Earnings Call Transcript - MYRG Q4 2025

Operator, Operator

Good morning, everyone, and welcome to the MYR Group Fourth Quarter 2025 Earnings Results Conference Call. Please be advised that today's conference is being recorded. I would now like to turn the call over to Jennifer Harper, Vice President of Investor Relations and Treasurer, for introductory remarks.

Jennifer Harper, Vice President of Investor Relations and Treasurer

Thank you, and good morning, everyone. I would like to welcome you to the MYR Group conference call to discuss the company's fourth quarter and full year results for 2025, which were reported yesterday. Joining us on today's call are Rick Swartz, President and Chief Executive Officer; Kelly Huntington, Senior Vice President and Chief Financial Officer; Brian Stern, Senior Vice President and Chief Operating Officer of MYR Group's Transmission and Distribution segment; and Don Egan, Senior Vice President and Chief Operating Officer of MYR Group's Commercial and Industrial segment. A copy of yesterday's press release announcing our fourth quarter and full year 2025 results can be found on the MYR Group website at myrgroup.com under the Investors tab. A webcast replay of today's call will be available on the website for 7 days following the call. Please note today's discussion may contain forward-looking statements. Any such statements are based upon information available to MYR Group's management as of this date, and MYR Group assumes no obligation to update any such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Accordingly, these statements are no guarantee of future performance. For more information, please refer to the risk factors discussed in the company's most recently filed annual report on Form 10-K. Certain non-GAAP financial measures will also be presented. A reconciliation of these non-GAAP measures to the most comparable GAAP measures is set forth in yesterday's press release. With that, let me turn the call over to Rick Swartz.

Richard Swartz, President and Chief Executive Officer

Thanks, Jennifer. Good morning, everyone. Welcome to our fourth quarter 2025 conference call to discuss financial and operational results. I will begin by providing a summary of the fourth quarter and full year results, and then we'll turn the call over to Kelly Huntington, our Chief Financial Officer, for a more detailed financial review. Following Kelly's overview, Brian Stern and Don Egan, Chief Operating Officers for our T&D and C&I segments, will provide a summary of our segment performance and discuss some of MYR Group's opportunities going forward. I will then conclude today's call with some closing remarks and open the call up for your questions. We closed 2025 with strong financial performance in the fourth quarter and full year revenues of $3.7 billion. A steady backlog of $2.8 billion at the end of 2025 reflects a healthy bidding environment and the continued investment in infrastructure to meet the growing electrification needs across the U.S. and Canada. Our work this year underscores the stability and expansion of our clients' relationships as well as our measured pursuit of new opportunities. We continue to see strong bidding activity across our business segments and are closely monitoring these opportunities and positioning ourselves to strategically pursue and execute projects with operational excellence. As always, our success is grounded in an unwavering commitment to our customers through safe and reliable project execution. Our teams are dedicated to helping our customers advance their business objectives, and I'm grateful for their continued hard work. Now Kelly will provide details on our fourth quarter and full year 2025 financial results.

