Item 9A. Controls and Procedures
Item 9A. CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures
Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are designed to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
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Based on management’s evaluation with the participation of our principal executive officer and principal financial officer, as of the end of the period covered by this Annual Report on Form 10-K, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of December 31, 2025.
Changes in internal control over financial reporting
During the year ended December 31, 2025, we implemented new reporting systems and made changes to related internal controls. There have been no other changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Management’s report on internal control over financial reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States. Our system of internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles and that receipts and expenditures are being made only in accordance with authorizations of our management; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our consolidated financial statements.
Management, under the oversight of our principal executive officer and principal financial officer, and Audit Committee, assessed the effectiveness of our internal control over financial reporting as of December 31, 2025 using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal control - An Integrated Framework (“2013 Framework”). Based on its assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2025 at the reasonable assurances level.
Our independent registered public accounting firm, KPMG LLP, who audited the consolidated financial statements included in this annual report, has audited the effectiveness of our internal control over financial reporting as of December 31, 2025. KPMG LLP’s report appears on page F-4 of this Annual Report on Form 10-K.
Item 9B. OTHER INFORMATION
Director and Officer Trading Arrangements.
During the quarter ended December 31, 2025, no director or officer of Orion adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as such terms are defined in Item 408(a) of Regulation S-K.
Item 9C. DISCLOSURE CONCERNING CERTAIN FOREIGN JURISDICTIONS THAT PREVENT
INSPECTIONS
Not applicable.
PART III
Item 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors, Executive Officers, Promoters and Control Persons
The information under the heading “Information about our executive officers” in this Annual Report on Form 10-K is incorporated by reference into this section. The information required by Paragraphs (c) through (g) of Item 401 of
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Regulation S-K and Item 405 of Regulation S-K is hereby incorporated by reference from our definitive proxy statement to be filed with the SEC pursuant to Regulation 14A no later than April 30, 2026 (the “Proxy Statement”).
Code of Ethics
We have adopted a code of ethics for our chief executive, chief financial and principal accounting officers; a code of business conduct and ethics for members of our Board of Directors; and corporate governance guidelines. The full texts of the codes of ethics and corporate governance guidelines are available at our website www.oriongroupholdingsinc.com. Although we have never done so, in the event we make any amendment to, or grant any waiver from, a provision of the code of ethics that applies to the principal executive officer, principal financial officer or principal accounting officer that requires disclosure under applicable SEC rules, we will disclose such amendment or waiver and the reasons therefore on our website. We will provide any person without charge a copy of any of the aforementioned codes of ethics upon receipt of a written request. Requests should be addressed to: Orion Group Holdings, Inc. 2940 Riverby Road, Suite 400, Houston, Texas 77020, Attention: Corporate Secretary.
Corporate governance
The information required by Items 407(c)(3), (d)(4) and (d)(5) and 408(b) of Regulation S-K is hereby incorporated by reference from our Proxy Statement.
Item 11. EXECUTIVE COMPENSATION
The information required by Items 402, 407(e)(4) and 407(e)(5) of Regulation S-K is hereby incorporated by reference from our Proxy Statement.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information required by Items 201(d) and 403 of Regulation S-K is hereby incorporated by reference from our Proxy Statement.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information required by Items 404 and 407(a) of Regulation S-K is hereby incorporated by reference from our Proxy Statement.
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by Item 9(e) of Schedule 14A is hereby incorporated by reference from our Proxy Statement.
PART IV
Item 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
The following documents are filed as part of this Report:
1. Financial Statements
The Company’s Consolidated Financial Statements at December 31, 2025 and 2024 and for each of the three years in the period ended December 31, 2025 and the notes thereto, together with the Report of the Independent Registered Public Accounting Firm on those Consolidated Financial Statements are hereby filed as part of this Report, beginning on page F-1.
2. Financial Statement Schedule
The following financial statement schedule of the Company for each of the three years in the period ended December 31, 2025 is filed as part of this Report and should be read in conjunction with the Consolidated Financial Statements of the Company.
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Schedule II – Schedule of Valuation and Qualifying Accounts
3. Exhibits
Exhibit
Number
Description
2.1 #
Securities Purchase Agreement, dated as of February 3, 2026, by and among Orion Group Holdings, Inc., the Shareholders, the Members, the Beneficial Owners and the Sellers Representative (incorporated herein by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 4, 2026 (File No. 001 33891)).
3.1
Amended and Restated Certificate of Incorporation of Orion Group Holdings, Inc. (incorporated herein by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2016, filed with the Securities and Exchange Commission on August 5, 2016 (File No. 001-33891)).
3.2
Amended and Restated Bylaws of Orion Group Holdings, Inc. (incorporated herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on March 25, 2025 (File No. 001-33891)).
4.1
Description of Registered Securities of Orion Group Holdings, Inc. (Incorporated herein by reference to Exhibit 4.1 to the Company’s Annual Report on Form 10-K filed with the Securities Exchange Commission on February 28, 2020 (File No. 001-338911).
† 10.1
Form of Indemnity Agreement for Directors and Certain Officers dated November 24, 2008 (incorporated herein by reference to Exhibit 1.01 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 25, 2008 (File No. 001 33891)).
† 10.2
Orion Marine Group, Inc. 2011 Long Term Incentive Plan (incorporated herein by reference to Appendix A to the Company’s Definitive Proxy Statement filed with the Securities and Exchange Commission on April 4, 2011 (File No. 001 33891)).
† 10.3
Form of Stock Option Agreement Under the 2011 Long Term Incentive Plan (incorporated herein by reference to Exhibit 10.10 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2012 (File No. 001 33891)).
† 10.4
Form of Restricted Stock Agreement and Notice of Grant of Restricted Stock under the 2011 Long Term Incentive Plan (incorporated herein by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2012 (File No. 001 33891)).
† 10.5
Executive Incentive Plan (incorporated herein by reference to Exhibit 10.14 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, filed with the Securities and Exchange Commission on November 7, 2008 (File No. 001 33891)).
† 10.6
Orion Group Holdings, Inc. 2017 Long-Term Incentive Plan (incorporated herein by reference to Appendix A to the Company’s Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission on April 11, 2017 (File No. 001 33891)).
† 10.7
Form of Stock Option Agreement under the 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.9 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 27, 2019 (File No. 001 33891)).
† 10.8
Form of Restricted Stock Agreement under the 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.10 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 27, 2019 (File No. 001 33891)).
† 10.9
Form of Performance Unit Agreement under the 2017 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 27, 2019 (File No. 001 33891)).
† 10.10
Summary of Non-Employee Director Compensation (incorporated herein by reference to Exhibit 10.12 to the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 27, 2019 (File No. 001 33891)).
† 10.11
2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 24, 2022 (File No. 001-33891)).
† 10.12
Amendment No. 1 to Orion Group Holdings, Inc.’s 2022 Long-Term Incentive Plan (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 17, 2024 (File No. 001 33891)).
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Exhibit
Number
Description
† 10.13
Orion Group Holdings, Inc. Employee Stock Purchase Plan (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 17, 2024 (File No. 001 33891)).
† 10.14
Form of Restricted Stock Agreement under the 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on April 26, 2024 (File No. 001-33891)).
† 10.15
Form of Performance Unit Agreement under the 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on April 26, 2024 (File No. 001-33891)).
10.16
Land Sale-Leaseback Contract, dated June 21, 2023, by and between Orion Marine Construction, Inc., a Florida corporation, and Pelican Marine Services, LLC, a Louisiana limited liability company. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 26, 2023 (File No. 001-33891)).
10.17
Land Sale-Leaseback Contract, dated June 5, 2023, by and between Orion Marine Construction, Inc., a Florida corporation, and Store Capital Acquisitions, LLC, a Delaware limited liability company. (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 26, 2023 (File No. 001-33891)).
10.18 #
Credit Agreement, dated as of December 23, 2025, among Orion Group Holdings, Inc., as Borrower, the lenders from time to time party thereto, and UMB Bank, N.A., as Administrative Agent and Issuing Bank (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on December 29, 2025 (File No. 001-33891)).
10.19 #
First Amendment to Loan Documents, dated February 3, 2026, by and among Orion Group Holdings, Inc., each of the guarantors party thereto, each of the lenders party thereto and UMB Bank, N.A., as administrative agent (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 4, 2026 (File No. 001 33891)).
10.20
Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent. (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on May 15, 2023 (File No. 001-33891)).
10.21
Amendment No. 1, dated December 1, 2023 to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent. (incorporated herein by reference to Exhibit 10.22 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on March 1, 2024 (File No. 001 33891)).
10.22
Amendment No. 2, dated February 27, 2024 to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent. (incorporated herein by reference to Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on March 1, 2024 (File No. 001 33891)).
10.23
Amendment No. 3, dated April 24, 2024 to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent (incorporated herein by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, filed with the Securities and Exchange Commission on April 26, 2024 (File No. 001 33891)).
10.24
Amendment No. 4, dated June 28, 2024, to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 2, 2024 (File No. 001 33891)).
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Exhibit
Number
Description
10.25
Amendment No. 5 dated July 26, 2024, to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent (incorporated herein by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, filed with the Securities and Exchange Commission on July 26, 2024 (File No. 001 33891)).
10.26
Amendment No. 6 dated March 4, 2025, to the Loan Agreement dated as of May 15, 2023 among Orion Group Holdings, Inc. and certain of its subsidiaries from time to time party hereto as borrowers, the entities from time to time party hereto, as Lenders, White Oak Commercial Finance, LLC, as Administrative Agent and Collateral Agent (incorporated herein by reference to Exhibit 10.25 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission on March 5, 2025 (File No. 001 33891)).
† 10.27
Employment Offer Letter dated August 15, 2022 between Orion Group Holdings, Inc. and Travis J. Boone (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on August 18, 2022 (File No. 001-33891)).
† 10.28
Employment Agreement by and between Orion Group Holdings, Inc. and Travis J. Boone, effective September 27, 2023. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 28 2023 (File No. 001-33891)).
† 10.29
Offer Letter for Alison Vasquez dated May 24, 2025 (incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 10, 2025 (File No. 001-33891)).
† 10.30
Employment Offer Letter dated November 20, 2023 between Orion Group Holdings, Inc. and E. Chipman Earle (incorporated herein by reference to Exhibit 10.29 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on March 1, 2024 (File No. 001 33891)).
† 10.31
Employment Agreement by and between Orion Group Holdings, Inc. and E. Chipman Earle, effective March 20, 2024 (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on April 26, 2024 (File No. 001-33891)).
† 10.32
Employment Offer Letter dated August 29, 2022 between Orion Group Holdings, Inc. and Gordon Scott Thanisch (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on August 31, 2022 (File No. 001-33891)).
† 10.33
Employment Agreement by and between Orion Group Holdings, Inc. and Scott Thanisch, effective September 27, 2023. (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 28 2023 (File No. 001-33891)).
† 10.34
Separation and General Release Agreement (Separation Agreement) dated June 30, 2025 (incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 1, 2025 (File No. 001-33891)).
19.1
Insider Trading Policy (incorporated herein by reference to Exhibit 19.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission on March 5, 2025 (File No. 001-33891)).
