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Construction Partners (ROAD) Q3 Earnings Beat, Backlog Rises
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Construction Partners, Inc. (ROAD - Free Report) reported solid third-quarter fiscal 2024 (ended Jun 30, 2024) results, with earnings and revenues surpassing the Zacks Consensus Estimate and increased on a year-over-year basis.
The company’s quarterly result reflects a strong demand environment across more than 70 local markets in the Southeast. Owing to strong industry demand and favorable funding trends, the company raised its fiscal 2024 outlook.
ROAD focuses on safely and efficiently building projects across six southeastern states while integrating three recent acquisitions. The company also registered 13% year-over-year organic growth in the quarter. It stays committed to its ROAD-Map 2027 goals, aiming to enhance shareholders’ value by improving returns on capital.
Inside the Headlines
In third-quarter fiscal 2024, the company reported earnings of 59 cents per share, which topped the Zacks Consensus Estimate of 54 cents by 9.3%. The metric also rose 43.9% year over year.
Quarterly revenues of $517.8 million surpassed the consensus mark of $503 million by 2.9% and grew 22.7% year over year.
Construction Partners, Inc. Price, Consensus and EPS Surprise
Adjusted EBITDA surged 30.5% from the year-ago quarter’s figure to $73.2 million. Adjusted EBITDA margin expanded 80 basis points (bps) from the year-ago quarter’s levels to 14.1%.
The project backlog at the end of third-quarter fiscal 2024 amounted to $1.86 billion, up 17% from the year-ago period’s tally and 3.9% sequentially.
Operating Highlights
During the third quarter, the company reported a gross profit of $83.5 million, up 30% from $64.1 million reported in the year-ago period. The gross margin expanded 90 bps year over year to 16.1%.
The quarter’s operating income of $45.6 million was up from the year-ago quarter’s level of $33.3 million. Operating margin expanded 90 bps to 8.8% from the year-ago quarter’s reported value of 7.9%.
General and administrative expenses were $38.9 million in the third quarter, up from $32.2 million reported in the year-ago quarter. General and administrative expenses (as a percentage of total revenues) were 7.5%, down 10 bps year over year.
Financials
As of Jun 30, 2024, ROAD had cash and cash equivalents of $56.3 million, up from $48.2 million reported at the fiscal 2023 end. As of third-quarter fiscal 2024 end, long-term debt (net of current maturities and deferred debt issuance costs) was $453.9 million, up from $360.7 million at the fiscal 2023 end.
For the first nine months of fiscal 2024, net cash provided by operating activities (net of business acquisitions) was $113.2 million compared with $94.5 million a year ago.
Fiscal 2024 Guidance Raised
For the fiscal 2024, Construction Partners now expects revenues to be in the range of $1.835-$1.860 billion, up from the prior projection of $1.81-$1.85 billion. This indicates an 18.6% improvement from the fiscal 2023 levels, considering the mid-point of the guidance.
Net income is expected to be in the range of $73.5-$76.5 million (up from the prior projection of $71-$75) versus $49 million in the fiscal 2023.
For the fiscal year, the company now anticipates adjusted EBITDA to be in the range of $219-$228 million (up from the prior projection of $211-$225) versus $174.1 million in the prior year. Adjusted EBITDA margin is now anticipated to be between 11.9% and 12.3% (up from the prior projection of 11.7-12.2%) versus $11.1% in the fiscal 2023.
Martin Marietta Materials, Inc. (MLM - Free Report) reported tepid results for second-quarter 2024, with earnings and revenues missing the Zacks Consensus Estimate. The top and the bottom line declined on a year-over-year basis.
MLM witnessed historic precipitation in Texas and parts of the Midwest, along with ongoing restrictive monetary policy and curtailed volumes, thanks to April and May's historically wet weather. Owing to the slowing product demand in the interest-rate-sensitive private construction sector, the company lowered its full-year adjusted EBITDA guidance to $2.2 billion at the midpoint.
KBR, Inc. (KBR - Free Report) reported mixed second-quarter 2024 results, with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. The top and the bottom line increased on a year-over-year basis.
KBR performed well across key metrics and expects this trend to continue for the rest of the year. Driven by robust performance in its core business, KBR raised its adjusted EBITDA and cash flow guidance for 2024.
Armstrong World Industries, Inc. (AWI - Free Report) reported solid results in second-quarter 2024, with earnings and net sales topping the Zacks Consensus Estimate and increasing on a year-over-year basis.
Solid contributions from the Mineral Fiber and Architectural Specialties segments backed AWI’s growth trend. Growth was attributable to the increase in average unit value and volume. Also, contributions from recent acquisitions aided the uptrend.
