GRAPEVINE, Texas--(BUSINESS WIRE)--March 26, 2026--
Southland Holdings, Inc. (NYSE American: SLND and SLND WS) ("Southland"), a leading provider of specialized infrastructure construction services, today announced financial results for the quarter and full year ended December 31, 2025.
Fourth Quarter 2025 Results Include:
-- Revenue of $104.0 million for the quarter ended December 31, 2025,
compared to $267.3 million for the quarter ended December 31, 2024.
-- Gross loss of $193.4 million for the quarter ended December 31, 2025,
compared to $7.7 million in gross profit for the quarter ended December
31, 2024.
-- Net loss attributable to stockholders of $216.4 million, or $(4.00) per
share for the quarter ended December 31, 2025, compared to a net loss
attributable to stockholders of $4.2 million, or $(0.09) per share for
the quarter ended December 31, 2024.
-- EBITDA of $(202.2) million for the quarter ended December 31, 2025,
compared to $(2.7) million for the quarter ended December 31, 2024. (1)
-- Backlog of $2.03 billion. (1)
Full Year 2025 Results Include:
-- Revenue of $772.2 million for the year ended December 31, 2025,
compared to $980.2 million for the year ended December 31, 2024.
-- Gross loss of $155.3 million for the year ended December 31, 2025,
compared to $63.0 million in gross loss for the year ended December 31,
2024.
-- Income tax expense of $56.5 million for the year ended December 31,
2025, primarily driven by a non-cash charge related to the establishment
of a valuation allowance on deferred taxes, compared to income tax
benefit of $46.9 million for the year ended December 31, 2024. (2)
-- Net loss attributable to stockholders of $306.5 million, or $(5.67) per
share for the year ended December 31, 2025, compared to a net loss
attributable to stockholders of $105.4 million, or $(2.19) per share for
the year ended December 31, 2024.
-- EBITDA of $(191.4) million for the year ended December 31, 2025,
compared to $(100.4) million for the year ended December 31, 2024. (1)
(1) Please refer to "Non-GAAP Measures" and reconciliations for our
non-GAAP financial measures, including, "EBITDA" and "Backlog"
(2) This allowance is required under GAAP. This does not limit utilization
of the respective tax assets in the future.
Frank Renda, Southland's President & CEO said, "While I am disappointed in this quarter's results, I am fully accountable for our results and am committed to the strategic plan we have launched to move Southland forward. The capital support provided by our sureties, including replacing our senior lender, is a significant vote of confidence in our team and provides us additional financial flexibility to focus on the project execution of our $2 billion backlog. As part of our plan, we continue to focus on core market opportunities with higher margins, as evidenced by the recently announced $118 million of project awards, led by a data center project. We are also taking decisive action to right-size our asset base and pay down debt, positioning Southland to emerge from this period as a leaner, more disciplined, and more profitable organization."
Business Update:
Washington State Convention Center Adverse Ruling
The fourth quarter and full year 2025 financial results were impacted by a $135.8 million unfavorable adjustment related to an adverse trial court ruling involving the construction of the Washington State Convention Center ("WSCC"). This was a legacy project that Southland acquired through the 2020 acquisition of American Bridge. The unfavorable adjustment reflects the reversal of Southland's expected recovery of American Bridge's initial claims for damages and the recognition of a long-term liability as a result of the counterclaim by the counterparty awarded to the counterparty in the trial court ruling. On January 15, 2026, the trial court entered a judgment against American Bridge and certain of its sureties, jointly and severally, in the principal amount of $57.1 million. Interest and fees were assessed by the court at a later date. Because the adverse ruling makes the likelihood of recovering the claimed amount and collectability no longer probable, the Company derecognized contract assets as of December 31, 2025, on its consolidated balance sheet, resulting in a $40.3 million non-cash charge to revenue on its consolidated statement of operations for the quarter and year ended December 31, 2025.
