Fluor Corporation (FLR) Earnings Call Transcript & Summary

Okay. Good morning. Welcome back. I am Steve Fisher, UBS machinery, engineering, construction, U.S. building materials analyst. Really excited to have management of Fluor with us. We have Joe Brennan, the CFO; and Jason Landkamer, the Head of Investor Relations. We're going to run this as a fireside chat. But of course, if you do have any questions, you can use either the QR code on the tables or as we've done in prior sessions, if you have any questions, just raise your hand, and we will get a microphone to you.

So maybe just to start off here. Very timely, appreciate to have you at our conference, Joe, just after the announcement of your retirement. I've gotten a lot of questions on it over the course of the week. If you want to just kind of give any color on your on announcement.

Yes. Yes, I know. Sure. I think I need to probably just give a little bit of color. My dad worked for the company for 35 years. I've now worked for the company for 34 years, and my son has worked for the company for 5 years. He's got his start, and he's doing something else today. Over the last maybe 10 years, it's been a little bit of a challenge getting through kind of the integrated solution strategy that we had. And as I was brought into this role in August of 2020, my mandate was to fix the balance sheet, kind of restore the financial health of the company, and I think I've been able to achieve that. And it's -- as you recall, when I started, I think in the inner day trading, our stock was trading at about $3 a share, and our market cap was in the low single hundred millions of dollars. And today, when we look back at kind of what we've achieved in terms of the restoration of the balance sheet, I would suggest we probably have a bulletproof balance sheet today. We are -- we've opened the aperture on returning shareholder capital. And the nature of this job is certainly 24/7 when you go through a journey like that. And at this point in time, I would suggest to you my mandate is done, and I want to hand the job over to Mr. Regan. And I'm doing it at this point in my life in terms of -- I just -- I need to step away. I've laid it out for the last 5 years, and I think the results are there. And it's time for kind of a new voice to step in. John -- so everyone understands, John was with me from day 1 on this journey. When I came up to the office to take over this role in the face of, what, 9 months of delayed filings, john was the first gentleman that I met, and we've been arm-in-arm through this journey. So he's going to take over. He's got a lot of experience on more of the pure financial side of it. And I think that's kind of where we're heading. In terms of the capital allocation, we're generating good cash flow again. And how are we going to deploy that in the most accretive way for our shareholders? And I think John is the right guy to do that. And I think what I've been asked to do by the Board and by Mr. Constable, my mandate has been achieved. And I think I'm ready to just kind of move on and take a little break. It's as simple as that.

Well earned, and congratulations and best wishes again on that.

Great. Thank you.

So maybe kind of similar type of discussion, but zooming out a little bit and rewinding really to think about how the industry has evolved over the last 5 to 10 years and how Fluor model has evolved. Maybe you could just talk about sort of the recent evolution of Fluor and where it's headed from a business model perspective as David Constable and you and the rest of the team have kind of really shaped -- made the decisions; as the industry was changing, I would say, like I said, over the last 5 to 10 years, how Fluor management made the decision to have the business model that you are going to go forward with. And so talk about some of that evolution and why that model that you have today is really relevant and the right model for the market today.

Well, what I would suggest to you is the model that we have in play today is the model that had kind of represented the backbone of Fluor for the 110-year history that we've had. And it's a relationship-based model. It's reimbursable in nature. It's more of a partnership with our clients and helping them define what their capital plans are in the future. If I rewind maybe 10 years ago, what the management team was faced with was a changing industry, more risk shift to the EPC contractors. There was a desire from the management team to get further down the value chain, which caused us to get into acquisitions like Stork and, certainly, AMECO and some of our fab yard acquisitions at that point in time. And then we took on a significant amount of risk and opened our profile to a lot of lump sum, hard money contracts. And I got to say that, that has never been Fluor's DNA. Fluor has always been a relationship-based contractor and not a transactional-based contractor. So when David came in, it was -- in building a better future was to get back to that relationship-based model and being a partner to our clients. And as such, we certainly changed our risk aperture. And I think you can see that as we came out of the previous management, we were at 75%, 80% lump sum to 15%, 20% reimbursable. As we look back today, we're at 80% reimbursable to 20% lump sum. And I think that has firmly reestablished that relationship -- partnership relationship with our clients, and I think it served us well. And you can see it not only in, I think, the health of the balance sheet and where we are financially, but also in our backlog. Our backlog has grown significantly over the last 2, 3 years, and we're up above $30 billion at 80% reimbursable. So it's -- that's kind of the journey that we've been on, and we have really stuck to our financial discipline in terms of what we'll onboard into our backlog. And it's given us a lot more assurances in terms of being able to deliver that and deliver to our commitments and to our promises.

