Construction Partners, Inc. Reports Fiscal 2025 Second Quarter Earnings Results

Construction Partners, Inc. (ROAD) today announced its financial results for the recent quarter, showcasing a strong performance that exceeded expectations. The company reported earnings per share of $0.08, beating the consensus estimate by $0.15, while revenue reached $571.65 million, surpassing projections by approximately $10.37 million. This positive financial outcome highlights Construction Partners’ robust growth and operational efficiency in a competitive market.

Key Highlights:

• Revenue increased by 54% year-over-year to $571.7 million.
• Net income of $4.2 million, with earnings per share (EPS) of $0.08.
• Adjusted EBITDA rose 135% to $69.3 million, with an adjusted EBITDA margin of 12.1%.
• Record project backlog of $2.84 billion.
• Company raised its fiscal 2025 outlook for revenue and earnings.

Construction Partners, Inc. reported strong financial results for the second quarter of fiscal 2025, showcasing significant growth across key metrics. Revenue surged by 54% compared to the same quarter last year, driven by both organic growth and acquisitions, with net income turning positive at $4.2 million. CEO Fred J. (Jule) Smith, III, highlighted the operational success during a typically challenging winter quarter, stating, “The operational performance of our family of companies was outstanding,” and noted the record backlog of $2.84 billion, positioning the company well for the upcoming busy construction season.

The company also announced an acquisition of PRI, expanding its operations throughout Tennessee, which Smith described as a state with “organic and acquisitive growth opportunities.” The acquisition is expected to enhance CPI’s capabilities and market presence. Furthermore, the company raised its fiscal 2025 outlook, anticipating revenues between $2.77 billion and $2.83 billion, reflecting strong demand for both public and commercial projects in the rapidly growing Sunbelt region. Executive Chairman Ned N. Fleming, III, emphasized the company’s strategic positioning and commitment to delivering long-term value, stating, “CPI will continue to benefit from opportunities afforded by a generational investment in infrastructure.”

Construction Partners, Inc. (ROAD) has experienced a remarkable surge in its stock price, particularly over the past month, where it has skyrocketed by nearly 33%. This impressive momentum is underscored by a staggering 75.4% increase over the past year, suggesting strong investor confidence in the company’s growth trajectory. However, the company’s price-to-earnings ratio stands at a staggering -393.92, indicating that it is currently unprofitable, which raises questions about its valuation amidst such price appreciation. On a more positive note, the company has demonstrated robust growth in its earnings, with a two-year compound annual growth rate (CAGR) of 102.92%, alongside a revenue CAGR of 21%. Additionally, Construction Partners boasts a return on invested capital of 8.22% and a net profit margin of 2.64%, reflecting its ability to generate returns despite its current challenges. While the stock’s recent performance is certainly impressive, potential investors should remain cautious, considering the volatility and the underlying fundamentals that may impact future growth.

Construction Partners, Inc., a civil infrastructure company, engages in the construction and maintenance of roadways across Alabama, Florida, Georgia, North Carolina, and South Carolina. The company, through its subsidiaries, provides various products and services to public and private infrastructure projects, with a focus on highways, roads, bridges, airports, and commercial and residential developments. It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; paving activities, including the construction of roadway base layers and application of asphalt pavement; site development, including the installation of utility and drainage systems; mining aggregates, such as sand and gravel that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production. The company was formerly known as SunTx CPI Growth Company, Inc. and changed its name to Construction Partners, Inc. in September 2017. Construction Partners, Inc. was incorporated in 1999 and is headquartered in Dothan, Alabama.