Overview

Perini Corporation is a leading construction services company, based on revenues, as ranked by Engineering News-Record, offering diversified general contracting, construction management and design-build services to private clients and public agencies throughout the world. We have provided construction services since 1894 and have established a strong reputation within our markets for executing large, complex projects on time and within budget while adhering to strict quality control measures. We offer general contracting, pre-construction planning and comprehensive project management services, including the planning and scheduling of the manpower, equipment, materials and subcontractors required for a project. We also offer self-performed construction services including site work, concrete forming and placement, steel erection and electrical and mechanical, plumbing and HVAC.

Our business is conducted through three segments: building, civil, and management services. Our building segment focuses on large, complex projects in the hospitality and gaming, municipal offices, sports and entertainment, educational, transportation, corrections, healthcare, biotech, pharmaceutical and high-tech markets, and electrical and mechanical, plumbing and HVAC services as a subcontractor to the Company and other general contractors. Our civil segment specializes in public works construction, primarily in the western, northeastern and mid-Atlantic United States, including the repair, replacement and reconstruction of the public infrastructure such as highways, bridges, mass transit systems and wastewater treatment facilities. Our management services segment, including the recently acquired Tutor-Saliba operation in Guam, provides diversified construction, design-build and maintenance services to the U.S. military and government agencies, as well as to surety companies and multi-national corporations in the United States and overseas.

Significant Accounting Policies

Our significant accounting policies are described in Note 1 of Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2008. Our critical accounting policies are also identified and discussed in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2008. We have made no significant changes to these policies during the first quarter of 2009, except as noted below.

In December 2007, the Financial Accounting Standards Board ("FASB") issued SFAS No. 141(R), "Business Combinations," ("SFAS No. 141(R)"). SFAS No. 141(R) establishes principles and requirements for how an acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. SFAS No. 141(R) also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. SFAS No. 141(R) is effective for us beginning January 1, 2009 and we applied the provisions of SFAS No. 141(R) to an acquisition we completed on January 15, 2009 (see Note 3(a)).

In February 2008, the FASB issued FASB Staff Position No. SFAS 157-2, "Effective Date of FASB Statement No. 157," which amends SFAS No. 157 by delaying its effective date by one year for non-financial assets and non-financial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Therefore, the application of SFAS No. 157 relating to our non-financial assets and non-financial liabilities will be adopted prospectively beginning January 1, 2009. See Note 5, "Fair Value Measurements" for additional information.

In December 2008, the FASB issued FASB Staff Position ("FSP") FAS 132(R)-1, "Employers' Disclosures about Postretirement Benefit Plan Assets" ("FSP
132(R)-1"), which requires employers to disclose information about fair value measurements of plan assets that are similar to the disclosures about fair

value measurements required by SFAS No. 157, "Fair Value Measurements." FSP
132(R)-1 will become effective for our annual financial statements for 2009. Since FSP 132(R)-1 only requires enhanced disclosures, the adoption of FSP
132(R)-1 will not have an impact on our financial statements.

In April 2009, the FASB issued FSP FAS 157-4, "Determining Fair Value when the Volume and Level of Activity for the Asset or Liability have Significantly Decreased and Identifying Transactions that are not Orderly" ("FSP 157-4"), which is effective for us for the quarterly period beginning April 1, 2009. FSP 157-4 affirms that the objective of fair value when the market for an asset is not active is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. FSP 157-4 provides guidance for estimating fair value when the volume and level of market activity for an asset or liability have significantly decreased and determining whether a transaction was orderly. FSP 157-4 applies to all fair value measurements when appropriate. We plan to adopt the provisions of FSP 157-4 during the second quarter of 2009, but we do not believe that this guidance will have a significant impact on our financial position, cash flows, or disclosures.

In April 2009, the FASB issued FSP FAS 115-2 and FAS 124-2, "Recognition and Presentation of Other-Than-Temporary Impairments" ("FSP 115-2"), which is effective for us for the quarterly period beginning April 1, 2009. FSP 115-2 amends existing guidance for determining whether an other than temporary impairment of debt securities has occurred. Among other changes, the FASB replaced the existing requirement that an entity's management assert it has both the intent and ability to hold an impaired security until recovery with a requirement that management assert (a) it does not have the intent to sell the security, and (b) it is more likely than not it will not have to sell the security before recovery of its cost basis. We have not determined the impact the adoption of FSP 115-2 may have on our financial statements.

