Operator
Hello, everyone. Thank you for joining us and welcome to the Century Second Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to and Nathan Tetlow, Vice President, Investor Relations. Nathan, please go ahead.
Thank you, and good morning, everyone. Today, we issued and posted to Century Earnings website our second quarter earnings release and investor presentation. Please note that on today's call, we will address certain factors that may impact this year's earnings and provide some longer-term guidance. Some of the information that will be discussed today contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These statements are as of today's date and based on management's assumptions and are subject to several risks and uncertainties, including uncertainties surrounding the impacts of future economic conditions and regulatory approvals. A cautionary note, as well as a note regarding non-GAAP measures is included in today's press release in the investor presentation and in our filings with the Securities and Exchange Commission, which we encourage you to review. Also provided are reconciliations of our non-GAAP measures to related GAAP measures. These risks and uncertainties may cause actual results to differ materially from statements made today. We caution against placing undue reliance on any forward-looking statements, and we assume no obligation to update any such statement except as required by law. Today's call is also being webcast live and will be available for replay in the investor relations section of our website shortly after the completion of this call. On today's call, we have Chris Brown, President and Chief Executive Officer, and Greg Eisenstark, Chief Financial Officer. I will now turn the call over to Chris.
Nate, thank you, and thank you, everyone, for joining our second quarter earnings call. We're proud to have delivered $962 million of revenue for the quarter, a new quarterly record for century. Adjusted net income for the quarter was $24.4 million, an increase of 44 percent from the same quarter last year in terms of our base measures which includes storm work and for this quarter a one-time pre-ipo receivable write-off second quarter base revenue was 36 percent higher than last year and base gross profit was 21 percent higher. For the first half of the year, base revenue was 33% higher than last year and base gross profit was 35% higher than last year. This is remarkable growth and reflects the dedication of our teams across the US and across Canada. I'll start with the recently announced acquisition of JJ White, a leading provider of union industrial, mechanical and electrical maintenance and construction services. JJ White has about 1,000 employees and will be integrated into our rigged distiller business, adding scale and implant construction expertise across several end markets, including data centres. This token acquisition is consistent with our strategy that we laid out earlier this year. We increased scale in the North, East and Midwest, expanded our core business, and added new customers in the electric end markets. We expect J.J. White to add more than $20 million of gross profit on a full year annualised basis. The total cash consideration paid was approximately $62 million, funded from existing balance sheet liquidity. We therefore see no change to our year-end leverage target of two times. And we're very much excited to welcome the JJY team and we look forward to the growth and their execution ahead. Now for a commercial update. Where we continue to see strength in our core and adjacent end markets and more than ample opportunity to deliver sustainable growth at double digit levels. Second quarter bookings were nearly 850 million, bringing our year-to-date bookings to over 2.2 billion. Our book-to-build ratio year-to-date is 1.3 times, and on an organic basis, for the full year, we are targeting a 1.2 times book-to-build, or approximately $4.4 billion of total bookings for 2026. The successful negotiation and award of our largest data centre project has demonstrated our ability to differentiate and secure complex, value-added contracts into our portfolio. The $125 million award covers electrical infrastructure and utility for a multi-building data center campus. We continue to view the data center demand as robust, attractive and growing. And with the addition of JJY, we will further increase data center backlog and the pipeline of opportunities for our company. At quarter end, we had about $2 billion of data center opportunities in our pipeline. Other bid works in the quarter include the construction of an electrical transmission and substation project for Atlantic Canada, which was a very nicer word for the Connect team, and also the assembly and installation of key components of the gas infrastructure for a gas infrastructure company, and finally a large significant electrical high-voltage transmission project in the northeast of the US. On the MSA side, we booked approximately 250 million in renewals, which included gas distribution, infrastructure upgrades, and expanded scopes of work for a long-standing utility customer. We also booked approximately 200 million between new MSAs and from existing MSAs. Demand for our core MSA work, including expanded scopes of work, remains very strong. Our current backlog stands at approximately 6.4 billion, which is up 21% year over year. Even more notable is the opportunity pipeline has increased to approximately 16 billion, which is up 23% from the first quarter, which demonstrates