia and $1.2 billion highway widening project in Los Angeles and a large bridge job between Detroit in Canada of approximately $2 billion. Other civil prospects include approximately $6 billion in various mass transit tunneling and highway projects throughout the Midwest and East Coast. The building segment see the $7 billion pipeline of prospective work being awarded over the next 12 months to 18 months these include over $3 billion of opportunities in Florida with the remainder being spread within California and the Northeastern United States. Specialty contracting segment continues to have a strong $4 billion to $5 billion pipeline of prospective opportunities for the greatest demand coming from the New York region were our electrical and mechanical resources are facing a very high level of bidding opportunities with extremely limited competition. As a result both Five Star Electric and WDF if had to become much more selective in the recent pursuits as the backlogs reach record highs. Based on our year-to-date results in the outlook for the remainder of the year we are maintaining our fiscal 2015 guidance for revenue in the range of $5 billion to $5.5 billion however due to the loss on the Hudson Yards Tower C concrete project and further delays on the Alaskan Way Viaduct we are reducing our fiscal 2015 diluted earnings per share guidance to a range of a $1.90 to $2.10. Furthermore we are hopeful that we can expect to favorably resolve certain settlements in the third quarter and fourth quarter and certain legal proceedings such that we may achieve the low end of our previous earnings-per-share guidance. Our EPS guidance assumes a tax rate of 41% and 49.9 million shares outstanding. I will now turn the call over to Michael Kershaw to review the details of our financial results for the quarter.

Okay. Thanks, Ron. As mentioned we have healthy revenue growth in the second quarter. Revenue was $1.3 billion up 21% from last year's $1.1 billion and I was led by strong growth in the civil and building segments. I want to point out this is the highest second quarter revenue since 2009. And I'll review the major revenue drivers by segment in a moment. The loss that Ron mentioned on Hudson Yards Tower C resulted in a second quarter impact of just less than $15 million of income from construction operations, $8.7 million of net income and $0.17 of diluted EPS. I wanted to remind you as well that last years second quarter results benefited significantly from net favorable gains related to legal rulings on two civil projects, you recall as [predominantly in] Central Artery which contributed almost $15 million of income from construction operations and $0.18 of EPS for that quarter. A second quarter SG&A was $68 million versus $64 million last year; this increases mostly due to higher legal-related expenses depreciation the timing of some of our employee medicals expenses. However I want to point out that I think overall we are controlling SG&A pretty well which is reflected in our 5.2% SGA& margin for the quarter which is the lowest we've seen since the third quarter of 2011. Our second quarter operating margin was 2.4%, our net income for the quarter was $12 million down from last year’s $29 million as a result of the reduced operating income. Diluted EPS was $0.24 versus $0.58 last year. If you exclude the Tallassee loss this quarter and a significant net gain on those adjustments that we had last year our EPS on the line would have resulted in and being about a penny higher last year While we’re disappointed with a loss for the quarter we’re pleased with our strong revenue growth and continue strong backlog both of which were in line with expectations. Moving on to segment analysis, in the civil segment we had significantly increased activity on the JFK Runway reconstruction project in New York and number of bridge project in the Midwest as well as the mass transit projects in California and New York. This was partially offset by decreased activity on tunnel project in the West Coast and some of our higher margin civil projects. Leading – so this led to the highest quarterly revenue for civil ever in a quarter of $534 million up 37% from last year’s $391 million. Income from construction operations for the second quarter was $46 million versus $58 million, however as I just mentioned last year included $15 million of net favorable gain sorry excluding than gain, civil operating income was actually $3 million up this year over the last year. The lower margin on our higher margin work that we performed this year generated a reduction in our civil operating margin to 8.7% versus 14.8%, if you exclude that gain, it would've been at a 11.5% last year. Moving on to our Building segment revenue for the second quarter at $451 million was 21% up from last year’s $372 million, it’s a highest second quarter revenues of building since 2011, was driven by increased activity on various building projects in California, hospitality and gaming projects in Mississippi and California are partially offset by decreased activity mainly due to a multiunit residential project in Pennsylvania that was completely last year. The income driven by this increased activity was offset by the Tallassee loss, overall we had a second quarter loss from construction operations of $13 million compared to $8 million of income from construction operations last year. The $8 million of income last year included over $4 million of favorable closeout adjustments for a number of projects including an Afghanistan electrical project. Our operating margin of a negative 2.8% this year compared with a 2% profit last year. If you exclude the Tallassee loss this quarter and you exclude the closeout benefits in last year’s second quarter. Income this year would've been over $2 million compared with about $3 million last year at least to a reduction in operating margin of excluding those exceptions of 50 basis points year-over-year. Moving on to our specialty contractors segment we had increased activity on mass transit and other electrical and mechanical projects in New York and this was partially offset by decreased activity on various smaller electrical projects in the Southern U.S. as well as electrical projects of the World Trade Center and mechanical projects in the United Nations both in New York and two signal system modernization project in New York, that led to revenue this quarter at $327 million being very close to last year’s $322 million. Income from construction operations this year was up – was $14 million up 9%, which is greater than the 2% increase in revenue from last year’s $13 million and our associated operating margin grew from 3.9% to 4.2% this year based on the revenue mix changes and improved performance in our mechanical business in New York. We are pleased with a continued improvement in our specialty segments operating margin. Moving on to other expenses our interest expense for the quarter was $11 million which is flat compared to last year’s $11 million. Income tax expense was $8 million compared to $19 million last year, obviously that’s driven primarily by the decrease in pretax income, rate for the quarter that was 41%. With respect to our balance sheet our working capital at June 30 was $1.2 billion up slightly from last year's $1.1 billion. We used $29 million in cash from operating activities in the second quarter of 2015 this is a $20 million usage for the same quarter last year. Similar to last quarter, we funded additional short-term working capital associated with some of our larger projects. However, we believe that cash flow will improve during the remainder of this year as a result of that continued focus on improving the processes around converting project, working capital into cash. I am already starting to see positive results. With respect to debt balance at June 30 was $893 million compared with $865 million at the end of December. I’ll turn the call back over to Ron for closing comments.