In April 2009, the FASB issued FSP FAS 107-1 and APB 28-1, "Interim Disclosures about Fair Value of Financial Instruments" ("FSP 107-1"), which is effective for us for the quarterly period beginning April 1, 2009. FSP 107-1 requires an entity to provide the annual disclosures required by SFAS No. 107, "Disclosures about Fair Value of Financial Instruments," in its interim financial statements. We plan to adopt the provisions of FSP 107-1 and provide the additional disclosure requirements for the second quarter of 2009.

Recent Developments

Acquisition of Keating Building Corporation

On January 15, 2009, we completed our acquisition of Daniel J. Keating Construction Company, d/b/a Keating Building Corporation ("Keating"), a Philadelphia-based privately held construction, construction management and design-build company. Under the terms of the transaction, we acquired 100% of Keating's common stock for total consideration of $51.1 million, which includes amounts paid at closing and additional consideration that may become payable under the terms of the agreement. Keating is licensed to provide construction services in a number of states, mostly in the mid-Atlantic and northeast regions of the United States. We believe that the acquisition of Keating is a strong strategic fit which will enable us to expand our building construction market presence in the eastern half of the United States, including the important northeast and mid-Atlantic regions, and to realize significant synergies from the acquisition by deploying Keating's resources in the regional private non-residential and public works building markets in the eastern United States. The results of operations for Keating are included in our financial statements for the first quarter of 2009.

Amended Credit Agreement

Effective September 8, 2008, we entered into a Third Amended and Restated Credit Agreement (the "Credit Agreement") with Bank of America, as Agent, which allows us to borrow up to $155 million on a

revolving credit basis (the "Revolving Facility"), with a $50 million sublimit for letters of credit, and an additional $111.7 million under a supplementary facility (the "Supplementary Facility") to the extent that the $155 million base facility has been fully drawn. The total amount available to borrow under the Supplementary Facility reduces upon the sale of all or any portion of the $111.7 million face value of auction rate securities held in our investment portfolio as of September 8, 2008. Subsequent to September 8, 2008, we have sold auction rate securities with a face value in the amount of $2.4 million. This Supplementary Facility provides us with access to a source of liquidity should the need arise. On February 23, 2009, the Credit Agreement was amended, effective from December 31, 2008, to modify certain financial covenants to accommodate the impact of a $224.5 million impairment charge recorded in 2008 and to extend the maturity date of the Supplementary Facility to December 31, 2010. The termination date of the Revolving Facility is February 22, 2012.

Executive Appointments

On March 23, 2009, we announced the following executive appointments.

• Robert Band will continue to serve as President of Perini Corporation. In addition, he will assume the title of CEO of the Management Services Group, which includes Perini Management Services, Inc., where he has been President since 1996.

• Kenneth Burk will continue to serve as Chief Financial Officer and will assume the title of Executive Vice President, Chief Financial Officer. He will also be responsible for Human Resources, Information Systems and Investor Relations.

• James ("Jack") Frost as Executive Vice President and CEO of Perini's Civil Group. Frost, who joined Tutor-Saliba in 1988, was most recently Executive Vice President and Chief Operating Officer of Tutor-Saliba. In his new position, all civil operations of Perini will report to him, including Tutor-Saliba, Perini Civil Construction, Cherry Hill Construction and Black Construction.

• Mark Caspers as Executive Vice President and CEO of Perini's Building Group. He was most recently President and Chief Operating Officer of Perini Building Company. All of Perini's building companies will report to Caspers including Perini Building Company, Rudolph & Sletten, Inc., Keating and James A. Cummings, Inc.

• William Sparks as Executive Vice President, Treasurer and Corporate Secretary of Perini Corporation. Sparks joined Tutor-Saliba Corporation in 1995 as Senior Vice President and Chief Financial Officer. He will also assume responsibilities for Risk Management for Perini.

• Steven Meilicke as Vice President, Corporate Controller. He also serves as Perini's principal accounting officer. Prior to joining Perini in January 2009, he was Finance Manager for a division of General Electric's real estate group in California; and previously was Senior Audit Manager for Deloitte & Touche's Real Estate and Construction Group.

Backlog of $5.8 Billion

Our backlog of uncompleted construction work at March 31, 2009 was approximately $5.8 billion, as compared to the $6.7 billion backlog reported at December 31, 2008. The March 31, 2009 backlog includes approximately $0.5 billion added in the first quarter of 2009, presented as "New Business Awarded" in the table below, due to the acquisition of Keating. The overall decrease in our backlog during 2009 reflects the normal completion of work under contract for the period and a reduced level of new work acquired during this quarter as a result of the challenging economic environment, which has caused some customers to delay and/or reduce in scope certain construction projects.