Kelly Huntington, Senior Vice President and Chief Financial Officer

Thank you, Rick, and good morning, everyone. For the year ended December 31, 2025, we reached record annual revenues of $3.7 billion. Full year net income of $118 million and EBITDA of $233 million. Our fourth quarter 2025 revenues were $974 million, which represents an increase of $144 million or 17% compared to the same period last year. Our fourth quarter T&D revenues were $531 million, an increase of 18% compared to the same period last year. The breakdown of T&D revenues was $330 million for transmission and $201 million for distribution with increases of $64 million in revenue on transmission projects and $17 million in revenue on distribution projects from the prior year. Work performed under master service agreements continue to represent approximately 60% of our T&D revenues. C&I revenues were $443 million, a record high for our C&I segment and an increase of 17% compared to the same period last year. C&I segment revenues increased primarily due to an increase in revenue on fixed-price contracts. Our gross margin was 11.4% for the fourth quarter of 2025 compared to 10.4% for the same period last year. The increase in gross margin was primarily due to the fourth quarter of 2024 being negatively impacted by certain T&D clean energy projects and a C&I project. In the fourth quarter of 2025, gross margin was also positively impacted by better-than-anticipated productivity, favorable change orders, and a favorable job closeout. These margin increases were partially offset by an increase in costs associated with inefficiencies on certain projects. T&D operating income margin was 7.4% for the fourth quarter of 2025 compared to 6.7% for the same period last year. The increase was primarily related to the fourth quarter of 2024 being negatively impacted by certain clean energy projects. In the fourth quarter of 2025, T&D operating income margin was also positively impacted by a favorable change order and better-than-anticipated productivity. These operating income margin increases were partially offset by an increase in costs associated with project inefficiencies on certain projects. C&I operating income margin was 6.6% for the fourth quarter of 2025 compared to 3.9% for the same period last year. The increase was primarily related to a larger portion of our C&I projects progressing at higher contractual margins, some of which are nearing completion. In the fourth quarter of 2025, C&I operating income margin was also positively impacted by better-than-anticipated productivity, a favorable change order, and a favorable job closeout. These operating income margin increases were partially offset by an increase in costs associated with inefficiencies on certain projects. Fourth quarter 2025 SG&A expenses were $65 million, an increase of $8 million compared to the same period last year, primarily due to increases in employee incentive compensation costs and employee-related expenses to support future growth. Fourth quarter 2025 interest expense was $1 million, a decrease of $1 million compared to the same period last year. The decrease was attributable to lower interest rates and lower average outstanding debt balances during the fourth quarter of 2025 as compared to the same period last year. Our fourth quarter effective tax rate was 21.2% compared to 40.9% for the same period last year. The decrease was primarily due to changes in state tax rates used to measure our state deferred income taxes and lower permanent difference items. Fourth quarter 2025 net income was a record $37 million compared to $16 million for the same period last year. Net income per diluted share of $2.33 compared to $0.99 for the same period last year. Fourth quarter 2025 EBITDA was a record $64 million compared to $45 million for the same period last year. Total backlog as of December 31, 2025, was $2.8 billion, a 9.6% increase from the prior year. Total backlog as of December 31, 2025, consisted of $1.0 billion for our T&D segment and $1.8 billion for our C&I segment. As a reminder, our backlog includes projected revenue for only a 3-month period for many of our unit price, time and equipment, time and materials, and cost-plus contracts, which are generally awarded as part of a master service agreement. However, our master service agreements typically have a much longer duration. Fourth quarter 2025 operating cash flow was $115 million compared to operating cash flow of $21 million for the same period last year. The increase in cash provided by operating activities was primarily due to the timing of billings and payments associated with project starts and completions, higher net income, and lower contingent compensation payments associated with a prior acquisition. Fourth quarter 2025 free cash flow was $85 million compared to free cash flow of $9 million for the same period last year, reflecting the increase in operating cash flow, partially offset by higher capital expenditures to support future growth. Moving to liquidity. We had approximately $265 million of working capital, $59 million of funded debt, $408 million in borrowing availability under our credit facility, and $150 million in cash and cash equivalents as of December 31, 2025. We have continued to maintain a strong funded debt-to-EBITDA leverage ratio of 0.25x leverage as of December 31, 2025. We believe that our credit facility, strong balance sheet, and future cash flow from operations will enable us to meet our working capital needs, support the organic growth of our business, pursue acquisitions, and opportunistically repurchase shares. I'll now turn the call over to Brian Stern, who will provide an overview of our Transmission and Distribution segment.

