PART I [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three and nine months ended September 30, 2021, showing increased revenue but decreased net income, significant balance sheet growth from acquisitions, and reduced operating cash flow [Consolidated Statements of Operations](index=3&type=section&id=Consolidated%20Statements%20of%20Operations) For Q3 2021, revenues increased to $559.1 million from $490.0 million year-over-year, but operating profit declined to $37.5 million from $42.1 million, leading to a net income decrease to $23.7 million ($0.49 per diluted share) from $31.2 million ($0.64 per diluted share) Consolidated Statements of Operations | Financial Metric | Three Months Ended Sep 30, 2021 | Three Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | $559.1M | $490.0M | $1,514.6M | $1,476.7M | | **Total operating profit** | $37.5M | $42.1M | $91.7M | $135.0M | | **Net income** | $23.7M | $31.2M | $60.4M | $96.1M | | **Diluted EPS** | $0.49 | $0.64 | $1.23 | $1.97 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of September 30, 2021, total assets increased to $3.30 billion from $2.65 billion at year-end 2020, primarily driven by acquisitions which increased Goodwill and Property, Plant, and Equipment, with total debt also rising sharply to $743.8 million to fund these activities Consolidated Balance Sheets | Balance Sheet Item | September 30, 2021 (unaudited) | December 31, 2020 | | :--- | :--- | :--- | | **Total current assets** | $810.9M | $664.9M | | **Property, plant, and equipment, net** | $1,273.0M | $913.3M | | **Goodwill** | $932.6M | $794.0M | | **Total Assets** | **$3,301.2M** | **$2,646.7M** | | **Total current liabilities** | $389.4M | $310.3M | | **Debt** | $743.8M | $248.2M | | **Total Stockholders' equity** | $1,940.9M | $1,892.2M | | **Total Liabilities and Stockholders' Equity** | **$3,301.2M** | **$2,646.7M** | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2021, net cash from operating activities significantly decreased to $76.8 million from $226.7 million, while investing activities used $569.3 million primarily for acquisitions, and financing activities provided $462.8 million largely from new debt issuance Consolidated Statements of Cash Flows | Cash Flow Activity (Nine Months Ended Sep 30) | 2021 | 2020 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $76.8M | $226.7M | | **Net cash required by investing activities** | ($569.3M) | ($409.7M) | | **Net cash provided by financing activities** | $462.8M | $131.6M | | **Net (decrease) in cash and cash equivalents** | ($29.7M) | ($51.4M) | [Note 2. Acquisitions and Divestitures](index=10&type=section&id=Note%202.%20Acquisitions%20and%20Divestitures) In 2021, the company aggressively expanded its Construction Products segment through two major acquisitions, StonePoint for $374.8 million and Southwest Rock for $149.9 million, funded by cash, revolving credit, and new senior notes - Completed the acquisition of StonePoint, a top 25 U.S. construction aggregates company, for **$374.8 million**, funded by a new **$400.0 million** senior unsecured notes offering[29](index=29&type=chunk) - Acquired Southwest Rock, a natural aggregates company in the Phoenix area, for **$149.9 million**, funded with cash and **$100.0 million** from the revolving credit facility[29](index=29&type=chunk) [Note 4. Segment Information](index=14&type=section&id=Note%204.%20Segment%20Information) For Q3 2021, revenue growth in Construction Products and Engineered Structures was offset by a significant decline in Transportation Products, leading to a sharp drop in operating profit for Transportation Products and impacting overall profitability Segment (Q3 2021 vs Q3 2020) | Segment | Revenues | Operating Profit | | :--- | :--- | :--- | | **Construction Products** | $227.4M vs $146.9M | $26.8M vs $20.8M | | **Engineered Structures** | $250.1M vs $222.6M | $23.6M vs $20.7M | | **Transportation Products** | $81.6M vs $120.7M | $1.5M vs $17.6M | Segment (Nine Months 2021 vs 2020) | Segment | Revenues | Operating Profit | | :--- | :--- | :--- | | **Construction Products** | $585.1M vs $444.5M | $60.5M vs $61.9M | | **Engineered Structures** | $699.6M vs $668.6M | $70.2M vs $66.5M | | **Transportation Products** | $230.0M vs $365.9M | $6.9M vs $47.8M | [Note 7. Debt](index=17&type=section&id=Note%207.