                     Backlog at     New Business     Revenue       Backlog at
                    Dec. 31, 2008     Awarded      Recognized    March 31, 2009
                                           (in millions)
Building            $   5,732.0     $     663.5    $  1,342.9    $     5,052.6
Civil               528.0           13.4           89.4          452.0

Results of Operations

Comparison of the First Quarter of 2009 with the First Quarter of 2008

Revenues increased by $262.0 million to $1,518.3 million, gross profit increased by $40.3 million, income from construction operations increased by $23.6 million, and net income increased by $13.8 million (or 54.8%) to $39.0 million in 2009. While a portion of these increases are attributable to the additions of Tutor-Saliba and Keating, the strong performance in the first quarter of 2009 reflects improved profit contributions in all of our segments - building, civil and management services. Basic earnings per common share were $0.80 for the first quarter of 2009, compared to $0.93 for the first quarter of 2008. Diluted earnings per common share were $0.80 for the first quarter of 2009, compared to $0.91 for the first quarter of 2008.

                            Revenues for the
                     Three Months Ended March 31,     Increase      %
                        2009             2008        (Decrease)   Change
                                   (in millions)
Building            $   1,342.9      $    1,163.0    $  179.9      15.5%
Civil               89.4             60.1            29.3          48.8%

Overall revenues increased by $262.0 million (or 20.9%), from $1,256.3 million in 2008 to $1,518.3 million in 2009. This increase was due primarily to an increase in building construction revenues of $179.9 million (or 15.5%), from $1,163.0 million in 2008 to $1,342.9 million in 2009, due primarily to an increase in revenues as a result of the merger with Tutor-Saliba in September 2008. In addition, the acquisition of Keating in January 2009 resulted in an increase in building construction revenues compared to 2008. Civil construction revenues increased by $29.3 million (or 48.8%), from $60.1 million in 2008 to $89.4 million in 2009, due primarily to an increase in revenues as a result of the merger with Tutor-Saliba. Management services revenues increased by $52.8 million (or 159.0%), from $33.2 million in 2008 to $86.0 million in 2009, due primarily to an increase in revenues as a result of the merger with Tutor-Saliba as well as an increased volume of work in Iraq and Guam.

                         Income from Construction
                           Operations for the           Increase
                      Three Months Ended March 31,     (Decrease)     %
                        2009              2008         In Income    Change
                                    (in millions)
Building            $    43.2        $      34.8       $    8.4      24.1%
Civil               12.7             2.8               9.9          353.6%
Management Services 15.7             6.4               9.3          145.3%
Subtotal            $    71.6        $      44.0       $   27.6      62.7%

Less: Corporate     (9.0)            (5.0)             (4.0)         80.0%
Total               $    62.6        $      39.0       $   23.6      60.5%

Income from construction operations (excluding corporate) increased by $27.6 million (or 62.7%), from $44.0 million in 2008 to $71.6 million in 2009. Building construction income from operations increased by $8.4 million (or 24.1%), from $34.8 million in 2008 to $43.2 million in 2009, due primarily to the increase in revenues discussed above. Building construction operations experienced an improvement in operating margin in 2009 due primarily to profit increases recognized based on substantial completion of certain projects in Las Vegas. Civil construction income from operations increased by $9.9 million (or 353.6%), from $2.8 million in 2008 to $12.7 million in 2009, due primarily to profit increases recognized on a wastewater treatment project in metropolitan New York and bridge projects in California and New Jersey as these projects reached substantial completion. Management services income from operations increased by $9.3 million (or 145.3%), from $6.4 million in 2008 to $15.7 million in 2009, due primarily to the increased revenues discussed above and continued favorable performance on overhead coverage system projects in Iraq. Overall income from construction operations was unfavorably impacted by a $4.0 million increase in corporate general and administrative expenses, from $5.0 million in 2008 to $9.0 million in 2009, due primarily to expenses related to the acquisition and integration of Tutor-Saliba.

Other income decreased by $0.2 million, from $1.5 million in 2008 to $1.3 million in 2009. Recognition of a $2.6 million loss due to the adjustment of certain of our investments in auction rate securities to fair value at March 31, 2008 was offset by a $2.5 million decrease in interest income due to lower available interest rates and a lower available cash investment balance in 2009.

