Construction Partners (NASDAQ: ROAD) boosts FY26 guidance after strong Q2 results
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Construction Partners, Inc. reported strong fiscal 2026 second quarter results and raised its full-year outlook. Revenue for the quarter reached $769.2 million, up 34.5% from $571.7 million a year earlier, while gross profit increased to $98.9 million from $71.4 million.
Net income doubled to $9.2 million, with diluted EPS rising to $0.16 from $0.08. Adjusted net income was $10.4 million and Adjusted EBITDA was $93.3 million, up 34.6% from $69.3 million. Project backlog reached a record $3.14 billion as of March 31, 2026.
For fiscal 2026, the company now expects revenue between $3.59 billion and $3.65 billion, net income of $159.0–$162.0 million, Adjusted net income of $170.4–$174.2 million, and Adjusted EBITDA of $552.0–$564.0 million, implying an Adjusted EBITDA margin of about 15.4%.
Positive
- Strong revenue and profit growth: Q2 2026 revenue rose 34.5% to $769.2 million, Adjusted EBITDA increased 34.6% to $93.3 million, and net income more than doubled to $9.2 million with diluted EPS at $0.16.
- Record backlog and higher guidance: Project backlog reached a record $3.14 billion at March 31, 2026, and the company raised its FY26 outlook for revenue, net income, Adjusted net income and Adjusted EBITDA with a targeted Adjusted EBITDA margin around 15.4%.
Negative
- None.
Insights
Q2 showed strong growth, margin stability, record backlog and a notable guidance raise.
Construction Partners delivered sharply higher scale in Q2 2026, with revenue up 34.5% to $769.2M and Adjusted EBITDA up 34.6% to $93.3M. Importantly, Adjusted EBITDA margin held essentially flat at about 12.1%, indicating the business is absorbing growth without visible margin compression.
Net income more than doubled to $9.2M and diluted EPS reached $0.16. A record project backlog of $3.14B as of March 31, 2026 supports revenue visibility, aided by the company’s vertically integrated model and cost pass-through contracts described in management’s commentary.
The company raised its fiscal 2026 outlook, now targeting revenue of $3.59B–$3.65B and Adjusted EBITDA of $552M–$564M, implying an Adjusted EBITDA margin of roughly 15.4%. This combination of strong in-period performance, record backlog and upgraded guidance is typically viewed as a favorable development, though execution on acquisitions and integration remains an ongoing focus area.
8-K Event Classification
Item 2.02 — Results of Operations and Financial Condition
1 item
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Key Figures
Q2 2026 Revenue: $769.2M
Q2 2026 Net Income: $9.2M
Q2 2026 Adjusted EBITDA: $93.3M
+5 more
8 metrics
Q2 2026 Revenue
$769.2M
For the three months ended March 31, 2026; up 34.5% year over year
Q2 2026 Net Income
$9.2M
For the three months ended March 31, 2026 vs. $4.2M in 2025
Q2 2026 Adjusted EBITDA
$93.3M
For the three months ended March 31, 2026; 34.6% growth, 12.13% margin
Project Backlog
$3.14B
Backlog at March 31, 2026; record level compared to prior periods
FY26 Revenue Outlook
$3.59B–$3.65B
Updated fiscal 2026 guidance range for total revenue
FY26 Adjusted EBITDA Outlook
$552M–$564M
Updated fiscal 2026 guidance range; 15.38–15.45% margin
Operating Cash Flow
$147.8M
Net cash provided by operating activities for six months ended March 31, 2026
Long-Term Debt
$1.75B
Long-term debt including current maturities as of March 31, 2026
Key Terms
Adjusted EBITDA, Adjusted net income, backlog, transformative acquisition expenses, +2 more
6 terms
Adjusted EBITDA financial
"Adjusted EBITDA(1) in the second quarter of fiscal 2026 was $93.3 million"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
Adjusted net income financial
"Adjusted net income(1) was $10.4 million in the second quarter of fiscal 2026"
Adjusted net income is a company's reported profit after removing unusual, one-time, or non-operational items so the number reflects the business’s regular earning power. Investors use it like a cleaned-up scorecard — similar to judging a player’s season performance without a few fluke games — to compare companies or assess trends without being misled by rare gains or losses that won’t affect future cash flow.