the strength of our end markets and our ability to present centrally for backlog growth we have nearly 700 700 differentiated bid opportunities in the pipeline which collectively represents 60 of the 16 billion and in the very near term we have 2.5 billion of outstanding bids pending at the end of q2 which represents a 15 increase increase from the first quarter. This number has further increased as we've moved into Q3, another positive indicator of the strength we are seeing across our red markets. Over two thirds of these pending bids are from our electrical segment. It should also be noted that as we bid and increased our volumes, our bid margins year over year have increased by more than 10 percent which is fully in line with our long-term margin targets that we communicated earlier in february this year as we've discussed over the recent months we are focused on driving longer term sustainability into our business through margin expansion backlog and greater coverage for the subsequent years coming into 2026 we had about 3 billion of coverage for 2026 revenue and we are now forecasting to exit 2026 with more than 3.6 billion of revenue coverage for 2027. This is a 20% in organic increase. This visibility and predictability provide the foundation for sustainable growth, allowing us to plan and execute for the future. Lastly, To support customer demand and build for sustained growth over the first six months of this year, we have organically added approximately 1,700 employees, representing an 18% growth in headcounts so far this year. In the U.S. gas business alone, we've added over 1,200 employees, a 25% increase to support client demand emanating from our strategy to mitigate seasonality in our business and expand our gross margins. This significant capacity increase added near-term costs, which we estimate reduced second quarter gross profit by approximately 3 million. we fully expect these capacity investments to benefit q326 and the subsequent quarters as our resources generate revenue and margin expansion we forecast approximately seven and a half percent gross margin for our u.s gas business in the second half of this year in 2026 we were also affected by elevated fuel prices in the quarter relating to the ongoing conflicts in the middle least the average per gallon cost was at 48 percent year over year and the estimated cost impact within the second quarter was approximately six million dollars higher fuel prices and the investment associated with the additional gas resources together had a combined 95 basic point impacts on the second quarter base gross profit magic the fundamentals of our business remain strong, and we continue to invest in the future, guided by the priorities outlined within our Vision One Century strategy. I'll now turn it over to Greg to discuss the financial results.
Thank you, Chris, and good morning to everyone. Second quarter, 2026 consolidated revenues totaled $962 million, a new quarterly record, and was a 33% increase from Q2 2025. Consolidated gross profit was $69 million and gross profit margin was 7.2% in the quarter. In terms of base results, which exclude the impact of storm work, and for this quarter, a one-time write-off I'll discuss shortly, base revenue was up 36% and base gross profit was up 21% compared to last year. Base gross profit margin was 7.9% in the quarter versus 8.9% last year, and on a trading 12-month basis, base gross profit margin was 7.8% versus 7.4% a year ago. Net income attributable to common stock in the second quarter was $6.1 million, or $0.06 per share, compared to a net income attributable to common stock of $8.1 million, or $0.09 on a per share basis in the same period last year. In the second quarter adjusted EBIT was $40.5 million, 8% higher year-over-year, and adjusted EBITDA was $75.7 million, a 5% increase over the same period last year. Adjusted net income in the second quarter came in at $24.4 million, or 24 cents on a per share basis, compared to $16.9 million, dollars or 19 cents per share in the same period last year. As Chris mentioned, second quarter results were impacted by elevated fuel prices from the ongoing conflict in the Middle East. We estimate that the higher fuel prices in the quarter amounted to an additional cost of approximately six million dollars or approximately 60 basis point impact on margins. In the second quarter, the company wrote down all of its remaining accounts receivable and contract assets related to work that was completed prior to 2020 for the city of chicago the work the write down reduced u.s gas revenue by nine million dollars in the court we did not we did not budget collection of this receivable in 2026 so the write down has no impact on our cash flow expectations we have excluded this one time item from our non-gap measures including our base metrics Now to our segments. U.S. gas revenue was $489.5 million, an increase of 45% compared to the prior year. The growth was driven by increased bid work and MSA volumes, demonstrating the underlying strength of our customer relationship and market position. Growth profit margin was 4.2% in the quarter, down from 7.8% last year. Base gross profit margin for U.S. gas was 5.9%. As previously mentioned, second quarter margins for U.S. gas were impacted by approximately $3 million, or 60 basis points, from capacity added in the second quarter. While the timing of these additions impacted Q2 costs, we expect the results scale benefits benefits to support stronger performance in the second half of 2026 and further