Jorge Casado - Vice President of Investor Relations & Corporate Communications Ronald N. Tutor - Chairman and Chief Executive Officer Michael J.

Kershaw - Chief Financial Officer and Executive Vice President

Steven Fisher - UBS Investment Bank, Research Division Will Gabrielski - Stephens Inc., Research Division Min Cho - FBR Capital Markets & Co., Research Division John B. Rogers - D.A.

Davidson & Co., Research Division Michael Andrew Romanelli - Sidoti & Company, LLC

Good afternoon, and thank you for your interest and participation today. Joining us on the call are Ronald Tutor, Chairman and CEO; and Michael Kershaw, Executive Vice President and CFO.

Before we discuss our results for the second quarter, I would like to 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 24, 2014. With that, I will turn the call over to our Chairman and CEO, Ronald Tutor.

Thank you, Jorge. Good afternoon, and thank you for joining us.

I am pleased to report that we delivered another quarter of solid results with revenue in line with expectations and earnings per share ahead of expectations, due to continued revenue growth and strong profitability in our Civil segment. We booked several new large projects during the second quarter and, as a result, continued our recent trend of backlog growth.

Unlike last quarter, most of our large and new awards in the second quarter were for our Building segment and, to a lesser extent, our Specialty Subcontractor segment. As mentioned in the earnings release, our Civil segment booked a large new contract at JFK airport in the backlog during the first week of the third quarter, and I will go into more detail on that award a bit later.

Backlog grew 18% year-over-year due to strong volume of Civil awards over the past 12 months. Our backlog remains at the highest level since 2008, and then today, 75% is specific to our higher-margin Civil and specialty projects.

Now I'll provide you with an update on some of our larger key projects underway. On the Seattle SR99 project, our joint venture Seattle Tunnel Partners continues to execute the repair plan being led by Hitachi Zosen, the tunnel boring machine manufacturer, necessary to make the needed repairs to the tunnel boring machine, which was damaged during an unexpected encounter with a steel casing within the tunnel that had been left in place.

Several major components are currently on vessels heading to Seattle from Osaka, Japan. The repairs and testing needed to restart the tunneling operations are now expected to take until December of this year.

Our focus remains on making these repairs and getting the tunnel boring machine tunneling again as soon thereafter as possible. Concurrently, many elements of the Civil work at the 2 tunnel portals are finishing on schedule, namely the concrete structures at both ends.

We continue to expect that the costs relating to the breakdown of the machine and the delays associated with that breakdown will be borne by others. Several additional safeguards will be added during this repair by Hitachi, and we continue to have confidence that once the TBM begins to mine again that it will more successfully operate in its completion of the tunnel.

One of our more active job sites in the second quarter, of course, was Hudson Yards, where we have several projects well underway. Our work on the Amtrak tunnel has progressed very well, and we are on track to substantially complete that contract by the end of this year in December.

Our work to build the platform, namely our Civil work over the Eastern rail yard, which will serve as the foundation for the future buildings at Hudson Yards, is also advancing well with 93 out of a total of 253 caissons drilled and installed in the bedrock by our drilling subsidiary Becho. And steel erection work is now underway.

The platform is at -- scheduled to be completed in the fourth quarter of 2015. Finally, our work on the South Tower is advancing with concrete work completed through the 10th floor.

As a reminder, South Tower is scheduled to complete in late 2015. We currently anticipate receiving additional contractors' contracts and notices to proceed for Towers D and E and the retail work as scheduled previously for later this year or the first quarter of 2015.

Preconstruction tasks and design continues on the California High-Speed Rail project, including the commencement of demolition of several structures and the construction of a 10-foot test pile built to confirm certain bridge design elements meet seismic safety requirements. Further construction work along the 29-mile route will proceed in the coming months as access to the various land parcels is provided by the authority.

The state continues this process of acquiring these needed land parcels. In October, the TPZP team along with 2 other European teams will bid on the next set of bundled construction packages for the project known as CP2-CP3, which comprises the next 75 miles of rail civil infrastructure to the Kern County line.

The state estimates the value of this next package at between $1.5 billion and $2 billion. Next I'll share with you some information about other recent new orders, backlog and pending awards.