While the Company intended to appeal as of December 31, 2025, certain of its sureties entered into negotiations with the counterparty on behalf of the Company subsequent to December 31, 2025, in accordance with certain rights available to the sureties included in certain General Indemnity Agreements ("GIAs"). Any settlement that is agreed upon will be paid by certain of Southland's sureties under the respective GIAs with the sureties. The sureties agreed to forbear on seeking repayment of any settlement related to the WSCC adverse ruling until at least March 27, 2027. Based on these negotiations and due to the events occurring prior to December 31, 2025, that led to the adverse ruling, the Company recorded a long-term accrued liability of $89.1 million and a reduction to retainage receivables of $6.4 million on the consolidated balance sheet related to the principal judgment, fees, sanctions and interest as of December 31, 2025. This resulted in a decrease in revenue of $6.4 million and an increase of $89.1 million in cost of construction on the Company's consolidated statements of operations for the quarter and year ended December 31, 2025. The total impact to the consolidated statements of operations for the fourth quarter and full year 2025 is $135.8 million, of which $46.7 million is recorded as a reduction of revenue and $89.1 million is recorded in cost of construction. The total impact to the consolidated balance sheets is a $40.3 million reduction in contract assets, a $6.4 million reduction in retainage receivables, and a $89.1 million increase in other noncurrent liabilities.
Strategic Plan
Southland has launched a strategic plan focused on the following:
-- Capital Restructuring: The Company executed a comprehensive
restructuring of its senior credit facility. Southland's sureties have
replaced the previous senior lender, assuming the remaining $110 million
in debt. The sureties have agreed to waive all scheduled quarterly
principal and monthly interest payments through maturity, which is
expected to reduce debt service requirements by approximately $27 million
over the next twelve months. The Company and the sureties are working on
an amendment to the credit agreement.
-- Liquidity & Support: The Company has secured approximately $116 million
in funding from its sureties to support ongoing bonded construction
projects. This included approximately $14 million as of December 31,
2025, and $102 million subsequent to year end. This partnership should
provide Southland with enhanced financial flexibility to successfully
close out legacy contracts while executing on the remainder of its $2
billion backlog. Repayment terms are currently being negotiated in a
long-term financing agreement and the sureties have agreed to forbear any
repayment until at least March 27, 2027.
-- Asset Monetization: To further strengthen the balance sheet, the
Company expects to monetize non-core assets, including idle equipment and
certain real estate holdings. This initiative should optimize the asset
base and aligns the fleet with Southland's core project footprint.
Proceeds from these asset sales, alongside the resolution of certain
claims, are expected to pay down the senior credit facility prior to
maturity.
-- Core Market Focus: Moving forward, the Company continues to concentrate
its bidding activity on water resource, bridge, marine, and tunnel
projects in geographies where its teams have historically delivered the
highest margins. This disciplined approach is yielding results, as
evidenced by $118 million of recently announced awards, including a $48
million contract for critical utility infrastructure at a Southwest data
center.
2025 Fourth Quarter & Full Year Results
Condensed Consolidated Statements of Operations
Three Months Ended
----------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
---------------------------------- ------------------- -------------------
Revenue $ 103,957 $ 267,250
Cost of construction 297,334 259,584
--------------- ---------------
Gross profit (loss) (193,377) 7,666
Selling, general, and
administrative expenses 16,999 15,708
--------------- ---------------
Operating loss (210,376) (8,042)
Gain (loss) on investments, net 165 (207)
Other income, net 180 1,201
Interest expense (8,996) (9,617)
--------------- ---------------
Losses before income taxes (219,027) (16,665)
Income tax benefit (323) (14,096)
--------------- ---------------
Net loss (218,704) (2,569)
Net income (loss) attributable to
noncontrolling interests (2,291) 1,586
--------------- ---------------
Net loss attributable to Southland
Stockholders $ (216,413) $ (4,155)
=============== ===============
Net loss per share attributable to
common stockholders
Basic (1) $ (4.00) $ (0.09)
Diluted (1) $ (4.00) $ (0.09)
Weighted average shares
outstanding
Basic (1) 54,113,036 47,877,558
Diluted (1) 54,113,036 47,877,558
_________________________________
(1) Basic net loss per share is the same as diluted net loss per share
attributable to common stockholders for the three months ended December
31, 2025, and December 31, 2024, because the inclusion of potential
shares of common stock would have been anti-dilutive for the period
presented.
Revenue for the three months ended December 31, 2025, was $104.0 million, a decrease of $163.3 million, or 61.1%, compared to the three months ended December 31, 2024. Materials & Paving business had a reversal of $10.6 million to revenue in the three months ended December 31, 2025.
Gross loss for the three months ended December 31, 2025, was $193.4 million compared to gross profit of $7.7 million for the three months ended December 31, 2024. Gross margin decreased from 2.9% to (186.0)% for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. Materials & Paving business negatively impacted gross loss by $26.9 million in the three months ended December 31, 2025.