* 21 .1
List of Subsidiaries.
* 23 .1
Consent of Independent Registered Public Accounting Firm -KPMG, LLP.
* 31 .1
Certification of CEO pursuant to Section 302.
* 31 .2
Certification of CFO pursuant to Section 302.
* 32 .1
Certification of CEO and CFO pursuant to Section 906.
97.1
Orion Group Holdings, Inc. Executive Compensation Clawback Policy (incorporated herein by reference to Exhibit 97.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on March 1, 2024 (File No. 001-33891)).
*101.INS
XBRL Instance Document.
*101.SCH
XBRL Taxonomy Extension Schema Document.
* 101.CAL
XBRL Extension Calculation Linkbase Document.
*101.DEF
XBRL Taxonomy Extension Definition Linkbase Document.
*101.LAB
XBRL Taxonomy Extension Label Linkbase Document.
*101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document.
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Exhibit
Number
Description
*104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
* Filed herewith
† Management contract or compensatory plan or arrangement
#
Certain exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant agrees to furnish supplementally a copy of any omitted exhibit or schedule to the Commission upon request.
Item 16. FORM 10-K SUMMARY
None.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
ORION GROUP HOLDINGS, INC.
March 4, 2026
By:
/s/ Travis J. Boone
Travis J. Boone
President, Chief Executive Officer and Director
(Principal Executive Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:
Signature
Title
Date
/s/ Travis J. Boone
President, Chief Executive Officer and
March 4, 2026
Travis J. Boone
Director (Principal Executive Officer)
/s/ Alison G. Vasquez
Chief Financial Officer (Principal Financial
March 4, 2026
Alison G. Vasquez
Officer and Principal Accounting Officer)
/s/ Austin J. Shanfelter
Chairman of the Board
March 4, 2026
Austin J. Shanfelter
/s/ Thomas N. Amonett
Director
March 4, 2026
Thomas N. Amonett
/s/ Michael J. Caliel
Director
March 4, 2026
Michael J. Caliel
/s/ Margaret M. Foran
Director
March 4, 2026
Margaret M. Foran
/s/ Robert S. Ledford
Director
March 4, 2026
Robert S. Ledford
/s/ Quentin P. Smith, Jr.
Director
March 4, 2026
Quentin P. Smith, Jr.
/s/ Mary E. Sullivan
Director
March 4, 2026
Mary E. Sullivan
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ORION GROUP HOLDINGS, INC. AND SUBSIDIARIES
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2025
Reports of Independent Registered Public Accounting Firm (PCAOB ID 185 )
F-2
Consolidated Balance Sheets at December 31, 20 25 and 2 024
F-5
Consolidated Statements of Operations for the Years Ended December 31, 2 025 , 2 024 and 2 023
F-6
Consolidated Statement of Stockholders’ Equity for the Years Ended December 31, 2025, 2024 and 2023
F-7
Consolidated Statements of Cash Flows for the Years Ended December 31, 2025, 2024 and 2023
F-8
Notes to Consolidated Financial Statements
F-9
F-1
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors
Orion Group Holdings, Inc.:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Orion Group Holdings, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated March 4, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
F-2
Table of Contents
Evaluation of estimated costs at completion and variable consideration for certain long-term, fixed-priced construction contracts
As discussed in Notes 3 and 5 to the consolidated financial statements, contract revenue is recognized over time because control of the promised goods and services is continually transferred to the customer. Progress is measured by the percentage of actual costs incurred to date to the total estimated costs at completion. Contract costs include all direct costs, such as material and labor, and those indirect costs incurred that are related to contract performance. The Company estimates variable consideration related to claims and unapproved change orders based on the most likely amount to which it expects to be entitled. The Company reported contract revenues of $852.3 million for the year ended December 31, 2025, which included revenue related to long-term, fixed price construction contracts.
We identified the evaluation of estimated costs at completion and variable consideration for certain long-term, fixed-priced construction contracts in the Marine segment as a critical audit matter. Evaluating the Company’s estimated costs at completion for contracts in progress involved subjective auditor judgement given the variability and estimation uncertainty associated with costs of material and labor to be incurred over a long-term contract period. Additionally, evaluating the estimates of variable consideration involved subjective auditor judgement given the uncertainty in determining the costs the Company is entitled to recover under the contract.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s revenue process, including controls over the estimation of costs to complete and variable consideration for certain long-term, fixed-priced construction contracts. We evaluated the Company’s ability to estimate these amounts by comparing the Company’s previous estimates to actual results. We evaluated estimated costs at completion for certain in-progress contracts by:
● inspecting contractual documents with customers
● conducting interviews with and reviewing questionnaires prepared by project personnel to gain an understanding of the status, risks, and uncertainties of projects
● analyzing a selection of costs in the estimated costs at completion, including the cost of labor, materials, and subcontracts, as applicable, by comparing amounts to purchase orders, costs incurred to date on the project, and costs incurred on similar projects.
We evaluated variable consideration for certain contracts by:
● comparing a selection of costs underlying the claims and unapproved change orders to supporting documentation, including contractual documents and correspondence between the Company and the customer
● assessing management’s determination of the most likely amount to which it expects to be entitled by comparing it to the Company’s historical experience with similar claims and unapproved change orders.
/s/ KPMG LLP
We have served as the Company’s auditor since 2017.
Houston, Texas
March 4, 2026
F-3
Table of Contents
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and Board of Directors
Orion Group Holdings, Inc.:
Opinion on Internal Control Over Financial Reporting
We have audited Orion Group Holdings, Inc. and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated March 4, 2026 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate
/s/ KPMG LLP
Houston, Texas
March 4, 2026
F-4
Table of Contents
Orion Group Holdings, Inc. and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Share and Per Share Information)
December 31,
December 31,
2025
2024
ASSETS
Current assets:
Cash and cash equivalents
$
1,588
$
28,316
Restricted cash
1,697
—
Accounts receivable:
Trade, net of allowance for credit losses of $ 3,461 and $ 555 , respectively
175,695
106,304
Retainage
49,194
35,633
Income taxes receivable
256
483
Other current
3,531
3,127
Inventory
2,432
1,974
Contract assets
31,083
84,407
Prepaid expenses and other
12,686
9,084
Total current assets
278,162
269,328
Property and equipment, net of accumulated depreciation
88,210
86,098
Operating lease right-of-use assets, net of accumulated amortization
20,397
27,101
Financing lease right-of-use assets, net of accumulated amortization
18,360
25,806
Inventory, non-current
6,395
7,640
Deferred income tax asset
17
17
Other non-current
3,111
1,327
Total assets
$
414,652
$
417,317
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current debt, net of debt issuance costs
$
1,789
$
426
Accounts payable:
Trade
107,433
97,139
Retainage
1,699
1,310
Accrued liabilities
31,750
26,294
Income taxes payable
197
507
Contract liabilities
49,104
47,371
Current portion of operating lease liabilities
4,418
7,546
Current portion of financing lease liabilities
7,517
10,580
Total current liabilities
203,907
191,173
Long-term debt, net of debt issuance costs
6,085
22,751
Operating lease liabilities
24,695
20,837
Financing lease liabilities
5,878
11,346
Other long-term liabilities
14,975
20,503
Deferred income tax liability
80
28
Total liabilities
255,620
266,638
Stockholders’ equity:
Preferred stock -- $ 0.01 par value, 10,000,000 authorized, none issued
—
—
Common stock -- $ 0.01 par value, 50,000,000 authorized, 40,612,139 and 39,681,597 issued; 39,900,908 and 38,970,366 outstanding at December 31, 2025 and December 31, 2024, respectively
406
397
Treasury stock, 711,231 shares, at cost, as of December 31, 2025 and December 31, 2024, respectively
( 6,540 )
( 6,540 )
Additional paid-in capital
226,369
220,513
Retained Loss
( 61,203 )
( 63,691 )
Total stockholders’ equity
159,032
150,679
Total liabilities and stockholders’ equity
$
414,652
$
417,317
The accompanying notes are an integral part of these consolidated financial statements
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statements of Operations
(In Thousands, Except Share and Per Share Information)
Year ended December 31,
2025
2024
2023
Contract revenues
$
852,260
$
796,394
$
711,778
Costs of contract revenues
746,646
705,234
650,115
Gross profit
105,614
91,160
61,663
Selling, general and administrative expenses
93,471
82,537
69,431
Amortization of intangible assets
—
—
427
Gain on disposal of assets, net
( 2,468 )
( 2,898 )
( 8,455 )
Intangible asset impairment loss
—
—
6,890
Operating income (loss)
14,611
11,521
( 6,630 )
Other (expense) income:
Interest expense
( 8,863 )
( 13,381 )
( 11,659 )
Loss on extinguishment of debt
( 3,777 )
—
—
Other income
936
564
744
Other expense, net
( 11,704 )
( 12,817 )
( 10,915 )
Income (loss) before income taxes
2,907
( 1,296 )
( 17,545 )
Income tax benefit
419
348
330
Net income (loss)
$
2,488
$
( 1,644 )
$
( 17,875 )
Basic income (loss) per share
$
0.06
$
( 0.05 )
$
( 0.55 )
Diluted income (loss) per share
$
0.06
$
( 0.05 )
$
( 0.55 )
Shares used to compute income (loss) per share
Basic
39,627,400
34,783,256
32,346,992
Diluted
39,639,250
34,783,256
32,346,992
The accompanying notes are an integral part of these consolidated financial statements
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statement of Stockholders’ Equity
(In Thousands, Except Share Information)
Common
Treasury
Additional
Stock
Stock
Paid-In
Retained
Shares
Amount
Shares
Amount
Capital
Loss
Total
Balance, January 1, 2023
32,770,550
$
328
( 711,231 )
$
( 6,540 )
$
188,184
$
( 44,172 )
$
137,800
Share-based compensation
—
—
—
—
2,042
—
2,042
Exercise of stock options
—
—
—
—
—
—
—
Issuance of restricted stock
1,031,853
10
—
—
( 10 )
—
—
Forfeiture of restricted stock
( 390,886 )
( 4 )
—
—
4
—
—
Payments related to tax withholding for share-based compensation
( 151,506 )
( 1 )
—
—
( 491 )
—
( 492 )
Net loss
—
—
—
—
—
( 17,875 )
( 17,875 )
Balance, December 31, 2023
33,260,011
$
333
( 711,231 )
$
( 6,540 )
$
189,729
$
( 62,047 )
$
121,475
Share-based compensation
—
—
—
—
4,009
—
4,009
Exercise of stock options
136,549
1
—
—
896
—
897
Issuance of restricted stock
830,059
8
—
—
( 8 )
—
—
Forfeiture of restricted stock
( 69,497 )
( 1 )
—
—
1
—
—
Payments related to tax withholding for share-based compensation
( 64,525 )
—
—
—
( 479 )
—
( 479 )
Issuance of common stock
5,589,000
56
—
—
26,365
—
26,421
Net loss
—
—
—
—
—
( 1,644 )
( 1,644 )
Balance, December 31, 2024
39,681,597
$
397
( 711,231 )
$
( 6,540 )
$
220,513
$
( 63,691 )
$
150,679
Stock-based compensation
—
—
—
—
5,450
—
5,450
Exercise of stock options
15,000
—
—
—
108
—
108
Issuance of restricted stock
1,119,434
11
—
—
( 11 )
—
—
Employee share purchase plan
154,006
2
—
—
728
—
730
Forfeiture of restricted stock
( 297,591 )
( 3 )
—
—
3
—
—
Payments related to tax withholding for share-based compensation
( 60,307 )
( 1 )
—
—
( 422 )
—
( 423 )
Net income
—
—
—
—
—
2,488
2,488
Balance, December 31, 2025
40,612,139
$
406
( 711,231 )
$
( 6,540 )
$
226,369
$
( 61,203 )
$
159,032
The accompanying notes are an integral part of these consolidated financial statements
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
Year Ended December 31,
2025
2024
2023
Cash flows from operating activities:
Net income (loss)
$
2,488
$
( 1,644 )
$
( 17,875 )
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Operating activities:
Depreciation and amortization
13,680
15,545
18,844
Amortization of ROU operating leases
8,259
9,960
6,763