That's great. And Fluor, you just talked about relationship model around big project expertise. Often what comes along with that is uncertainty around timing of things. And one of the recent things that came up on the Q3 conference call, the 2026 targets, maybe a little bit of a slippage there. Can you talk a little bit about sort of the drivers of that and how we should think about 2025 in the context of maybe timing on '26 and maybe what you had?

Yes. I think what we're seeing in our Energy Solutions business is more of kind of a reset to a FEED opportunity and a reloading kind of that pipeline. As the markets have changed and the fact that we've got a very good kind of platform, a very diversified platform, Urban Solutions has presented some very short-term, near-term opportunities relative to our EPC and EPCM activities. And as such, you've seen our Urban Solutions segment grow to represent $20 billion of our $30-plus billion in backlog. And I think also as a function of that, we've also identified and recognized that there's probably some additional headroom in terms of what we thought to be a very explosive growth opportunity within Urban Solutions to be even greater than maybe what we had anticipated as we see the data centers come online and a slate of opportunities, that, that has the ability and the potential to even grow that number significantly higher. So that's been a big play, and I think we've done a very good job in being able to identify where that demand-driven growth is. And I think we've structured the company to capture that. And we are in the process also of driving the Energy Solutions platform to kind of be the second leg of that EPC, EPCM opportunity as we complete -- or as we execute and complete a number of these FEED opportunities that we're currently executing.

Great. Yes, that was going to be my next question. We were just kind of talking about where the growth leadership is going to come from. So it sounds like Urban first, then Energy and then Missions, but you have some big programs in Missions as well. So how do you sort of rank?

Well, I think Urban will -- in the near term, when I say near term, 18 -- 12 to 18 months, you'll see kind of the bookings flow through Urban Solutions that drive the top line growth in the company. And Energy Solutions will drive smaller revenue numbers through the FEED activity but much higher margins. And that'll be kind of the baseline as we move into the 18-, 24-month time frame where you'll see some of those FEEDs convert to EPC. The Mission Solutions side of the business [ meet ] is -- continues to maintain a robust opportunity slate. It is reasonably consistent, and it has been over the course of the last few years. They are big chunky awards when they do come in, and we do have some very good opportunity in '25. But we don't see really a major shift in the Mission Solutions business as it's kind of played out over the last 3 or 4 years. It's a good opportunity slate. We're very well positioned across all the agencies, and we would expect that to continue.

Great. So maybe we can kind of dig in a little bit on the Urban side of things. Like you said, it's a big piece of your backlog today. A number of different components to it. A lot of exciting things going on there. Can you maybe just break down for us how you see this -- that segment really evolving over the next couple of years?

Sure. I'll let Jason jump in here.