improve seasonality during the first quarter of 2027. On a year-to-date basis, we've seen significant growth and improvement in profitability of U.S. gas. Based gross profit has more than doubled from last year, and based gross profit margin improved by 36 percent over the same period last year. Canadian operations revenue was $81.4 million, up nearly 48% from the prior year period, primarily from the conclusion of Kinect. Operational performance in this segment remains strong against the backdrop of sustained favorable demand, as evidenced by the 16% gross profit margin in the quarter. Union electric revenue was $224.2 million, an increase to 23% year-over-year. Growth has been fueled by robust activity and projects serving industrial end-user segments. Gross profit margin for the Union Electric segment was 9 percent in the second quarter, ahead of the 8.4 percent reported in the same period last year. Non-Union Electric revenue in the second quarter was $166.9 million, an increase of 11 percent year-over-year. Base revenues in the non-union electric was $157.1 million in the quarter, which is a 15 percent increase from last year. This growth reflects the significant expansion we've seen in MSA activity, building on the momentum we've discussed in recent quarters. Gross profit margin in the non-union electric segment was 9.1 percent in the current period, compared to 11% in a prior year period, and base gross profit margin was 8.4% compared to 8.9% in the prior year. Turning to cash flow analogy, net cash provided in operating activities for the second quarter was $20 million and free cash flow was negative $7 million, consistent with our expectations. For the full year, we expect free cash flow to exceed $75 million, a 25% improvement over initial expectations. We ended the quarter with a net debt to adjust the EBITDA ratio of 2.6 times, which was down from 3.7 times a year ago. We continue to forecast net debt to adjust EBITDA of around two times by year end, finally turning to our 2026 outlook. We have increased our full year guidance and it included expected contributions from J.J. White. The full year guidance also includes approximately $5 million of forecasted incremental fuel expenses based on the assumption that higher fuel prices persist through the third quarter. As a reminder, base revenue and base gross profit are non-GAAP measures that excrete the impact of storm restoration services and the one-time breakdown related to the City of Chicago. For 2026, we expect base revenue of $3.5 to $3.7 billion and base gross profit of $270 to $290 million. Revenue, adjusted EBITDA, and adjusted net income are measures that include storm restoration services. Guidance for these measures includes storm restoration services using a three-year average of $88 million in revenue and $28 million in gross profit. For 2026, we expect revenue of $3.59 to $3.79 billion, adjusted EBITDA of $285 to $310 million, and adjusted net income of $60 to $75 million. And lastly, we are reducing our net capex outlook to a range of $60 to $75 million following the sale and leaseback of select equipment early in the third quarter. I will now turn it back to Chris to wrap up our prepared remarks.
Thank you, Greg. As we wrap up today's call, I'd like to leave you with a few key thoughts. We've demonstrated our ability to capture market demand and deliver growth. Over the course of the last year and again in the first half of this year, We have successfully identified and secured opportunities across our end markets, expanded our workforce to meet our customer demand, and continue to grow revenue, backlog, and the opportunity pipeline. The focus now is not on only sustaining that growth, but leveraging the scale we are building to expand margins and drive stronger profitability over time. We're very pleased with our first half performance, and more importantly, encouraged by the trajectory of our business. As we outlined last quarter in our Vision One Century strategy, the path to achieving our 29 base growth profit margin target of 9.7 is built on three primary drivers, reducing the seasonality of our business increasing the mix of higher margin big work and delivering operational excellence we've already begun to see these initiatives gain traction our first quarter results demonstrated meaningful progress in seasonality our opportunity pipelines and bookings continue to support growth in big work and we are now advancing several operational excellence initiatives that believe will bring lasting value over time we are increasingly confident that the right tools processes and leadership are in place to drive sustained progress initiatives like our newly established pmo organization fleet optimization efforts working capital management and enhanced job level performance attribution and analytics are in early stages these initiatives represent important building blocks in creating a more efficient, scalable, one-century model. We are investing with intention, executing against our clear strategy, and are encouraged by the momentum we are seeing across the business. In short, the implementation of our margin improvement plan to deliver the 2029 targets continues in line with our expectations. As we look ahead, we remain confident in our ability to deliver sustainable growth, achieve our long-term margin objectives, generate free cash flow, and create significant value for all our shareholders. We truly appreciate everyone's time today and the interest that you've shown. Operator, let's begin the Q&A.