Brian Stern, Senior Vice President and Chief Operating Officer of Transmission and Distribution

Thanks, Kelly, and good morning, everyone. The T&D segment delivered steady fourth quarter and full year results, supported by a healthy mix of smaller to midsized jobs and ongoing master service agreements. Our performance reflects the continued application of our core business principles around safety, quality, and reliable execution. Bidding activity remains healthy as backlog, revenue, margins, and income increased from 2024 to 2025. We continue to expand relationships with long-term clients and pursue opportunities with new and existing clients, building on the positive industry outlook. This quarter, Great Southwestern Construction executed a new 7-year master service agreement in Kentucky for transmission line construction and maintenance projects. L.E. Myers was awarded a transmission project in Virginia as well as transmission work in Iowa. In addition, Sturgeon Electric won two transmission projects in Oregon and transmission work in Arizona. Both Sturgeon Electric and High Country Line Construction were awarded station and line work in Washington, California, and Arizona. Harlan Electric was selected to perform multiple jobs throughout New Jersey and Pennsylvania. According to Edison Electric Institute industry data, investor-owned electric companies are projected to invest approximately $178 billion in transmission construction between 2025 and 2028. This level of planned investment reflects an ongoing need for grid modernization and the increased capacity to accommodate load growth. As utilities invest in these upgrades, we believe we are well-positioned to benefit from expanding backlogs and long-duration project pipelines. With our experience, we continue to position ourselves to capture future 765 kV projects along with 500 kV and 345 kV transmission and substation projects over the next 10 years. MYR Group subsidiaries are prepared to pursue and perform these opportunities across the U.S. and Canada. In summary, we are proud of our accomplishments in the fourth quarter and all of 2025. We will continue to actively bid and execute projects of varied capacity, size, and complexity across the U.S. and Canada, while maintaining our consistent focus on safety and the development of our dedicated workforce, who ultimately enable us to take on the important work ahead. I will now turn the call over to Don Egan, who will provide an overview of our Commercial and Industrial segment.

Don Egan, Senior Vice President and Chief Operating Officer of Commercial and Industrial

Thanks, Brian, and good morning, everyone. Our C&I segment achieved solid results in the fourth quarter, thanks to the health of our core markets. We continue to see steady bidding activity and increases in backlog as we strategically monitor and pursue new opportunities in collaboration with our valued customers. We believe our ability to safely and skillfully execute projects of various sizes continues to create many long-term opportunities in our core markets. Data centers continue to be one of the most active areas of investment nationwide, fueled by the accelerating need for cloud, AI, and digital infrastructure. Industry researchers expect this demand to remain robust through 2026, with utilities and developers working to expand power capacity to support this surge. Infrastructure-related construction is also benefiting from ongoing commitments in transportation, clean energy, wastewater, and fresh water treatment facilities. Our ever-expanding network of clients continues to engage us early on upcoming opportunities in these segments. Our teams across all subsidiaries continue to execute and pursue an array of work. During this period, we were awarded multiple data center projects in Colorado, Arizona, California, and New Jersey. In addition to data centers, our subsidiaries were awarded projects in clean energy, manufacturing, and industrial projects in California and Arizona. These accomplishments highlight our ongoing momentum and solid market presence throughout the U.S. and Canada. In conclusion, we believe our core markets remain healthy and the depth of our customer relationships continues to create new opportunities. This success is driven by our dedicated employees, whose commitment to quality and safety is at the heart of everything we do. Thank you, everyone, for your time today. I will now hand the call back to Rick for his closing remarks.

Richard Swartz, President and Chief Executive Officer

Thank you for those updates, Kelly, Brian, and Don. We are proud of our fourth quarter and full year 2025 performance, which demonstrated the strength of our sound business strategies and our ability to maintain and expand long-term customer relationships across both segments. We believe our core markets are well-positioned for continued growth as investment in electrical infrastructure accelerates. We remain committed to safely executing projects, strategically bidding opportunities, and supporting our customers in an ever-changing energy environment. We believe our proven track record of collaboration, integrity, and dependable project delivery puts us in a strong position for opportunities ahead. We are excited to play a meaningful role in strengthening the electrical infrastructure that keeps our communities running. I would like to thank our employees for their invaluable contributions and our shareholders for your continued support of MYR Group. I look forward to the year ahead. Operator, we are now ready to open the call up for your comments and questions.

Operator, Operator

Our first question comes from Sangita Jain of KeyBanc.