Interest expense increased by $0.9 million, from $0.3 million in 2008 to $1.2 million in 2009, due primarily to the increase in debt assumed in conjunction with the merger with Tutor-Saliba.

The provision for income taxes increased by $8.7 million, from $15.0 million in 2008 to $23.7 million in 2009, due primarily to the increase in pretax income in 2009. The effective tax rate for the first quarter of 2009 was 37.8%, as compared to 37.3% for the first quarter of 2008.

Potential Impact of Current Economic Conditions

Current economic and financial market conditions in the United States and overseas, including severe disruptions in the credit markets, could adversely affect our results of operations in future periods, particularly if there is a prolonged economic recession or depression or if government efforts to stabilize and revitalize credit markets and financial institutions are not effective. The current instability in the financial markets has made it difficult for certain of our customers, including state and local governments, to access the credit markets to obtain financing or refinancing, as the case may be, to fund new construction projects on satisfactory terms or at all. State and local governments also are facing potentially significant budget shortfalls as a result of declining tax and other revenues, which may cause them to defer or cancel planned infrastructure projects. This situation has contributed to an $851 million decrease in our backlog during 2009 as new projects have been deferred or delayed pending a

turnaround in the economy, an improvement in the credit markets, and the release of funds for construction under the Federal economic stimulus package. We may encounter increased levels of deferrals and delays related to new construction projects in the future. Difficulty in obtaining adequate financing due to the unprecedented disruption in the credit markets may increase the rate at which our customers defer, delay or cancel proposed new construction projects. Such deferrals, delays or cancellations could have an adverse impact on our future operating results.

Liquidity and Capital Resources

Cash and Working Capital

Effective September 8, 2008, we entered into a Third Amended and Restated Credit Agreement (the "Credit Agreement") with Bank of America, as Agent. The Credit Agreement amends and replaces in its entirety a previously existing credit agreement dated February 25, 2007, as amended on May 7, 2008, and allows us to borrow up to $155 million on a revolving credit basis (the "Revolving Facility"), with a $50 million sublimit for letters of credit, and an additional $111.7 million under a supplementary facility (the "Supplementary Facility") to the extent that the $155 million base facility has been fully drawn. The total amount available to borrow under the Supplementary Facility reduces upon the sale of all or any portion of the $111.7 million face value of auction rate securities held in our investment portfolio as of September 8, 2008. Subsequent to September 8, 2008, we have sold auction rate securities with a face value in the amount of $2.4 million. This Supplementary Facility provides us with access to a source of liquidity should the need arise. On February 23, 2009, the Credit Agreement was amended, effective December 31, 2008, to modify certain financial covenants to accommodate the impact of a $224.5 million impairment charge recorded in 2008 and to extend the maturity date of the Supplementary Facility to December 31, 2010. The termination date of the Revolving Facility is February 22, 2012. We had borrowings of $125 million under the Revolving Facility as of March 31, 2009. We did not borrow under the Revolving Facility during 2008. We had $121.3 million available to borrow under the Credit Agreement, including the Supplementary Facility, at March 31, 2009, including outstanding letters of credit.

Cash and cash equivalents as reported in the accompanying Consolidated Condensed Financial Statements consist of amounts held by us as well as our proportionate share of amounts held by construction joint ventures. Cash held by us is available for general corporate purposes while cash held by construction joint ventures is available only for joint venture-related uses. Joint venture cash and cash equivalents are not restricted to specific uses within those entities; however, the terms of the joint venture agreements limit our ability to distribute those funds and use them for corporate purposes. Cash held by construction joint ventures is distributed from time to time to us and to the other joint venture participants in accordance with our respective percentage interest after the joint venture partners determine that a cash distribution is prudent. Cash distributions received by us from our construction joint ventures are then available for general corporate purposes. At March 31, 2009 and December 31, 2008, cash held by us and available for general corporate purposes was $437.7 million and $342.3 million, respectively, and our proportionate share of cash held by joint ventures and available only for joint venture-related uses was $20.9 million and $43.9 million, respectively. At March 31, 2009 and December 31, 2008, our cash balance included $1.2 million and $6.0 million, respectively, which represents an advance received from a project owner to be used to fund subcontract work on a specific project under certain circumstances. We have included these amounts in our contract billings and they are included as a component of "billings in excess of costs and estimated earnings" in the Consolidated Condensed Balance Sheets at March 31, 2009 and December 31, 2008.

A summary of cash flows for each of the three month periods ended March 31, 2009 and 2008 is set forth below: