Cardinal Infrastructure Group (CDNL) Announces the Acquisition of A. L. Grading Contractors, Selected Preliminary Estimated Operating Results for 2025, and Updated Consolidated Guidance for 2026

Rhea-AI Summary

Cardinal Infrastructure Group (NASDAQ: CDNL) acquired A.L. Grading Contractors (ALGC) for a total consideration of $245.5 million, expanding Cardinal into Georgia and adding unaudited ALGC revenue of $160 million with a 26.3% Adjusted EBITDA margin (TTM to Sept 30, 2025).

Cardinal provided preliminary 2025 results (revenue ~$452.3M–$459.7M; Adj. EBITDA margin ~17.8%–18.0%) and 2026 guidance (revenue $664.9M–$678.3M; Adj. EBITDA margin at least 20%). Pro forma net tangible leverage is ~1.27x.

Positive

• Acquisition adds $160M unaudited annual revenue from ALGC
• ALGC reported 26.3% Adjusted EBITDA margin (TTM to Sept 30, 2025)
• Transaction is immediately accretive and targets margin expansion to >20% in 2026
• Pro forma net tangible leverage of 1.27x, below 2.5x target

Negative

• Total consideration includes $116.9M issued equity, creating potential dilution
• Deal funds include $48.6M cash plus an $80M credit facility extension

Key Figures

ALGC revenue: $160 million ALGC Adj. EBITDA margin: 26.3% Deal consideration: $245.5 million +5 more

8 metrics

ALGC revenue $160 million Unaudited annual revenue, trailing 12 months ended Sep 30, 2025

ALGC Adj. EBITDA margin 26.3% Trailing 12 months ended Sep 30, 2025

Deal consideration $245.5 million Total consideration for ALGC acquisition

2025 revenue guidance $452.3M–$459.7M Full-year 2025 revenue; ~45% growth vs 2024 at midpoint

2025 Adj. EBITDA margin 17.8%–18.0% Full-year 2025 Adjusted EBITDA margin guidance

Backlog 2025 $678.3M–$685.7M Record backlog; ~33% growth vs 2024 at midpoint

2026 revenue guidance $664.9M–$678.3M Revenue outlook for year ending Dec 31, 2026

2026 Adj. EBITDA margin ≥20% Minimum Adjusted EBITDA margin guidance for 2026

Market Reality Check

Price: $24.56 Vol: Volume 135,838 is close t...

normal vol

$24.56 Last Close

Volume Volume 135,838 is close to the 20-day average of 132,906, suggesting typical trading interest pre-announcement. normal

Technical Shares at 24.56 are trading below the 200-day MA of 25.08 and about 17.45% under the 52-week high.

Peers on Argus

No peers in the momentum scanner and no same-day peer headlines were provided, s...

No peers in the momentum scanner and no same-day peer headlines were provided, so the move appears company-specific based on current inputs.

Market Pulse Summary

This announcement combines a sizeable ALGC acquisition with strong growth signals. ALGC contributes ...

Analysis

This announcement combines a sizeable ALGC acquisition with strong growth signals. ALGC contributes $160 million in revenue and a 26.3% Adjusted EBITDA margin, while Cardinal guides 2025 revenue to $452.3M–$459.7M and a record backlog of about $680M. For 2026, revenue of $664.9M–$678.3M and margins of at least 20% highlight an expansion path. Investors may watch integration progress, margin delivery, and leverage levels against these targets.

Key Terms

adjusted EBITDA margin, vertical integration, lockup

3 terms

adjusted EBITDA margin financial

"ALGC will strengthen the company's margin profile, as reflected in Cardinal's revised 2026 consolidated Adjusted EBITDA margin guidance."

Adjusted EBITDA margin shows how much profit a company makes from its core operations, expressed as a percentage of its total revenue, after removing certain one-time or unusual expenses and income. It helps investors understand the company's true earning ability from regular business activities, making it easier to compare performance over time or with other companies. Think of it as measuring the efficiency of a business in turning sales into profits, excluding irregular adjustments.

vertical integration technical

"ALGC is well-positioned to drive margin expansion and valuation uplift through disciplined execution and vertical integration initiatives."