Amortization of ROU finance leases
8,582
7,220
5,034
Loss on extinguishment of debt
3,777
—
—
Write-off of debt issuance costs upon debt modification
—
—
119
Amortization of deferred debt issuance costs
1,176
2,015
1,616
Deferred income taxes
52
( 27 )
( 103 )
Share-based compensation
5,450
4,009
2,042
Gain on disposal of assets, net
( 2,468 )
( 2,898 )
( 8,455 )
Intangible asset impairment loss
—
—
6,890
Allowance for credit losses
2,906
194
( 109 )
Change in operating assets and liabilities:
Accounts receivable
( 86,315 )
1,892
14,129
Income tax receivable
227
143
( 224 )
Inventory
787
( 554 )
( 729 )
Prepaid expenses and other
( 3,724 )
41
( 55 )
Contract assets
53,324
( 2,885 )
( 37,619 )
Accounts payable
11,085
16,018
( 4,507 )
Accrued liabilities
8,099
( 10,920 )
11,817
Operating lease liabilities
( 7,272 )
( 8,662 )
( 6,807 )
Landlord lease inventive received
6,530
—
—
Income tax payable
( 310 )
( 63 )
48
Contract liabilities
1,733
( 16,708 )
26,359
Net cash provided by operating activities
28,066
12,676
17,178
Cash flows from investing activities:
Proceeds from sale of property and equipment
25,159
2,609
11,079
Purchase of property and equipment
( 38,862 )
( 14,091 )
( 8,909 )
Net cash (used in) provided by investing activities
( 13,703 )
( 11,482 )
2,170
Cash flows from financing activities:
Borrowings on credit facilities
185,468
72,589
106,958
Payments on credit facilities
( 185,468 )
( 73,067 )
( 104,431 )
Payments made on term loan
( 23,000 )
( 15,000 )
—
Payment of make-whole on debt extinguishment
( 1,056 )
—
—
Proceeds from deemed financing obligation
4,456
—
17,099
Principal payments on deemed financing obligation
( 8,157 )
( 5,855 )
Loan costs related to credit facilities
( 1,643 )
( 393 )
( 6,537 )
Payments of finance lease liabilities
( 10,409 )
( 8,929 )
( 4,791 )
Proceeds from issuance of common stock
—
26,421
—
Employee stock plans, net activity
415
418
( 492 )
Net cash (used in) provided by financing activities
( 39,394 )
( 3,816 )
7,806
Net change in cash, cash equivalents and restricted cash
( 25,031 )
( 2,622 )
27,154
Cash, cash equivalents and restricted cash at beginning of period
28,316
30,938
3,784
Cash, cash equivalents and restricted cash at end of period
$
3,285
$
28,316
$
30,938
Cash and cash equivalents
$
1,588
$
28,316
$
30,938
Restricted cash
1,697
—
—
Total cash, cash equivalents and restricted cash shown above
$
3,285
$
28,316
$
30,938
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest, net of amounts capitalized
$
9,026
$
11,501
$
12,084
Taxes, net of refunds
$
565
$
797
$
618
Noncash financing activity:
Capital expenditures included in accounts payable and accrued liabilities
$
1,172
$
—
$
—
Noncash financing activity:
Write-off of deferred financing costs upon debt extinguishment
$
2,651
$
—
$
—
The accompanying notes are an integral part of these consolidated financial statements
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Orion Group Holdings, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
Years Ended December 31, 2025, 2024 and 2023
(Tabular Amounts in thousands, Except Share and per Share Amounts)
1. Description of Business and Basis of Presentation
Description of business
Orion Group Holdings, Inc. and its subsidiaries (hereafter collectively referred to as the “Company”), is a leading specialty construction company serving the infrastructure, industrial, and building sectors, providing services both on and off the water in the continental United States, Alaska, Hawaii, Canada and the Caribbean Basin through our marine and concrete segments. We are headquartered in Houston, Texas.
Basis of presentation
These consolidated financial statements include the accounts of the parent company, Orion Group Holdings, Inc. and its wholly-owned subsidiaries and have been prepared in accordance with U.S. GAAP on the going concern basis of accounting, which assumes the Company will continue to operate as a going concern and which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. For the periods presented, there were no items of other comprehensive income, and therefore comprehensive loss is equal to net loss. All intercompany balances and transactions have been eliminated in consolidation.
2. Summary of Significant Accounting Policies
The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Management’s estimates, judgments and assumptions are continually evaluated based on available information and experience; however, actual amounts could differ from those estimates.
On an ongoing basis, the Company evaluates the significant accounting policies used to prepare its consolidated financial statements, including, but not limited to, those related to:
● Revenue recognition from construction contracts;
● The recording of accounts receivable and allowance for credit losses;
● The carrying value of property, plant and equipment;
● Leases;
● Share-based compensation;
● Income taxes; and
● Self-insurance.
Revenue recognition
The Company’s revenue is derived from contracts to provide marine construction, dredging, turnkey concrete services, and other specialty services. The Company’s projects are typically brief in duration, but occasionally, span a period of over one year. The Company determines the appropriate accounting treatment for each contract before work begins and, subject to qualifications discussed in the next paragraph, records contract revenue over time.
Performance obligations are promises in a contract to transfer distinct goods or services to the customer and are the unit of account under Topic 606. Each of the Company’s contracts and related change orders typically represent a single performance obligation because the Company provides an integrated service and individual goods and services are not separately identifiable. Revenue is recognized over time because control of the promised goods and services are continuously transferred to the customer over the life of the contract. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using its best estimate of the stand-alone selling price of each distinct good or service. Progress is measured by the percentage of actual contract costs incurred to date to total estimated costs for each contract. This method is used because management considers contract costs incurred to be the best available measure of progress on these contracts. Contract costs include all direct costs, such as
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material and labor, and those indirect costs incurred that are related to contract performance such as payroll taxes and insurance. General and administrative costs are charged to expense as incurred. Upfront costs, such as costs to mobilize personnel and equipment prior to satisfying a performance obligation are capitalized and amortized over the contract performance period.
Changes in job performance, job conditions and estimated profitability, including those arising from final contract settlements, may result in revisions to costs and reported revenue and are recognized in the period in which the revisions are determined. The effect of changes in estimates of contract revenue or contract costs is recognized as an adjustment to recognized revenue on a cumulative catch-up basis to match contract progress with revenue recognition. When the Company anticipates a loss on a contract that is not yet complete, it recognizes the entire loss in the period in which such losses are determined. Revenue is recorded net of any sales taxes collected and paid on behalf of the customer, if applicable.
Contract revenue is derived from the original contract price as modified by agreed-upon change orders and estimates of variable consideration related to incentive fees and change orders or claims for which price has not yet been agreed by the customer. The Company estimates variable consideration based on its assessment of the most likely amount to which it expects to be entitled. Variable consideration is included in the estimated recognition of revenue to the extent it is probable that a significant reversal of cumulative recognized revenue will not occur. A determination that the collection of a claim is probable is based upon the Company’s evaluation of its compliance with the terms of the contract and the extent to which the Company performed in accordance therewith but does not guarantee collection in full.
Assets and liabilities derived from contracts with customers include the following:
● Accounts Receivable: Trade, net of allowance - Represent amounts billed and currently due from customers and are stated at their estimated net realizable value.
● Accounts Receivable: Retainage - Represent amounts that have not been billed to or paid by customers due to retainage provisions in construction contracts, which amounts generally become payable upon contract completion and acceptance by the customer.
● Contract Assets - Represent revenues recognized in excess of amounts billed, which management believes will be billed and collected within one year of the completion of the contract and are recorded as a current asset, until such amounts are either received or written off.
● Contract Liabilities - Represent billings in excess of revenues recognized and are recorded as a current liability, until the underlying obligation has been performed or discharged.
Classification of current assets and liabilities
The Company includes in current assets and liabilities amounts realizable and payable in the next twelve months.
Cash and cash equivalents and restricted cash
The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. At times, cash held by financial institutions may exceed federally insured limits. The Company has not historically sustained losses on its cash balances in excess of federally insured limits. Cash equivalents at December 31, 2025 and December 31, 2024 consisted primarily of overnight bank deposits.
Restricted cash represents cash that is not available for general corporate purposes. At December 31, 2025, restricted cash of $ 1.7 million consisted of cash held at White Oak to collateralize outstanding letters of credit. There was no restricted cash at December 31, 2024. Restricted cash is classified on the consolidated balance sheets based on the expected timing of release.
Risk concentrations
Financial instruments that potentially subject the Company to concentrations of credit risk principally consist of accounts receivable.
A significant portion of the Company’s revenue base depends on its ability to continue to obtain federal, state and local governmental contracts, and indirectly, on the amount of funding available to these agencies for new and current governmental projects. Therefore, a portion of the Company’s operations is dependent upon the level and timing of
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government funding. Statutory mechanics’ liens provide the Company high priority in the event of lien foreclosures following financial difficulties of private owners, thus minimizing credit risk with private customers.
Accounts receivable
Accounts receivable are stated at the historical carrying value, net of allowances for credit losses. The Company had significant investments in billed and unbilled receivables as of December 31, 2025 and December 31, 2024. Billed receivables represent amounts billed upon the completion of small contracts and progress billings on large contracts in accordance with contract terms and milestone achievements. Unbilled receivables on contracts represent recoverable costs and accrued profits that are not yet capable of being billed under the terms of the applicable contracts. Revenue associated with these billings is recorded net of any sales tax, if applicable.
In establishing an allowance for credit losses, the Company evaluates its contract receivables and contract assets and thoroughly reviews historical collection experience, the financial condition of its customers, billing disputes and other factors. The Company writes off potentially uncollectible accounts receivable against the allowance for credit losses if the Company determines that the amounts will not be collected or if a settlement with respect to a disputed receivable is reached for an amount that is less than its carrying value. As of December 31, 2025 and December 31, 2024, the Company had recorded an allowance for credit losses of $ 3.5 million and $ 0.6 million, respectively.