backlog financial
"Project backlog was a record $3.14 billion at March 31, 2026"
A backlog is the amount of work or orders that a company has received but hasn't completed yet. It’s like a restaurant with many dishes to serve; the backlog shows how many orders are still waiting to be finished. It matters because a large backlog can indicate strong demand or potential delays in delivering products or services.
transformative acquisition expenses financial
"Transformative acquisition expenses | 1,573 | | | 221"
interest rate swap contract financial
"Unrealized gain (loss) on interest rate swap contract, net | 58"
Earnings Snapshot
Revenue: $769.2M · Guidance included
Q2 2026
Revenue
$769.2M
+34.5% YoY
Net income
$9.2M
up from $4.2M YoY
Diluted EPS
$0.16
up from $0.08 YoY
Adjusted EBITDA
$93.3M
+34.6% YoY
Backlog
$3.14B
record level at March 31, 2026
Guidance
For FY26, the company guides revenue to $3.59–$3.65B, net income to $159.0–$162.0M, Adjusted net income to $170.4–$174.2M, and Adjusted EBITDA to $552.0–$564.0M with a 15.38–15.45% Adjusted EBITDA margin.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 8, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) | ||||||||||||
290 Healthwest Drive, Suite 2 Dothan, Alabama 36303 (Address of principal executive offices) (ZIP Code) | ||||||||||||||
(334) 673-9763 (Registrant’s telephone number, including area code) | ||||||||||||||
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||||||||
| (Nasdaq Global Select Market) | ||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On May 8, 2026, Construction Partners, Inc. issued a press release announcing its financial results for the fiscal quarter ended March 31, 2026. A copy of the press release is furnished as Exhibit 99.1 hereto, and the information contained in Exhibit 99.1 is incorporated herein by reference.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||||||||
| 99.1** | Press release dated May 8, 2026 | |||||||||||||
| 104* | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||||||||
* Filed herewith.
** Furnished herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CONSTRUCTION PARTNERS, INC. | ||||||||
| Date: May 8, 2026 | By: | /s/ Gregory A. Hoffman | ||||||
| Gregory A. Hoffman | ||||||||
| Senior Vice President and Chief Financial Officer | ||||||||
Exhibit 99.1
 | NEWS RELEASE | |||||||
Construction Partners, Inc. Announces Fiscal 2026 Second Quarter Results
Revenue Up 35% Compared to Q2 FY25
Adjusted Net Income Up 136% Compared to Q2 FY25
Adjusted EBITDA Up 35% Compared to Q2 FY25
Record Backlog of $3.14 Billion
Company Raises FY26 Outlook
DOTHAN, AL, May 8, 2026 – Construction Partners, Inc. (NASDAQ: ROAD) (“CPI” or the “Company”), a vertically integrated civil infrastructure company specializing in the construction and maintenance of roadways in local markets throughout the Sunbelt, today reported financial and operating results for the fiscal quarter ended March 31, 2026.
Fred J. (Jule) Smith, III, the Company’s President and Chief Executive Officer, said, “We delivered a strong quarter, driven by exceptional execution across the business. Our teams throughout our family of companies performed at a high level, consistently outperforming on project delivery, productivity, and safety. Favorable weather conditions further supported our ability to advance work efficiently and exceed expectations. Additionally, energy cost volatility had a limited impact on results due to the pass-through nature of our project contracts, as well as the physical hedge inherent to our vertical integration. Strong financial performance in the quarter led to 35 percent growth in both revenue and Adjusted EBITDA, including 11 percent organic revenue growth. Our local teams across our Sunbelt footprint continued to capture meaningful project wins, driving our backlog to a record $3.14 billion. With the peak construction season ahead in the second half of our fiscal year, we are raising our FY 2026 outlook, and we are well-positioned to execute against this record backlog and sustain our growth momentum.”