In the second quarter, we had $1.2 billion of new awards and adjustments to existing contracts to a book-to-bill of 1.1. We ended the quarter with a backlog of $7.8 billion, up $1.2 billion compared to the second quarter last year.

Our backlog mix is now 48% Civil, 26% Building and 26% Specialty. Our pending awards at the end of the second quarter were $4.2 billion, down slightly from $4.3 billion at the first quarter due to several large projects awarded.

Our Building Group had new awards and adjustments in the second quarter totaling $647 million. The largest awards included the $255 million Panorama Tower in Miami, Florida; the $120 million Broadway Plaza retail development project in California; and the $113 million Scarlet Pearl Casino Resort project in Mississippi.

The Building Group's backlog was $2 billion, up $275 million compared to the first quarter. The Building Group continues to have several large pending awards, including more than $2 billion in approaching phases of the Hudson Yards development, which as mentioned, are expected to be booked into backlog as they award it later this year or the first part of next year.

In addition to Hudson Yards, there continues to be a number of pending awards by condominium developments at Northeast and Southeast, a large healthcare project in California and various other projects we are expected to be awarded over the next several quarters. Also, in April, Perini Management Services was awarded a new 5-year multiple-award IDIQ contract valued up to $100 million by the State Department's bureau of overseas buildings operation for worldwide design, build and construction services.

We anticipate task orders to begin flowing on this contract later this year. Our Civil Group had second quarter new awards and adjustments totaling $211 million and ended the quarter with a backlog of $3.7 billion, down $179 million, or 5%, from the first quarter.

The largest civil order book was the $67 million John Hart dam excavation and tunneling project in British Columbia, Canada. As I mentioned earlier, in the first week of July, Tutor Perini was awarded a contract by the Port Authority of New York and New Jersey valued at $267 million for runway reconstruction at the JFK International Airport.

The value of this contract is now in backlog in the third quarter, and we are currently mobilizing our plans and preparing to commence work in September. As you may know, Tutor Perini has substantial experience in large, complex airport projects, including runway and terminal projects currently underway at the Fort Lauderdale-Hollywood International Airport in Florida as well as major construction at Clark County airport in Las Vegas as well as both San Francisco and LAX in California.

The Specialty Contractors group had second quarter new awards and adjustments totaling approximately $338 million. Their backlog was stable at $2 billion compared to the last quarter.

Significant new awards included 3 large electrical subcontracts totaling $104 million for Five Star Electric related to the Hudson Yards platform, a multi-unit residential tower and a mixed-use building all in New York; as well as a $26 million heating, ventilating and air conditioning project for WDF on a multi-unit residential tower, also in New York City. Now I turn your attention to our future bidding opportunities.

For our Civil Group, we continue to see a strong $10 billion pipeline of prospective work to be bid and awarded over the next 12 months. We are absolutely bidding the maximum of our physical capacity with what seems to be no end in sight in major civil works.

The largest of these prospects is CP2-3 of the California High-Speed Rail project. Other prospects include $5 billion in various highway, airport and mass transit as well as over $2 billion in various bridge projects.

The building part -- markets are experiencing a very significant recovery as evidenced by the various large building awards we booked during the second quarter all over the country as well as several other building projects that are pending or under negotiation, including 2 large mixed-use condominium projects in Miami, Florida, and a large healthcare project in California. The Building Group has a $12 billion pipeline of prospective work over the next 12 months.

Our proposal for the LaGuardia Central Terminal Building replacement project has been submitted, and we are hoping and expecting an announcement by the port authority regarding the selected team sometime in the first 2 weeks of September. I would like to point out that while LaGuardia is a sizable prospective project, it is just one of many opportunities we face ahead of us.

Over the past several years, we have continually maintained a large breadth and depth of project opportunities that span our experience and capabilities. The Specialty Contractors group has a $5 billion pipeline of prospective opportunities over the next 12 months as New York City remains one of our strongest markets, and the number and size of these opportunities there continues to explode.

These include projects for various transit and government agencies, school districts, building owners, developers and other general contractors. Based on our current backlog and outlook, we are updating our guidance for 2014 with revenue now expected to be in the range of $4.5 billion to $4.7 billion and diluted earnings per share expected to remain in the range of $2.20 to $2.40.

The EPS guidance assumes a tax rate of 40%, 49 million average diluted shares outstanding, $43 million, or $0.53 a share, of depreciation expense, and $17 million, or $0.20, of amortization expense. I might add that one of the reasons for reducing the revenue projections was that a significant amount of revenue projected for the Alaskan Viaduct in Seattle for 2014, which I estimated to be between $250 million and $300 million in the tunnel, has now been deferred to 2015.

Finally, we're extremely pleased to report in June a very favorable legal ruling pertaining to the Central Artery/Tunnel Project in Boston, which we completed more than 10 years ago and for which our joint venture has been working diligently ever since to collect a large sum of money that we believe we were owed, well over $80 million to date, including crude -- accrued interest. The court basically reinstated certain awards previously made in our favor by the project's binding dispute review board decisions, which had previously been suspended upon appeal by the project owner, the Massachusetts Department of Transportation.

We are very confident that we will be collecting this money soon, and this ruling certainly validates our practice of pursuing collections on cost recoveries for which we are truly entitled. I will now turn the call over to Michael Kershaw to go over the details of our financial results.

Thank you, Ron. Revenue for the quarter was $1,085,000,000.

That's up 3% from last year's $1,053,000,000. It's due primarily to increased activity on our Civil and Building projects at Hudson Yards and increased activity on some of our electrical and mechanical projects on the East Coast.

Gross profit at $130 million was up 22% from last year's $106 million. Our gross profit margin was up 180 basis points at 11.9% versus 10.1% this time last year.

Our SG&A was down $2 million to $64 million this year versus $66 million last year. Our income from construction operations was up 66% at $65 million for the quarter compared with $39 million last year.

Our operating margin at 6% was up 230 basis points from last year's 3.7%, which resulted in net income for the quarter of $29 million compared with $15 million for the second quarter of last year. Diluted EPS was up 81% at $0.58 for the quarter versus $0.32 last year.

As Ron mentioned, our second quarter revenue was in line with our internal expectations, and EPS results were ahead of our expectations with continued strong operating performance in Civil offset by lower revenue in Building and lower-than-expected profitability in parts of our Specialty Contractors business. As a reminder, our backlog volume is understated by about $525 million due to the construction management not-at-risk work associated with Hudson Yards and elsewhere.

And remind you also, these portions of backlog effectively carry a -- higher margins. Moving on to our segment-by-segment results.

Civil's revenue was $391 million for the quarter, up 13% from last year's $346 million. This is due primarily to increased activity on our Civil projects at Hudson Yards, both the Amtrak tunnel and the Hudson yard platform; and increased activity on some of our bridge projects in the Midwest and New York.

This was partially offset by decreased activity on 2 tunnel projects on the West Coast and some of our highway projects on the East Coast. Our income from construction operations was up 83% from last year's $32 million to $58 million.

This is due primarily to the revenue volume changes that I mentioned and also net favorable adjustments to anticipated recoveries related to some of our claim positions. Our operating margin at 14.8% is up 560 basis points from last year's 9.2%.

Moving on to our Building segment. Revenue was down 12% at $372 million versus $423 million last year, and that's due primarily to decreased activity on hospitality and gaming projects in multiple states.

And that's partially offset by the increased activity on the Hudson Yards project and various other projects throughout the country, including a multi-unit residential tower in Pennsylvania. Our income from construction operations at $8 million is almost -- is over double what it was last year at $3 million, up 196%.

This increase is due primarily to decreased G&A expense and favorable adjustments related to the winding down of an electrical project in Afghanistan, and that was offset by our volume changes mentioned previously. The operating margin at 2% is up 140 basis points from 0.6% this time last year.

Our Specialty Contractors revenue at $322 million is up 13% from last year's $284 million, and that's due primarily to increased activity on 2 signal system modernization projects in New York and various other mechanical projects on the East Coast. Our income from construction operations was $13 million versus $16 million last year, and that decrease was due to the favorable settlement that we had last year in the second quarter related to a large hospitality and gaming electrical subcontract, some unfavorable performance and cost adjustments related to some of our mechanical projects in New York, and that was partially offset by the increased volume that we mentioned earlier and some improved financial performance at our pneumatically placed concrete business.

Our operating margin is below our expectations for this segment at 3.9%, down 170 basis points from last year's 5.6% In other expenses, our depreciation and amortization expense of $15 million this quarter was up 12% from last year's 14%. Our interest expense was flat at $11 million in both years, and our income tax expense is up 9 -- to $19 million versus $10 million last year.

Obviously, there are higher taxes due to our significantly increased income, and our effective rate for the quarter was 40% versus 38.5%. And as Ron mentioned, we're still forecasting 40% for the year.

Moving on to our balance sheet. Our working capital at June 30 was just over $1 billion, up $200 million from December's $787 million.

That reflects increased receivables and unbilled that is related primarily to the increased volume that we're seeing this year. I'd point out that the net amount of unapproved change other than claims is virtually the same as it was at the end of the year.

And we have $140 million in cash and cash equivalents versus $120 million at year end. Our current ratio at 1.74 is up from 1.61 at December.

We used approximately $20 million of cash from operating activities in the second quarter of this year versus $46 million that we generated last year. And remind you that, last year, we had a strong collection on the Rapid Repairs collections, which had been delayed into the second quarter.

In the second quarter, we also refinanced our credit agreement. We increased our liquidity by resetting our term loan size with a more favorable amortization schedule.

We've now got more favorable interest rates under our maximum rate scenario. We have fewer and less-restrictive covenants than before, and we incorporated a $300 million accordion feature to provide future financing flexibility.

Our total debt at June 30 was $829 million versus $734 million at year end, and our debt-to-equity ratio was at 0.64 versus 0.59 at the end of December. I'll pass the call back to Ron for closing comments.

Thanks, Mike. Our Civil Group's continuing strong performance combined with the obvious increase and potential from our Building Group provides me the confidence for an even stronger financial performance in the second half of 2014.

With approximately 75% of our backlog comprised of our higher-margin Civil and Specialty projects and with a significant volume of pending awards and projects, I foresee continued growth and solid profitability over the next 3 to 5 years, remembering that all the major Civil work and major Specialty contracts that we bid and are awarded are generally of the 3- to 5-year duration. This concludes our prepared remarks.

We will now ask the operator to open the call for questions.

Mike, could you just quantify, if you can, how much the anticipated recoveries were in the Civil segment margin in the quarter? And then are you expecting any particular closeouts or recoveries in the second half as well?

No, we had -- we booked 2 positions. We booked the increase in the Central Artery that we did.

And we also reduced, obviously, the bus depot that we had to write off. So the net recovery that we're left with now is a net $14 million of income that we've got to collect.

That's what we booked in the quarter.

Okay, that went through the profit margin line.

Yes, that went through the profit line. When you get to our Q, you will see that that's laid out for you.

Okay. And what about in the second half of the year?

Anything in particular you're expecting?

Well, we hope to resolve -- we -- even though we have a judgment, we have another $25 million of DRB awards, though unbinding, with the Central Artery. And they've asked for and I have agreed to have a meeting with them toward the end of August to discuss a settlement, which we would hope would encompass everything, not just what we won, but since they've been such a difficult owner, I don't know where that's going to lead other than we have a judgment.

And I intend to go forthwith to collect every penny of the judgment while we continue to litigate the balance of open issues. Secondly, we're in day-to-day continued to be negotiations and discussions with MGM and the insurance companies on a possible resolve of MGM CityCenter.

We have a trial starting date of September 22 or thereabouts. So obviously, it's coming down to the short strokes.

I can't really say whether there's a high potential settlement in the offing or not, but it's getting down to very short periods of time. Other than those 2 issues, I can't really recall any pending litigation that might take place in the second half of the year.

No, I mean the one that we've got coming through now is we got everything agreed on Harold Structures for a new...

Harold Structures, we got an executed change order. I expect payment of the $63 million that we executed.

We expect payment by the end of this month of approximately $40 million of it. And it's no longer a claim, although it never involved attorneys, and the MTA was very good about resolving it between ourselves.

It took literally years to resolve, and it's now executed and signed off. There's always this smattering of other litigation and various points of resolve but nothing of significance that would impact the second half, other than, of course, MGM.