Operator
We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Sangeeta Jain with KeyBank Capital Markets. Sangeeta, your line is now open.
Great, thank you. Good morning. Can I start with the JJ White acquisition and maybe you can discuss what your key goals are with this acquisition and what type of synergies are you hoping to achieve?
Good morning, Sangeeta. Yeah, I can cover that. But first of all, we've known JJ White as an organization for a number of years. So the cultural fit, the capability and the relationship between our respective businesses were long established. So this wasn't finding a business we did not know well. So that was number one. What JJ White brings us is more scale, more capacity to be able to deliver on growth in the Midwest and the Northeast, primarily focused on implant power data center related activities the business has got a massive track record in in in developing talent within the business it's currently a thousand people we believe it can flex easy to two thousand people so it brings capacity for us um your question on synergy um we don't we don't see cost synergy at all in the transaction um jj white is currently is currently um mobilizing into our overall rigs offices in the new jersey area uh we see the synergy coming from their operational capability combined with ours to do more work for our customers um that that's where we see the synergy in the supply chain of people they have, supervisors, as well as craft, giving us more capacity in that Northeast Midwest to deliver for customers in both data centers and energy.
And that's very helpful. And then maybe I can follow up for Greg. You gave us a look into second half. You said you're factoring in 5 million on higher fuel costs.
Can you give us a sensitivity on how many basis points of margin that should mean for the second half yeah so uh good morning and so you know overall for the full year fuel from the uh seven and a half million dollars or seven million dollars in the first half and then the five million dollars that i noted in the second quarter or in the second in the third quarter excuse me it's about 35 basis points of headwind for a full year basis okay Okay.
And you're assuming just for third quarter, nothing for fourth quarter yet?
Our assumption in our guidance assumes a $5 million headwind in the third quarter and then back to some level of normalized increase year over year. So our guidance in the beginning of the year did assume some normal increase that you would expect.
Got it. Thank you. Thanks for answering my questions.
Operator
Your next question comes from the line of Manish Samaya with Kantor. Manish, your line is now open.
Thank you. Good morning, everybody.
Hi. Greg, I had a question for you on guidance. Looks like revenue is up about $300 million at the midpoint.
EBITDA is up a little bit maybe if you can just help us understand you know the conversion the EBITDA flow through and then I have a follow-up yeah so you know maybe taking a step back when you look at base gross profit you know of the increase that we've assumed in our guidance about two-thirds of it kind of relates to organic business and then one-third of it kind of relates to the the decent minimal position of J.J. White in the five or so months of contribution that we'll get here in the back half of the year. From an adjusted EBITDA perspective, we've assumed that same level of base growth profit along with our storm activity. Obviously, you have the the previously discussed kind of headwind from moving to a 50-50 split on leasing, which we're on target with, and have revised or finalized the sale and lease back of our existing fleet. So any future purchasing will be along those lines. So the combination of all that you know, gets you to adjusted EBITDA, you know, about 78.1% at the midpoint.
And Greg, I think in the slides you have fleet investments at 60% operating lease and 40% CapEx vis-a-vis the 50-50 split that we have talked about. So I guess what is the incremental the impact to EBITDA of that sort of 10 percentage point increase in opening lease this year?
So the full year impact of our leasing is about a half a percentage point, or is about 55 basis points, excuse me?
On margin, on EBITDA margin, 55 basis points on EBITDA margin.
Okay, wonderful. Wonderful. I'll get back in queue. I'll respect the instructions. Thank you.
Operator
Your next question comes from the line of Justin Houck with Robert W. Baird. Justin, your line is now open.
I've got two questions here. I'll start. I guess the first one, this one's really easy, and then I've got a question on the guidance. but the first question is just the JJ White acquisition, I think you said $315 million of backlog and a $2.8 billion pipeline increase. Is that pipeline increase already in the $16 billion number that you gave, or is that something? Okay.
Just that it's not. We didn't close on JJ White until I think the third week in July, so it's excluded from the numbers, so it will be Okay.
All right. I figured that. I just didn't know, given it's a pipeline number.
But as Greg just said, the only element you'll see of JJ White within our release is to guidance where one-third of the guidance increase came from JJ White for that five-month period. That's the only thing I would stress.
