Southland Announces Fourth Quarter & Full Year 2025 Results
GRAPEVINE, Texas--( BUSINESS WIRE)--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:
Full Year 2025 Results Include:
Please refer to “Non-GAAP Measures” and reconciliations for our non-GAAP financial measures, including, “EBITDA” and “Backlog”
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:
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
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
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 Total
% of 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 Total
% of 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
(Amounts in thousands)
December 31, 2025
December 31, 2024
% of Segment
% of Segment
Segment
Gross Loss
Revenue
Gross 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 Segment
% of Segment
Segment
Gross Profit
Revenue
Gross 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
(Amounts in thousands)
December 31, 2025
December 31, 2024
December 31, 2025
December 31, 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.