Sangita Jain, Analyst

First, Rick, can I ask you for your thoughts on the large transmission market out there? I know you were optimistic on late 2026 potential bookings for 2027 revenue. Just wondering if you're seeing the same type of trend right now.

Richard Swartz, President and Chief Executive Officer

We are. Nothing's changed on that side. I mean, it takes a while to bring these projects to market, and we've known that. So we're in good conversations with our clients, and we believe we'll capture some of that work that will start to burn in '27.

Sangita Jain, Analyst

Got it. And then, Kelly, maybe for you, cash flow has been really, really strong this year. So I'm trying to figure out if some of that was catch-up from the pending payments from last year's solar projects or if there's any meaningful advances in new projects that we should be aware of?

Kelly Huntington, Senior Vice President and Chief Financial Officer

Thank you for the question, Sangita. We experienced a very robust year for cash flow, especially in the fourth quarter. This improvement was largely due to our lower days sales outstanding, which are now in the mid-50s compared to the historical average of about 70. We achieved a 16-day year-over-year improvement, with 11 days of that occurring in the third quarter. Some of this is linked to resolving the issues we faced with certain projects in 2024, but a significant factor is our strong net overbuild position, primarily from large fixed-price contracts in the commercial and industrial sector. This may present some challenges as we move forward, depending on the type of work we secure this year, particularly the mix of mid- to large-sized fixed-price contracts with a more favorable billing profile compared to outcome-based agreements, which are valuable but do not generate cash flow as effectively.

Operator, Operator

Our next question comes from Julien Dumoulin-Smith of Jefferies.

Brian Russo, Analyst

It's Brian Russo on for Julien. Could you just comment more on the strength in the T&D backlog at $1 billion? It looks like it was up about 20% year-over-year, quite a bit of improvement from the year-over-year progression that we've been seeing in the last few quarters. Just curious, are any of the new projects, in particular that Kentucky MSA agreement, included in the December backlog? And then also, is there any Xcel $500 million 5-year MSA in that December backlog as well?

Richard Swartz, President and Chief Executive Officer

As far as the backlog goes, I'd say on the Xcel stuff, very little of that is in the backlog as of now. I mean, we said it would be a slow start to the year and then kind of progressing throughout the year and increase. So again, not too much of that in our backlog right now because we only count 90 days of that MSA work, as Kelly highlighted in her script, within our backlog. When we look at the Kentucky side, that work really will start later this year. So not much of that in there. So again, we've seen great activity in the markets out there, and we're being selective on what we take on and really focused on long-term relationships with clients. 90% of our business is return clientele. We're always looking for those one-off projects as additive. But again, how do we grow with our existing clients, and that's where our focus is at.

Brian Russo, Analyst

Okay. Great. And just a follow-on there in T&D. We saw a very large Texas-based wires company announce a rather robust 5-year capital plan update. And can you just remind us what your positioning is currently in Texas? And then maybe what your level of activity has been kind of in the past up-cycles in capital spend that we've seen?

Richard Swartz, President and Chief Executive Officer

Yes. Texas has been a good market for us for the last decade. I mean, it's been a good market. We continue to see that grow. We're excited about some of the opportunities that are out there with some of the 765 work, but even some of the 500 and 345 work we're doing every day. So I think the 765 is upcoming. We're excited about our positioning on that. But again, we're seeing good activity, not just in Texas, but across the nation. Lots of good opportunities out there.

Brian Russo, Analyst

Okay. And the strong C&I margins in the fourth quarter, plus 6%. How does that fit into the 5% to 7.5% operating margin target step-up you're guiding towards this year? And then just kind of tie that into the backlog. Are there still projects still to be completed that would be in that old kind of 4% to 6% target? Or are those really nearly all burned? So everything from here on out is really in the new 5% to 7.5% range?