Right, I was just trying to get a sense of how much your guidance relied on getting some of these closeouts, but it doesn't sound like there's anything major in there.

No.

Okay. And then just trying to gauge the risk on the Seattle tunnel.

I mean how confident should we be that there won't be any negative impact on your financials related to that project over the next few quarters?

Well, let me put it to you this way. For whatever it's worth, I've been doing this a long time.

I've said it before; I'll say it again: I don't believe that we will suffer any negative impacts from what has taken place in that tunnel. And we hope to have all the issues resolved by the end of the year, frankly, before the fourth quarter is up.

And even with the revenue deferral, it's not impacting your margins in any particular way.

Believe it or not, we are able to earn with the existing backlog and new awards enough money to offset a very significant, as you might imagine, deferral of income to next year and the year following.

That's good. And then just lastly, from a seasonality perspective, should Q3 be stronger than Q4 in getting to that $2.3 billion of revenues embedded in the back half guidance?

Steven, historically, both the third and fourth quarters have been the best quarters revenue-wise. It's very seldom toward the tail of -- in mid-December, we might get impacted by weather, but the first quarter is always the worst.

And believe it or not, the second quarter this year was not good, particularly in New York. So I feel somewhat confident just by the basis we generated $2 billion in the first half that we should generate enough to reach the projections we've given in the second half.

The -- can you talk about the specialty segment margin trends here through year end? And I know you guys spent a lot of time trying to align, I guess, the way they operate with how Tutor Perini has operated historically.

How is that going? And are you seeing that show up in tangible ways yet?

Well, if you look at last year, we had a very successful earnings in our specialty group. What took place this year that impacted severely WDF, we purchased a fire sprinkler subcontractor in New York City and merged them into WDF so they could provide a full-service mechanical service, including plumbing, heating and ventilating, and fire protection.

And we had some significant difficulties bringing them in and cleaning up some past work, and WDF took a very significant write-down in the second quarter as a result of it. And that's really what hammered those results the most.

Other than that, I think that they are slowly, not as rapidly as I'd like, but nevertheless, they are fitting into our means of doing business, both in our systems and contract administration and collection of receivables. And frankly, both WDF and Five Star are dominant powers in New York City, which right now is the most explosive market in the United States, where it seems that, every day, another major project goes out to bid with very, very definitive lack of capacity.

So I'm very optimistic about our continuing growth in New York City in our specialty group. While Fisk Electric, out of Texas, and Desert Plumbing, out of Los Angeles, continues to hold their own stable consistent, our real growth is still coming in New York City through Five Star Electric and WDF's mechanical.

Okay. And then as a follow-up, with the unprecedented level of work in New York, I would imagine that perhaps pricing is getting better.

Yes, it is. A very good assumption.

I think it's -- I think, with the limited competition, which I think is an understatement, and the fact that there's so much work to bid, I think all of us are looking at it by raising fees. It's also interesting to note, on the second phase of High-Speed Rail, where there were 5 bidders on the first phase, including our joint venture led by Tutor Perini, 2 American joint ventures, 2 Spanish joint ventures and Tutor Perini joint venture; in the second phase, both of the American companies dropped out, and it's just us competing with 2 Spanish company joint ventures.

So I think, nationally, the Civil business is growing with such leaps and bounds, there's definitely capacity constraints, which the next step leads to better margins.

Mike, quick question for you. You'd mentioned that there was a favorable adjustment tied to an Afghanistan project in the Building segment.

Can you tell me what impact that had to profitability?

No, I mean it was just a -- it was an improvement in -- when Building is such low volumes and margins, any kind of [indiscernible] is -- it's less than a couple of million dollars, the impact there. And this is just a wind-down of the job where the government has terminated a circumvenience [ph].

There were security issues there that we wouldn't proceed without adequate levels of security, and it just didn't work out that we could do that. So it just fell out [ph].

Okay. Okay.

I know, last year, kind of the guidance for 2013, in that Building segment for margins was approximately 2% for the full year. Is that kind of what you're looking for, for 2014 as well?

Or do you think it will be lower than that?

I would guess it'll be in that range. It's hard to say.

I think, nationally, we've raised our building fees. But remember, when we talk the margin, it's after all of the Building G&A.