%20Debt) Total debt nearly tripled to $755.8 million as of September 30, 2021, from $254.5 million at year-end 2020, driven by the issuance of $400 million in senior notes and increased revolving credit facility borrowings to finance acquisitions Debt Component | Debt Component | September 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Revolving credit facility | $200.0M | $100.0M | | Term loan | $147.2M | $149.1M | | Senior notes | $400.0M | $0.0M | | **Total debt** | **$755.8M** | **$254.5M** | - On April 6, 2021, the Company issued **$400.0 million** of 4.375% senior notes that mature in April 2029 to fund the StonePoint acquisition[29](index=29&type=chunk)[51](index=51&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's performance, highlighting strong demand in construction markets but significant weakness in transportation, with Q3 2021 revenues increasing 14.1% but operating profit falling 10.9% due to the Transportation Products segment [Executive Overview](index=24&type=section&id=Executive%20Overview) The company highlights a 14.1% revenue increase for Q3 2021, driven by Construction Products and Engineered Structures, partially offset by a decline in Transportation Products, with operating profit decreasing due to lower volumes in the transportation segment - Revenues for Q3 2021 increased **14.1%** to **$559.1 million**, while operating profit decreased by **$4.6 million** to **$37.5 million** compared to the same period in 2020[81](index=81&type=chunk) Backlog (Unsatisfied Performance Obligations) | Backlog | September 30, 2021 | September 30, 2020 | | :--- | :--- | :--- | | **Utility, wind, and related structures** | $465.9M | $429.3M | | **Inland barges** | $130.2M | $177.5M | [Segment Discussion](index=28&type=section&id=Segment%20Discussion) The segment discussion reveals mixed performance, with Construction Products seeing a 54.8% revenue increase and Engineered Structures growing 12.4%, while Transportation Products revenue fell 32.4% with operating profit plummeting 91.5% due to weak barge demand and high steel prices - **Construction Products:** Q3 revenues rose **54.8%**, with acquisitions contributing approximately **40%** of the increase, and operating profit grew **28.8%**[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk) - **Engineered Structures:** Q3 revenues increased **12.4%** due to higher pricing and volumes in utility structures and storage tanks, and operating profit rose **14.0%**[96](index=96&type=chunk)[98](index=98&type=chunk) - **Transportation Products:** Q3 revenues decreased **32.4%**, driven by a **41.2%** drop in inland barge revenues, and operating profit fell **91.5%** due to lower volumes and reduced efficiency[102](index=102&type=chunk)[103](index=103&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity position remains solid despite a decrease in operating cash flow to $76.8 million for the first nine months of 2021, with major financing activities including issuing $400 million in senior notes and borrowing an additional $100 million under the revolving credit facility to fund acquisitions - Net cash from operating activities for the nine months ended Sep 30, 2021, was **$76.8 million**, a significant decrease from **$226.7 million** in the prior year period[110](index=110&type=chunk) - The company issued **$400 million** in senior notes and borrowed an additional **$100 million** under its revolving credit facility to fund acquisitions[111](index=111&type=chunk) - As of September 30, 2021, the company had **$271.8 million** available under its revolving credit facility[111](index=111&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes in its market risks since the end of the previous fiscal year, as detailed in its 2020 Annual Report on Form 10-K - There has been no material change in the company's market risks since December 31, 2020[119](index=119&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of September 30, 2021, with the assessment of internal controls excluding recently acquired StonePoint and Southwest Rock businesses - The Chief Executive and Chief Financial Officers believe the company's disclosure controls and procedures are effective[121](index=121&type=chunk) - The assessment of internal control over financial reporting excluded the StonePoint and Southwest Rock businesses, acquired in April and August 2021, respectively[122](index=122&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 15 of the Consolidated Financial Statements for detailed information regarding the company's ongoing legal proceedings - For details on legal proceedings, refer to Note 15 of the Consolidated Financial Statements[124](index=124&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) The company states that there have been no material changes to its risk factors from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2020 - There have been no material changes in the Company's risk factors from those set forth in the 2020 Annual Report on Form 10-K[125](index=125&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q3 2021, Arcosa repurchased 98,456 shares of its common stock at an average price of $50.68 per share as part of its publicly announced repurchase program, with approximately $40.6 million remaining available for future repurchases Unregistered Sales of Equity Securities and Use of Proceeds | Period | Total Shares Purchased | Average Price Paid | Shares Purchased as Part of Program | Approx. Dollar Value Remaining in Program | | :--- | :--- | :--- | :--- | :--- | | **Q3 2021 Total** | **99,304** | **$50.69** | **98,456** | **$40,625,892** | - The company's Board of Directors authorized a **$50 million** share repurchase program effective from January 1, 2021, through December 31, 2022[127](index=127&type=chunk) [Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including agreements related to recent acquisitions, certifications by the CEO and CFO, and XBRL data files