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Construction Partners (ROAD) Q3 Earnings Beat, Backlog Rises
Construction Partners, Inc. (ROAD - Free Report) reported solid third-quarter fiscal 2024 (ended Jun 30, 2024) results, with earnings and revenues surpassing the Zacks Consensus Estimate and increased on a year-over-year basis.
The company’s quarterly result reflects a strong demand environment across more than 70 local markets in the Southeast. Owing to strong industry demand and favorable funding trends, the company raised its fiscal 2024 outlook.
ROAD focuses on safely and efficiently building projects across six southeastern states while integrating three recent acquisitions. The company also registered 13% year-over-year organic growth in the quarter. It stays committed to its ROAD-Map 2027 goals, aiming to enhance shareholders’ value by improving returns on capital.
Inside the Headlines
In third-quarter fiscal 2024, the company reported earnings of 59 cents per share, which topped the Zacks Consensus Estimate of 54 cents by 9.3%. The metric also rose 43.9% year over year.
Quarterly revenues of $517.8 million surpassed the consensus mark of $503 million by 2.9% and grew 22.7% year over year.
Construction Partners, Inc. Price, Consensus and EPS Surprise
Construction Partners, Inc. price-consensus-eps-surprise-chart | Construction Partners, Inc. Quote
Adjusted EBITDA surged 30.5% from the year-ago quarter’s figure to $73.2 million. Adjusted EBITDA margin expanded 80 basis points (bps) from the year-ago quarter’s levels to 14.1%.
The project backlog at the end of third-quarter fiscal 2024 amounted to $1.86 billion, up 17% from the year-ago period’s tally and 3.9% sequentially.
Operating Highlights
During the third quarter, the company reported a gross profit of $83.5 million, up 30% from $64.1 million reported in the year-ago period. The gross margin expanded 90 bps year over year to 16.1%.
The quarter’s operating income of $45.6 million was up from the year-ago quarter’s level of $33.3 million. Operating margin expanded 90 bps to 8.8% from the year-ago quarter’s reported value of 7.9%.
General and administrative expenses were $38.9 million in the third quarter, up from $32.2 million reported in the year-ago quarter. General and administrative expenses (as a percentage of total revenues) were 7.5%, down 10 bps year over year.
Financials
As of Jun 30, 2024, ROAD had cash and cash equivalents of $56.3 million, up from $48.2 million reported at the fiscal 2023 end. As of third-quarter fiscal 2024 end, long-term debt (net of current maturities and deferred debt issuance costs) was $453.9 million, up from $360.7 million at the fiscal 2023 end.
For the first nine months of fiscal 2024, net cash provided by operating activities (net of business acquisitions) was $113.2 million compared with $94.5 million a year ago.
Fiscal 2024 Guidance Raised
For the fiscal 2024, Construction Partners now expects revenues to be in the range of $1.835-$1.860 billion, up from the prior projection of $1.81-$1.85 billion. This indicates an 18.6% improvement from the fiscal 2023 levels, considering the mid-point of the guidance.
Net income is expected to be in the range of $73.5-$76.5 million (up from the prior projection of $71-$75) versus $49 million in the fiscal 2023.
For the fiscal year, the company now anticipates adjusted EBITDA to be in the range of $219-$228 million (up from the prior projection of $211-$225) versus $174.1 million in the prior year. Adjusted EBITDA margin is now anticipated to be between 11.9% and 12.3% (up from the prior projection of 11.7-12.2%) versus $11.1% in the fiscal 2023.
Zacks Rank & Recent Construction Releases
Construction Partners currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Martin Marietta Materials, Inc. (MLM - Free Report) reported tepid results for second-quarter 2024, with earnings and revenues missing the Zacks Consensus Estimate. The top and the bottom line declined on a year-over-year basis.
MLM witnessed historic precipitation in Texas and parts of the Midwest, along with ongoing restrictive monetary policy and curtailed volumes, thanks to April and May's historically wet weather. Owing to the slowing product demand in the interest-rate-sensitive private construction sector, the company lowered its full-year adjusted EBITDA guidance to $2.2 billion at the midpoint.
KBR, Inc. (KBR - Free Report) reported mixed second-quarter 2024 results, with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. The top and the bottom line increased on a year-over-year basis.
KBR performed well across key metrics and expects this trend to continue for the rest of the year. Driven by robust performance in its core business, KBR raised its adjusted EBITDA and cash flow guidance for 2024.
Armstrong World Industries, Inc. (AWI - Free Report) reported solid results in second-quarter 2024, with earnings and net sales topping the Zacks Consensus Estimate and increasing on a year-over-year basis.
Solid contributions from the Mineral Fiber and Architectural Specialties segments backed AWI’s growth trend. Growth was attributable to the increase in average unit value and volume. Also, contributions from recent acquisitions aided the uptrend.