Financial Data and Key Metrics Changes - Construction Partners reported a revenue of $2.812 billion for fiscal 2025, representing a 54% increase compared to the previous year, with 8.4% organic growth and 45.6% acquisitive growth [15][16] - Adjusted EBITDA for fiscal 2025 was $423.7 million, a 92% increase year-over-year, with an adjusted EBITDA margin of 15% compared to 12.1% in fiscal 2024 [16] - Net income reached $101.8 million, up 48% from the previous year, while adjusted net income increased by 73% to $122 million [16] Business Line Data and Key Metrics Changes - The fourth quarter of fiscal 2025 saw revenue of $900 million, a 67% increase year-over-year, with 10.4% of that being organic revenue growth [15] - General and administrative expenses as a percentage of total revenue decreased to 7.1% from 8.1% in the previous year [16] Market Data and Key Metrics Changes - The company ended fiscal 2025 with a record project backlog of $3 billion, covering approximately 80%-85% of the next 12 months' contract revenue [19] - The company expects contract awards in FY2026 to increase approximately 15% over FY2025, driven by strong public contract bidding across its operational states [11][12] Company Strategy and Development Direction - The company has initiated a five-year strategic plan called Road 2030, aiming to double its revenue to over $6 billion by 2030, with a target of expanding EBITDA margins to 17% by the end of the period [9] - The growth strategy focuses on acquisitions in the Sunbelt region, leveraging the ongoing generational transition in the industry to identify potential acquisition targets [12][14] Management's Comments on Operating Environment and Future Outlook - Management highlighted four macro trends driving growth: migration to the Sunbelt, reshoring of manufacturing, increased infrastructure funding, and a fragmented industry ripe for consolidation [10][11] - The company remains focused on attracting and retaining talent, emphasizing the importance of its workforce in driving business growth and shareholder value [14] Other Important Information - The company expects total capital expenditures for fiscal 2026 to be in the range of $165 million-$185 million, with a focus on high-return growth initiatives [18] - Cash flow from operations for fiscal 2025 was $291 million, up from $209 million in fiscal 2024, with expectations to convert 75%-85% of EBITDA to cash flow from operations in fiscal 2026 [17][18] Q&A Session Summary Question: Integration of recent acquisitions and differences from five years ago - Management noted that the integration process has improved significantly, with a focus on cultural fit and involving employees from across the company in the integration teams [24][26] Question: Impact of government shutdown on business - Management confirmed that the government shutdown did not significantly impact revenue or bidding due to the funding structure through the Highway Trust Fund [30] Question: Confidence in reauthorization bill voting timeline - Management expressed optimism about the reauthorization bill, indicating that both chambers are working on it and aiming for a vote by spring [38] Question: Expected rollover M&A revenue and its impact on margins - Management projected that 2025 acquisitions would contribute approximately $240 million-$250 million in revenue, with a neutral impact on margins [40] Question: Pricing and inflation outlook for fiscal 2026 - Management indicated that inflation was benign in 2025, with stable construction material costs, and they expect to pass through any increased costs in their pricing [56][57] Question: Demand for private construction and data center projects - Management reported healthy demand for private construction, particularly in the Sunbelt, and confirmed participation in large data center projects [66][68]