I'll start with Advanced Technologies, Life Sciences. So when you look at that end market -- and we've been talking with investors about the opportunity slate there and our excitement around that for the better part of the last 1.5 years or so. And we're still very excited as we go forward into '25 and '26. I would maybe start with Life Sciences, right? We had a great opportunity earlier this year for a project for Eli Lilly. They -- we indicated on our call last month that we're already getting some of the engineering for the next phase of that project. And so we continue to execute very well in terms of that Life Sciences space, and there's other opportunities that will be coming forth as we go through this kind of time frame that Joe just discussed. When you look at the data center side, we've talked about the approach that we're taking to that market in relation to let's get involved in what we've [ forethought ] kind of an MSA type of an agreement, right? So it's a little bit more of a standardized process, but that allows us to be under the tent to say, okay, here's opportunities that we could bid on as opposed to transactional. Again, I kind of go back to Joe's point, we're best when it's a relationship. And it's not one location here and then no relation different location somewhere else, and it's a little bit disparate. So I think you're going to see and hear us talk more about that as we get through 2025 in terms of the size and what the opportunity set can really be there. And then on the semiconductor side, there's still a fair bit of interest there. You've seen some recent announcements even just a couple of weeks ago about additional CHIPS Act funding that continues to progress in the marketplace. And I think we're well positioned to support clients in that space as well. So you've got -- so I just went through 3 different unrelated kind of markets that are all under one business line that has probably dominated 80% or 90% financial media.

Let's include mining in that.

Well, and that's one of my next pivot was going to be, too, is on the mining side, which, Steve, as you know, we have a very strong presence there, really great relationships with our clients. And we've had some nice wins this year. We have some additional ones right on the near-term horizon. You saw that BHP awarded us Minera Escondida. So it's great copper concentrator project. So full release of that will be forthcoming, but it's ours. That's a great kind of longer-term view of the mining space. I also think what's interesting there is the potential for the rare earth refining materials. We got -- we recently got an expansion for a rare earth refining project in Australia. But also in the lithium space. There are some near-term opportunities with clients in the United States because they've hit their final permit approvals. So we're front and center with all of those key clients, and I think that's going to continue to grow and expand. Maybe just to cover off the rest of Urban Solutions, Steve, is our Infrastructure group, which for -- as many of you know, right, we had some near-term execution challenges over the past few years in terms of the portfolio of projects there. But if you look at how the Infrastructure group has refocused and we're really more exposing ourselves to opportunity going forward in a much more simplified manner. So when you look at our -- one of our largest clients there, which is TxDOT, we're looking at opportunities within the state of Texas, road and bridge projects, where we -- and with a client that we have a great relationship with. So as we close out the final legacy projects in that Infrastructure space, there's an opportunity, and we are doing -- in '24, we did, of adding higher quality work into that space. So it's an opportunity for us, but it's not going to look as strong of a growth relative to what we see in the ATLS and Mining space in Urban.

Great. Maybe we can dig into data centers a little bit more since that's a very topical subject, and it sounds like you guys have some really interesting things ahead. Kind of it sounds like we're talking about relationship-based type opportunities. There's not one-offs here. Can you just talk about how you're -- and you've been working on data centers already. So maybe you can talk about how that's -- what you're doing now and what it might evolve into and how that might flow through the backlog and timing.

Yes. Our near-term portfolio or CV of experience there is we've executed a handful of data centers primarily in Europe, and we had one that we're executing, I think, might be finishing up right now in India. Now those are not the hyperscale data centers, which clearly has captured Wall Street's eye in terms of is this the direction, where this is going, help me understand scale and size and power needs and how the market is going to pivot to that. What I would say broadly is the hyperscale, the normal traditional data center market is actually really interesting for us and where we've executed projects in the past, whether it be modularized delivery of those data centers. We have a very competent model there. So when you pivot to the hyperscale and the opportunities there, it makes it an even more interesting opportunity for Fluor. This allows us to bring to bear a lot of key characteristics that I think are unique to really Fluor and some of the top E&C firms in the world. And what I mean by that is -- and maybe just as a bit of a side note here, I think we were on this fireside chat here over 2 years ago, and we were asked why are we still engaged in the construction space, why do we not just go back to an engineering, consulting model. And Joe and I, 2 years ago, had a very full thread of defense on why it's important to have construction. I think where -- and where you're seeing now is clients are coming to Fluor, and they're saying, we need a company that can execute in the field, but it's also about time to market, whether that be the hyperscale data center, Steve, or whether it's in the Life Sciences space or the semiconductor space. But one thing that's not talked about in the construction piece, it's the silent part, but it's equally important, and that's supply chain. So when you think about the ability to procure at scale, the materials required for any of these types of facilities and then also have that cracked labor execution strategy and acumen in the field backed by our home office engineers around the world, it becomes a solution for the client to where they say, "Okay, this helps us get clarity on how to go forward with this."