Financial Data and Key Metrics Changes - Arcosa reported a 3% revenue growth year-over-year, with adjusted EBITDA remaining consistent with last year's record levels [4][6] - Adjusted net income declined by 18% primarily due to increased non-cash expenses, particularly depreciation and amortization from recent acquisitions [6] Business Line Data and Key Metrics Changes - The Construction Products segment, which now accounts for over 50% of adjusted EBITDA, saw a 38% revenue growth and a 17% increase in adjusted EBITDA, despite adverse weather conditions [11][12] - Engineered Structures revenue increased by 9%, with adjusted EBITDA rising by 25% to $38 million, aided by a resolution of a customer dispute [14] - The Transportation Products segment experienced a significant downturn, with revenue down 47% and adjusted EBITDA decreasing by 73% due to lower utilization [16] Market Data and Key Metrics Changes - The Phoenix metropolitan area is highlighted as one of the fastest-growing construction markets in the U.S., with strong infrastructure spending supporting growth opportunities [9][21] - Arizona ranked first in infrastructure spending on highway contracts over the past five years, indicating a favorable market environment for Arcosa [9] Company Strategy and Development Direction - The company is focusing on integrating recent acquisitions and pursuing organic growth opportunities while simplifying its overall portfolio [10][19] - The acquisition of Southwest Rock Products is part of a strategy to enhance margins and growth potential in less cyclical markets [5][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the construction market's recovery, driven by strong demand for aggregates and infrastructure projects [21][22] - The outlook for the Engineered Structures segment remains positive, with expectations for year-over-year growth in the second half of the year [22][23] - Management acknowledged challenges in the Transportation Products segment but noted signs of recovery in the railcar OEM market [25][26] Other Important Information - The company maintains a consolidated adjusted EBITDA guidance of $270 million to $290 million for 2021, reflecting a strong performance despite headwinds in the Transportation Products segment [27] - The company has over $300 million in available liquidity and no near-term debt maturities, indicating a strong financial position [19] Q&A Session Summary Question: What is the impact of steel prices on the barge business? - Management indicated that while steel prices are high, they expect a reduction in prices due to increased capacity coming online in 2022, which should improve order flow [31][33] Question: How does the guidance reflect the addition of StonePoint and the outlook for aggregates? - The guidance remains unchanged, with the addition of Southwest Rock contributing positively, while challenges in the Transportation Products segment are acknowledged [36][38] Question: What are the expected margins for Southwest Rock under Arcosa? - Management expects Southwest Rock's margins to align with industry peers in the mid-thirties, with potential for higher margins during periods of strong demand [54] Question: How are customers approaching capital deployment for barges? - Customers are assessing the economic viability of new barge orders in light of high steel prices, with expectations for a gradual recovery in demand [55][58] Question: What is the strategy for future acquisitions? - The focus will be on integrating recent acquisitions and pursuing organic growth, with potential for bolt-on acquisitions in existing metropolitan areas [68][69]

Arcosa, Inc. (NYSE:ACA) Q1 2021 Earnings Conference Call April 30, 2021 8:30 AM ET Company Participants Gail Peck - SVP Finance and Treasurer Antonio Carrillo - President and CEO Scott Beasley - CFO Conference Call Participants Ian Zaffino - Oppenheimer Brent Thielman - DA Davidson Julio Romero - Sidoti Justin Bergner - G. Research Operator Good morning, ladies and gentlemen, and welcome to the Arcosa, Inc. First Quarter 2021 Earnings Conference Call. My name is Mallory, and I will be your conference call c ...