Vertical integration occurs when a company controls multiple stages of its production or supply chain, such as making its own products and also distributing or selling them. This can help the company reduce costs and increase control over quality and delivery. For investors, it often signals a company’s effort to become more self-sufficient and competitive in its industry.

lockup financial

"and $48.6 million in cash, with the equity consideration subject to a six-month post-closing lockup."

A lockup is a contractual restriction that prevents company insiders, early investors, and employees from selling their shares for a fixed period after a public offering or other share issuance. It matters to investors because when that period ends, a sudden increase in available shares can push the stock price down or change trading liquidity; think of it like many homeowners being allowed to list their homes for sale all at once after a temporary sales ban is lifted.

AI-generated analysis. Not financial advice.

RALEIGH, N.C., Feb. 18, 2026 /PRNewswire/ -- Cardinal Infrastructure Group, Inc., (NASDAQ: CDNL) ("Cardinal" or "the Company") announced today that it has acquired Sugar Hill, Georgia-based A.L. Grading Contractors ("ALGC"). A fourth-generation, high-growth market leader, ALGC provides comprehensive site development solutions, including grading, underground utilities, erosion control, and clearing, supporting large-scale commercial, industrial, and residential construction in Georgia and South Carolina.

The transaction is the first expansion in the Southeast for Cardinal outside the Carolinas and signifies another step in Cardinal's growth strategy.

Strategic Highlights

• ALGC holds a leading position in a high-growth, mission-critical market in Georgia.
  • Expands Cardinal's footprint into Georgia, a market aligned with broader Southeast trends that support development investment across various end markets.
  • Expected to drive growth through strong alignment with blue‑chip customers.
• The transaction is immediately accretive. 
  • ALGC will strengthen the company's margin profile, as reflected in Cardinal's revised 2026 consolidated Adjusted EBITDA margin guidance.
  • Evidenced by ALGC's compelling financial profile, including unaudited annual revenue of $160 million and a 26.3% Adjusted EBITDA margin for the trailing 12 months ended September 30, 2025¹.
• ALGC is well-positioned to drive margin expansion and valuation uplift through disciplined execution and vertical integration initiatives.
  • Integration expansion enables faster project execution, schedule leadership, and margin enhancement.
  • Deployment of specialized services from the Carolinas into Georgia is expected to compress schedules and expand margins.
• Combining the companies creates compelling economics.
  • Total consideration of $245.5 million, comprised of an $80 million extension of Cardinal's existing credit facility, $116.9 million in issued equity², and $48.6 million in cash, with the equity consideration subject to a six-month post-closing lockup.
  • Conservative pro forma net tangible leverage of 1.27x, below maximum target of 2.5x.
  • Valuation multiple is squarely within Cardinal's target range.
• ALGC has a highly experienced leadership team and strong cultural alignment with Cardinal, and they're collectively committed to building the Southeast's leading site development contractor.
  • ALGC's President Lee Wood will continue his strategic leadership responsibilities and is expected to join Cardinal's board of directors.
  • ALGC's Vice President Benji Wood will assume the role of chief operating officer for Cardinal.
  • ALGC's CFO Rick Leeson will continue to serve in his capacity.

Selected Preliminary Estimated 2025 Operating Results for Cardinal Infrastructure Group³

Cardinal also announced today the following selected preliminary estimated 2025 operating results:

• Full-year revenue in the range of $452.3 million - $459.7 million, representing approximately 45% growth vs. 2024 at the midpoint.
• Full-year Adjusted EBITDA margin in the range of 17.8% - 18.0%.⁴
• Record backlog of $678.3 million - $685.7 million, representing approximately 33% growth vs. 2024 at the midpoint, reflecting the strength and durability of demand across Cardinal's markets.

2026 Consolidated Guidance/Outlook⁵

Cardinal also announced today the following guidance for the year ending December 31, 2026:

• Revenue in the range of $664.9 million to $678.3 million.
• Adjusted EBITDA margin⁴ of at least 20%.

