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SEC filingCenturi delivered strong top-line growth and gross margin expansion in Q1 FY2026, with revenue up 31.5% and gross profit up 75.9%, though operating losses narrowed only modestly as the company continues to absorb costs from MSA ramp-up and project execution variability.
Operating income improved to -$4.7M from -$12.7M year-over-year, a 62.7% reduction in loss magnitude. Management attributes part of this improvement to progress on a new master service agreement (MSA), noting that margins on this contract improved throughout the quarter and are expected to continue improving over the fiscal year. The continued ramp-up phase — during which productivity levels were below normal in the first half of the quarter — remains a headwind, but its impact is diminishing. This dynamic explains why gross profit expanded significantly while operating income remained negative: overhead and startup costs associated with scaling operations persist even as direct project margins improve.
Net cash used in operating activities totaled -$35.0M, reversing $16.7M of cash generation in Q1 FY2025. This shift reflects working capital timing: accounts receivable and contract assets increased in connection with large bid projects, while accounts payable and accrued expenses declined from elevated year-end balances. As management notes, working capital is primarily affected by changes in these balance sheet items, which themselves correlate closely with revenue and related cost recognition patterns. Capital expenditures of $20.2M were slightly lower than the prior year’s $24.4M, supporting ongoing field capacity needs without signaling accelerated growth investment.
The Securitization Facility had no unused capacity as of March 29, 2026 — a fact confirmed in both the current and prior quarter-end. While the facility’s full draw reflects active liquidity management, no dollar amount is disclosed in the authoritative financial packet, so no figure is stated. This underscores reliance on committed financing tools to support operations during periods of working capital outflow, particularly when revenue growth accelerates faster than collections.