Financial Performance - Q1 2021 results exceeded expectations due to strong Construction Products performance[8] - Winter Storm Uri negatively impacted Adjusted EBITDA by $4-5 million in Q1 2021[15] - The company is raising Full Year Adjusted EBITDA guidance to $270 million - $290 million to incorporate StonePoint[8] - Q1 2021 Adjusted EBITDA was $56.5 million, with an Adjusted EBITDA Margin of 12.8%[72] - Net debt / Adjusted EBITDA ratio was 1.9x after issuing $400 million of senior notes at 4.375% to fund the StonePoint acquisition[8, 30] Segment Performance - Construction Products Adjusted Segment EBITDA was roughly flat compared to Q1 2020, with a margin of 21.5%[18, 21] - Engineered Structures revenues declined, and Adjusted Segment EBITDA margin was 12.8%[22, 25] - Transportation Products maintained margins above 10% despite operating well below capacity[26] Strategic Initiatives - StonePoint Materials acquisition was completed on April 9, expected to generate ~$125 million in revenues and ~$30 million in Adjusted EBITDA in 2021[36, 37] - The company published its inaugural full year Sustainability Report in April 2021, highlighting a 12% reduction in GHG Emissions Intensity and a 16% reduction in municipal water intensity in 2020[8, 53, 54]

Arcosa, Inc. (NYSE:ACA) Q4 2020 Earnings Conference Call February 25, 2021 8:30 AM ET Company Participants Gail Peck - Senior Vice President, Finance & Treasurer Antonio Carrillo - President & Chief Executive Officer Scott Beasley - Chief Financial Officer Conference Call Participants Brent Thielman - D.A. Davidson Ian Zaffino - Oppenheimer Stefanos Crist - CJS Securities Justin Bergner - G. Research Operator Good morning, ladies and gentlemen, and welcome to the Arcosa Inc. Fourth Quarter 2020 Earnings Con ...

2020 Highlights - Arcosa achieved 11% Revenue growth and 18% Adjusted EBITDA growth[8] - The company generated $178 million of Free Cash Flow[8] - Construction Products EBITDA has almost doubled since 2018[8] 2021 Outlook - 2021 guidance range: Revenue of $1.78-1.90 billion and Adjusted EBITDA of $250-270 million[9] - Total Transportation Products Adjusted EBITDA expected to be $35-40 million, down from 2020's $78 million[56] - Full year 2021 tax rate is expected to be ~23-25%[66] Q4 and Full Year 2020 Results - Q4-2020 Revenue grew 3% and Adjusted EBITDA grew 6%[18] - Full Year 2020 Adjusted EBITDA Margin was 14.7%[82] - Construction Products Adjusted Segment EBITDA grew 73% in Q4 and 50% for the full year[24] - Transportation Products Full Year EBITDA was up 22%[33]