Richard Swartz, President and Chief Executive Officer

Well, I would say our forecast, when we look at it for the year, is operating within the midpart of both our T&D and C&I margin profile. So in that midpoint of that, we see good opportunities out there. We continue to see good activity in the market. So with that being said, we haven't changed from what we said last quarter on both from a revenue standpoint. We look at that 10-ish percent growth in both segments and as a company overall. And then we look at operating in those midparts of that range. So good opportunities there, and I think we'll continue to do everything we can to increase our margins from our standpoint as far as what we do from a prefab standpoint, from an efficiency standpoint, from utilizing our equipment better, and we'll continue to try to maximize on that side.

Operator, Operator

Our next question comes from Justin Hauke of Baird.

Justin Hauke, Analyst

Great. I have two quick questions. First, in your backlog, you differentiate between what you expect to book over the next 12 months and what you expect to book beyond that period. It seems that nearly all of the backlog increase this quarter is related to the longer-duration backlog. I would like to understand the components of that. Is this related to some of the data center work from C&I that you've mentioned? Is the duration of your projects extending because their size is increasing? I'd appreciate some guidance on how to think about this.

Richard Swartz, President and Chief Executive Officer

On our larger project side, those take a bit longer to complete. Some data centers can take around 18 to 24 months to construct, especially for the larger projects, and some transportation work extends even further, with timelines of 4 to 5 years. While we are seeing good activity in smaller and midsized projects that are progressing quickly, larger projects generally require more time to construct.

Justin Hauke, Analyst

Okay. And then I guess my second question, not to be myopic, I guess, but obviously, there's been a lot of winter weather all over. 1Q is not typically your productive quarter versus the summer. But just curious if there's anything you would be thinking about or you want to communicate in terms of potential weather impacts in the first quarter that would be unusual that have occurred thus far? Or maybe it's not, maybe it's just in line with kind of normal seasonality?

Richard Swartz, President and Chief Executive Officer

I believe we always plan our operations according to normal seasonal patterns. There will inevitably be some storms that occur. Poor weather typically does not impact us as significantly as very wet conditions that hinder our ability to access the right-of-way. However, we continually monitor the weather, and its effects largely depend on the specific projects in question. It's not uncommon for weather to impact one area significantly while leaving another area unaffected even if they are only 50 miles apart. Overall, weather has not uniformly influenced our business nationwide; it has had variable effects in select regions. We will keep assessing the situation, as weather presents the most significant potential impact. However, it has not disrupted our operations across the country as a whole, only in certain locations. Sometimes, we have mitigating work from other storms and repairs we are carrying out. Our core business remains focused on daily maintenance service agreements and construction projects. While we engage in storm recovery work, we are not reliant on it.

Kelly Huntington, Senior Vice President and Chief Financial Officer

Yes. And I would just add a little bit broader context, Justin, and looking at first quarter revenues, we are expecting that we will trend in the first quarter a little bit above that full year rate of about 10% growth, and that's really driven by first quarter last year. We had a little bit slower start. So it is a bit of an easier comp compared to the rest of the year. So just as you're thinking about modeling that, we would expect a little stronger revenue growth in the first quarter.

Operator, Operator

Our next question comes from Caitlin Donohue of Goldman Sachs.

Caitlin Donohue, Analyst

Just focusing on the data centers, you outlined a few awards this past quarter. How are you seeing that project pipeline shape up for 2026, 2027 as you're speaking with your customers?

Richard Swartz, President and Chief Executive Officer

The conversations are strong on that side. It's not just '27 and '28. I mean, we're having conversations with customers that go well beyond that time frame. So again, I think our awards are always lumpy just on how long it takes the projects to get finalized. But again, great conversations going forward. So good activity in that market. But again, not completely dependent on that market by itself. We like the diversification we have with transportation, health care, and some of that other work we do. So good opportunities on that side also.

Caitlin Donohue, Analyst

That's helpful. And then just on capital allocation strategy for 2026. We've seen CapEx step up a little bit. You've done buybacks in the past. How are you thinking through MYR Group's strategy for the year?