Thank you, Michael. We are pleased with our solid revenue growth and level of backlog particularly the pending award although disappointed in the profitability of our building segment and our focusing on making those corrections over the balance of this year. Our final note before we conclude, we announced recently that Mike Kershaw will be retiring from the Company and that we have hired Gary Smalley of Fluor Senior Executive to replace him as our new CFO. I want to acknowledge Mike and say thank you for all your hard work and leadership and contribution to everything we've done here during your four years. With all his positive contributions since he is retiring Gary will be starting with us on September 1 and we look forward to introducing to you in our next quarter. Mike will remain with us for the balance of the year and probably consult for the better part of next year. We look forward to providing you our next update in November. This concludes our prepared remarks. We will ask the operator to open the call for questions.

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Our first question is from the line of Steven Fisher with UBS. Please go ahead.

Good afternoon. Actually on the Hudson Yards, where do you stand on Tower C from a progress perspective and just trying to get comfortable the risk going forward on that project?

We should conclude the concrete in the Tower by the end of September and the project – we’ll finish the project by the March 1 next year.

Okay.

The entire project meaning not just the concrete.

Okay. So have you now accrued for sort of the current pace of productivity there?

I think so. I've got a big review coming up in two weeks to go over the final cost, but we’re almost done.

Okay and then how are you counting for the Seattle tunnel project at this point. I mean is it still profit generating project and I know your last 10-Q you had about $800 million of unbilled costs and unapproved change orders and then claims. I’m not sure where the project falls in those numbers and then I guess broadly can you get your civil margins back to double-digits this year?

I think we typically earn double-digits everywhere. I get these percentages, but most of our civil work is doubled. Do you want to share with me?

Yes, no what drives it up Steve as you know we have some high-margin project that is sporadic and we haven't had much of that in this earlier part of the year? It’s difficult to forecast when that’s going to occur with respect to the other the rest of civil it goes along in line with where is always been in those margins that when you get down to the adding – taking of G&A that stay in that 10%-ish range.

Remember all of these civil margins are after the civil G&A so there are not the gross margins they’re virtually the net margins and when our highway markets which is reduced level - our highway markets always been an 8% to 10% market and heavy civil particularly in New York and in California is more a 12% to 15% market. It'll vary as to how those go in terms of the contract, but remember we then take off significant civil G&A before you see those returns. So when you had the G&A back everything is well over 10% on the average.

Well, I am just looking at the numbers I mean you have pretty big ramp-up in the second half of the year to get to your numbers and I presume that a big improvement in civil is a big part of that. So I guess I am just wondering where that’s going to come from and how your accounting for the Seattle project at this point is that still a profit generating project.

