Revenue also fell off in the second quarter and first half of 2022—to $861 million from $1.2 billion for the quarter and to $1.8 billion from $2.4 billion for the six months.

The company as a result restated to investors its guidance of likely earnings for the year.

CEO Ronald N. Tutor said in an Aug. 5 conference call for investment analysts that the company's finances are healthy and it continues to collect cash. But "unlike last quarter, our operating cash was largely driven by the resolution of certain disputes and collections of certain successfully negotiated and approved change orders.

"Unfortunately, our second quarter earnings were negatively impacted by certain unfavorable project adjustments, certain settlements of claims and change orders, and unexpected partial reversal of previously awarded legal damages in a judgment," Tutor added.

Lower revenue for the quarter also was behind the reduced profits.

Neither the CEO nor the company named in public statements the projects involved in its contract earnings adjustments, change orders and legal disputes. The settlements and probable outcomes of the change claims and disputed amounts are recognized under accounting standards either as reserves, losses or profits, based on the probable outcomes.

The biggest negative cost impact in the second quarter, said Tutor Perini CFO Gary Smalley, came from disputed costs and "extended project supervision and associated labor inefficiencies on the electrical component of a transportation project in the Northeast," which he did not identify.

But there is no clear match between the firm's reported claims and disputes and its list of legal matters in earnings reports.

Pending Legal Issues

Tutor Perini's latest quarterly financial filing said it was appealing the result of a damage award to the Washington State Dept. of Transportation related to the Alaskan Way Viaduct project, which involved use of a tunnel boring machine to construct a large-diameter tunnel to replace the viaduct. The tunneling work stopped for months as the TBM struck unexpected material along the way.

The company, which did the work as part of a joint venture, recorded the entire impact of the jury verdict against it during the fourth quarter of 2019, resulting in a pretax charge of $166.8 million. That amount included $25.7 million for Tutor Perini's share of the damages won by the state DOT.

But there is also associated litigation related to claims under the project's builder's risk insurance policy. Tutor Perini states it expects to prevail in that dispute, though the insurer has denied coverage.

Another drawn-out project dispute involves the rebuilding of the George Washington Bridge Bus Station in New York City, completed in 2017.

There were significant design errors and delays involving two Tutor Perini subsidiaries, the company states, so it is seeking $113 million related to that contract. Issues were complicated by the 2019 bankruptcy filing of the development company contracted by the Port Authority of New York and New Jersey, the bus station owner. Tutor Perini is now pursuing claims against it over the station work.

As of June 20, the company reported, it had a good chance of winning and included an estimated amount of the potential recovery in its revenue recorded to date.