Revenues were $769.2 million in the second quarter of fiscal 2026, an increase of 34.5% compared to $571.7 million in the same quarter last year.
Gross profit was $98.9 million in the second quarter of fiscal 2026, compared to $71.4 million in the same quarter last year.
General and administrative expenses were $63.6 million in the second quarter of fiscal 2026, compared to $46.7 million in the same quarter last year, and as a percentage of total revenues, was 8.3%, compared to 8.2% in the same quarter last year.
Net income was $9.2 million in the second quarter of fiscal 2026 and diluted earnings per share were $0.16, compared to net income of $4.2 million and diluted earnings per share of $0.08 in the same quarter last year.
Adjusted net income(1) was $10.4 million in the second quarter of fiscal 2026, compared to Adjusted net income of $4.4 million in the same quarter last year. Using Adjusted net income, diluted earnings per share would have been $0.18 for the second quarter of fiscal 2026, compared to $0.08 in the same quarter last year.
Adjusted EBITDA(1) in the second quarter of fiscal 2026 was $93.3 million, an increase of 34.6% compared to $69.3 million in the same quarter last year.
Project backlog was a record $3.14 billion at March 31, 2026, compared to $2.84 billion at March 31, 2025 and $3.09 billion at December 31, 2025.
Smith added, “Our performance is a testament to the hard work and dedication of our people. A deeply embedded culture of operational excellence, disciplined project execution, and an unwavering commitment to safety continues to unite our family of companies, driving results and reinforcing CPI’s reputation as an acquirer of choice across our eight-state footprint. We were pleased to have completed our latest strategic acquisition in April with the purchase of Four Star Paving by our Tennessee platform company, Pavement Restorations, Inc. (“PRI”). This transaction strengthens our vertical integration of services and enhances our capabilities and scale across the middle Tennessee region. As the Nashville metro area continues to rapidly grow,
(1) Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin are financial measures not presented in accordance with generally accepted accounting principles (“GAAP”). Please see “Reconciliation of Non-GAAP Financial Measures” at the end of this press release.
we are now better positioned than ever to participate in the resulting construction projects and opportunities. Reflecting our strong second quarter results and incorporating the expected contribution of Four Star Paving, we are raising our fiscal 2026 outlook ranges. We remain confident in CPI’s growth trajectory and expanding profitability and are focused on delivering long-term value for our investors and other stakeholders.”
Fiscal 2026 Outlook
The Company is raising its outlook for fiscal year 2026 with regard to revenue, net income, Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin as follows:
•Revenue in the range of $3.590 billion to $3.650 billion
•Net income in the range of $159.0 million to $162.0 million
•Adjusted net income(1) in the range $170.4 million to $174.2 million
•Adjusted EBITDA(1) in the range of $552.0 million to $564.0 million
•Adjusted EBITDA margin(1) in the range of 15.38% to 15.45%
Ned N. Fleming, III, the Company’s Executive Chairman, stated, “We are pleased with our team’s strong execution this quarter as we continue to advance CPI’s proven growth strategy. Our differentiated business model, built on cost pass-through, vertical integration, and a decentralized partnership approach, remains a powerful and often underappreciated driver of sustainable results. Supported by a strong balance sheet, disciplined leadership, and an expanding Sunbelt footprint, CPI is well-positioned to compound shareholder value through both geographic expansion and increasing operational scale. The long-term demand environment remains compelling. Growing infrastructure repair and maintenance needs, sustained population migration, economic expansion, and rising roadway capacity demands across the Sunbelt continue to create a durable and growing addressable market for our services. Against this powerful backdrop, the Board and I remain highly confident in CPI’s long-term trajectory and the significant opportunities ahead.”
Conference Call
The Company will conduct a conference call today at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) to discuss financial and operating results for the fiscal quarter ended March 31, 2026. To access the call live by phone, dial (412) 902-0003 and ask for the Construction Partners call at least 10 minutes prior to the start time. A webcast of the call will also be available live and for later replay on the Company’s Investor Relations website at www.constructionpartners.net.
About Construction Partners, Inc.