So it has to absorb the G&A. I think somewhere between 1.8% and 2% is reasonable in the Building Group.

Not much more than that is possible given the advent of what I'd call CM at no risk and the negotiated nature of most of our work.

Okay. That's very helpful.

Also, Ron, I know you talked about Tower D and E and the retail work on the Hudson project. Is there any risk that you are not awarded that part of the work?

There's always a risk. We're doing all the preconstruction.

We staffed up for all of it. It's not inconceivable.

We don't think it is. We have been talking to them through all the details, doing all their review of design and doing everything with related -- as if we were going to do it, but it's like everything else: until they sign the contract, you can't count it.

Okay. And then just last question.

It sounds like pricing should start improving on the Civil side just given the capacity, but given the amount of backlog that you've been awarded on the Building side, and I know there's a lot of work going on in Miami and you've got some work in Mississippi as well, are you starting to see some pricing improvements in certain geographies within the Building segment yet?

Unfortunately, the Building segment, by its very nature of subcontracting everything and our peers having the minimal risk, I don't see -- I mean a huge upswing in margin in the Building business would be to add 1% to the fees. That's why you see Tutor Perini going from 2008 and 95% of its margin coming from Building to today, when it's probably less than 10%.

The Building business is a solid business that took us through some of our difficult years over the last 20, 30 years. But -- and it will continue to be a strong part of our operation, but all you need to do [ph] is look at our backlog, look at our earnings and where it comes and understand that the Building business will be a -- will never be a large factor in our profit, the way I see it.

Ron, you talked a little bit about being up against the -- your physical capabilities in terms of bidding. Do you have to make any investments in equipment or people to take advantage of the market?

Well, we think we've had an ongoing investment in people and our training programs and the like, but we're always infilling around our leadership in the people side. And yes, you're right, John, we are -- as we are awarded new contracts, we continue to add new equipment because, as you see, our Civil operation growing the way it is and the lack of competition on some of this major work, I find myself adding more equipment.

But we generally add equipment. The beauty of these very large contracts are that you may buy $30 million worth of equipment for a 4-year contract, but by the time you ran it to the contract, it essentially defrays the majority of its cost.

And I mean, at some point, we will be up against a physical limitation on talent. We're not there yet.

On the equipment, John, we generally finance all of those...

We 100% finance that. And essentially, the job cash flows or the jobs pay us rent for that equipment, retires that debt.

So it very seldom affects our cash flow or our balances.

And equipment financing is pretty cheap at the moment.

The -- I -- the only thing they do is they make us pay them back. They're -- we're getting it at 2.5% interest.

Okay. And in terms of the tunnel boring machine from Hitachi, when would you take ownership of that or would the JV?

Well, the purchase order required that, before we accept the machine, we had to drive 1,100 feet of tunnel. I believe we're at approximately 900 feet.

So assuming, as we hope, we start tunneling again in December, we will reach that crossing point where we're going to have to determine that we accept the machine probably in January.

Okay. Okay.

And then lastly, Guam, some others have recently mentioned the pickup in bidding activity there. Have you seen that?

I've seen it. They're wearing me out.

We're bidding $200 million to $300 million a month in Guam. And if I'm not reviewing estimates in Guam, it's at Diego Garcia in the Indian Ocean.

Our Guam operation is absolutely flooded. So although the government doesn't seem to be talking about it, the so-called relocation of the Marines, I don't know what they're spending $0.5 billion a year in Guam for if it isn't pending that relocation.

Got you. And just lastly, in terms of the second half earnings, the couple of big projects, LaGuardia, the High-Speed Rail, is it a major impact on your earnings if -- for bid costs, if they don't go your way?

Do you have to...

No, because we absorb those all in -- those are all absorbed in the G&A. And for example, both of them have approximately $2 million stipends.

And both of those more than compensate for all the joint ventures out-of-pocket costs of engineers, consultants and the like. So the only thing we're left to absorb is usually the majority of our in-house engineering and estimating, which, frankly, is part of our fixed G&A.

I mean it's lost opportunities. You don't like to think of it, but so far, we're able, with all our capacity and people across the country, I seem to be reviewing every major Civil job in America.