And I think there's a significantly heavier reliance on an EPC contractor in that space because of maybe the maturity level that those clients have relative to EPC contracts and that type of capital investment. And if it's underpinned by time to market, being able to pull the thread on the FEED all the way through start-up commissioning and handover in a singular approach, I think, is a pretty attractive value proposition for the client. And we didn't talk about it and you'll probably get into it, but offering power solutions, either through the thermal side or through the nuclear side, we have got our fingers in all of that. So we do have a pretty compelling, I think, value proposition that does support a time-to-market investment strategy for them.

I do think it makes sense to talk about Power as part of the discussion, so we'll get to that. Maybe walk us through -- sticking with data centers a little longer. Maybe walk us through the progression of what we should expect over the next 6 to 12 months? Are there going to be big things coming into backlog? Is this sort of multiple programs, multiple customers? How do we think about how this might progress for you from here?

Yes. We haven't disclosed the client list yet in that space, but we're working at finalizing some of these agreements. And so what I would say as you look forward to '25 and really beyond, I have to always say and beyond, right, is I think there's opportunities, not in kind of the more medium scale kind of co-location data centers, but then also the hyperscale space. So I think that we're tracking some prospects right now that's towards that, I think, the middle of next year.

Mid next year.

Yes. And so I would say kind of stay tuned in that regard. But our approach to this market, Steve, is again, I go back to it's not transactional. It's one to where we're getting the teams and the agreements in place to where we can have exposure to what could be an extremely long cycle of build-out because this really is transformational in terms of how data centers are leveraged, right? It's not just a place where you're storing files. It's the NVIDIA servers and the AI chips that are kind of coming into this. And it adds some interesting engineering complexities, right, in terms of just the size and scale alone. But then you think about the energy point, which Joe mentioned. But with energy comes cooling and huge cooling demand. And we had indicated a little bit of that on our earnings call last month about we have a great team of engineers at Fluor that are really taking a look at how can we add our knowledge from even the energy solutions space, the hydrocarbon processing space and deploy that knowledge of heat transfer, how does that comport to data centers themselves. So I think it makes a pretty interesting dynamic in terms of not only the timing of some of these awards, but the attractiveness of bringing Fluor onboard to help with that.

And I was just going to add, David made the conscious decision -- Mr. Constable made the conscious decision about 18 months ago to bring in someone into the ATLS leadership that had very big EPC experience.and came off the TCO project, which is a $40-plus billion program and bringing that type of insight and attitude into how we were going to attack ATLS moving forward, which is a conscious decision. They had been more on the O&M side and support side, and we saw the opportunity to grow that into a much more significant delivery model. And the decision was made to bring that individual in, and it's fundamentally changed that organization in terms of what they can capture and what they are capturing. So it was something that we had really identified quite a while ago, and David did a very good job of kind of pivoting very quickly to it.

Interesting. And maybe as a kind of we get very U.S.-focus here being U.S.-centric, but I'm imagining there's more to it than this as you have these sort of alliance and bigger-picture things. How should we think about international versus domestic on the data center opportunity? Is this a global reach that you'll be kind of focused on?

We've executed data centers across a number of countries. So I would still say that the story for this next wave is both domestic and international. I think in terms of the opportunities that are in front of us in the near term or relatively near term, it probably starts on the domestic side. And then -- but we clearly have a structure in place to support efforts and opportunities internationally because I do think that one of the problems that our clients are needing to solve is, where is the power coming from, right? And so you can't just keep that localized per se to say just the United States or North America. You've got to look at where do these facilities need to be built to support their client bases.