Construction Partners, Inc. is a vertically integrated civil infrastructure company operating in local markets throughout the Sunbelt in Alabama, Florida, Georgia, North Carolina, Oklahoma, South Carolina, Tennessee and Texas. Supported by its hot-mix asphalt plants, aggregate facilities and liquid asphalt terminals, the Company focuses on the construction, repair and maintenance of surface infrastructure. Publicly funded projects make up the majority of its business and include local and state roadways, interstate highways, airport runways and bridges. The company also performs private sector projects that include paving and sitework for office and industrial parks, shopping centers, local businesses and residential developments. To learn more, visit www.constructionpartners.net.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained herein that are not statements of historical or current fact constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. These statements may be identified by the use of words such as “may,” “will,” “expect,” “should,” “anticipate,” “intend,” “project,” “outlook,” “believe” and “plan.” The forward-looking statements contained in this press release include, without limitation, statements related to financial projections, future events, business strategy, future performance, future operations, backlog, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management. These and other forward-looking statements are based on management’s current views and assumptions and involve risks and uncertainties that could significantly affect expected results. Important factors could cause actual results to differ materially from those expressed in the forward-looking statements, including, among others: our ability to successfully manage and integrate acquisitions; failure to realize the expected economic benefits of acquisitions, including future levels of revenues being lower than expected and costs
being higher than expected; failure or inability to implement growth strategies in a timely manner; declines in public infrastructure construction and reductions in government funding, including the funding by transportation authorities and other state and local agencies; risks related to our operating strategy; competition for projects in our local markets; risks associated with our capital-intensive business; government requirements and initiatives, including those related to funding for public or infrastructure construction, land usage and environmental, health and safety matters; unfavorable economic conditions and restrictive financing markets; our ability to obtain sufficient bonding capacity to undertake certain projects; our ability to accurately estimate the overall risks, requirements or costs when we bid on or negotiate contracts that are ultimately awarded to us; the cancellation of a significant number of contracts or our disqualification from bidding for new contracts; risks related to adverse weather conditions; our substantial indebtedness and the restrictions imposed on us by the terms thereof; our ability to maintain favorable relationships with third parties that supply us with equipment and essential supplies; our ability to retain key personnel and maintain satisfactory labor relations; property damage, results of litigation and other claims and insurance coverage issues; risks related to our information technology systems and infrastructure; our ability to maintain effective internal control over financial reporting; and the risks, uncertainties and factors set forth under “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and its subsequently filed Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date they are made. The Company assumes no obligation to update forward-looking statements to reflect actual results, subsequent events, or circumstances or other changes affecting such statements except to the extent required by applicable law.
Contact:
Rick Black
Dennard Lascar Investor Relations
ROAD@DennardLascar.com
(713) 529-6600
- Financial Statements Follow -
Construction Partners, Inc.
Consolidated Statements of Comprehensive Income