Management Commentary 

"We are thrilled to welcome the ALGC team into the Cardinal family as we complete this strategic acquisition," said Jeremy Spivey, CEO of Cardinal Infrastructure Group. "Their exceptional culture and leadership align seamlessly with our values, positioning us for enhanced collaboration and innovation in site development. We look forward to executing our growth strategy through vertical integration and expanding our self-performed service offerings to the Georgia market, exemplifying our commitment to robust expansion and solidifying our position as the Southeast's premier site development platform."

About Lee Wood, Jr.

Lee Wood served as president of ALGC and has built a reputation for instituting strategic growth, operational excellence, and strong relationship-driven leadership. Under his direction, ALGC grew into a full-service site work contractor and now employs more than 300 professionals. He will continue his strategic oversight role and is expected to join Cardinal's board of directors.

About Benji Wood

Benjamin (Benji) Wood served as vice president of ALGC, overseeing company performance, project execution, client relationships, and strategic growth initiatives. He's known for combining innovation in operations, efficiency, and field expertise to deliver high-quality site work and infrastructure solutions. After the close of the deal, he will become chief operating officer of Cardinal Infrastructure Group.

VRA Partners, LLC, acted as the exclusive financial advisor to ALGC.

About Cardinal

Cardinal Infrastructure Group delivers its suite of comprehensive infrastructure services that support the planning, preparation, installation, and development of residential, commercial, industrial, municipal, and state infrastructure projects through wholly owned, market leading subsidiaries. Cardinal's operations leverage in-house, highly skilled teams and equipment fleets to deliver wet utility installations (water, sewer, and stormwater systems), as well as grading, site clearing, erosion control, drilling and blasting, paving, and other related site services.

¹Unaudited results for the trailing 12 months ended September 30, 2025. Adjusted EBITDA margin is a non-GAAP financial measure. See Reconciliation of Net Income Attributable to ALGC to Adjusted EBITDA and non-GAAP measures below.
²Composed of 4,186,062 limited liability company units of Cardinal Civil Contracting Holdings LLC and an equal number of shares of Cardinal Class B common stock, and 345,666 of Cardinal Class A common stock.
³The preliminary estimated financial results for the year ended December 31, 2025, are based on currently available information and reflect Cardinal's current estimates and assessments. Cardinal has not completed its full year financial closing procedures and controls and governance procedures, and its independent registered public accounting firm has not completed any audit, review or set of procedures with respect to the preliminary estimated financial results and has not expressed any opinion or any other form of assurance with respect thereto. Actual reported results may differ materially from the preliminary results presented as a result of the completion of Cardinal's financial closing procedures and controls. These preliminary estimated financial results should not be viewed as a substitute for Cardinal's full audited financial statements prepared in accordance with GAAP. Accordingly, you should not place undue reliance on these preliminary estimated financial results.
⁴Adjusted EBITDA margin is a non-GAAP financial measure. Cardinal is unable provide the most directly comparable GAAP financial measure or a quantitative reconciliation thereto without unreasonable effort. See "Non-GAAP Measures" below.
⁵Guidance reflects an estimated 10.5‑month contribution from ALGC.

Important Information for Investors and Stockholders

Non-GAAP Measures

This press release includes a discussion of Adjusted EBITDA and Adjusted EBITDA margin, which are "non-GAAP" financial measures as defined in Regulation G under the Securities Exchange Act of 1934. Cardinal and ALGC report financial results in accordance with U.S. generally accepted accounting principles ("GAAP") but believe that certain non-GAAP financial measures provide useful supplemental information to investors regarding the underlying business trends and performance of their respective ongoing operations and is useful for period-over-period comparisons of those operations. Non-GAAP measures should be used in addition to, and not in lieu of, results prepared in conformity with GAAP.

Cardinal is not able to provide the most directly comparable GAAP financial measure, or a quantitative reconciliation thereto, for the forward-looking guidance of estimated Adjusted EBITDA Margin without unreasonable effort due to the inherent uncertainty and difficulty in predicting the timing and amount of certain items, including but not limited to amortization of intangible assets and depreciation, which may be significant and difficult to project with a reasonable degree of accuracy, as the allocation of purchase price to intangible assets and property and equipment has not yet been performed. Because these adjustments are inherently variable and uncertain and depend on various factors that are beyond Cardinal's control, Cardinal is also unable to predict their probable significance. The variability of these items could have an unpredictable, and potentially significant, impact on Cardinal's future GAAP financial results.