Yeah. Well, and that leads to my second question, because I guess this is what I kind of want understand a little bit better because you know the the organic you know as you just discussed the revenue is 200 million dollars higher you've got you know another 100 from jj white you raise the the ebit the guidance by five you pick up nine or so from you know the five months that you have jj white and you offset that with the the five million dollar headwind from the higher fuel cost So that basically just, I guess I would look at that and say that it implies organically that there's no incremental margin on any of that acquired revenue. And so I guess I just want to understand that dynamic and also just the confidence in the second half base gross profit margin outlook, which is like roughly 9% versus, you know, just under 8% that you did here in 2Q.
I know there's seasonality, but just, you know, I guess help me understand some of those moving pieces a little bit better. let me talk about second half and then greg can come to the overall guidance just to just to help you map the numbers um you know we feel um second half of the year uh very strongly about the volume of work and also about the nine percent quoted margin um we've got total visibility of pretty much everything that we need to deliver this year is under contracts i think there's a slide within the deck that shows that to everybody um we've we've added the capacity we needed to add in gas i think everybody has said in my speaker notes but everyone will recall we have we have a we have a massive drain on margins in our in our in our first quarter even going into april so adding more volume into the gas business needed people to win work put it into the backlog which we did you've then got to mobilize people and we've added 12 in the quarter the boys and girls will stay within the headcount because we've now reached where we have to be on capacity standpoint so as as we we don't just look on you can't run the business on a quarter just on a quarterly on a quarterly basis the business is not yet it's just not linear like that because of the seasonality as well as the portfolio nick so what's the point the point is we we added the capacity we needed in the second quarter we've got full visibility of where we're going to be for the second half of this year we're really confident in the nine percent margins as quoted and our intent now is to is to drive very strongly to the end of the year and then if you look even into 27 which i know i know we're not into 27 yet we've already built up the backlog for next year which is really important when it comes to seasonality um the seasonality for the first quarter next year requires us to win work now and add resources for that for next year so the bottom line is very confident in the second half of the year we've got pretty much all of the revenue under contracts we've we've added the capacity we need to particularly in the gas
business so we feel very confident that the investment in the first quarter will widen margins in the second half of the year i'm confident within that overall nine percent for the second half of the year across the board and specific to the guidance you know we we talked about in our release that the annualized uh revenue conquer a profit gross profit contribution from jj white uh being you know 20 million plus um with margins consistent with our you know our union electric business or our business as a whole um when you think about um they also have a bit of gna expense and they're very capital light in their and how they operate their business and so very little depreciation um within the business um as they they're very efficient uh from that perspective and so taking into consideration um lower depreciation within their numbers and then some level of gna expense you know you get to an ebitda contribution um that's um you know a little bit less than where we, you know, what we said on the gross profit basis. You also have to remember that our EBITDA guidance includes the fuel impact, you know, it's about $12 million on a full year basis that we forecasted. When you factor all that in, you know, in G&A, it's then still being, you know, in line with what we previously said, which is, you know, four percent or better on a percentage of revenue basis and then the last thing i just point out on on gross profit i mean gross profit margin in um you know on a full year basis is going to be in that you know kind of uh you know 7.8 to 8 percent range your next question comes from the line of
Operator
Zachary Schechtman with Wells Fargo. Zachary, your line is now open.
Hey guys, thanks for taking my question. I was wondering if you could give a little more color on that 9% for 2H, 3Q versus 4Q. You mentioned the fuel headwind and U.S. gas labor ramp delivers a meaningful impact. So I'm just wondering if 3Q still hits around that mark or we're expecting to see a sizable step up and 4Q.
Zach, I apologize. The line wasn't particularly bad. Were you asking us about Q3 over Q4 margins in gas? Was that your question?
Yes, that's correct. And just total base gross margin.
So, I think we said in our prepared remarks at the back half of the year for U.S. gas, you know, we expect to have gross margins in the 7.5% range. and from a total basis perspective, gross margin in the second half of the year is going to be about 9%.
Got it. And we should expect a size little increase from 3Q to 4Q due to the headwinds you mentioned previously.
I mean, the third quarter generally is the most active quarter that we have, just given weather throughout the United States and Canada. And the fourth quarter, while while comparable to that, you obviously get weather and and holidays in the back half that could, you know, impact productivity and but but generally speaking, the third quarter is our strongest period.