(unaudited in thousands, except share and per share data)
| For the Three Months Ended March 31, | For the Six Months Ended March 31, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Revenues | $ | 769,196 | $ | 571,650 | $ | 1,578,665 | $ | 1,133,230 | ||||||||||||||||||
| Cost of revenues | 670,343 | 500,300 | 1,358,312 | 985,309 | ||||||||||||||||||||||
| Gross profit | 98,853 | 71,350 | 220,353 | 147,921 | ||||||||||||||||||||||
| General and administrative expenses | (63,596) | (46,662) | (125,097) | (90,928) | ||||||||||||||||||||||
| Acquisition-related expenses | (2,480) | (806) | (14,109) | (20,358) | ||||||||||||||||||||||
| Gain on sale of property, plant and equipment, net | 4,606 | 3,407 | 6,645 | 4,462 | ||||||||||||||||||||||
| Operating income | 37,383 | 27,289 | 87,792 | 41,097 | ||||||||||||||||||||||
| Interest expense, net | (25,590) | (21,592) | (52,960) | (39,722) | ||||||||||||||||||||||
| Other income (expense) | 276 | (159) | 23 | 262 | ||||||||||||||||||||||
| Income before provision for income taxes and earnings from investment in joint venture | 12,069 | 5,538 | 34,855 | 1,637 | ||||||||||||||||||||||
| Provision for income taxes | 2,889 | 1,310 | 8,469 | 461 | ||||||||||||||||||||||
| Loss from investment in joint venture | — | (13) | (1) | (12) | ||||||||||||||||||||||
| Net income | 9,180 | 4,215 | 26,385 | 1,164 | ||||||||||||||||||||||
| Other comprehensive income (loss), net of tax | ||||||||||||||||||||||||||
| Unrealized gain (loss) on interest rate swap contract, net | 58 | (2,890) | (1,152) | (21) | ||||||||||||||||||||||
| Unrealized gain (loss) on restricted investments, net | (158) | 231 | (122) | (102) | ||||||||||||||||||||||
| Other comprehensive (loss) | (100) | (2,659) | (1,274) | (123) | ||||||||||||||||||||||
| Comprehensive income | $ | 9,080 | $ | 1,556 | $ | 25,111 | $ | 1,041 | ||||||||||||||||||
| Net income per share attributable to common stockholders: | ||||||||||||||||||||||||||
| Basic | $ | 0.16 | $ | 0.08 | $ | 0.47 | $ | 0.02 | ||||||||||||||||||
| Diluted | $ | 0.16 | $ | 0.08 | $ | 0.47 | $ | 0.02 | ||||||||||||||||||
| Weighted average number of common shares outstanding: | ||||||||||||||||||||||||||
| Basic | 55,917,842 | 55,248,526 | 55,860,888 | 54,698,442 | ||||||||||||||||||||||
| Diluted | 56,256,531 | 55,669,646 | 56,150,804 | 55,141,358 | ||||||||||||||||||||||
Construction Partners, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)
| March 31, | September 30, | ||||||||||
| 2026 | 2025 | ||||||||||
| ASSETS | (unaudited) | ||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 76,860 | $ | 156,062 | |||||||
| Restricted cash | 120 | 2,953 | |||||||||
| Contracts receivable including retainage, net | 515,650 | 549,884 | |||||||||
| Costs and estimated earnings in excess of billings on uncompleted contracts | 64,539 | 45,340 | |||||||||
| Inventories | 176,802 | 155,133 | |||||||||
| Prepaid expenses and other current assets | 28,424 | 25,459 | |||||||||
| Total current assets | 862,395 | 934,831 | |||||||||
| Property, plant and equipment, net | 1,265,112 | 1,153,070 | |||||||||
| Operating lease right-of-use assets | 95,724 | 76,355 | |||||||||
| Goodwill | 1,097,535 | 943,309 | |||||||||
| Intangible assets, net | 76,391 | 79,230 | |||||||||
| Investment in joint venture | — | 72 | |||||||||
| Restricted investments | 16,150 | 23,176 | |||||||||
| Other assets | 25,450 | 28,813 | |||||||||
| Total assets | $ | 3,438,757 | $ | 3,238,856 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 290,346 | $ | 284,218 | |||||||
| Billings in excess of costs and estimated earnings on uncompleted contracts | 142,185 | 129,300 | |||||||||
| Current portion of operating lease liabilities | 26,807 | 19,867 | |||||||||
| Current maturities of long-term debt | 38,500 | 38,500 | |||||||||
| Accrued expenses and other current liabilities | 66,472 | 110,163 | |||||||||
| Total current liabilities | 564,310 | 582,048 | |||||||||
| Long-term liabilities: | |||||||||||
| Long-term debt, net of current maturities and deferred debt issuance costs | 1,710,699 | 1,573,614 | |||||||||
| Operating lease liabilities, net of current portion | 69,461 | 57,201 | |||||||||