Selling, general, and administrative costs for the three months ended December 31, 2025, were $17.0 million, an increase of $1.3 million, or 8.2%, compared to the three months ended December 31, 2024. Selling, general, and administrative costs as a percent of revenue were 16.4% for the three months ended December 31, 2025, compared to 5.9% for the three months ended December 31, 2024.
Condensed Consolidated Statements of Operations
Year Ended
----------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
---------------------------------- ------------------- -------------------
Revenue $ 772,168 $ 980,179
Cost of construction 927,427 1,043,219
--------------- ---------------
Gross loss (155,259) (63,040)
Selling, general, and
administrative expenses 61,623 63,274
--------------- ---------------
Operating loss (216,882) (126,314)
Gain (loss) on investments, net 291 (225)
Other income, net 1,744 3,631
Interest expense (37,019) (29,512)
--------------- ---------------
Losses before income taxes (251,866) (152,420)
Income tax expense (benefit) 56,497 (46,892)
--------------- ---------------
Net loss (308,363) (105,528)
Net loss attributable to
noncontrolling interests (1,823) (163)
--------------- ---------------
Net loss attributable to Southland
Stockholders $ (306,540) $ (105,365)
=============== ===============
Net loss per share attributable to
common stockholders
Basic (1) $ (5.67) $ (2.19)
Diluted (1) $ (5.67) $ (2.19)
Weighted average shares
outstanding
Basic (1) 54,049,705 48,073,973
Diluted (1) 54,049,705 48,073,973
__________________________________
(1) Basic net loss per share is the same as diluted net loss per share
attributable to common stockholders for the year ended December 31,
2025, and December 31, 2024, because the inclusion of potential shares
of common stock would have been anti-dilutive for the period
presented.
Revenue for the year ended December 31, 2025, was $772.2 million, a decrease of $208.0 million, or 21.2%, compared to the year ended December 31, 2024. Materials & Paving business contributed $52.1 million to revenue in the year ended December 31, 2025.
Gross loss for the year ended December 31, 2025, was $155.3 million compared to gross loss of $63.0 million for year ended December 31, 2024. Gross margin decreased from (6.4)% to (20.1)% for the year ended December 31, 2025, compared to the year ended December 31, 2024. Materials & Paving business negatively impacted gross loss by $42.8 million in the year ended December 31, 2025.
Selling, general, and administrative costs for the year ended December 31, 2025, were $61.6 million, a decrease of $1.7 million, or 2.6%, compared to the year ended December 31, 2024. Selling, general, and administrative costs as a percent of revenue were 8.0% for the year ended December 31, 2025, compared to 6.5% for the year ended December 31, 2024.
Segment Revenue
Three Months Ended
-----------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
------------------ -----------------
% of % of
Total Total
Segment Revenue Revenue Revenue Revenue
-------- -------- -------- -------
Civil $ 58,403 56.2% $103,798 38.8%
Transportation 45,554 43.8% 163,452 61.2%
------- -------
Total revenue $103,957 100.0% $267,250 100.0%
======= =======
Year Ended
-----------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
------------------ -----------------
% of % of
Total Total
Segment Revenue Revenue Revenue Revenue
-------- -------- -------- -------
Civil $342,330 44.3% $323,288 33.0%
Transportation 429,838 55.7% 656,891 67.0%
------- -------
Total revenue $772,168 100.0% $980,179 100.0%
======= =======
Segment Gross Profit (Loss)
Three Months Ended
------------------------------------------
December 31,
(Amounts in thousands) December 31, 2025 2024
-------------------- ----------------
% of % of
Segment Segment
Gross
Segment Gross Loss Revenue Profit Revenue
---------- -------- ------- -------
Civil $ (31,319) (53.6)% $ 8,031 7.7%
Transportation (162,058) (355.7)% (365) (0.2)%
--------- ------
Gross profit $(193,377) (186.0)% $ 7,666 2.9%
========= ======
Year Ended
--------------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
-------------------- ------------------
% of % of
Segment Segment
Gross Gross
Segment Profit Revenue Profit Revenue
---------- -------- --------- -------
Civil $ 16,344 4.8% $ 16,725 5.2%
Transportation (171,603) (39.9)% (79,765) (12.1)%
--------- --------
Gross profit (loss) $(155,259) (20.1)% $(63,040) (6.4)%
========= ========
EBITDA Reconciliation
Three Months Ended Year ended
--------------------- ---------------------------
December December December December 31,
(Amounts in thousands) 31, 2025 31, 2024 31, 2025 2024
----------------------- ---------- --------- ---------- ---------------
Net loss attributable to
Southland Stockholders $(216,413) $ (4,155) $(306,540) $ (105,365)