Balances billed to customers but not paid pursuant to retainage provisions in construction contracts generally become payable upon contract completion and acceptance by the owner. Retainage at December 31, 2025 totaled $ 49.2 million, of which $ 2.2 million is expected to be collected beyond December 31, 2026. Retainage at December 31, 2024 totaled $ 35.6 million.
From time to time, the Company negotiates change orders and claims with its customers. Unsuccessful negotiations of claims could result in a change to contract revenue that is less than amounts previously recorded, which could result in the recording of a loss in the amount of the shortfall. Successful claims negotiations could result in the recovery of previously recorded losses. Significant losses on receivables could adversely affect the Company’s financial position, results of operations and overall liquidity.
Advertising costs
The Company primarily obtains contracts through the open bid process, and therefore advertising costs are not a significant component of expense. Advertising costs are expensed as incurred.
Environmental costs
Costs related to environmental remediation are charged to expense. Other environmental costs are also charged to expense unless they increase the value of the property and/or provide future economic benefits, in which event the costs are capitalized. Environmental liabilities, if any, are recognized when the liability is considered probable and the amount can be reasonably estimated. The Company did not recognize any environmental liabilities as of December 31, 2025 or December 31, 2024.
Fair value measurements
The Company evaluates and presents certain amounts included in the accompanying consolidated financial statements at “fair value” in accordance with U.S. GAAP, which requires the Company to base its estimates on assumptions that market participants, in an orderly transaction, would use to price an asset or liability, and to establish a hierarchy that prioritizes the information used to determine fair value. Refer to Note 7 for more information regarding fair value determination.
The Company generally applies fair value valuation techniques on a non-recurring basis associated with (1) valuing assets and liabilities acquired in connection with business combinations and other transactions; (2) valuing potential impairment loss related to long-lived assets; and (3) valuing potential impairment loss related to goodwill and indefinite-lived intangible assets.
Inventory
Current inventory consists of parts and small equipment held for use in the ordinary course of business and is valued at the lower of cost (using historical average cost) or net realizable value and is relieved as utilized. Where shipping and
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handling costs are incurred by the Company, these charges are included in inventory and charged to cost of contract revenue upon use. Non-current inventory consists of spare parts (including engines, cutters and gears) that require special order or long-lead times for manufacture or fabrication but must be kept on hand to reduce downtime and is valued at the lower of cost (using historical average cost) or net realizable value.
Property and equipment
Property and equipment are recorded at cost. Ordinary maintenance and repairs that do not improve or extend the useful life of the asset are expensed as incurred. Major renewals and betterments of equipment are capitalized and depreciated generally over three to ten years until the next scheduled maintenance.
When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in results of operations for the respective period.
Depreciation is computed using the straight-line method over the estimated useful lives of the related assets for financial statement purposes, as follows:
Automobiles and trucks
3 to 10 years
Buildings and improvements
10 to 30 years
Construction equipment
3 to 10 years
Vessels and other equipment
3 to 40 years
Office equipment
3 to 5 years
The Company generally uses accelerated depreciation methods for tax purposes where beneficial.
Dry-docking costs are capitalized and amortized using the straight-line method over a period ranging from three to seven years . Dry-docking costs include, but are not limited to, the inspection, refurbishment and replacement of steel, engine components, tailshafts, mooring equipment and other parts of the vessel. Amortization related to dry-docking activities is included as a component of depreciation. These costs and the related amortization periods are periodically reviewed to determine if the estimates are accurate. If warranted, a significant upgrade of equipment may result in a revision to the useful life of the asset, in which case the change is accounted for prospectively.
Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset or asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment loss is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are separately presented in the balance sheet and reported at the lower of the carrying amount or the fair value, less the costs to sell, and are no longer depreciated. There were no assets classified as held for sale as of December 31, 2025 or December 31, 2024.
Leases
Management determines if a contract is or contains a lease at inception of the contract or modification of the contract. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period in exchange for consideration. Control over the use of the identified asset means the lessee has both (a) the right to obtain substantially all of the economic benefits from the use of the asset and (b) the right to direct the use of the asset.
Finance and operating lease right-of-use (“ROU”) assets and liabilities are recognized based on the present value of future minimum lease payments over the expected lease term at commencement date. As the implicit rate is not determinable in most of the Company’s leases, management uses the Company’s incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The expected lease term includes options to extend or terminate the lease when it is reasonably certain the Company will exercise such option. Lease expense for minimum lease payments is recognized on a straight-line basis over the expected lease term.
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The Company’s lease arrangements have lease and non-lease components accounted for using the practical expedient . Leases with an expected term of 12 months or less are not accounted for on the balance sheet and the related lease expense is recognized on a straight-line basis over the expected lease term.
The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
See Note 18 for more information regarding leases.
Share-based compensation
The Company recognizes compensation expense for equity awards over the vesting period based on the fair value of these awards at the date of grant. The computed fair value of these awards is recognized as a non-cash cost over the period the employee provides services, which is typically the vesting period of the award. The fair value of restricted stock grants and restricted stock units is equivalent to the fair value of the stock issued on the date of grant and is measured as the closing price of the stock on the date of grant.
Employee Stock Purchase Plan (“ESPP”) compensation fair value is determined using the Black Scholes Merton Option Pricing model, using a six-month expected term to conform with the six-month ESPP offering period.
Compensation expense is recognized only for share-based payments expected to vest. See Note 14 for further discussion of the Company’s share-based compensation plan.
Income taxes
The Company determines its consolidated income tax provision using the asset and liability method prescribed by U.S. GAAP, which requires the recognition of income tax expense for the amount of taxes payable or refundable for the current period and for deferred tax liabilities and assets for the future tax consequences of events that have been recognized in an entity’s financial statements or tax returns. The Company must make significant assumptions, judgments and estimates to determine its current provision for income taxes, its deferred tax assets and liabilities, and any valuation allowance to be recorded against any deferred tax asset. The current provision for income tax is based upon the current tax laws and the Company’s interpretation of these laws, as well as the probable outcomes of any tax audits. The value of any net deferred tax asset depends upon estimates of the amount and category of future taxable income reduced by the amount of any tax benefits that the Company does not expect to realize. Actual operating results and the underlying amount and category of income in future years could render current assumptions, judgments and estimates of recoverable net deferred taxes inaccurate, thus impacting the Company’s financial position and results of operations. The Company computes deferred income taxes using the liability method. Under the liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under the liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
The Company accounts for uncertain tax positions in accordance with the provisions of ASC 740, Income Taxes, which prescribes a recognition threshold and measurement attribute for financial statement disclosure of tax positions taken, or expected to be taken, on its consolidated tax return. The Company evaluates and records any uncertain tax positions based on the amount that management deems is more likely than not to be sustained upon examination and ultimate settlement with the tax authorities in the tax jurisdictions in which it operates.
See Note 11 for additional discussion of income taxes.
Insurance coverage
The Company maintains insurance coverage for its business and operations. Insurance related to property, equipment, automobile, general liability, and a portion of workers’ compensation is provided through traditional policies, subject to a deductible or deductibles. A portion of the Company’s workers’ compensation exposure is covered through a mutual association, which is subject to supplemental calls.
If a claim arises and a potential insurance recovery is probable, the impending gain is recognized separately from the related loss. The recovery will only be recognized up to the amount of the loss once the recovery of the claim is deemed
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probable and any excess gain will fall under contingency accounting and will only be recognized once it is realized. The Company does not net insurance recoveries against the related claim liability as the amount of the claim liability is determined without consideration of the anticipated insurance recoveries from third parties.
Separately, the Company’s marine segment employee health care is paid for by general assets of the Company and currently administered by a third party. The administrator has purchased appropriate stop-loss coverage. Losses on these policies up to the deductible amounts are accrued based upon known claims incurred and an estimate of claims incurred but not reported. The accruals are derived from known facts, historical trends and industry averages to determine the best estimate of the ultimate expected loss. Actual claims may vary from estimates. Any adjustments to such reserves are included in the Consolidated Statements of Operations in the period in which they become known. The Company’s concrete segment employee health care is provided through two policies. A fully funded policy is offered primarily to salaried employees and their dependents while a partially self-funded plan with an appropriate stop-loss is offered primarily to hourly employees and their dependents. The self-funded plan is funded to the maximum exposure and, as a result, is expected to receive a partial refund after the policy expiration.
The total accrual for insurance claims liabilities was $ 5.6 million and $ 4.3 million at December 31, 2025 and December 31, 2024, respectively, reflected as a component of accrued liabilities in the consolidated balance sheets.
Recent Accounting Pronouncements
The Financial Accounting Standards Board (“FASB”) issues accounting standards and updates (each, an “ASU”) from time to time to its Accounting Standards Codification (“ASC”), which is the primary source of U.S. GAAP. The Company regularly monitors ASUs as they are issued and considers applicability to its business. All ASUs are adopted by their respective due dates and in the manner prescribed by the FASB.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The amendments require disclosure of specific categories in the rate reconciliation and provides additional information for reconciling items that meet a quantitative threshold and further disaggregation of income taxes paid for individually significant jurisdictions. The ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. Adoption of this standard did not impact our financial position or results of operations but resulted in expanded tax disclosures in these full year financial statements for the year ended December 31, 2025.
In November 2024, the FASB issued ASU No. 2024-03 , Income Statement—Reporting Comprehensive Income (Topic 220): Expense Disaggregation Disclosures . The amendments require entities to provide enhanced disaggregation of certain expense categories presented in the income statement, including details on significant components within those categories, to provide greater transparency and decision-useful information to users of financial statements. The ASU is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact that this guidance will have on the disclosures within its consolidated financial statements.
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets . The amendments introduce a practical expedient that allows entities to assume current conditions as of the balance sheet date remain unchanged over the remaining life of current accounts receivable and current contract assets arising from transactions within the scope of ASC 606. The ASU is effective for fiscal years beginning after December 15, 2025, including interim periods within those fiscal years, with early adoption permitted. The Company is evaluating the impact that the guidance will have on the disclosures within its consolidated financial statements; however, adoption is not expected to have a material impact on the Company’s financial position or results of operations.
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3. Revenue
Contract revenues are recognized when control of the promised goods or services is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The following table represents a disaggregation of the Company’s contract revenues by service line for the marine and concrete segments:
Year Ended December 31,
2025
2024
2023
Marine Segment
Construction
$
453,170
$
448,321
$
297,462
Dredging
76,429
57,048
60,667
Specialty services
15,232
15,881
37,788
Marine segment contract revenues
$
544,831
$
521,250
$
395,917
Concrete Segment
Structural
$
45,819
$
61,545
$
53,827
Light commercial
261,610
213,599
262,034
Concrete segment contract revenues
$
307,429
$
275,144
$
315,861
Total contract revenues
$
852,260
$
796,394
$
711,778
The Company has determined that it has two reportable segments as described in Note 17 , but has disaggregated its contract revenues in the above chart in terms of services provided within such segments. Additionally, both the marine and concrete segments have limited contracts with multiple performance obligations. The Company’s contracts are often estimated and bid as one project and performance is evaluated as one project, not by individual services performed by each.