| Deferred income taxes, net | 83,543 | 80,079 | |||||||||
| Other long-term liabilities | 31,359 | 33,951 | |||||||||
| Total long-term liabilities | 1,895,062 | 1,744,845 | |||||||||
| Total liabilities | 2,459,372 | 2,326,893 | |||||||||
| Stockholders’ equity: | |||||||||||
Preferred stock, par value $0.001; 10,000,000 shares authorized and no shares issued and outstanding at March 31, 2026 and September 30, 2025 | — | — | |||||||||
Class A common stock, par value $0.001; 400,000,000 shares authorized, 48,710,906 shares issued and 47,965,450 shares outstanding at March 31, 2026 and 47,963,617 shares issued and 47,406,498 shares outstanding at September 30, 2025 | 48 | 47 | |||||||||
Class B common stock, par value $0.001; 100,000,000 shares authorized, 11,481,568 shares issued and 8,549,118 shares outstanding at March 31, 2026 and 11,463,770 shares issued and 8,538,165 shares outstanding at September 30, 2025 | 12 | 12 | |||||||||
| Additional paid-in capital | 609,457 | 541,179 | |||||||||
Treasury stock, Class A common stock, par value $0.001, at cost, 745,456 shares at March 31, 2026 and 557,119 shares at September 30, 2025 | (59,770) | (34,589) | |||||||||
Treasury stock, Class B common stock, par value $0.001, at cost, 2,932,450 shares at March 31, 2026 and 2,925,605 shares at September 30, 2025 | (16,833) | (16,046) | |||||||||
| Accumulated other comprehensive income, net | 3,095 | 4,369 | |||||||||
| Retained earnings | 443,376 | 416,991 | |||||||||
| Total stockholders’ equity | 979,385 | 911,963 | |||||||||
| Total liabilities and stockholders’ equity | $ | 3,438,757 | $ | 3,238,856 | |||||||
Construction Partners, Inc.
Consolidated Statements of Cash Flows
(in thousands)
| For the Six Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 26,385 | $ | 1,164 | |||||||
| Adjustments to reconcile net income to net cash, cash equivalents and restricted cash provided by operating activities: | |||||||||||
| Depreciation, depletion, accretion and amortization | 91,299 | 68,447 | |||||||||
| Amortization of deferred debt issuance costs | 1,335 | 2,211 | |||||||||
| Provision for bad debt | 282 | 172 | |||||||||
| Gain on sale of property, plant and equipment | (6,645) | (4,462) | |||||||||
| Realized loss on sales, calls and maturities of restricted investments | (12) | 44 | |||||||||
| Share-based compensation expense | 22,410 | 18,883 | |||||||||
| Distribution of earnings from investment in joint venture | 71 | — | |||||||||
| Loss from investment in joint venture | 1 | 12 | |||||||||
| Deferred income tax benefit | 3,808 | (1,480) | |||||||||
| Other non-cash adjustments | (495) | (488) | |||||||||
| Changes in operating assets and liabilities, net of business acquisitions: | |||||||||||
| Contracts receivable including retainage | 58,752 | 49,336 | |||||||||
| Costs and estimated earnings in excess of billings on uncompleted contracts | (16,105) | (15,007) | |||||||||
| Inventories | (9,780) | (4,387) | |||||||||
| Prepaid expenses and other current assets | (1,428) | 5,248 | |||||||||
| Other assets | 2,108 | (824) | |||||||||
| Accounts payable | (11,082) | (27,606) | |||||||||
| Billings in excess of costs and estimated earnings on uncompleted contracts | 1,717 | 5,294 | |||||||||
| Accrued expenses and other current liabilities | (9,124) | 567 | |||||||||
| Other long-term liabilities | (5,724) | (827) | |||||||||
| Net cash provided by operating activities, net of business acquisitions | 147,773 | 96,297 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Purchases of property, plant and equipment | (81,728) | (68,226) | |||||||||
| Proceeds from sale of property, plant and equipment | 13,502 | 5,991 | |||||||||
| Proceeds from sales, calls and maturities of restricted investments | 9,449 | 3,940 | |||||||||
| Business acquisitions, net of cash acquired | (275,875) | (828,736) | |||||||||
| Purchase of restricted investments | (2,448) | (6,202) | |||||||||
| Net cash used in investing activities | (337,100) | (893,233) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from revolving credit facility | 185,000 | 145,000 | |||||||||
| Proceeds from issuance of long-term debt, net of debt issuance costs | — | 834,566 | |||||||||