That's certainly a global footprint.

Yes.

Okay. Well, I think that's a good pivot point to talk about the Power angle on this. And Fluor has certainly had a long-running capability in the power area very broadly, and so maybe what seems to be most topical now is nuclear. So maybe we can talk a little bit about some of your recent nuclear experience. You announced an award recently. Can you talk about really kind of how nuclear you see developing for you from here?

Yes. No, it's actually become a very significant part of our kind of a thought process moving forward. We're currently working on conventional nuclear with turnabout on the FEED there as we look to convert and support them on their EPCM activities going forward. We're currently supporting SMR with RoPower. And historically, we have a significant amount of experience in the thermal space, be it single or combined cycle. We believe we'll be able to deploy that across, certainly, this new power demand that we see burgeoning. And as we look at it relative to how it would support the data center energize energization, if you will, we feel like there's a very good synergy there. And there's a very good value proposition that we can deploy relative to time to market as it relates to the data center, but also maybe a carbon-free power solution. So we think there's a really good value proposition there as it supports their time-to-market opportunities, and those discussions are ongoing. And we'll continue to certainly support and push that.

Great. So maybe just taking that a step further here. You mentioned programs in Europe. How do we think about, again, U.S. versus international opportunities there and sort of the timing of revenue generation? Obviously, nuclear often has very long lead times till actual revenue generation. So what's the sort of domestic versus international? And when could we start to see real revenue opportunities?

Yes. I think what's interesting right now is I think it was maybe 2 days ago, right, I think Meta came out with an RFP for a tremendous amount of nuclear energy. And while I can't comment on that specifically, I'll comment that, that is a great indicator of the appetite really increasing in the United States for that 0-carbon nuclear power generated source. You've seen a number of technology companies that say they're aligned with perhaps one nuclear technology versus another. And what -- our takeaway from this is the nuclear industry is getting the attention that it deserves for the solution it provides. And so now you're starting to see the capital start to flow to this. You're starting to see the interest as a solution starting to flow to this. And we feel -- I think we're very proud of the position that NuScale has right now, and what I mean by that is it's the only NRC-approved design. They have -- they're in process of getting their approval for the upgrade in process. But then the other nuclear technologies that have been covered from time to time in the media, they're still in the -- what they call by the NRC, the pre-application phase.

Sure.

And as we know as somebody that went through the approval process for NuScale as -- when they were part of us, that's a multiyear process. And so when we think about our ability and, really, NuScale's ability and Fluor's ability to participate in that on getting time to market -- if you think about data centers that will be powered by nuclear as you get towards the end of this decade, and I'm excluding some of the restart opportunities that have been in the news, of course, it makes it really interesting in terms of that domestic component because there is a solution. It's a U.S.-based solution with NRC approval. And you've had, you've seen in terms of interest from the DOE, support across multiple administrations. So this is something to where it's not the administration today versus the administration in January. No. There's been pretty strong support on that. So what I would say is we feel like not only NuScale is in great position for that, but we're in a great position to be able to participate and support them in those commercialization efforts.

Yes, sure. Great. Well, maybe to just continue to build on the NuScale discussion. Obviously, you're still a very large holder of the -- of that company. Anything you can talk about in this forum on...

I'll reiterate what we said on the Q3 earnings call. We will be -- we'll locking up some value here in the beginning of 2025. Our intention is to do something that's accretive to both Fluor and SMR shareholders, and we understand that time is of the essence. And so we would expect, as we get into the Q4 earnings call, that we'll have a much more fulsome discussion around on what that is.

Okay. That sounds good. All right. Maybe shifting over, not too far, staying on the power topic, but you mentioned gas-fired. Do you see opportunities for Fluor to be involved in gas-fired build-out?