Got it, understood. And just as a follow-up, I see really nice growth acceleration in bid work last couple quarters.
Can you just talk about how gross margins have been trending in that work um how they've been trending versus expectation and how it compares to msa at this point yeah exactly we laid out previously our desire to to grow the business and the bid mix moving from 80 msa 20 bid work to probably long term 65 35 get it said um we we see we are tracking bid margins as we are tracking now more closely as delivered margins and bid work is between 1.1 or 1.5 percent higher than the msa margin got it thank you guys your next question comes from the
Operator
line of avi yarislavitz with ubs avi your line is now open thank you hi good morning guys um I believe you already answered this, but just want to make sure.
The $16 billion opportunity pipeline that you noted, that does not include J.J. White. Is that correct?
I can confirm that's the case, Abby. The $16.2 billion, to be precise, excludes any J.J. White pipeline of opportunity, as does the backlog of 6.4-plus million-week quotities, absolutely excludes.
Okay, got it. So the opportunity pipeline up about $3 billion. The mix of bid work in there is up about five percentage points. But the number of bid opportunities that you called out is about the same as last quarter. So should we take that to mean that you're looking at meaningfully larger bid opportunities than previously, or is that just reading into it too much?
I mean, you can't, and it's the same of the conversation on the margin as it is with the pipeline. You can't look at it. It's not Swiss watchmaking. We can't look at it on a quarter by quarter basis. So we look at absolute data over a longer time horizon. so what i will what i will tell you is at the end of last year december the 31st we had 13 billion in the pipeline there's now 16.2 billion a six-month time horizon is a fair in my view direction of travel for a number of things both pipeline as well as margins if you look at the mix of work over the same timeline um we've gone from 6.7 billion of the 13 billion at the end of december was project work and six and a half billion was msa work at the end of june at the end of june so the quarter would just close the project work is 9.664 to be precise and 6.56 is the MSA work. So we've seen just nearly a 50% increase in the bid work, which is totally consistent with the strategy we laid out in February. I will tell you the average size of the scope of work within that project has only moved up by a couple of million dollars. So we're not deviating from doing the services and the projects that we've always done. There's a $2 million increase from the average contract size within the pipeline at the end of the year to where we are at the end of June. So it's not materially different. But the amount of work, that is bid work, has gone up by 46.5% to be precise. Okay.
I appreciate that. And, yeah, I understand that we're talking in approximate terms with the exact number of opportunities in there. I want to ask also about the slide note that you're evaluating opportunities to expand geographically and with electric transmission capabilities. Do you see those more as organic growth opportunities or would they more likely to be through acquisitions?
I think you've got to decouple sort of two things there. The primary basis of our business is organic growth. and we've got the capability to do more to do transmission work we announced two awards in the quarter one for Canada which is and one for the northeast um we've doubled in the sales pipeline we have doubled the amount of transmission electric transmission opportunities from the December to where we are in June so there is an absolute desire as we communicated in February is part of our strategy to drive organic growth into our transmission business across both union and non-union. And we're doing that, we're seeing that in the pipeline, we're also seeing that in the recent awards. Your second question around M&A, I will stick to what I think we said in February and what I've been saying for a year. We've got a very, very good platform to grow our business. We've got some evolution to do as we bring us together as one strategy, as one company, as one vision, mission, and values to deliver the sustainable growth. But there are areas in the business where we would like to acquire. We've essentially done two token acquisitions in my tenure here. One was Connect in Northern Atlantic Canada, which was electrical transmission distribution substation. And the recent acquisition for unions in the Northeast was Electrical Union to support the overall data center and utility clients. As I said when we rolled out the strategy, I would anticipate as time moves on, if we see businesses that look similar in size, similar in quality, that we can pay the right price for, that complements our electrical business, especially our electric transmission, we would love to do those. So that's how I would answer the question.
All right. I appreciate it. Thank you very much.
Operator
Our last question comes from the line of Manish Samaya with Kantor. Manish, your line is now open.