| Settlement of stock awards | (2,490) | — | |||||||||
| Repayments of long-term debt | (49,250) | (135,601) | |||||||||
| Purchase of treasury stock | (25,968) | (20,129) | |||||||||
| Net cash provided by financing activities | 107,292 | 823,836 | |||||||||
| Net change in cash, cash equivalents and restricted cash | (82,035) | 26,900 | |||||||||
| Cash, cash equivalents and restricted cash: | |||||||||||
| Cash, cash equivalents and restricted cash, beginning of period | 159,015 | 76,684 | |||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 76,980 | $ | 103,584 | |||||||
| Supplemental cash flow information: | |||||||||||
| Cash paid for interest | $ | 51,341 | $ | 35,788 | |||||||
| Cash paid for income taxes | $ | 4,030 | $ | 1,888 | |||||||
| Cash paid for operating lease liabilities | $ | 14,705 | $ | 7,191 | |||||||
| Non-cash items: | |||||||||||
| Operating lease right-of-use assets obtained in exchange for operating lease liabilities | $ | 30,910 | $ | 20,613 | |||||||
| Property, plant and equipment financed with accounts payable | $ | 9,694 | $ | 6,783 | |||||||
| Amounts (receivable) payable to sellers in business combinations, net | $ | (2,064) | $ | 84,119 | |||||||
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA represents net income before, as applicable from time to time, (i) interest expense, net, (ii) provision (benefit) for income taxes, (iii) depreciation, depletion, accretion and amortization, (iv) share-based compensation expense, (v) loss on the extinguishment of debt, and (vi) nonrecurring expenses related to transformative acquisitions, which management considers to include transactions of a size that would require clearance under federal antitrust laws. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenues for each period. Adjusted net income represents net income before (i) nonrecurring expenses related to transformative acquisitions, which management considers to include transactions of a size that would require clearance under federal antitrust laws, and (ii) nonrecurring fees associated with financing arrangements incurred in connection with transformative acquisitions. These metrics are supplemental measures of our operating performance that are neither required by, nor presented in accordance with, GAAP. These measures have limitations as analytical tools and should not be considered in isolation or as an alternative to net income or any other performance measure derived in accordance with GAAP as an indicator of our operating performance. We present Adjusted EBITDA, Adjusted EBITDA margin and Adjusted net income because management uses these measures as key performance indicators, and we believe that securities analysts, investors and others use these measures to evaluate companies in our industry. Our calculation of Adjusted EBITDA, Adjusted EBITDA margin and Adjusted net income may not be comparable to similarly named measures reported by other companies. Potential differences may include differences in capital structures, tax positions and the age and book depreciation of intangible and tangible assets.
The following tables present a reconciliation of net income, the most directly comparable measure calculated in accordance with GAAP, to (i) Adjusted net income and (ii) Adjusted EBITDA (with the resulting calculation of Adjusted EBITDA margin) for the applicable periods.
Construction Partners, Inc.
Net Income to Adjusted EBITDA Reconciliation
Three Months Ended March 31, 2026 and 2025
(in thousands, except percentages)
| For the Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net income | $ | 9,180 | $ | 4,215 | |||||||
| Interest expense, net | 25,590 | 21,592 | |||||||||
| Provision for income taxes | 2,889 | 1,310 | |||||||||
| Depreciation, depletion, accretion and amortization | 46,269 | 37,263 | |||||||||
| Share-based compensation expense | 7,818 | 4,672 | |||||||||
| Transformative acquisition expenses | 1,573 | 221 | |||||||||
| Adjusted EBITDA | $ | 93,319 | $ | 69,273 | |||||||
| Revenues | $ | 769,196 | $ | 571,650 | |||||||
| Adjusted EBITDA margin | 12.13 | % | 12.12 | % | |||||||
Construction Partners, Inc.