I do. I think we're in kind of the initial stages internally to figure out how to plug that into -- there's a gap here relative to energizing the data center market in the short term versus what it's going to look like in the long term. And I think there will be opportunity in there, and we are reorganized in order to be a little bit more forward-facing to that. Internally, we're pulling in our Advanced Technology and our Power group together to wrap that value proposition and introduce it into the market. And I think we're in the process of developing that, and I would suggest that'll play out positively as we move forward, if time to market truly is driving some of these investments, so.

Actually, I wanted to go back to one last question on the nuclear side of things. So we get this question a lot in terms of just the size of individual opportunities around nuclear. Obviously, if we're talking about large scale, those are going to be very, very big. I don't know if those -- if your scope would be in the multibillions. And if we're thinking about if it's in SMR, is that sort of the same scale type of [indiscernible]?

Yes, it is. I would suggest there'll be a lot of FEED opportunities to help develop and support FID decisions moving forward. So some of these opportunities like the RoPower opportunity is a very substantial FEED. It's good work for us. But as these things convert into EPC, EPCM opportunities, they will be multibillion dollars in nature, for sure.

Okay. Great. Wanted to just maybe to round out the discussion in Urban Solutions around Mining. You mentioned a number of opportunities and things that you have going on. It's interesting, I was out at MINExpo back in the end of September. And some of the discussion back then was commodity prices are in a nice area, but there's still restraint on some investments due to permitting environment. And the discussion was if we get changes in administration, not only in the U.S. but in certain other places, we could see sort of an unleashing of opportunities. Do you see or hearing anything more about opportunities that might come out of that?

Well, here's -- I'll answer it. Maybe you can get more specifically. Fundamentally, we think the regulatory environment will be more favorable to business moving forward. That's what we believe. So I think that will create a broader opportunity set. And I think projects that have been hung up in the regulatory process, I think, will have cleaner and clearer pathways to get to FID at the end of the day and maybe particular on opportunities.

Yes. When we look at across the commodities that Fluor has historically been focused on, and I look at copper, historically, of course, iron ore, which we talked about a debottlenecking opportunity that'll be coming fairly shortly. Lithium and rare earth is also kind of another interesting development. And I think when I go back and think about copper, right, there's been a fair bit of kind of M&A activity over the past 12 months or so, and a lot of that was really acquisition of copper delivery, right, amongst a handful of companies. And I think as that cycle comes to a close, then the next logical progression would be engaging Fluor to help them develop new mine -- copper mine opportunities. So yes, to Joe's point on a regulatory environment, whether that be in the United States, where we typically don't do mining work, and I would say our near-term opportunities in the U.S. is probably more on the lithium side. But when you look at our presence in South America, Australia, other key regions, yes, there's some great potential there to start that process again and really lean into the commodity cycle. I always have to kind of remind our shareholder base, Steve, that whether you're talking about copper or crude oil -- WTI prices, right, our clients don't make decisions on that spot price, right? They're looking at the forward curve, and then they're even looking beyond the curve to say, okay, we know internally what our economics are for Project X, how does Fluor fit into this? And how is this -- what range of prices will this facility operate in for the next 10, 20, 30?

And I think our clients in that space would be looking at kind of the future landscape favorably in terms of maybe the regulatory, how they believe they'll be able to get to FID on these projects. And I think there's probably a bit more optimism relative to some of those things going forward.

Great. Want to get into cash, capital allocation, but maybe we'll pause here. And see if anyone would like to ask a question again to either use the QR code or raise your hand if anyone would like to ask any question. Please, we have one here.

Can you please talk about just Shell's plans for Phase 2 as we think about LNG Canada? And I know that's been a source of revenues that's coming off. How do we think about that as we move out to '26 as well -- '25, '26?