Depreciation and
amortization 5,683 6,373 23,213 23,298
Income tax expense
(benefit) (323) (14,096) 56,497 (46,892)
Interest expense 8,996 9,617 37,019 29,512
Interest income (137) (464) (1,610) (991)
--------- -------- --------- --------------
EBITDA $(202,194) $ (2,725) $(191,421) $ (100,438)
========= ======== ========= ==============
Backlog
(Amounts in thousands) Backlog
---------------------------------------------- ----------
Balance: December 31, 2024 $2,572,912
New contracts, change orders, and adjustments 230,336
Less: contract revenue recognized in 2025 (772,168)
---------
Balance December 31, 2025 $2,031,080
=========
Condensed Consolidated Balance Sheets
(Amounts in thousands, except
shares and per share data) As of
----------------------------------------
ASSETS December 31, 2025 December 31, 2024
------------------- -------------------
Current assets
Cash and cash equivalents $ 52,713 $ 72,185
Restricted cash 14,755 15,376
Accounts receivable, net 167,786 179,320
Retainage receivables 101,779 112,264
Contract assets 366,607 483,181
Other current assets 30,326 19,326
--------------- ---------------
Total current assets 733,966 881,652
Property and equipment, net 107,305 116,328
Right-of-use assets 10,524 14,897
Investments - unconsolidated
entities 129,696 126,705
Investments - limited liability
companies 2,323 2,590
Investments - private equity 2,588 2,699
Deferred tax asset 3 54,531
Goodwill 1,528 1,528
Intangible assets, net 1,180 1,180
Other noncurrent assets 167 1,539
--------------- ---------------
Total noncurrent assets 255,314 321,997
--------------- ---------------
Total assets 989,280 1,203,649
=============== ===============
LIABILITIES AND EQUITY
Current liabilities
Accounts payable $ 224,915 $ 191,670
Retainage payable 36,977 33,622
Accrued liabilities 80,011 91,515
Current portion of long-term
debt 53,731 44,525
Short-term lease liabilities 6,808 10,104
Contract liabilities 252,543 249,706
--------------- ---------------
Total current liabilities 654,985 621,142
Long-term debt 203,971 255,625
Long-term lease liabilities 16,403 10,791
Deferred tax liabilities 3,032 292
Financing obligations, net 41,440 41,468
Long-term accrued liabilities 58,075 58,075
Other noncurrent liabilities 143,880 40,847
--------------- ---------------
Total long-term liabilities 466,801 407,098
--------------- ---------------
Total liabilities 1,121,786 1,028,240
--------------- ---------------
Commitments and contingencies
(see Note 17)
Stockholders' equity (deficit)
Preferred stock, $0.0001 par
value, authorized 50,000,000
shares, none issued and
outstanding as of December 31,
2025 and December 31, 2024 -- --
Common stock, $0.0001 par value,
authorized 500,000,000 shares,
54,113,036 and 53,936,411
issued and outstanding as of
December 31, 2025 and December
31, 2024, respectively 5 5
Additional paid-in-capital 293,237 292,173
Accumulated deficit (431,158) (124,618)
Accumulated other comprehensive
loss (3,018) (3,902)
--------------- ---------------
Total stockholders' equity
(deficit) (140,934) 163,658
Noncontrolling interest 8,428 11,751
--------------- ---------------
Total equity (deficit) (132,506) 175,409
--------------- ---------------
Total liabilities and equity $ 989,280 $ 1,203,649
=============== ===============
Condensed Consolidated Statement of Cash Flows
Year Ended
----------------------------------------
(Amounts in thousands) December 31, 2025 December 31, 2024
------------------- -------------------
Cash flows from operating
activities:
Net loss $ (308,363) $ (105,528)
Adjustments to reconcile net
loss to net cash provided by
operating activities:
Depreciation and amortization 23,213 23,298
Amortization of deferred
financing costs 1,858 --
Loss on extinguishment of debt -- 246
Deferred taxes 57,258 (44,751)
Share-based compensation 1,184 2,049
Gain on sale of assets (2,273) (3,439)
Foreign currency remeasurement
gain (49) (12)
Loss from equity method
investments 1,291 415
TZC investment present value
accretion -- (3,367)
Loss (gain) on trading
securities, net (292) 224
Changes in assets and
liabilities:
Accounts receivable 23,070 9,924
Contract assets 116,841 70,713
Other current assets (11,001) 757
Right-of-use assets 4,374 (2,410)
Accounts payable and accrued
liabilities 23,617 (3,652)
Contract liabilities 2,828 56,426
Operating lease liabilities (4,369) 2,538
Other noncurrent liabilities 89,069 --
Other (1,675) (1,504)
--------------- ---------------
Net cash provided by operating
activities 16,581 1,927
Cash flows from investing
activities:
Purchase of property and
equipment (3,846) (7,416)
Proceeds from sale of property
and equipment 6,549 6,513
Purchase of trading securities -- (89)
Proceeds from the sale of
trading securities 403 401
Distributions received from
investees 934 4,069
Capital contribution to
