Southland (SLND) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was $215.4 million, down 14.4% year-over-year, mainly due to lower Transportation segment activity as projects neared completion, partially offset by new Civil segment projects.

• Gross profit improved to $13.4 million from a $40 million loss in Q2 2024, with gross margin rising to 6.2% from -15.9% year-over-year.

• Net loss narrowed to $10.3 million ($0.19/share) from $46.1 million ($0.96/share) in Q2 2024.

• EBITDA was $4.2 million, up from negative $49.9 million in Q2 2024.

• Backlog at quarter-end was $2.32 billion, with 41% expected to convert in the next 12 months.

Financial highlights

• Six-month revenue was $454.9 million, down 15.7% year-over-year; six-month gross profit was $34.8 million, up from a $19.6 million loss.

• SG&A expenses for Q2 were $13.6 million, down 13.4% year-over-year; as a percent of revenue, SG&A was 6.3%.

• Net cash provided by operating activities for the first half was $1.0 million, compared to $17.5 million in the prior year.

• Total debt as of June 30, 2025, was $278.6 million, with $48.9 million due within 12 months.

• Cash and cash equivalents at June 30, 2025, were $46.5 million, down from $72.2 million at year-end.

Outlook and guidance

• Management expects continued strong demand in both Civil and Transportation segments, supported by federal and local infrastructure spending.

• 41% of the $2.32 billion backlog is expected to be recognized as revenue over the next year.

• Civil segment margins expected to remain in the mid-teens; transportation margins to improve as legacy projects wind down.

• Anticipate most legacy and Materials & Paving projects to be substantially complete by end of 2025, with a few trailing into 2026.

• The company believes cash flow from operations, available cash, and financing sources will be adequate for at least the next 12 months.