Additionally, the table below represents contract revenue by type of customer for the years ended December 31, 2025, 2024 and 2023, respectively:
2025
%
2024
%
2023
%
Federal Government
$
162,992
19
%
$
234,175
30
%
$
153,410
22
%
State Governments
116,304
14
%
74,286
9
%
59,354
8
%
Local Government
158,990
19
%
123,160
15
%
99,621
14
%
Private Companies
413,974
48
%
364,773
46
%
399,393
56
%
Total contract revenues
$
852,260
100
%
$
796,394
100
%
$
711,778
100
%
On March 10, 2023, the United States Navy awarded the Dragados/Hawaiian Dredging/Orion Joint Venture a contract to complete the construction of a dry dock at Pearl Harbor Naval Shipyard. The Company’s joint venture with Dragados/Hawaiian Dredging is a related-party transaction. The Company’s portion of work as a dedicated subcontractor totals $ 463.9 million.
For the years ended December 31, 2025, 2024 and 2023, the United States Navy, which is included in the Federal Government category, accounted for 14 %, 25 % and 13 %, respectively, of total contract revenue.
For the years ended December 31, 2025, 2024 and 2023, the Company’s revenue related to the joint venture subcontract was approximately $ 121.5 million, $ 199.4 million and $ 90.5 million, respectively.
The Company does not believe that the loss of any one of its customers would have a material adverse effect on the Company or its subsidiaries and affiliates since no single specific customer sustains such a large portion of receivables or contract revenue over time.
Contract revenues generated outside the United States totaled 5 %, 7 % and 5 % of total revenues for the years ended December 31, 2025, 2024 and 2023, respectively, and were primarily located in the Caribbean Basin.
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4. Concentration of Risk and Enterprise-Wide Disclosures
Accounts receivable include amounts billed to governmental agencies and private customers and do not bear interest. Balances billed to customers but not paid pursuant to retainage provisions generally become payable upon contract completion and acceptance by the owner.
The table below presents the concentrations of current receivables (trade and retainage) at December 31, 2025 and December 31, 2024, respectively:
December 31, 2025
December 31, 2024
Federal Government
$
51,057
23
%
$
19,874
14
%
State Governments
14,008
6
%
9,553
7
%
Local Governments
23,453
10
%
24,641
17
%
Private Companies
139,832
61
%
88,424
62
%
Gross receivables
228,350
100
%
142,492
100
%
Allowance for credit losses
( 3,461 )
( 555 )
Net receivables
$
224,889
$
141,937
At December 31, 2025, the United States Navy, which is included in the Federal Government category and is a customer in the Private Companies category, accounted for 20 % and 12 %, respectively, of total current receivables. At December 31, 2024, the United States Navy accounted for 11 % of total current receivables.
5. Contracts in Progress
Contracts in progress are as follows as of December 31, 2025 and December 31, 2024:
December 31,
December 31,
2025
2024
Costs incurred on uncompleted contracts
$
1,980,625
$
1,561,338
Estimated earnings
292,235
211,439
Costs and estimated earnings on uncompleted contracts
2,272,860
1,772,777
Less: Billings to date
( 2,290,881 )
( 1,735,741 )
Net contracts in progress
$
( 18,021 )
$
37,036
Included in the accompanying Consolidated Balance Sheets under the following captions:
Contract assets
$
31,083
$
84,407
Contract liabilities
( 49,104 )
( 47,371 )
Net contracts in progress
$
( 18,021 )
$
37,036
Included in contract net assets (liabilities) is approximately $ 7.1 million and $ 19.8 million at December 31, 2025 and December 31, 2024, respectively, related to claims and unapproved change orders.
Remaining performance obligations represent the transaction price of firm orders or other written contractual commitments from customers for which work has not been performed or is partially completed and excludes unexercised contract options and potential orders. As of December 31, 2025, the aggregate amount of the remaining performance obligations was approximately $ 640 million. Of this amount, the current expectation of the Company is that it will recognize $ 516 million, or 81 %, in the next 12 months and the remaining balance thereafter.
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6. Property and Equipment
The following is a summary of property and equipment as of December 31, 2025 and December 31, 2024:
December 31,
December 31,
2025
2024
Construction equipment
$
113,863
$
117,652
Vessels and other equipment
98,505
96,173
Building and improvements
36,229
39,401
Automobiles and trucks
5,999
1,790
Office equipment
1,429
7,562
Gross book value of depreciable assets
256,025
262,578
Less: Accumulated depreciation
( 185,650 )
( 209,234 )
Net book value of depreciable assets
70,375
53,344
Construction in progress
15,143
7,806
Land
2,692
24,948
Property and equipment, net of depreciation
$
88,210
$
86,098
Substantially all depreciation expense is included in the cost of contract revenue in the Company’s Consolidated Statements of Operations. Substantially all of the assets of the Company are pledged as collateral under the Company’s Credit Agreement (as defined in Note 9 ).
Interest costs of $ 0.3 million were capitalized during the year ended December 31, 2025, related to the build-out of the Company’s new corporate office facility.
Substantially all of the Company’s long-lived assets are located in the United States.
See Note 2 to the Company’s consolidated financial statements for further discussion of property and equipment.
7. Fair Value
Recurring Fair Value Measurements
The fair value of financial instruments is the amount at which the instrument could be exchanged in a current transaction between willing parties. Due to their short-term nature, the Company believes that the carrying value of its accounts receivable, other current assets, accounts payable and other current liabilities approximate their fair values.
The Company classifies financial assets and liabilities into the following three levels based on the inputs used to measure fair value in the order of priority indicated:
● Level 1- fair values are based on observable inputs such as quoted prices in active markets for identical assets or liabilities;
● Level 2 - fair values are based on pricing inputs other than quoted prices in active markets for identical assets and liabilities and are either directly or indirectly observable as of the measurement date; and
● Level 3- fair values are based on unobservable inputs in which little or no market data exists.
Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value requires judgment and may affect the placement of assets and liabilities within the fair value hierarchy levels.
Our concrete segment has life insurance policies with a combined face value of $ 11.1 million as of December 31, 2025. These policies are invested in mutual funds and the fair value measurement of the cash surrender balance associated with these policies is determined using Level 2 inputs within the fair value hierarchy and will vary with investment performance. The fair value of the cash surrender value of these policies at December 31, 2025 and December 31, 2024 was $ 1.3 million and $ 1.2 million, respectively. These assets are included in the “Other non-current” asset section in the Company’s Consolidated Balance Sheets.
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Other Fair Value Measurements
The fair value of the Company’s debt at December 31, 2025 and 2024 approximated its carrying value of $ 7.9 million and $ 26.8 million, respectively, as interest is based on current market interest rates for debt with similar risk and maturity. The estimated fair value of debt is classified a s Level 2 w ithin the fair value hierarchy.
8. Accrued Liabilities
Accrued liabilities as of December 31, 2025 and 2024 consisted of the following:
December 31, 2025
December 31, 2024
Accrued salaries, wages and benefits
$
20,580
$
13,931
Accrued liabilities expected to be covered by insurance
5,618
4,250
Sales taxes
2,904
1,605
Sale-leaseback arrangement
1,049
2,852
Property taxes
526
1,814
Other accrued expenses
1,073
1,842
Total accrued liabilities
$
31,750
$
26,294
9. Debt
On May 15, 2023, the Company entered into a credit agreement with White Oak ABL, LLC and White Oak Commercial Finance, LLC (the “White Oak Credit Agreement”), providing for a $ 65.0 million asset-based revolving credit facility (the “White Oak Revolver”) and a $ 38.0 million fixed asset term loan (the “White Oak Term Loan”). The White Oak Credit Agreement, as subsequently amended, was scheduled to mature on May 15, 2028 and was secured by substantially all of the assets of the Company and its subsidiaries, including fixed assets and accounts receivable.
On December 23, 2025, in connection with entering into the UMB Credit Agreement described below, the Company terminated the White Oak Credit Agreement and repaid all amounts outstanding thereunder. In connection with such termination, the Company paid a make-whole payment of approximately $ 1.1 million and wrote off approximately $ 2.7 million of unamortized deferred financing costs, resulting in a $ 3.8 million loss on debt extinguishment for the year ended December 31, 2025.
On December 23, 2025, the Company entered into a $ 120.0 million Credit Agreement (the “UMB Credit Agreement”) with certain financial institutions from time-to-time party thereto, as lenders, and UMB Bank, N.A., as Administrative Agent and Issuing Bank. The UMB Credit Agreement consists of a $ 60.0 million revolving loan (the “UMB Revolver”), a $ 20.0 million equipment term loan and a $ 40.0 million acquisition term loan. In addition, the UMB Credit Agreement provides for a $ 25.0 million accordion option for future acquisitions (subject to customary conditions). The UMB Credit Agreement is secured by substantially all of the assets of the Company and certain of its domestic subsidiaries, subject to permitted liens, and is guaranteed, on a joint and several basis, by each existing and subsequently acquired or formed direct and indirect domestic subsidiary of the Company.
The UMB Credit Agreement matures in December 2030.
The UMB Credit Agreement includes a letter of credit sublimit equal to the lesser of $ 7.5 million and the total amount of the revolving commitments then in effect. The Company is subject to a commitment fee on the average daily unused amount of the revolving commitments, which accrues at a rate per annum equal to the applicable rate set forth in the UMB Credit Agreement.
As of December 31, 2025, the Company had no borrowings outstanding under the UMB Revolver, equipment term loan or acquisition term loan. The Company’s borrowing availability under the UMB Revolver at December 31, 2025 was approximately $ 60.0 million.
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The Company’s obligations under debt arrangements consisted of the following:
December 31, 2025
December 31, 2024
Term loan
$
—
$
23,000
Other
7,874
3,843
Total debt
7,874
26,843
Less: current
1,789
426
Less: deferred debt issuance costs (1)
—
3,666
Total long-term debt
$
6,085
$
22,751
(1) Deferred financing costs include lender/arrangement fees, legal fees and other third-party costs incurred in connection with entering into or amending the Company’s credit facilities. Deferred financing costs are presented as a direct deduction from the carrying amount of the related term loan when amounts are outstanding. At December 31, 2025, because there were no borrowings outstanding under the Company’s credit facilities, unamortized deferred financing costs of $ 1.7 million related to the UMB Credit Agreement were included in Other long-term assets. At December 31, 2024, deferred financing costs were presented as a direct deduction from the carrying amount of the White Oak Term Loan. The Credit Agreement is used to finance working capital and general corporate purposes, capital expenditures, permitted acquisitions and associated transaction fees, and to refinance existing indebtedness. Borrowings under the UMB Revolver may be repaid and reborrowed, subject to the borrowing base and other conditions.
The Company’s credit facilities are used to finance working capital and general corporate purposes, capital expenditures, permitted acquisitions and associated transaction fees, and to refinance existing indebtedness. Borrowings under the revolving facilities may be repaid and reborrowed, subject to the borrowing base and other conditions.
Borrowings under the White Oak Credit Agreement bore interest at rates based on 30-day Secured Overnight Financing Rate (“SOFR”) plus applicable margins, subject to a SOFR floor. Borrowings under the UMB Credit Agreement must be of the same type and may bear interest at either an alternate base rate (“ABR”) or an SOFR, in each case plus an applicable margin determined by the Company’s consolidated senior leverage ratio. The applicable margin ranges from 2.50 % to 3.00 % for SOFR loans and 1.50 % to 2.00 % for ABR loans, and the interest rate is subject to a 4.00 % per annum floor.