Yes. I -- listen, I think Shell is continuing to work through with their consortium partners what that investment looks like. My understanding has been that the economics are significantly improved with Phase 2 onboard. There are 4 other partners with Shell, and I think they're working their way through their internal discussions in terms -- we continue to be engaged with the consortium. And I think at this point, we'll kind of let it play out. I would suspect by the end of this year -- or excuse me, 2025, we'll have a better understanding of what it's going to look like. And if there is an award or we're able to participate in Phase 2, it'd be an early 2026 opportunity and award. But we continue to work our way through those conversations, and I think the discussions have been very positive. But it's a big decision for them. And we understand with 4 other partners, that there are discussions that need to occur, and we're there to support and serve. And certainly, I would suggest that what we've done on Phase 1 and our knowledge of the region and our knowledge of some of the sensitivities and the cultural sensitivities there are helpful, and we'll see how this plays out. But we feel positive about what we've done on Phase 1, and we think that should translate into some very good open and opportunistic conversations with the consortium going forward.

Anybody else? Okay. Maybe we can round out the last few minutes here with discussion on cash flow, capital allocation. Can you talk, Joe, a little bit about cash flow and how to think about where we are in terms of what's the normalized level of cash flow conversion, however way you want to frame it in terms of EBITDA or net income? How do you see this for the next couple of years?

Yes. I -- listen, when we started this year, Jason and I plugged into the -- I think the Q4 script for 2024, this is going to be the year of cash. We started out with a $350 million OCF guide. We're at $700 million today for 2024. And I would suggest to you that we have a significantly better line of sight in terms of what our cash generation is going into 2025. And I would suggest to you that as we go through the operating plan, we'll nail this down a little bit tighter. But we would suggest that just an EBITDA-OCF conversion in the 65% to 75% range. I think we're going to get back to a much more normalized discussion around cash as we move forward.

Okay. And in terms of allocation, you announced on a recent call your authorization of buybacks from -- I think it was 10 million to 30 million. Can you just talk about how you see that being executed or any kind of planned communication that you have around that? Is it too early to say exactly what you're going to do?

No. I -- what I will say is the 30 million shares that we've opened the aperture on relative to share repos is something that we'll look at over the planning cycle. But what we are going to do in the February call, we're going to lay it out on an annualized basis, and we'll do it programmatically within the year. And then as we move into '25 or '26, we'll talk about what we're going to do that year. But that 30 million shares is really over the life of the cycle. But we will give very clear indications of what it looks like for the upcoming year, at least at a minimum, right?

And one finer point here, going back to NuScale. You mentioned earlier in the discussion about locking up some value. I think you said your capital allocation plans assume will be exclusive of anything that...

Absolutely. In terms of what we're doing with the 30 million shares, that is off the strength of the business and the recovery that we've achieved to date. Anything that comes out of the activities that we've discussed around NuScale will be separate and will be communicated at that point in time.

Okay. And then lastly, multiyear targets. Should we anticipate, at your upcoming earnings quarter, there'll be sort of another longer-term framework to talk about from an EBITDA perspective? Or how should we set our expectations around that kind of communication?

Yes. I think that's something that we're going to be looking at now. Like I said, we have operating plan reviews coming up throughout the month of December. And as we look at the next strategic operating plan, I think it's going to be more helpful for our investors to talk about what's observable in the market. And what I mean by that is, I would expect, Steve, that we can give guidance in terms of how we think about, for example, the cash flow conversion rate, like Joe talked about. A metric that we've been disclosing in the last couple of earnings calls is what is the margin on the services piece of our business, right, because I think that's fundamentally a key way to view how the efficiency of our model because it strips that -- that strips out the conversation on the impact of client furnished materials, right? So I would expect to be able to talk in a more robust manner in terms of those long-term trends and perhaps less so in terms of here is an EBITDA or EPS range 4 years from now. That's -- I think that's the direction that we're going towards.

Okay. Got it. Terrific. Well, we're out of time. I want to thank you so much for being here, really appreciate the exciting times, and we will wrap it there. Thank you.

Thanks, Steve.

Thanks, Steve.