Net Income to Adjusted Net Income Reconciliation
Three Months Ended March 31, 2026 and 2025
(in thousands)
| For the Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net income | $ | 9,180 | $ | 4,215 | |||||||
| Transformative acquisition expenses | 1,573 | 221 | |||||||||
| Financing fees related to transformative acquisition | — | — | |||||||||
| Tax impact due to above reconciling items | (385) | (53) | |||||||||
| Adjusted net income | $ | 10,368 | $ | 4,383 | |||||||
Construction Partners, Inc.
Net Income to Adjusted EBITDA Reconciliation
Fiscal Year 2026 Updated Outlook
(unaudited, in thousands, except percentages)
| For the Fiscal Year Ending September 30, 2026 | |||||||||||
| Low | High | ||||||||||
| Net income | $ | 159,000 | $ | 162,000 | |||||||
| Interest expense, net | 111,000 | 113,000 | |||||||||
| Provision for income taxes | 51,500 | 52,500 | |||||||||
| Depreciation, depletion, accretion and amortization | 188,500 | 192,500 | |||||||||
| Share-based compensation expense | 28,000 | 29,000 | |||||||||
| Transformative acquisition expenses | 14,000 | 15,000 | |||||||||
| Adjusted EBITDA | $ | 552,000 | $ | 564,000 | |||||||
| Revenues | $ | 3,590,000 | $ | 3,650,000 | |||||||
| Adjusted EBITDA margin | 15.38 | % | 15.45 | % | |||||||
Construction Partners, Inc.
Net Income to Adjusted Net Income Reconciliation
Fiscal Year 2026 Updated Outlook
(unaudited, in thousands)
| For the Fiscal Year Ending September 30, 2026 | |||||||||||
| Low | High | ||||||||||
| Net income | $ | 159,000 | $ | 162,000 | |||||||
| Transformative acquisition expenses | 14,000 | 15,000 | |||||||||
| Financing fees related to transformative acquisition | 1,200 | 1,200 | |||||||||
| Tax impact due to above reconciling items | (3,800) | (4,000) | |||||||||
| Adjusted net income | $ | 170,400 | $ | 174,200 | |||||||
FAQ
How did Construction Partners (ROAD) perform in Q2 fiscal 2026?
Construction Partners reported strong Q2 2026 results, with revenue of $769.2 million, up 34.5% year over year. Net income rose to $9.2 million and diluted EPS reached $0.16, while Adjusted EBITDA increased to $93.3 million with a margin of about 12.1%.
What is Construction Partners’ record backlog as of March 31, 2026?
The company reported a record project backlog of $3.14 billion as of March 31, 2026. This compares with $2.84 billion a year earlier and $3.09 billion at December 31, 2025, supporting visibility into future revenue from public and private infrastructure projects.
Did Construction Partners (ROAD) raise its fiscal 2026 outlook?
Yes. Construction Partners raised its fiscal 2026 outlook, now guiding revenue to $3.59–$3.65 billion, net income to $159.0–$162.0 million, Adjusted net income to $170.4–$174.2 million, and Adjusted EBITDA to $552.0–$564.0 million with a 15.38–15.45% Adjusted EBITDA margin.
How did profitability metrics change for Construction Partners in Q2 2026?
Gross profit increased to $98.9 million from $71.4 million a year earlier. Net income more than doubled to $9.2 million, while Adjusted net income rose to $10.4 million. Adjusted EBITDA climbed to $93.3 million, maintaining an approximately 12.1% margin on significantly higher revenue.
What non-GAAP measures does Construction Partners highlight and why?
The company highlights Adjusted EBITDA, Adjusted EBITDA margin and Adjusted net income, which exclude items like transformative acquisition expenses and certain financing fees. Management uses these as key performance indicators and believes investors use them to evaluate operating performance in the construction infrastructure industry.
How did Construction Partners’ cash flow and debt levels evolve in early 2026?
For the six months ended March 31, 2026, net cash provided by operating activities was $147.8 million. Long-term debt (including current maturities) totaled roughly $1.75 billion, while cash and cash equivalents were $76.9 million, reflecting active investment and acquisition activity alongside substantial leverage.