unconsolidated investments (915) (250)
Return of investment in limited
liability company 267 --
--------------- ---------------
Net cash provided by investing
activities 3,392 3,228
Cash flows from financing
activities:
Borrowings on revolving credit
facility -- 5,000
Payments on revolving credit
facility -- (95,000)
Borrowings on notes payable -- 168,127
Payments on notes payable (50,708) (89,781)
Proceeds from financing
obligations -- 42,500
Payments of deferred financing
costs (297) (7,982)
Pre-payment premium -- (246)
Advances from (to) related
parties (3) 12
Payments on finance lease and
financing obligations (1,350) (5,481)
Capital contributions from
noncontrolling members -- 1,838
Distribution to members (1,808) --
Payment of taxes related to net
share settlement of RSUs (120) (206)
Proceeds from advancement of
surety funds 14,135 --
--------------- ---------------
Net cash provided by (used in)
financing activities (40,151) 18,781
Effect of exchange rate on cash 85 (195)
--------------- ---------------
Net increase (decrease) in cash
and cash equivalents and
restricted cash (20,093) 23,741
Beginning of period 87,561 63,820
--------------- ---------------
End of period $ 67,468 $ 87,561
=============== ===============
Supplemental cash flow
information
Cash paid for income taxes $ 1,163 $ 1,561
Cash paid for interest $ 35,281 $ 28,047
Non-cash investing and
financing activities:
Lease assets obtained in
exchange for new leases $ 12,088 $ 18,718
Assets obtained in exchange for
notes payable $ 6,723 $ 27,365
Related party payable exchanged
for note payable $ -- $ 3,797
Conversion of promissory notes
payable to equity $ -- $ 20,000
Distribution to joint venture
partner $ -- $ 276
Conference Call
Southland will host a conference call at 10:00 a.m. Eastern Time on Friday, March 27, 2026. The call may be accessed here, or at www.southlandholdings.com. Following the conference call, a replay will be available on Southland's website.
About Southland
Southland is a leading provider of specialized infrastructure construction services. With roots dating back to 1900, Southland and its subsidiaries form one of the largest infrastructure construction companies in North America, with experience throughout the world. The company serves the bridges, tunnelling, communications, transportation and facilities, marine, steel structures, water and wastewater treatment, and water pipeline end markets. Southland is headquartered in Grapevine, Texas.
For more information, please visit Southland's website at southlandholdings.com.
Non-GAAP Financial Measures
This press release includes certain unaudited financial measures not presented in accordance with generally accepted accounting principles ("GAAP"), including but not limited to earnings before interest, taxes, depreciation, and amortization ("EBITDA"), backlog, and certain ratios and other metrics derived therefrom. Note that other companies may calculate these non-GAAP financial measures differently, and therefore such financial measures may not be directly comparable to similarly titled measures of other companies. Further, these non-GAAP financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing financial results. Therefore, these measures should not be considered in isolation or as an alternative to net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP. Southland believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Southland's financial condition and results of operations. Southland also believes that these non-GAAP financial measures provide an additional tool for investors to use in evaluating ongoing operating results and trends. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which items of expense and income are excluded or included in determining these non-GAAP financial measures.
Please see the accompanying table for reconciliations of the following non-GAAP financial measures for Southland's current and historical results: EBITDA (non-GAAP financial measures) to net income (loss) attributable to common stock.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on Southland's current beliefs, expectations and assumptions regarding the future of Southland's business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of Southland's control. Southland's actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.
Any forward-looking statement made by Southland in this press release is based only on information currently available to Southland and speaks only as of the date on which it is made. Southland undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260326878890/en/
CONTACT: Southland Contacts:
Keith Bassano
Chief Financial Officer
kbassano@southlandholdings.com
Alex Murray
Corporate Development & Investor Relations
amurray@southlandholdings.com
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