The annual weighted average interest rate for the White Oak Credit Agreement for the years ended December 31, 2025 and 2024 was 10.70 % and 11.87 %, respectively. The annual weighted average interest rate for the UMB Credit Agreement for the year ended December 31, 2025 was 6.47 %.
The White Oak Credit Agreement contained customary affirmative and negative covenants, as well as financial maintenance covenants. The UMB Credit Agreement contains customary affirmative and negative covenants, including limitations on indebtedness, liens, investments, asset sales, and dividends, and includes financial maintenance covenants requiring the Company to maintain (i) a consolidated fixed charge coverage ratio of not less than 1.20 to 1.00 and (ii) a consolidated senior leverage ratio of not greater than 3.00 to 1.00, each tested periodically.
In addition, the Company’s credit agreements contain events of default that are usual and customary for similar arrangements, including non-payment of principal, interest or fees; breaches of representations and warranties that are not timely cured; violation of covenants; bankruptcy and insolvency events; and events constituting a change of control.
The Company was in compliance with all covenants under its credit agreements as of December 31, 2025 and 2024.
Other debt
The Company had a $ 4.4 million construction financing obligation as of December 31, 2025 related to lessor-financed build-to-suit equipment. Under this arrangement, the lessor funds costs associated with equipment being constructed to the Company’s specifications. Because the Company is deemed to control the equipment during construction, the Company recognizes the equipment as construction in progress within property and equipment and records a corresponding financing obligation (included in other debt). The equipment is expected to be placed in service during fiscal 2026.
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The Company has entered into debt agreements for the purpose of financing equipment purchased. As of December 31, 2025 and December 31, 2024, the carrying value of this debt was $ 1.0 million and $ 1.4 million, respectively. The agreements are secured by the financed equipment assets and the debt is included as a component of current debt and long-term debt on the Condensed Consolidated Balance Sheets.
On June 23, 2023, the Company closed on a land-sale leaseback contract for the Company’s Port Lavaca South Yard property located in Port Lavaca, Texas for a purchase price of $ 12.0 million. A portion of the operating lease above the fair value of the land was financed by the Company. As of both December 31, 2025 and 2024 the carrying value of this debt was $ 2.5 million and $ 2.4 million, respectively.
10. Other Long-Term Liabilities
Other long-term liabilities at December 31, 2025 and 2024 consisted of the following:
December 31, 2025
December 31, 2024
Sale-leaseback arrangement
$
13,379
$
19,001
Deferred compensation
1,239
1,194
Other
357
308
Total other long-term liabilities
$
14,975
$
20,503
Sale-leaseback arrangements
On May 15, 2023, the Company entered into a $ 13.0 million sale-leaseback of certain equipment pursuant to which the Company leased-back the equipment for terms ranging from one to three years . This transaction was recorded as a failed sale-leaseback.
Concurrent with the sale of Company’s Port Lavaca South Yard property, the Company entered into a twenty-year lease agreement whereby the Company leased back the property at an annual rental rate of approximately $ 1.1 million, subject to annual rent increases of 2.5 %. Under the lease agreement, the Company has four consecutive options to extend the term of the lease by five years for each such option. The portion of this transaction related to the building was recorded as a failed sale-leaseback.
On September 27, 2019, the Company entered into a purchase and sale agreement (the “Purchase and Sale Agreement”). Pursuant to the terms of the Purchase and Sale Agreement, the Company sold certain properties for a purchase price of $ 19.1 million. Concurrent with the sale of the property, the Company entered into a fifteen-year lease agreement whereby the Company leased back the property at an annual rental rate of approximately $ 1.5 million, subject to annual rent increases of 2.0 %. Under the lease agreement, the Company has two consecutive options to extend the term of the lease by ten years for each such option. This transaction was recorded as a failed sale-leaseback.
Related to the failed sale-leasebacks, the Company recorded liabilities for the amounts received, will continue to depreciate the non-land portion of the assets, and has imputed an interest rate so that the net carrying amount of the financial liability and remaining assets will be zero at the end of the initial lease terms.
11. Income Tax
The following table presents the components of income (loss) before income taxes were attributable to the following regions for each year ended December 31, as follows:
2025
2024
2023
Domestic
$
( 9,526 )
$
( 6,169 )
$
( 18,780 )
Foreign
12,433
4,873
1,235
Total income (loss)
$
2,907
$
( 1,296 )
$
( 17,545 )
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The following table presents the components of our consolidated income tax expense for each year ended December 31, as follows:
2025
2024
2023
Current tax expense (benefit)
Federal
$
4
$
9
$
27
State
352
372
415
Foreign
11
( 6 )
( 8 )
Total current tax expense
$
367
$
375
$
434
Deferred tax expense (benefit)
Federal
$
—
$
—
$
—
State
52
( 27 )
( 79 )
Foreign
—
—
( 25 )
Total deferred tax expense (benefit)
$
52
$
( 27 )
$
( 104 )
Total income tax expense (benefit)
Federal
$
4
$
9
$
27
State
404
345
336
Foreign
11
( 6 )
( 33 )
Total income tax expense
$
419
$
348
$
330
The table below provides the updated requirements of ASU 2023-09 for 2025. See “Note 2. Summary of Significant Accounting Policies – Recent Accounting Pronouncements” for additional details on the adoption of ASU 2023-09.
The effective income tax rate for the year ended December 31, 2025 differs from the statutory federal income tax rate as follows:
2025
Statutory amount
$
610
21
%
Federal
Nontaxable and nondeductible items:
Stock compensation deficiency
( 156 )
( 5 )
Nondeductible meals and entertainment
690
24
Nondeductible executive compensation
391
13
Other
46
2
Tax credits
( 38 )
( 1 )
Cross-border tax laws:
US taxation of foreign disregarded entity
2,611
90
Valuation allowances
( 1,464 )
( 50 )
State and local income tax, net of federal benefit
330
11
Foreign tax effects:
Bahamas
Statutory income tax rate differential
( 2,603 )
( 90 )
Other foreign jurisdictions
2
0
Uncertain tax provision
—
—
Total tax provision and effective tax rate
$
419
14
%
In the year ended 2025, the Company’s effective tax rate differed from the statutory federal rate of 21 % primarily due to the tax impact from the valuation allowance for current year activity, state income taxes and the non-deductibility of other permanent items.
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As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows:
2024
2023
Statutory amount
$
( 272 )
$
( 3,685 )
Valuation allowance on foreign tax credits
( 32 )
( 438 )
State income tax, net of federal benefit
444
69
Permanent differences, other
998
749
Permanent differences, stock compensation
( 275 )
( 40 )
Valuation allowance, other
1,307
3,675
Uncertain tax provision
( 1,614 )
—
Other
( 208 )
—
Consolidated income tax provision
$
348
$
330
Consolidated effective tax rate
( 26.9 )
%
( 1.9 )
%
In the year ended 2024, the Company’s effective tax rate differed from the statutory federal rate of 21 % primarily due to the tax impact from the valuation allowance for current year activity, the statue expiration of an uncertain tax position, state income taxes and the non-deductibility of other permanent items.
In the year ended 2023, the Company’s effective tax rate differed from the statutory federal rate of 21 % primarily due to the tax impact from the valuation allowance for current year activity, state income taxes and the non-deductibility of other permanent items.
The Company’s effective tax rate can be volatile based on the amount of pretax income or loss in the reporting period. For example, when pretax income is lower, the effect of reconciling items to the U.S. statutory rate, such as nondeductible expenses, will have a greater impact on the effective tax rate.
The amounts of cash taxes paid by the Company in the year ended December 31, 2025 is as follows:
2025
Federal
$
( 13 )
State and local
Texas
$
455
Louisiana
225
Other
24
$
704
Foreign
Canada
$
120
USVI
( 246 )
Subtotal
$
( 126 )
Total cash taxes paid
$
565
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Table of Contents
Deferred Taxes
The Company’s deferred tax assets and liabilities are as follows:
Long Term
As of December 31,
2025
2024
Assets related to:
Accrued liabilities
$
788
$
616
Intangible assets
2,296
2,763
Net operating loss carryforward
19,755
15,549
Stock-based compensation
1,068
701
Foreign tax credits
3,372
3,362
Goodwill
2,268
2,770
Leases
13,773
16,347
Other
1,869
3,205
Total gross deferred tax assets
45,189
45,313
Less valuation allowance
( 20,216 )
( 22,070 )
Total net deferred tax assets
24,973
23,243
Liabilities related to:
Depreciation and amortization
( 24,809 )
( 22,330 )
Other
( 227 )
( 924 )
Total deferred tax liabilities
( 25,036 )
( 23,254 )
Net deferred tax liabilities
$
( 63 )
$
( 11 )
The Company has net operating loss carryforwards for federal income tax purposes of $ 65.4 million as of December 31, 2025, which are available to reduce future taxable income. The Company’s federal net operating losses arose after the 2017 tax year and can be carried forward for an indefinite period of time but are limited to offset 80% of taxable income in any given year. The Company has state net operating losses of $ 140.5 million that expire beginning in 2027. A portion of the state losses that arose after the 2017 tax year may be carried forward indefinitely. Additionally, the Company has foreign tax credits of $ 3.4 million that can be carried forward for up to ten years . The Company has foreign tax credits that will expire in 2026.
The Company assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to realize the existing deferred tax assets. The Company considers the scheduled reversal of deferred tax liabilities, available carryback periods, and tax-planning strategies in making this assessment. According to ASC subtopic 740-10, the Company’s history of losses is a significant piece of negative evidence. This negative evidence is weighed more heavily than the Company’s subjective positive evidence such as our estimated future taxable income and growth. Therefore, as of December 31, 2025, the Company continues to maintain a valuation allowance of $ 20.2 million. This valuation allowance decreased by $ 1.9 million during the year ended December 31, 2025 primarily to offset deferred tax liabilities generated during the period.
Uncertain Tax Benefits
The Company and its subsidiaries file consolidated federal income tax returns in the United States and also file in various states and foreign jurisdictions. With few exceptions, the Company remains subject to federal and state income tax examinations for the years of 2019-2024.
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The change in the total gross unrecognized tax benefits and prior year audit resolutions of the Company during the years ended December 31, 2025 and 2024 are reconciled in the table below:
2025
2024
Balance at beginning of the year
$
—
$
1,614
Additions based on tax position related to current year
—
—
Additions based on tax positions related to prior years
—
—
Reductions based on tax positions related to current year
—
—
Reductions based on tax positions related to prior years
—
—
Settlements with tax authorities
—
—
Lapse of statute of limitations
—
( 1,614 )
Balance at end of the year
$
—
$
—
The Company’s policy is to recognize interest and penalties related to any unrecognized tax liabilities as additional tax expense. No interest or penalties have been accrued at December 31, 2025 and 2024. The Company believes it has appropriate and adequate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. Although the Company believes its recorded assets and liabilities are reasonable, tax regulations are subject to interpretation and tax litigation is inherently uncertain; therefore, the Company’s assessments can involve both a series of complex judgments about future events and rely heavily on estimates and assumptions. Although the Company believes that the estimates and assumptions supporting its assessments are reasonable, the final determination of tax audit settlements and any related litigation could be materially different from that which is reflected in historical income tax provisions and recorded assets and liabilities. If the Company were to settle an audit or a matter under litigation, it could have a material effect on the income tax provision, net income, or cash flows in the period or periods for which that determination is made. Any accruals for tax contingencies are provided for in accordance with U.S. GAAP .