Kelly Huntington, Senior Vice President and Chief Financial Officer

Yes. We are seeing great opportunities to continue to grow our business organically and through acquisitions. And so I think as we've talked about before, we'll continue to prioritize our capital allocation to growth. We do use share repurchases opportunistically. And I think the last 2 years are a great example of that with deploying over $150 million at an average price of $117. So, but I think at this point, really focused on the growth opportunities that we see both organically and from acquisitions.

Operator, Operator

Our next question comes from Manish Somaiya from Cantor Fitzgerald.

Manish Somaiya, Analyst

Can you hear me?

Richard Swartz, President and Chief Executive Officer

Yes.

Manish Somaiya, Analyst

Okay. Wonderful. Rick, I have the first question for you. In the press release, we talked about the bid environment being steady. Maybe if you can just give us a sense as to what you're seeing in terms of pricing by geography, by end market? And what are you walking away from business that may not be attractively priced? So maybe if you can just give us a sense of what's going on in the marketplace.

Richard Swartz, President and Chief Executive Officer

I would say we have a select client list and we're not trying to cater to everyone. For example, in the C&I sector, we focus on customers we've had long-term relationships with or those we can continue to build relationships with, rather than one-off projects. We're not interested in bidding on projects that have numerous competitors. We prefer customers who have selective bid lists or those we have teaming arrangements with. There are good activities and opportunities in this area. Market conditions vary across the U.S.; some regions are tighter than others, but we anticipate that areas currently less active will become busier in the future. We continuously monitor these trends and leverage our 65-plus offices in the U.S. and some in Canada to identify which opportunities align with our strengths. We assess these opportunities regularly and are seeing positive activity in all of our markets.

Manish Somaiya, Analyst

And I know we talked a bit about the data centers. Maybe Don can shed some more light. Are the customers on the data center side, hyperscalers, GCs, developers? Maybe if you can just give us a sense. And then as it pertains to backlog, it seems obviously everybody is doing more data center work. But would you say that the backlog on the C&I side is diversified? Or is it kind of more concentrated?

Don Egan, Senior Vice President and Chief Operating Officer of Commercial and Industrial

Our backlog is very diversified. You're correct that there is a lot of activity in the market, and we are having ongoing conversations with end users, hyperscalers, general contractors, and developers on a regular basis. I hope that answers your question.

Manish Somaiya, Analyst

And in terms of the customers on the data center side, would it be hyperscalers or general contractors, developers?

Don Egan, Senior Vice President and Chief Operating Officer of Commercial and Industrial

Again, as I stated, it's all the above. We are having conversations with hyperscalers on a daily, weekly basis, same with general contractors and end users, owners.

Manish Somaiya, Analyst

Okay. And then just lastly, Rick, from a high level, obviously, you guys don't give guidance, but what would be the puts and takes for '26 as you kind of look at your internal benchmarks and targets? How should we think about the risks and opportunities?

Richard Swartz, President and Chief Executive Officer

Let me address Don's question briefly. Beyond new construction, the other aspect regarding data centers involves retrofitting existing buildings. These data centers are continually evolving with technology upgrades, which makes that repeat work crucial for us. Once we establish a presence in a data center, we typically maintain that connection over time. So, it's important to acknowledge that both new builds and retrofit projects play a role. Looking ahead, I would note that the most significant factor affecting T&D is weather. Apart from that, based on our discussions with clients, we don't foresee any market slowdown. The main concern is the timing of projects; it's a question of when they will commence rather than if they will happen. Occasionally, we may experience a 2- to 4-month delay, but it's unlikely that projects will be postponed for years. Additionally, permitting can sometimes cause a slight delay, but again, the underlying work is assured; it’s just a matter of timing. We continue to see strong activity in both T&D and C&I sectors.

Operator, Operator

Our next question comes from Tim Moore of Clear Street.

Timothy Michael Moore, Analyst

Great job with your backlog growth and book-to-bill. My equipment utilization tailwind for the T&D side was already asked. So I just have two questions remaining. Maybe, Rick, you can maybe walk us through or even Kelly elaborate on kind of the trade-off in your selectivity for staffing for maybe like an 18-month data center versus cross-selling a more medium-sized utility project. I know they're are separate segments, but I'm just kind of wondering if you could talk a bit more to like the regional staffing playing in, cross-selling opportunity. And if it is a new customer, not more than 90% incumbents.