Thank you so much. Greg, I have one other question for you and then I'll move on to Chris. Greg, if you can just kind of help us summarize all the puts and takes on the positive impact and the negative impact. I know we've talked about a lot of different numbers, and it's just been really hard to kind of make sure that I have what I need. And I'm sure there are folks at the call who probably feel the same way. Obviously, the revenue uptake is positive, which is, I think, Chris, you've talked about, you know, things are happening. But we're just trying to get a better sense as to puts and takes on uh some of the things that we've already talked about so maybe greg if you can just help us uh uh figure out you know what the different line items are just so that we have a better feel for uh how we should be looking at the numbers uh and then chris i can have one other question for you yeah when when greg just answers your question i will just sort of wrap up a little bit on the margin commentary because he does get lost because it's complicated business.
I would just like to summarize where we are and how we look at this so the audience can understand it. So let's, Greg, answer your question, then I'll just add something to the back end of that.
Yeah, and maybe let me focus on kind of full year gross margin, base gross margin, because that's ultimately one of the key drivers for the management team so when you think about gross a base gross profit margin you know there's there's the the contribution of uh jj white uh which is about a third of the the gross profit uh increase in the in the margin in the base guide that we that we discussed you have fuel costs um which between what's already occurred in the first half of the year and what's you know we had forecasted for the second half of the year is about 12 million dollars of a of a full year impact um and then you have the the ramp up costs which were already incurred in in this first half of the year they're already in our full year numbers obviously that's that's about three million dollars um so overall um you know gross margins are adjusted for fuel or are you know about 8.1 percent on the base um versus the the the guide of 7.8 but that obviously doesn't add back to the fuel so i believe what one thing i would would talk specifically about on on the margins you
know we got a reported margin then we've got the impact of the chicago which was was pre-app here and not even operationally we're we're in the we're involved in it it was just something that was on the balance sheet. We then got the fuel costs and then the Q2 capacity increase. If you look at year to date where we are on the margins and how we track it, our overall group margins, 25 to 6.2%, and we're now at 6.3%. All that is doing is just excluding in the Chicago one-time event. And if you look on a trailing 12-month basis, last year we were at 7.4%. This year we were at 7.8%. And the reason I look at the year-to-date and the trailing 12 months is not an excuse. It's just our business at the moment is not linear. We don't have 12 consecutive growth that all look the same, mainly due to seasonality, the portfolio mix, and the type of work. So we see our underlying margins if you just take out one thing, which is the city of Chicago, and you keep in there the fuel costs and the mobilisation for capacity in the second quarter on a year to date or up 6.2 to 6.3, and then on truly 12, 7.4 to 7.8. I think that's just getting lost a little bit because of the complexities of reporting. And I would say if you look at the gas margins where most of the seasonality is, year-to-date last year, we were at 2.2% gross profit. This year, we're at 2.9%. And on a trillion 12 months, we're well at the 1, 1.5% more than we were a year ago. So everything's moving in the right direction from a margin standpoint, Monique.
Okay, that's super helpful, Chris. And just kind of going back to our last meeting in June, Chris, we talked about maybe $3.5 billion or so of 27 work that you expected to book by the end of 26 and, you know, 15% plus backlog increase. If you can just give us a quick update on where that stands today, both excluding and including J.J. White.
I can. I can. We deliberately added a slide for readers, I think it's slide 12, if Greg may correct me, that basically addresses that very point, Manish. So as you quite rightly said, 2025, we had 3 billion of coverage coming into 26. We are round about where we sit now with about 3.6 billion. So we're up 20% in terms of expected coverage when we close out 2026 for 2027 revenue. So that trajectory has continued. And you'll recall the other 24, we only had 2 billion going into 25 budget, 12 months, 25. As I say, we had 3 billion. And you'll see on slide 12, we're at 3.6 billion is where we forecast. And that excludes JJ White. What I will tell you on JJ White, they have a similar level of coverage for both 26 and we are currently validating their coverage for 27. But I suspect that the JJ White coverage for next year will look very comparable to what we have within Century. So I think the guidance that we show in slide 12, where we have 3.6 billion excluding JJ J.Y. is very accurate and will drive the 20% more coverage going into next year. And I think J.J. White will be of a similar mix.
Okay, great. Thank you, Chris.
Operator
We have reached the end of the Q&A session. I will now turn the call back to Nathan for closing remarks.
Thank you, everyone, for your questions and for participating in today's call. Please feel free to reach out to me if you have further questions. And that concludes today's call.
Operator
This concludes today's call. Thank you for attending. You may now disconnect.