Reconciliation of Net Income Attributable to ALGC to Adjusted EBITDA

$ in Thousands Unaudited	Trailing 12 Months Ended September 30, 2025
Revenue	$	159,851
Net income		33,347
Interest expense, net		46
Income tax expense		1,489
Depreciation and amortization expense		7,138
EBITDA	$	42,020
Other		-
Adjusted EBITDA	$	42,020
Net Income Margin		20.9	%
EBITDA Margin		26.3	%
Adjusted EBITDA Margin		26.3	%

Supplemental Presentation

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning, among other things, Cardinal Infrastructure Group, Inc.'s ("Cardinal") acquisition (the "ALGC Acquisition") of A.L. Grading Contractors, Inc., ("ALGC") and the expected benefits of the ALGC Acquisition. Statements that are predictive in nature, that depend upon or refer to future events or conditions or that include the words "may," "could," "plan," "project," "budget," "predict," "pursue," "target," "seek," "objective," "believe," "expect," "anticipate," "intend," "estimate," and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-looking statements. These statements involve risks and uncertainties and Cardinal's actual results could differ materially from the results expressed or implied by such forward-looking statements. The potential risks, uncertainties and other factors that could cause actual results to differ from those expressed by the forward-looking statements in this press release include, but are not limited to, the possibility that any of the anticipated benefits of the ALGC acquisition will not be realized to the extent or when expected; the risk that integration of ALGC's operations with those of Cardinal will be materially delayed or will be more costly or difficult than expected; the challenges of integrating and retaining key employees; the effect of the announcement of the ALGC acquisition on ALGC's and Cardinal's business relationships, operating results and business generally; difficulty in sustaining rapid revenue growth, which may place significant demands on Cardinal's administrative, operational and financial resources, fluctuations in Cardinal's revenue and the concentration of Cardinal's business in the Southeastern United States. Cardinal has based these forward-looking statements largely on its current expectations and projections regarding future events and trends that it believes may affect its business, financial condition and results of operations. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the section entitled "Risk Factors" in Cardinal's Registration Statement on Form S-1 (333-292034) (the "Registration Statement"), and elsewhere in the Registration Statement. Accordingly, you should not rely upon forward-looking statements as predictions of future events. Cardinal cannot assure you that the results, events and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events or circumstances could differ materially from those projected in the forward-looking statements.  Although forward-looking statements reflect the good faith beliefs of Cardinal's management at the time they are made, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. Cardinal undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, unless required by law. These cautionary statements qualify all forward-looking statements attributable to Cardinal or persons acting on its behalf.

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SOURCE Cardinal Infrastructure Group Inc.

FAQ

What did Cardinal (CDNL) pay to acquire A.L. Grading Contractors and how was it funded?

Cardinal paid $245.5 million in total consideration for ALGC. According to the company, funding comprised an $80M credit extension, $116.9M issued equity, and $48.6M cash, with equity subject to a six-month lockup.

How does the ALGC acquisition affect Cardinal's 2026 profitability guidance (CDNL)?

The acquisition supports Cardinal's target of at least a 20% Adjusted EBITDA margin for 2026. According to the company, ALGC's strong margins and vertical integration are expected to drive margin expansion and valuation uplift.

What were Cardinal's selected preliminary estimated 2025 results announced on Feb 18, 2026 (CDNL)?

Cardinal estimated 2025 revenue of $452.3M–$459.7M and Adjusted EBITDA margin of 17.8%–18.0%. According to the company, backlog was a record $678.3M–$685.7M, roughly 33% growth versus 2024 at midpoint.

How large is ALGC's business and what margins did it report before the deal (CDNL)?

ALGC reported unaudited annual revenue of $160 million with a 26.3% Adjusted EBITDA margin for the trailing 12 months ended Sept 30, 2025. According to the company, ALGC is a market leader in Georgia site development.

What is Cardinal's post-transaction leverage position after acquiring ALGC (CDNL)?

Cardinal reported conservative pro forma net tangible leverage of approximately 1.27x, below its maximum target of 2.5x. According to the company, the capital structure remains within their target leverage range.