Yes, it is we are in the midst of discussions starting to resolve some of the issues not the least of which is a very, very sizable insurance policy that should be paid to us on the machine. We are starting to make progress there is a great deal of money owed to us we’ve won two DRB’s that says were entitled hopefully will start making some significant progress. Also just as importantly we finally have got the California High-Speed Rail going we’ve commenced work on the Fresno River bridges we should as I said be going Full Tilt prior to Thanksgiving and we should generate some significant revenues on that job. We’ve got a lot going on in these next six months and we believe that it will ramp up significantly. I did elect to write it down, as I said because of the building losses and we have a couple of events coming up frankly some potential resolves of all line disputes that could take it right back up, but it regardless of those we see a ramp-up in revenue that will take back much of what we gave up the second quarter.

Okay. I'll follow up off-line and congratulations Mike. Thanks a lot.

Thanks.

Thank you. Our next question is from the line of Alex Rygiel from FBR. Please go ahead.

Thank you. First question is the California High-Speed Rail line in SR99 are they in your guidance for this year and can you talk a little bit about some of the potential risks of the projects looking to the right a little bit more.

I can’t hear you. Can you speak up?

Yes, I am sorry.

Hear we go.

The California High-Speed Rail line in SR99 are they in your guidance, can you talk about some of the risks associated with those projects looking to the right?

High-Speed as we said SR99 is now scheduled to start up in November. So our revised guidance that we just put out incorporates to see that assumption. So one could say the risk is instead of starting up in end of November, we don’t get December’s revenue that obviously wouldn’t be significant in terms of an impact on this year. High-Speed Rail what we've done and there is projected within our guidance based on the expectation of the work is going to be proponent the balance of the year.

I am share this morning High-Speed Rail is going there shouldn't be any impact to our projections or revenue for the balance of this year.

Then Ron in the past you talk about competition particularly on large projects. Can you discuss competition today maybe referenced the highlight foreign competition and where that stands and my congratulations on your retirement.

Thanks.

Well it appears that our U.S. competition continues to wane in every time we turnaround our competition is from Europe. The last High-Speed Rail job we were beaten by the Dragados by 500 million and we were at $300 million under another Spanish led joint venture and we were the only U.S. bidder. The next phase of High-Speed Rail we are the only U.S. bidder and there's four pre-qualified European firms. Let’s just say and I'll try not to be too cynical. I don't believe there is a single European firm that can even marginally complete cost wise, but yet they are making a major footprint on America much as the Japanese did in the early 1990. Japanese lost an enormous amount of money and disappeared from our market. I believe you'll see the same thing with our European peers and I look forward to them disappearing.

Thank you.

Thank you. Our next question is from the line of John Rogers from D.A. Davidson. Please go ahead.

Hi, good afternoon.

Hi, John.

Couple of things first of all just in terms of the cash collection that you expect in the second half of the year, could you maybe give us a little more color on you know what the hurdles are to get there and how substantial those could be?

Well let me put it to you this way. We woke up and discovered, we’ve been issued over $100 million in change orders both time and material and forward price been directed to proceed in the first quarter at the World Trade Center through Five Star Electric. And that absorbed over $100 million of our cash, Jack Frost our President has taken over those negotiations with the Port Authority and they are negotiating and we are probably settling as much as $5 million a week. The only negative is a write us $5 million a week in additional extra work. So they have made a commitment to bring this current by October 1, and the only negative is I frankly don't see how they can given the amount of extra work they continue to give us. Negative is the cash flow issues, the positive is its lucrative extra work where we make very reasonable margins and unfortunately given the nature of the project they directed us to perform and our contract requires that we proceed. And since we did almost $1 billion worth electrical on the World Trade Center Five Star dominated that site, so every time they need electrical work done they go to Five Star. So I think honestly it will be the end of the year before we get out of the cash flow issues with the Port Authority at World Trade, but it does continue to be profitable and none of it is in dispute, it's just trying to get through the difficulties of negotiating 1,000 different extra work orders that total over a $100 million.

And then secondly, Ron in the recent past I mean you’ve talked about the difficult margins in the buildings business and it sounds like there's a lot of opportunity to book work here, Florida, California, New York you mentioned are you seeing the change in pricing in that market and is this going to be fixed price cost plus work or what?

