Financial Data and Key Metrics Changes - In Q2 2025, revenue increased by $43 million or 4%, gross profit increased by $34 million or 21%, adjusted net income improved by $9 million or 12%, and adjusted EBITDA improved by $22 million or 17% [22][27] - Year-to-date operating cash flow reached $5 million, aligning with the 2025 target [22][26] Business Line Data and Key Metrics Changes - In the construction segment, revenue increased by $19 million or 2% year-over-year to $937 million, driven by acquisitions and a strong backlog [22][19] - The construction segment's gross profit improved by $18 million to $154 million, with a gross profit margin of 16%, reflecting a 170 basis point increase due to improved execution [23] - In the materials segment, aggregate volumes increased by 11% for the quarter and 13% year-to-date, leading to improved cash gross profit margins [25][24] Market Data and Key Metrics Changes - The public market environment continues to drive growth, with strong transportation funding in California increasing budgeted allocations by 9% over the previous fiscal year [19][20] - The Southeast market is experiencing growth due to increased public funding and private investment, particularly in infrastructure [12][13] Company Strategy and Development Direction - The company is focused on raising construction margins and driving organic growth through strategic acquisitions, particularly in materials [6][7] - The recent acquisitions of Warm Paving and Pabich Construction are expected to enhance the company's vertical integration and expand its geographic reach [10][16] - The company aims to maintain a disciplined approach to M&A, targeting materials-focused companies to support its strategic plan [8][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance for the second half of the year, anticipating revenue growth acceleration as projects progress [20][36] - The company expects to achieve gross margin expansion of greater than 1% during 2025, supported by improved project performance [20][28] Other Important Information - The company amended its credit facility to support future M&A opportunities, with total debt outstanding approximately $1.35 billion [26][27] - Revised revenue guidance for 2025 is now between $4.35 billion and $4.55 billion, reflecting contributions from recent acquisitions [27][28] Q&A Session Summary Question: Comments on construction segment growth and project pace - Management noted that revenue growth is tied to project starts and finishes, with expectations for acceleration in the second half of the year due to a record backlog [36] Question: Insights on materials profit margin expansion - Management highlighted volume improvements in both asphalt and aggregate, with expectations for continued margin expansion [38][39] Question: Details on Pabich Construction's strengths - Pabich is primarily a public works contractor, complementing the company's existing footprint in California and expected to enhance overall business performance [42][44] Question: Comparison of cap trends between regions - Management indicated that the record cap is consistent across the entire footprint, with strong market support from federal funding [47][49] Question: Quality of assets from Warren Paving acquisition - Warren Paving is a high-performing business with a strong materials focus, expected to provide significant opportunities for growth in the Southeast [53][56] Question: Clarification on 2027 targets and acquisition impacts - Management confirmed that 2027 targets include organic growth expectations and potential contributions from future acquisitions, with a focus on maintaining a strong balance sheet [59][61]