Kind of just want to elaborate on that last point. Can you maybe give us an insight on the size of the projects to be bid on in the next year or so?

Should we expect more types of bids in the LaGuardia range? Is that where you guys want to be due to the amount of competition you guys are seeing?

Well, Michael, I think those 2 are classic to the size we want to be in and to the lack of competition in that side. And the lack of competition stems from the lack of qualifications that are required as well as the financial and physical capacity.

High-Speed Rail 2, we're bidding. It's, let's call it, $1.5 billion, 65 miles long from Southern Fresno to the King County border.

There's only 3 bidders, 2 of which are Spanish companies literally out of Europe who've historically have not had a successful track record in the U.S. The LaGuardia job, we believe there's really only 2 serious proposers that are going to be chosen from.

And that appears to be -- our real work we pinpoint is $1 billion and up. There's only a handful of us that do those jobs and historically have succeeded on them and have the financial and physical capacity to build them.

As a result, obviously, the margins are significantly more and where we feel most comfortable.

No, absolutely. And I guess, just looking at Civil awards.

They were down. Was there an element of unsuccessful project bids on the Civil side that contributed to the decline in new awards, just overall market conditions...

No, not really. We're waiting on LaGuardia.

We turned that in, in May. We turned in a $350 million subway job in New York transit at the end of May.

We're still waiting. There were only 2 bidders.

We're waiting for the outcome of that. We probably got 6 major subway and civil jobs we've committed to bid between now and Thanksgiving in New York.

There is absolutely no lack of major civil work in all our Civil markets.

And had we booked JFK 1 or 2 days earlier, we wouldn't be having that conversation.

Okay, good to hear. And I guess, just my last question.

Looking at, obviously, Civil margins the past few quarters. We're seeing numbers come above that 10% to 12% range.

Are these just accounting for a couple of one-offs? Or are there certain areas of the market, projects with those richer margins?

How should we look at that going forward the next couple of quarters even through '15?

I think, in the past, if you look back through some of our 10-Ks and reportings, we have achieved on a fairly regular basis, after G&A, in the 12% to 15% range. We think we've got some very high-margin work currently in our backlog.

And I'm in very strong hopes that we'll continue to stay in those margins after G&A in the 12% to 14%.

The question I had was around working capital and cash flow, just if you could elaborate, Mike, on how you see that trending over the next few quarters, revenues ramping. You guys are consuming some capital there.

But where are we on collections?

Yes, I mean, as Ron mentioned earlier in answering Steve some of his questions, we've got the -- those settlement coming on the Harold Structures over the next few months. We're hopeful of the other ones that we talked about, MGM and Central Artery, that they'll generate some cash.

In the startup of projects, we -- some of those go well in starting up and getting cash positive, but on the Specialty side, that -- and particularly in New York, that's always been a strain for us, and I think we'll -- it'll be a focus of our attention. I don't think we're expecting working capital to continue to grow.

As we said, this quarter, we held unapproved changeovers and claims pretty flat over the year. And the increases that we've got in unbilled and in receivables are purely timing differences as that volume of work starts to pick up.

So we should revert to stability. If you look back historically of -- the second half of our years over the last few years has always been stronger from a cash flow perspective than the first half of the year.

Okay. Is there anything over the course of a cycle that makes it hard to generate cash from ops in excess of net income if you were to look out multiple years from here?

No. No.

It really -- the only adverse effects on working capital is if we get a very large claim that has drained a lot of money to support, and we file it, and it doesn't resolve, and we are forced to litigate it. Fortunately, we haven't added many new ones.

And I might add that, between MGM and Central Artery, should those resolve, they generate close to $200 million in cash for Tutor Perini. So you might know that I'm watching those very closely.

As would I. And then just one last one, if you will, in terms of assuming you are successful in collecting on that cash.

Any change on how you're thinking about utilizing that cash and you have some debt that's callable later this year?

We haven't changed our attitude. We're looking at assuming we have certain collected cash of reducing our bond indebtedness and basically, reducing indebtedness, period.

Yes, the bonds are our highest interest rate at the moment. And as you know, they're -- we can start doing something in November but only if it makes the economic sense to do that.

They're all [indiscernible].

Thank you, everyone, for joining us. We'll see you next quarter.