I think John I've never seen such an enormous upswing, so quickly in our building business, we’re virtually and non-dated with major work. We’ve raised our bottom line fees all of a resounding one point. But in the building business you get one point increase it’s about 30% increase in profitability. So, yes we are pushing up our margins as best we can. Virtually, all of them are negotiated, pre-selected, construction manager or general contractor with a guaranteed maximum price or just straight cost-plus. But virtually none of them are hard money bid work like the Las Vegas Airport McCarran unfortunately for us is thing of the past, there is no more hard money building work it seems anywhere. So that businesses become strictly low-margin and I don't believe necessarily low risk. So it continues to be a difficult business, but the only thing I can say is there's just an enormous amount of major work in front of us and we are raising our margins and it certainly is getting rapidly healthier and healthier.

And I guess following up on that is there any significant fixed-price work left related to Hudson Yards anytime we are concerned about?

No, that was only foray into a hard money competitive bid and since we’ve probably done 50 concrete towers in the U.S., I very incorrectly felt confident that we could do the job in New York City, but we were taught a very valuable lesson.

Okay, thank you. And Mike, good luck.

Thanks.

Thank you. Our next question is from the line of Mike Shlisky from Global Hunter. Please go ahead.

Good afternoon guys.

Hi Mike.

Hi Mike.

Just following up on that last question in buildings do you think from what you know the current time for the back half of the year that you will have positive operating margin for the full-year in building?

No for the full-year that would be a – that will become what we…

It will be close because Rudolph & Sletten is having a very significant second half and I don't know if we can overcome all of that. I frankly which I probably should – we should have looked towards year-end. Rudolph & Sletten is having a very good year exceeding all of its projections, but that significant loss is hard to overcome.

Okay. And maybe somewhat similar question especially contractors you had mentioned the Five Star seeing some awfully good – I would say [indiscernible] everyone’s time. It sounds like there might be a little bit more selective on which projects they’ve been on and take. Do you sense that you might be seeing better margins in that segment next year versus this year?

Absolutely, Five Star dominates the Electrical scene in New York City. They are at least twice as large as the next biggest. We are literally the Five Star and Gary Siegel is President and has to get my clearance now on everything they did. We agree on the margins, there are more opportunities than we can take. And whenever there's a very large electrical, we obviously are engaged. So it’s very selective with increased margins.

All right. Thanks guys. Appreciated.

WDF was equally as large in the mechanical business and the same thing we talked virtually every other day and there just is more work in New York than there are confident contractors to build it.

Got it. Thanks very much. And Mike, best of luck.

Thanks.

Thank you. [Operator Instructions] Our next question is from the line of John D'Angelo from Macquarie. Please go ahead. John D'Angelo: Hey guys, good afternoon and thanks for taking my question.

Good afternoon. John D'Angelo: So I understand the $0.17 loss on the Hudson Yards project, but with this new guidance the midpoint of guidance is lowered about $0.35 from $2.35 to 2 bucks. And you also said that with a settlement you maybe to reach that previous $2.20 number so if you take the new guidance midpoint of $2 or so that's about $0.20 or about $10 million in additional net income. So I'm wondering whether or not operationally something else is going on, because it seems to me that X of these items you are implying a lowered guidance and I'm just curious is to what you guys maybe seeing out there? Should we expect more trouble with the Alaskan Way Viaduct project? Any color there would be terrific. Thanks guys.

The other driver which we mentioned that drove our guidance down is the delays in SR99 over where we were at beginning of the year. When we did guidance originally the beginning of the year was starting out much earlier.

The original – and that should've started up in April. John D'Angelo: Correct.

That was the original projection the Alaskan Viaduct which is the biggest job we have was going to start in April and that was the basis of the guidance and now we’re literally in November with hardly any revenue for the year and that coupled with the loss at the Hudson Yards concrete job is the primary reason. The other two things not only a revenue and operations going up we have to significant events. One is the litigation another an issue that I can't speak to the good result in a significant profit. That would offset the losses and that Tower C, but those won't come to light into probably the end of September. John D'Angelo: Okay terrific. Thanks so much guys.

Thank you. Our next question is from the line Steven Fisher from UBS. Please go ahead.

Thanks. Just a quick follow-up so of the $66 that you have embedded in the second half of the year, can you just talk about what your expectations are from a cadence perspective I mean how Q4 – how back and waited is this would it become flat Q3 and Q4 how should we think about that.

As you know Steve we generally avoid discussing quarterly, the best that we get to is talking about first half of the year versus the second half of the year.

I think it'll be even if anything third quarter might be a little better than fourth, but I really can't get specific right.

Okay. That's helpful, thank you. End of Q&A

Thank you. There are no further questions at this time. I would now like to turn the floor back over to the management for closing comments, over to you sirs.

Thank you, everyone for joining we’ll see you at the third quarter.

Thank you very much. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.