struction Partners(ROAD) - 2025 Q2 - Quarterly Results

Management Commentary & Strategic Developments Management highlighted strong Q2 performance, organic growth, and acquisitions, resulting in a record $2.84 billion project backlog and strategic expansion into Tennessee - Project backlog grew to a record $2.84 billion at March 31, 2025, compared to $1.79 billion a year prior[2][5] - Announced the acquisition of PRI, establishing a new platform company in Tennessee to capitalize on the state's strong economic growth and healthy transportation funding program[2] - Q2 revenue growth was composed of approximately 7% organic growth and 47% from recent acquisitions[2] - The company is experiencing healthy federal and state project funding and a steady workflow of commercial projects in fast-growing Sunbelt MSAs[2][7] Q2 Fiscal 2025 Financial Performance Construction Partners reported a 54% revenue increase to $571.7 million, achieving $4.2 million net income and 135% Adjusted EBITDA growth to $69.3 million in Q2 FY2025 Q2 Fiscal 2025 Key Financial Metrics vs. Q2 Fiscal 2024 | Metric | Q2 FY2025 | Q2 FY2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $571.7M | $371.4M | +54.0% | | Gross Profit | $71.4M | $38.8M | +84.0% | | Net Income (Loss) | $4.2M | ($1.1M) | N/A | | Diluted EPS | $0.08 | ($0.02) | N/A | | Adjusted EBITDA | $69.3M | $29.5M | +135% | | Adjusted EBITDA Margin | 12.1% | 7.9% | +420 bps | - General and administrative expenses as a percentage of total revenues decreased by 150 basis points to 8.2% from 9.7% in the prior-year quarter[4] Updated Fiscal 2025 Outlook The company raised its full-year fiscal 2025 guidance, projecting revenues between $2.77 billion and $2.83 billion and Adjusted EBITDA between $410.0 million and $430.0 million Updated Fiscal Year 2025 Guidance | Metric | Low Range | High Range | | :--- | :--- | :--- | | Revenue | $2.77B | $2.83B | | Net Income | $106.0M | $117.0M | | Adjusted Net Income | $122.5M | $133.5M | | Adjusted EBITDA | $410.0M | $430.0M | | Adjusted EBITDA Margin | 14.8% | 15.2% | Financial Statements This section presents the company's consolidated statements of comprehensive income, balance sheets, and cash flows for the specified periods Consolidated Statements of Comprehensive Income For the three months ended March 31, 2025, revenues increased 54% to $571.7 million, with operating income reaching $27.3 million and net income at $4.2 million Q2 Income Statement Highlights (in thousands) | Account | For the Three Months Ended March 31, 2025 | For the Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenues | $571,650 | $371,427 | | Gross Profit | $71,350 | $38,801 | | Operating Income | $27,289 | $3,080 | | Net Income (Loss) | $4,215 | $(1,124) | | Diluted EPS | $0.08 | $(0.02) | Consolidated Balance Sheets As of March 31, 2025, total assets increased to $2.75 billion, primarily due to acquisitions, with total liabilities rising to $1.95 billion, largely from increased long-term debt Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Assets | $2,753,526 | $1,542,135 | | Goodwill | $745,040 | $231,656 | | Total Liabilities | $1,945,657 | $968,395 | | Long-term debt, net | $1,319,325 | $486,961 | | Total Stockholders' Equity | $807,869 | $573,740 | Consolidated Statements of Cash Flows For the six months ended March 31, 2025, operating activities provided $96.3 million in cash, while investing activities used $893.2 million, primarily for acquisitions, funded by $823.8 million from financing Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | For the Six Months Ended March 31, 2025 | | :--- | :--- | | Net cash provided by operating activities | $96,297 | | Net cash used in investing activities | $(893,233) | | Net cash provided by financing activities | $823,836 | | Net change in cash | $26,900 | | Cash, end of period | $103,584 | - The primary use of cash in investing activities was $828.7 million for business acquisitions, net of cash acquired[19] Reconciliation of Non-GAAP Financial Measures This section provides reconciliations for non-GAAP measures, including the Q2 FY25 Adjusted EBITDA of $69.3 million from Net Income of $4.2 million, and the updated FY25 outlook - Adjusted EBITDA is defined as net income adjusted for interest, taxes, depreciation & amortization (D&A), share-based compensation, and certain nonrecurring acquisition expenses[20] Q2 FY25 Net Income to Adjusted EBITDA Reconciliation (in thousands) | Reconciliation Item | Amount | | :--- | :--- | | Net income (loss) | $4,215 | | Interest expense, net | $21,592 | | Provision (benefit) for income taxes | $1,310 | | Depreciation, depletion, accretion and amortization | $37,263 | | Share-based compensation expense | $4,672 | | Transformative acquisition expenses | $221 | | Adjusted EBITDA | $69,273 |