On August 9, 2024, Construction Partners Inc (ROAD, Financial) released its 8-K filing for the fiscal third quarter ended June 30, 2024. The company, which specializes in the construction and maintenance of roadways across six southeastern states, reported significant year-over-year growth in revenue, net income, and Adjusted EBITDA.
Company Overview
Construction Partners Inc operates as an infrastructure and road construction company. It provides construction products and services to the public and private sectors, including highways, roads, bridges, airports, and commercial and residential sites. The company also offers site development, paving, utility and drainage systems, and supplies hot mix asphalt.
Performance Highlights
Construction Partners Inc (ROAD, Financial) reported revenues of $517.8 million for Q3 FY2024, a 22.7% increase compared to $421.9 million in the same quarter last year. This figure surpassed the analyst estimate of $503.57 million. Net income rose to $30.9 million, up 42.4% from $21.7 million in Q3 FY2023, translating to an earnings per share (EPS) of $0.60, exceeding the analyst estimate of $0.54.
Financial Achievements
The company's gross profit for the quarter was $83.5 million, a 30% increase from $64.1 million in the same period last year. General and administrative expenses were $38.9 million, or 7.5% of total revenue, compared to $32.2 million, or 7.6% of total revenue, in Q3 FY2023. Adjusted EBITDA was $73.2 million, up 30.5% from $56.1 million in the same quarter last year, with an Adjusted EBITDA Margin of 14.1% compared to 13.3% in Q3 FY2023.
Key Financial Metrics
| Metric | Q3 FY2024 | Q3 FY2023 |
|---|---|---|
| Revenue | $517.8 million | $421.9 million |
| Gross Profit | $83.5 million | $64.1 million |
| Net Income | $30.9 million | $21.7 million |
| Adjusted EBITDA | $73.2 million | $56.1 million |
| Adjusted EBITDA Margin | 14.1% | 13.3% |
Operational Insights
The company reported a record project backlog of $1.86 billion as of June 30, 2024, compared to $1.59 billion at the same time last year. This robust backlog underscores the strong demand environment across its geographic footprint of more than 70 local markets in the Southeast.
"We are pleased to report strong third quarter results representing substantial year-over-year growth in revenue, net income, Adjusted EBITDA and Adjusted EBITDA margin. The demand environment remains strong across our geographic footprint of more than 70 local markets in the Southeast," said Fred J. (Jule) Smith, III, the Company’s President and Chief Executive Officer.
Fiscal Year 2024 Outlook
Construction Partners Inc (ROAD, Financial) has raised its FY2024 outlook, now expecting revenue in the range of $1.835 billion to $1.860 billion, net income between $73.5 million and $76.5 million, and Adjusted EBITDA between $219 million and $228 million. The company also anticipates an Adjusted EBITDA Margin of 11.9% to 12.3%.
"From a macro perspective, continued increasing funding for public projects at the federal, state and local levels coupled with a steady commercial project environment in the southeastern United States continue to drive growth at CPI," stated Ned N. Fleming, III, the Company’s Executive Chairman.
Conclusion
Construction Partners Inc (ROAD, Financial) has demonstrated robust financial performance in Q3 FY2024, exceeding analyst estimates and showcasing strong growth across key metrics. The company's record backlog and raised FY2024 outlook indicate a positive trajectory, driven by sustained demand and effective execution of strategic goals. Investors and stakeholders will be keenly watching how the company continues to leverage its strengths in the coming quarters.
Explore the complete 8-K earnings release (here) from Construction Partners Inc for further details.
