Orion Group Holdings, Inc. (ORN) Earnings

Management highlights

### Overall Business Context - Q2 2026 results missed expectations due to temporary client-related project delays in the marine segment, which management characterizes as a timing issue rather than a fundamental performance or demand issue. All delays are now resolved. - Total corporate pursuit pipeline grew to approximately $27 billion, with $1.6 billion in quoted projects awaiting award, up from ~$1 billion at the start of 2026. Q2 win rate was above industry average, with total Q2 bookings of $275 million, representing a 1.25x book-to-bill ratio. Ending total backlog was $722 million. ### Long-Term Market Opportunities - Orion is positioned to capitalize on a multi-year marine infrastructure investment mega cycle driven by priorities including U.S. economic competitiveness, energy security, supply chain resilience, and national defense. Bipartisan support for naval infrastructure modernization, Indo-Pacific military readiness, and port/logistics resilience remains solid despite ongoing legislative debate over the 2027 federal defense budget. - The concrete segment continues to see strong momentum from infrastructure buildout supporting AI, cloud computing, and domestic manufacturing expansion. Clients increasingly engage Orion earlier in project lifecycles to improve execution certainty and compress schedules. - The expansion of the concrete segment into site civil services is progressing very well, with growing demand and broad new project opportunities. The combined offering simplifies project execution for clients and de-risks delivery. - The McCamus acquisition completed in February 2026 has been successfully integrated, with full transition to Orion's financial, project control, and IT systems. McCamus's specialized jetty and breakwater construction expertise is already being leveraged across other geographies and projects within Orion. ### Operational Updates - Balance sheet remains healthy with a net leverage ratio of 2.3x, providing sufficient financial flexibility to support strategic growth priorities.

Guidance

- Full year 2026 revenue guidance is maintained at $900 million to $950 million, unchanged from prior guidance. - Full year 2026 adjusted EBITDA guidance is set at $50 million to $54 million, representing 15% year-over-year growth over 2025 actual results at the midpoint, reflecting the Q2 marine timing shift. - Full year 2026 adjusted EPS guidance is set at $0.23 to $0.30, representing 6% year-over-year growth over 2025 actual results at the midpoint. - Full year 2026 capital expenditure guidance is maintained at $25 million to $35 million, unchanged from prior guidance. - Management expects a significant sequential step-up in revenue and margins in the back half of 2026, supported by 80% of total full-year back half work already under contract, with high confidence in achieving updated full-year guidance. Management is optimistic about full year 2027 performance and expects continued sequential business growth into 2027.

Segment performance

Overall company total revenue for Q2 2026 was $222 million, an 8% increase year-over-year. Gross profit was $23 million, down $3 million YoY, driven by poor marine segment performance partially offset by strong concrete results. GAAP net loss was $4.1 million, compared to a $0.8 million net income YoY. Adjusted EBITDA was $7.9 million, down from $11 million YoY. 1. **Concrete Segment**: Delivered excellent Q2 performance with over 30% YoY top-line growth and 45% YoY adjusted EBITDA growth. Data center projects represented 50% of concrete segment revenue in Q2 2026, up from 40% in Q1 2026. Q2 2026 concrete margins were between 5.5% and 6%, in line with management's full-year target. The segment is benefiting from high demand driven by AI, cloud computing, and domestic manufacturing infrastructure buildout, as well as successful expansion into site civil services. 2. **Marine Segment**: Top-line revenue and profitability declined year-over-year due to temporary client-related project start delays, elongated award cycles, and lower equipment utilization. The segment's Q2 results were impacted by lost project profitability and underutilized fixed equipment costs. All delayed projects are now fully operational, with 90% of the segment's planned back-half 2026 work already under contract. The recently acquired Pacific Rock and Dredge (McCamus) was accretive to EBITDA margins in Q2, and will contribute much more significantly to the back half of 2026 aligned with its typical regional work window.

Risks & headwinds

- Marine project award and start timing is inherently variable; client-driven delays can compress quarterly revenue and profitability due to the fixed cost nature of marine equipment, leading to missed quarterly results even when long-term demand remains strong. - Federal defense and infrastructure investments that drive long-term marine growth remain subject to legislative approval and budget negotiation, creating uncertainty around the timing of large project awards. - Diesel fuel price volatility creates input cost uncertainty for both marine and concrete operations.

Analyst Q&A

• Q: Guidance implies a significant margin improvement in the back half of 2026. How confident are you in hitting these targets, and what is the pricing trend in new opportunities? /

  A: All delayed Q2 marine projects are now mobilized and operational, with 90% of marine back-half work and 80% of total corporate back-half work already under contract. Pricing has remained steady with no unfavorable shifts, and overall win rate increased slightly in Q2 compared to Q1, with continued solid win activity through early July. Management is fully confident in meeting the back-half margin and revenue targets.

• Q: Concrete backlog appears low, but the segment is seeing strong end market momentum. What is your expectation for concrete growth in the back half, and what drives the discrepancy between backlog and near-term demand? /

  A: Concrete projects have very short lead times — opportunities are often awarded and started within weeks of first being quoted, so low current backlog does not indicate weak demand. There are over $1 billion in outstanding concrete bids currently awaiting award, and the segment has strong momentum entering the third quarter, with management expecting continued solid growth in the back half.

• Q: What notable trends are driving the 27 billion total pursuit pipeline growth? /

  A: The pipeline growth is well balanced across segments and end markets, including defense naval infrastructure, commercial port modernization, private energy projects, state/local transportation infrastructure, and data center development. Management is seeing an increasing shift toward larger, more technically complex projects, which typically use alternative delivery models (design-build, CMGC, progressive design-build) that Orion is well positioned to pursue.

• Q: What is McCamus's expected contribution to the back half of 2026, and are there integration issues? /

  A: Integration of McCamus is complete and progressing better than expected, with the business already accretive to EBITDA in Q2. McCamus's regional work window runs from early July through February, so it will ramp up significantly and be highly utilized for the full back half of 2026, with its specialized jetty expertise already adding value across Orion's broader project portfolio.