Richard Swartz, President and Chief Executive Officer

I’ll start by saying that 90% of our business comes from repeat clients, and we remain committed to that. We are focused on cross-selling, particularly in data centers where we often work on sections owned by the project owner rather than the utility. We are always looking for opportunities and prioritize our long-term clients. We prefer clients who plan to undertake multiple projects rather than just one. For instance, in some of our data center projects, they start with one building and then continue to expand their campus, which is beneficial for us. There are cases where we are already involved in the third building of a planned twelve, ensuring our work spans many years into the future, which is where we want to concentrate our efforts.

Kelly Huntington, Senior Vice President and Chief Financial Officer

I think you covered that well, Rick. Thanks.

Timothy Michael Moore, Analyst

Great. That was really helpful. The only other question I had, given your liquidity and the cash and the bolt-on acquisition opportunity, can you maybe just talk high level about the philosophy? Is your priority within T&D more of the electrical contractors? And then on the C&I side, is it to build geographic scale like in the Southeast? Just kind of curious if you can add any color.

Kelly Huntington, Senior Vice President and Chief Financial Officer

Sure. I can start on that one. On the T&D side, we definitely focus on electrical contractors. We do have really good geographic presence across the U.S. and up into Canada and Ontario on the T&D side. So we also look at opportunities that would be ancillary services like right-of-way or foundation or environmental work. Those can be of interest to us as well. On the C&I side, I would say really two primary screens from a strategic perspective. First would be the geographic fit because we don't have quite as consistent of coverage as we do on the T&D side, and then really taking a close look at the end markets they serve. So does that acquisition opportunity have a similar profile as far as exposed to those higher growth tend to be less cyclical, more complex core markets like we are? So those would be the main things we're looking at, really still focused on tuck-in acquisitions in the places we know and the risk profiles that we understand as well.

Operator, Operator

Our next question comes from Jon Braatz of KCCA.

Jon Braatz, Analyst

Rick, your markets are very strong, and you've mentioned that you could achieve revenue growth of 7% to 10%. If opportunities arise, do you have the capability, capacity, workforce, and infrastructure to potentially accelerate that growth moving forward?

Richard Swartz, President and Chief Executive Officer

Yes, we have that opportunity. Looking back at our history, there have been years where we've grown more than that, and in other years, we've held back a bit. It all depends on the timing of the awards and how they occur. I see good opportunities available, but our primary focus is on controlled growth. Anyone could increase revenue at this point, but the key is doing it profitably. For us, it's about maintaining the right level of growth to ensure profitability. We are definitely capable of achieving more than that. However, for this year, we expect to grow in the range of around 10%, slightly above 7%. We just need to ensure we manage risk appropriately and pursue the right opportunities.

Jon Braatz, Analyst

Sure. Given the strength of the market and the number of projects out there and so on, I sense that you could be more selective and maybe the risk profile of the work that you're doing has improved. Would that be a fair statement?

Richard Swartz, President and Chief Executive Officer

Sure. We're always focused on that as we select our projects is how do we limit our risk, how do we partner with our customers? How do we make sure that we have those kinds of conversations? But again, derisking our projects is definitely important to us, and that's one of the evaluations we go through as we look at projects is I would say we have less risk in our backlog today than we had in our backlog a year ago or 5 years ago.

Operator, Operator

I'm showing no further questions in the queue. I would now like to turn the call back over to Rick Swartz for additional closing remarks.

Richard Swartz, President and Chief Executive Officer

To conclude, on behalf of Kelly, Brian, Don, and myself, I sincerely thank you for joining us on the call today. I don't have anything further, and we look forward to working with you in the future and speaking with you again on our next conference call. Until then, stay safe.

Operator, Operator

Thank you. This concludes today's conference call. We thank you for your participation, and you may now disconnect.