12. Earnings Per Share
The following table reconciles the denominators used in the computations of both basic and diluted earnings per share:
Year ended December 31,
2025
2024
2023
Total basic weighted average shares outstanding
39,627,400
34,783,256
32,346,992
Effect of potentially dilutive securities:
Common stock options
11,850
—
—
Employee stock purchase plan
—
Total diluted weighted average shares outstanding
39,639,250
34,783,256
32,346,992
For the years ended December 31, 2025, 2024 and 2023, the Company had 48,686 , 177,395 , and 250,264 , securities, respectively, that were potentially dilutive in earnings per share calculations. Such dilution is dependent on the excess of the market price of our stock over the exercise price and other components of the treasury stock method. The exercise price for certain stock options awarded by the Company exceeded the average market price of the Company’s common stock for the years ended December 31, 2025, 2024 and 2023. Such stock options are antidilutive and are not included in the computation of earnings per share for those periods. Due to the Company reporting a net loss fiscal 2024 and 2023, all potentially dilutive securities are antidilutive and are excluded from the computations of diluted loss per share.
13. Issuance of Common Stock
On September 12, 2024, the Company completed the sale of 5,589,000 shares of common stock, including 729,000 shares of common stock pursuant to an option granted to the underwriters, in an underwritten public offering. The Company received net proceeds of approximately $ 26.4 million, after deducting underwriting discounts and other estimated offering
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expenses payable by the Company. The net proceeds were used for working capital and for general corporate purposes, including repayment of borrowings under the White Oak Credit Agreement.
14. Share-Based Compensation
The Compensation Committee of the Company’s Board of Directors is responsible for the administration of the Company’s stock incentive plans. In general, the Company’s Long-Term Incentive Plan (“ LTIP”) provides for grants of restricted stock and performance-based awards to be issued with a per-share price not less than the fair market value of a share of common stock on the date of grant. The Company accounts for forfeitures of awards as they are incurred.
In May 2024, shareholders approved the Employee Stock Purchase Plan (“ESPP”), which became effective on September 16, 2024. The Company has reserved a total of 1,000,000 shares under the ESPP, all of which are authorized and available for future issuance under the ESPP. During the year ended December 31, 2025, there were 154,006 shares issued under the ESPP.
The table below presents the share-based compensation expense included in the Company’s accompanying condensed consolidated statements of operations:
Year Ended
December 31,
2025
2024
2023
Restricted stock awards
$
4,111
$
2,896
$
1,887
Performance stock units
1,005
1,015
155
Employee share purchase plan
334
98
—
Total share-based compensation expense
$
5,450
$
4,009
$
2,042
Under its approved long-term incentive plan, the Company grants share-based awards to its employees. The following table presents a summary of the Company’s unvested restricted stock awards and performance share units granted under the plan:
Restricted stock awards
Performance stock units
Weighted
Weighted
Number
Average
Number
Average
of
Fair Value
of
Fair Value
Shares
Per Share
Shares
Per Share
Nonvested at January 1, 2023
951,885
$
2.91
163,251
$
3.62
Granted
649,934
$
3.50
328,909
$
2.24
Vested
( 754,971 )
$
2.85
( 27,978 )
$
2.26
Forfeited shares
( 8,977 )
$
3.03
( 135,273 )
$
3.91
Nonvested at December 31, 2023
837,871
$
3.42
328,909
$
2.24
Granted
624,737
$
9.16
205,322
$
11.29
Vested
( 432,889 )
$
4.25
—
$
—
Forfeited shares
( 21,487 )
$
6.34
—
$
—
Nonvested at December 31, 2024
1,008,232
$
6.56
534,231
$
5.72
Granted
826,361
$
7.66
293,073
$
7.17
Vested
( 584,612 )
$
5.81
—
$
—
Forfeited shares
( 102,574 )
$
7.16
( 195,017 )
$
5.89
Nonvested at December 31, 2025
1,147,407
$
7.69
632,287
1
$
6.34
(1) A maximum of 1.2 million common shares could be awarded based upon the Company’s achievement of set performance-metrics.
In 2025, the Company granted certain executives a total of 293,073 performance-based units. The performance-based units will potentially vest 100 % if the target is met, with 50 % of the units to be earned based on the achievement of an absolute adjusted EBITDA target, measured in the final year of a three-year performance period and 50 % of the units to be earned based on the achievement of an objective, tiered return on relative total shareholder return, measured over a three-year performance period. The fair value of the grants awarded related to the adjusted EBITDA target was $ 5.89 per share and
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the fair value of the grants awarded related to the relative total shareholder return target was $ 8.45 per share valued using a Monte Carlo simulation model.
In 2024, the Company granted certain executives a total of 205,322 performance-based units. The performance-based units will potentially vest 100 % if the target is met, with 50 % of the units to be earned based on the achievement of an objective, tiered return on invested capital, measured over a three-year performance period and 50 % of the units to be earned based on the achievement of an objective, tiered return on relative total shareholder return, measured over a three-year performance period. The fair value of the grants awarded related to the return on invested capital was $ 8.36 per share and the fair value of the grants awarded related to the relative total shareholder return was $ 14.22 per share, valued using a Monte Carlo simulation.
In 2023, the Company granted certain executives as total of 328,909 performance-based units. The performance based-units will potentially vest 100 % if the target is met, with 75 % of the units to be earned based on the achievement of an objective, tiered return on invested capital, measured over a three-year performance period and 25 % of the units to be earned based on the achievement of an average closing stock price at the end of the three-year performance period. The fair value of the grants awarded related to the return on invested capital was $ 2.65 per share and the fair value of the grants awarded related to achievement of an average closing stock price at the end of the three-year performance period was $ 0.99 per share, valued using a Monte Carlo simulation.
The following table presents the assumptions related to the performance share units granted related to the relative total shareholder return, as indicated in the previous summary table:
2025
2024
2023
Grant-date fair value
$
5.89
$
8.36
$
2.65
Risk-free interest rate
3.86
%
4.34
%
3.83
%
Volatility factor
65.52
%
58.61
%
55.56
%
Contractual term (years)
2.78
2.78
2.76
Stock options
The following table summarizes the stock option activity under the Company’s equity incentive plans:
Weighted
Weighted
Average
Average
Number
Exercise
Contractual
Aggregate
of
Price
Life
Intrinsic
Shares
Per Share
(Years)
Value
Outstanding at January 1, 2023
303,329
$
7.29
Forfeited
( 70,465 )
$
7.74
Outstanding at December 31, 2023
232,864
$
7.15
Exercised
( 136,549 )
$
6.57
Forfeited
( 28,680 )
$
11.35
Outstanding at December 31, 2024
67,635
$
6.56
Exercised
( 15,000 )
$
7.22
Forfeited
( 7,310 )
$
9.03
Outstanding at December 31, 2025
45,325
$
5.95
Vested and expected to vest at December 31, 2025
45,325
$
5.95
1.10
$
181
Exercisable at December 31, 2025
45,325
$
5.95
1.10
$
181
The following table presents a summary of the unrecognized compensation cost, and the related weighted average recognition period associated with unvested awards and units as of December 31, 2025:
Restricted stock awards
Performance stock units
Unrecognized compensation cost
$
6,576
$
1,834
Weighted average period for recognition (years)
2.03
1.64
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The following table presents a summary of the total intrinsic value of options exercised and the total fair value of shares vested as of the year’s presented:
2025
2024
2023
Total intrinsic value of options exercised
$
11
$
233
$
—
Total fair value of shares vested
$
4,606
$
3,107
$
2,407
15. Employee Benefits
All of the Company’s employees except independent contractors, associate divers, the associate tugmasters, residents of Puerto Rico, and employees covered by a collective bargaining agreement, unless the agreement requires the employee to be included under the plan, are eligible to participate in the Company’s 401(k) Retirement Plan (the “Plan”) on the first day of any month following their date of hire. Each participant may contribute between 1 % and 80 % of eligible compensation on a pre-tax basis, Roth after-tax or a combination of pre-tax and Roth, up to the annual IRS limit. The Company matches 100 % on the first 3 % of eligible compensation contributed to the Plan and 50 % on the next 2 % of eligible compensation contributed to the Plan. Participants’ contributions are fully vested at all times. Because the Plan is a safe harbor plan, the money Orion contributes to employees’ accounts in the form of a match, and any related earnings become theirs immediately upon receipt. At its discretion, the Company may make additional matching and profit-sharing contributions. During the years ended December 31, 2025, 2024 and 2023 the Company contributed $ 2.7 million, $ 2.9 million and $ 2.7 million, respectively, in matching contributions.
The Company contributes to several multi-employer defined pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. Risks of participating in these multi-employer plans are different from single-employer plans in the following aspects:
● Assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers;
● If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; and
● If the Company chooses to stop participating in its multi-employer plans, it may be required to pay a withdrawal liability based on the underfunded status of the plan.
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The following table presents the Company’s participation in these plans:
Pension Protection
Expiration
Act ("PPA")
of
Employer
Certified Zone Status
FIP/RP
Collective
Identification
(1)
Status
Contributions (3)
Surcharge
Bargaining
Pension Trust Fund
Number
2025
2024
P/I (2)
2025
2024
2023
Imposed
Agreement
International Union of Operating Engineers - Employers Construction Industry Retirement Plan - Local 302 and 612 Trust Funds
91-6028571
Green
Green
N/A
$
1,755
$
1,182
$
1,340
—
2027
Washington Laborers
91-6022315
Green
Green
N/A
$
30
$
50
$
137
—
2027
SW Carpenters Pension Plan
95-6042875
Green
Green
N/A
$
1,336
$
681
$
1,906
—
2027
Cement Masons & Plasterers Trust Funds
91-6066773
N/A
Green
N/A
$
—
$
128
$
—
—
N/A
Western Conference of Teamsters Pension Trust Fund
91-6145047
N/A
Green
N/A
$
—
$
22
$
46
—
N/A
Oregon Operating Engineers – AGC -IUOE Local 701
93-6022485
Green
N/A
N/A
$
117
$
—
$
—
—
2028
Hawaii Operating Engineers Local 3 Trust Funds
81-3751949
Green
Green
N/A
$
1,610
$
1,706
$
121
—
2029
Hawaii Regional Council of Carpenters
45-3998630
Green
Green
N/A
$
1,611
$
1,542
$
128
—
2029
(1) The most recent PPA zone status available in 2025 and 2024 is for the plan’s year end during 2024 and 2023, respectively. Zone status is based on information received from the plan and is indicative of the plans funding status. Among other factors, plans in the red zone are generally less than 65% funded, plans in the orange zone are less than 80% funded and have an Accumulated Funding Deficiency in the current year or projected into the next six years, plans in the yellow zone are less than 80%funded, and plans in the green zone are at least 80% funded.
