Sterling Announces a $155 Million Aviation Award

Rhea-AI Summary

Sterling Infrastructure, Inc. (NasdaqGS: STRL) subsidiary, Road and Highway Builders, LLC, secures a $155 million contract for runway extension at Lihue Airport in Hawaii as part of the state's Airport Modernization Program. The project includes excavation, drain pipe installation, and asphalt work, expected to start in April 2024 with a two-and-a-half-year duration.

Market Research Analyst

The $155 million contract awarded to Sterling Infrastructure's subsidiary RHB for the Lihue Airport runway extension is a significant development in the infrastructure sector. This project, part of Hawaii's Airport Modernization Program, not only enhances the company's backlog but also reflects the increasing governmental focus on infrastructure improvement. The incorporation of this contract in the first quarter 2024 backlog suggests a positive outlook for Sterling's future revenue streams.

From a market standpoint, the news has the potential to positively affect Sterling's stock, as investors often react favorably to announcements of new contracts, particularly those of substantial value. The two-and-a-half-year duration of the project also provides a clear timeline for revenue recognition, which can aid in financial forecasting. It's important to note that infrastructure projects carry risks such as cost overruns and delays, which can impact the expected financial benefits. Monitoring Sterling's execution of this project will thus be critical for stakeholders.

Financial Analyst

With the announcement of the $155 million contract, Sterling Infrastructure's financial position is poised to strengthen. The project's addition to the first quarter 2024 backlog indicates an increase in the company's work-in-hand, which is a key metric for assessing future earnings potential in the construction sector. Investors should evaluate the impact of this contract on the company's debt levels, liquidity and overall financial health, as large projects typically require significant capital outlays and can affect cash flow.

Furthermore, the aviation infrastructure sector is often subject to stringent regulatory requirements and environmental considerations. The successful navigation of these factors can lead to enhanced investor confidence and potentially a more favorable credit rating, which in turn can lower the cost of capital for future projects. However, any regulatory hurdles or environmental issues that arise could delay the project and alter expected financial outcomes.

Construction Industry Expert

The involvement of Sterling's RHB subsidiary in Hawaii's Airport Modernization Program demonstrates the company's capabilities in handling large-scale infrastructure projects. The scope of work, including excavation, drain pipe installation, structural concrete wall installation and asphalt, requires expertise in various construction methodologies. It also indicates a commitment to modernizing transportation infrastructure, which is essential for economic growth.

Industry norms suggest that such projects can have a ripple effect on local economies by creating jobs and improving logistics. For Sterling, the successful completion of the Lihue Airport runway extension could lead to further contracts within the aviation sector and solidify its reputation as a reliable contractor. It is crucial, however, for Sterling to maintain high safety and quality standards throughout the project to mitigate risks and uphold its industry standing.

THE WOODLANDS, Texas, Feb. 26, 2024 /PRNewswire/ -- Sterling Infrastructure, Inc. (NasdaqGS: STRL) ("Sterling" or "the Company") today announced that its Road and Highway Builders, LLC (RHB) subsidiary (50% owned), has been awarded a $155 million contract for runway extension at the Lihue Airport located in Kauai, Hawaii. The award will be included in first quarter 2024 backlog.

The Lihue Airport project is part of Hawaii's Airport Modernization Program, which is transforming the state's airports into world-class facilities. RHB's scope of work includes excavation, drain pipe installation, structural concrete wall installation, and asphalt. The project is expected to start in April 2024 and has a two-and-a-half-year duration.

CEO Remarks
"We are thrilled to be part of Hawaii's efforts to modernize its airport system," stated Joe Cutillo, Sterling's CEO. "States are actively engaged in rolling out programs to upgrade their infrastructure, driving strong demand for RHB's best-in-class aviation and highway services," Mr. Cutillo continued. "Aviation projects, which have been somewhat slow to move forward following the passage of the Infrastructure Investment and Jobs Act ("IIJA") are accelerating."

About Sterling
Sterling Infrastructure, Inc., ("Sterling," "the Company," "we," "our" or "us"), a Delaware corporation, operates through a variety of subsidiaries within three segments specializing in E-Infrastructure, Transportation and Building Solutions in the United States, primarily across the Southern, Northeastern, Mid-Atlantic and Rocky Mountain regions and Hawaii. E-Infrastructure Solutions provides advanced, large-scale site development services for manufacturing, data centers, e-commerce distribution centers, warehousing, energy and more. Transportation Solutions includes infrastructure and rehabilitation projects for highways, roads, bridges, airports, ports, rail and storm drainage systems. Building Solutions projects include residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs and other concrete work. From strategy to operations, we are committed to sustainability by operating responsibly to safeguard and improve society's quality of life. Caring for our people and our communities, our customers and our investors – that is The Sterling Way.

Joe Cutillo, CEO, "We build and service the infrastructure that enables our economy to run, our people to move and our country to grow."

Important Information for Investors and Stockholders
Cautionary Statement Regarding Forward-Looking Statements
This press release contains statements that are considered forward-looking statements within the meaning of the federal securities laws. Any such statements are subject to risks and uncertainties, including those risks identified in the Company's filings with the Securities and Exchange Commission. Accordingly, such statements should be considered in light of these risks. The forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements for any reason, whether as a result of new information, future events or developments, changed circumstances, or otherwise, notwithstanding any changes in our assumptions, changes in business plans, actual experience or other changes. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.

Company Contact:
Sterling Infrastructure, Inc.
Noelle Dilts, VP of Investor Relations and Corporate Strategy
281-214-0795
Noelle.dilts@strlco.com  

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SOURCE Sterling Infrastructure, Inc.

FAQ

What contract did Sterling Infrastructure, Inc. subsidiary secure recently?

Sterling Infrastructure, Inc. subsidiary, Road and Highway Builders, LLC, secured a $155 million contract for runway extension at Lihue Airport in Hawaii.

What is the duration of the Lihue Airport project?

The Lihue Airport project is expected to start in April 2024 and has a two-and-a-half-year duration.

Who stated the remarks about the project?

Joe Cutillo, Sterling's CEO, stated the remarks about the project.

What kind of work is included in RHB's scope for the project?

RHB's scope of work includes excavation, drain pipe installation, structural concrete wall installation, and asphalt work.

Which act has accelerated aviation projects according to the CEO?

The Infrastructure Investment and Jobs Act ('IIJA') has accelerated aviation projects according to the CEO.