(2) The FIP/RP Status P/I column indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending (“P”), or implemented (“I”).
(3) Based on information provided by the plan administrators, the Company’s contributions represented less than 5% of the total contributions to each plan by all participating employers for the plan year(s) for which information is available.
There are currently no plans to withdraw from any of the multi-employer plans in which the Company participates.
16. Commitments and Contingencies
The Company is involved in various legal, audit, and other proceedings that are incidental to the conduct of its business, none of which in the opinion of management will have a material effect on the Company's financial condition, results of operations, or cash flows. Management believes that it has recorded adequate accrued liabilities and believes that it has adequate insurance coverage or has meritorious defenses for these claims and contingencies.
In October 2025, the Company received a sales tax assessment of $ 15 million from the State of Texas covering multiple periods. The Company believes it has meritorious defenses and based on current facts and circumstances does not believe a loss is probable.
17. Segment Information
The Company has determined that it has two reportable segments pursuant to ASC Topic 280, Segment Reporting: marine and concrete, both operating under the Orion brand and logo. The Chief Operating Decision Maker (“CODM)”, identified as the Chief Executive Officer, allocates resources and assesses performance based on these two reportable and operating segments.
In making this determination, management considered both quantitative and qualitative factors under ASC 280-10-50-11, including similarities in products and services, production processes, customer types, distribution methods, and regulatory environments. Although the segments share certain macroeconomic drivers, they are managed separately and have distinct operating results reviewed by the CODM for purposes of resource allocation and performance evaluation.
Each segment has a designated management team responsible for day-to-day operations, and discrete
financial information is produced and evaluated at the segment level.
Segment operating income (loss) is the primary performance measure used by the CODM in assessing performance of the segments. Segment operating income (loss) represents revenues, less direct costs of contract revenues, selling, general, and administrative expenses, and gains or losses on the disposal of assets.
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The CODM reviews segment results inclusive of all expenses directly attributable to the respective segments. Interest expense, income taxes, and other non-operating items are not allocated to the segments. The total of the segment operating income (loss) measures equals the Company’s consolidated operating income (loss); therefore, no reconciling items are required between total segment operating income and consolidated operating income.
Marine segment
Our marine segment provides construction, dredging and specialty services. Construction services include construction, restoration, maintenance, dredging and repair of marine transportation facilities, marine pipelines, bridges and causeways and marine environmental structures. Dredging services generally enhance or preserve the navigability of waterways or the protection of shorelines through the removal or replenishment of soil, sand or rock. Specialty services include design, salvage, demolition, surveying, towing, diving and underwater inspection, excavation and repair.
Concrete segment
Our concrete segment provides turnkey concrete construction services, including concrete surface place and finish, site preparation, layout, forming, and rebar placement for large commercial, structural and other associated business areas.
Segment information for the periods presented is provided as follows:
Year Ended December 31,
2025
2024
2023
Amount
Amount
Amount
Marine
(dollar amounts in thousands)
Contract revenues
$
544,831
$
521,250
$
395,917
Cost of contract revenues
457,725
465,857
355,777
Gross profit
87,106
55,393
40,140
Selling, general and administrative expenses
57,730
54,491
43,307
Gain on disposal of assets, net
( 487 )
( 1,416 )
( 6,837 )
Operating income
$
29,863
$
2,318
$
3,670
Total assets
$
315,474
$
316,199
$
318,684
Property and equipment, net
$
84,332
$
81,342
$
82,215
Depreciation and amortization
$
18,983
$
18,693
$
18,219
Capital expenditures
$
37,579
$
12,187
$
8,375
Concrete
Contract revenues
$
307,429
$
275,144
$
315,861
Cost of contract revenues
288,921
239,377
294,338
Gross profit
18,508
35,767
21,523
Selling, general and administrative expenses
35,741
28,046
26,124
Amortization of intangible assets
427
Gain on disposal of assets, net
( 1,981 )
( 1,482 )
( 1,618 )
Intangible asset impairment loss
6,890
Operating (loss) income
$
( 15,252 )
$
9,203
$
( 10,300 )
Total assets
$
99,178
$
101,118
$
98,209
Property and equipment, net
$
3,878
$
4,756
$
5,619
Depreciation and amortization
$
3,279
$
4,072
$
5,659
Capital expenditures
$
1,283
$
1,904
$
534
Intersegment revenues totaled $ 3.9 million, $ 1.8 million and less than $ 0.1 million for the years ended December 31, 2025, 2024 and 2023, respectively. These primarily relate to labor and equipment services between the marine and concrete segments and are eliminated in consolidation.
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18. Leases
The Company has operating and finance leases for office space, equipment and vehicles. Leases recorded on the balance sheet consists of the following:
December 31,
December 31,
2025
2024
Assets
Operating lease right-of-use assets, net (1)
$
20,397
$
27,101
Financing lease right-of-use assets, net (2)
18,360
25,806
Total assets
$
38,757
$
52,907
Liabilities
Current
Operating
$
4,418
$
7,546
Financing
7,517
10,580
Total current
11,935
18,126
Noncurrent
Operating
24,695
20,837
Financing
5,878
11,346
Total noncurrent
30,573
32,183
Total liabilities
$
42,508
$
50,309
(1) Operating lease right-of-use assets are recorded net of accumulated amortization of $ 33.8 million and $ 25.6 million as of December 31, 2025 and 2024, respectively.
(2) Financing lease right-of-use assets are recorded net of accumulated amortization of $ 24.8 million and $ 17.0 million as of December 31, 2025 and 2024, respectively.
Other information related to lease term and discount rate is as follows:
December 31,
December 31,
2025
2024
Weighted Average Remaining Lease Term (in years)
Operating leases
9.41
8.35
Financing leases
2.09
2.40
Weighted Average Discount Rate
Operating leases
11.50
%
10.66
%
Financing leases
9.02
%
8.74
%
The components of lease expense are as follows:
Year ended
December 31,
2025
2024
2023
Operating lease costs:
Operating lease cost
$
10,993
$
12,581
$
8,311
Short-term lease cost (1)
5,203
4,151
2,044
Financing lease costs:
Interest on lease liabilities
1,585
1,750
1,189
Amortization of right-of-use assets
8,582
7,220
5,034
Total lease cost
$
26,363
$
25,702
$
16,578
(1) Includes expenses related to leases with a lease term of more than one month but less than one year.
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Table of Contents
Supplemental cash flow information related to leases is as follows:
Year ended
December 31,
2025
2024
2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases
$
3,583
$
11,301
$
8,404
Operating cash flows for finance leases
$
1,585
$
1,750
$
1,189
Financing cash flows for finance leases
$
10,409
$
8,929
$
4,791
Non-cash activity:
ROU assets obtained in exchange for new operating lease liabilities
$
2,709
$
14,670
$
18,081
ROU assets obtained in exchange for new financing lease liabilities
$
1,899
$
8,300
$
13,997
Maturities of lease liabilities are summarized as follows:
Operating Leases
Finance Leases
Year ending December 31,
2026
$
7,361
$
8,239
2027
5,797
2,823
2028
4,431
1,497
2029
3,679
2,176
2030
3,643
83
Thereafter
24,948
—
Total future minimum lease payments
49,859
14,818
Less - amount representing interest
20,746
1,423
Present value of future minimum lease payments
29,113
13,395
Less - current lease obligations
4,418
7,517
Long-term lease obligations
$
24,695
$
5,878
19. Subsequent Event
On February 3, 2026, the Company entered into a Securities Purchase Agreement and completed an acquisition of all of the capital stock of J.E. McAmis, Inc., a California corporation, and all of the membership interests in JEM Marine Leasing, LLC, a Washington limited liability company (collectively, the “Acquired Companies”). The Acquired Companies are engaged in the business of providing jetty and breakwater construction, dredging, environmental restoration and rehabilitation, and dam and spillway construction.
The purchase agreement provides that the Company acquired all of the issued and outstanding shares and interests in the Acquired Companies for (a) $ 50.0 million in cash, subject to adjustments pursuant to the purchase agreement, (b) a $ 12.0 million unsecured subordinated five-year promissory note, (c) 182,392 shares of the Company’s common stock, $ 0.01 par value per share, calculated as specified in the purchase agreement, and (d) contingent post-closing cash payments dependent upon project profit realized from specified contracts of the Acquired Companies (the “Contingent Payments”).
The Contingent Payments relate to two different sets of contracts in backlog and in the near-term opportunity pipeline of the Acquired Companies. The Company’s payment obligation with respect to one set of backlog projects (the “First Tranche Projects”) is subject to the relevant projects resulting in realized project profit of at least $ 10.0 million. If the First Tranche Projects result in less than $ 10.0 million of project profit, the Company will not owe any payment. If the project profit for the First Tranche Projects equals or exceeds $ 10.0 million, the Company will pay $ 10.0 million and 40 % of each dollar of project profit in excess of $ 10.0 million realized from the First Tranche Projects. With respect to identified near-term pursuits (the “Second Tranche Projects”), the sellers are entitled to 40 % of each dollar of project profit realized from the Second Tranche Projects. The Company does not have an obligation to make a Contingent Payment until substantial completion of all of the First Tranche Projects or Second Tranche Projects, as applicable.
The cash consideration and related expenses were funded with cash on hand and borrowings of approximately $ 46.9 million under the Company’s credit agreement, dated as of December 23, 2025, with the lenders party thereto and UMB Bank, N.A., as administrative agent and issuing bank. In connection with the acquisition, the Company and the Acquired
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Companies entered into an amendment to the loan documents effective February 3, 2026 pursuant to which the Acquired Companies joined the credit agreement as guarantors and provided collateral in the same manner as the Company’s other subsidiary guarantors.
The promissory note bears interest at an annual rate of 6.0 %, with five equal payments of principal and interest on each anniversary of the closing.
Because the acquisition occurred after the balance sheet date, it represents a nonrecognized subsequent event; accordingly, the accompanying consolidated financial statements have not been adjusted to reflect the acquisition. The Company evaluated subsequent events through March 4, 2026.
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ORION GROUP HOLDINGS, INC.
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
(Dollars in thousands)
Balance at the
Charged to
Balance at the
Beginning of
Revenue, Cost
End of
Description
the Period
or Expense
Deduction
the Period
Year ended December 31, 2023
Allowance for credit losses
$
606
$
( 109 )
$
136
$
361
Deferred tax asset valuation allowance
$
17,557
$
3,238
$
—
$
20,795
Reserve for losses on uncompleted contracts
$
353
$
547
$
347
$
553
Year ended December 31, 2024
Allowance for credit losses
$
361
$
194
$
—
$
555
Deferred tax asset valuation allowance
$
20,795
$
1,275
$
—
$
22,070
Reserve for losses on uncompleted contracts
$
553
$
4
$
552
$
5
Year ended December 31, 2025
Allowance for credit losses
$
555
$
2,906
$
—
$
3,461
Deferred tax asset valuation allowance
$
22,070
$
( 1,854 )
$
—
$
20,216
Reserve for losses on uncompleted contracts
$
5
$
137
$
5
$
137
F-33
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.