Construction Partners, Inc. Announces Fiscal 2025 Third Quarter Results

Revenue Up 51% Compared to Q3 FY24

Adjusted EBITDA Up 80% Compared to Q3 FY24

Record Backlog of $2.94 Billion

Company Maintains FY25 Outlook

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 June 30, 2025.

Fred J. (Jule) Smith, III, the Company's President and Chief Executive Officer, said, “We are pleased to report strong performance and excellent year-over-year growth across our key financial metrics this quarter. Despite persistent weather-related delays, including record or near-record rainfall across many of our Sunbelt markets, our teams executed with discipline and delivered robust operational results, generating significant cash flow from operations and driving a record high Adjusted EBITDA margin(1) of 16.9%. In the Southeast alone, May marked the second-wettest month on record, leading to project delays and impacting fixed asset cost recoveries. Our family of companies, now more than 6,200 employees in eight states, worked through these challenges with resilience and operational excellence, while also building a record project backlog of $2.94 billion. CPI remains well-positioned for continued success as we move through the busy construction season to close out our fiscal year and build out this record backlog.”

Smith continued, “Earlier this week, we announced our acquisition of Durwood Greene Construction Co., adding its nearly 200 employees to the CPI family of companies in the greater Houston metropolitan area as a subsidiary of our Texas platform company, Lone Star Paving. As a third-generation family business, Durwood Greene has earned its reputation as a well-respected market leader in Houston, the fifth largest and one of the fastest-growing metro areas in the nation. Led by knowledgeable and experienced industry veterans, the company operates three hot-mix asphalt plants and a rail-served aggregates terminal. We expect Durwood Greene to continue its legacy of operational excellence and to benefit from vertical integration opportunities as part of CPI. We are excited to expand our Texas footprint and continue to see strong economic growth, favorable demographic trends, well-funded transportation program and additional opportunities for acquisitive and organic growth in the State of Texas.”

Revenues were $779.3 million in the third quarter of fiscal 2025, an increase of 51% compared to $517.8 million in the same quarter last year. The $261.5 million revenue increase included $235.7 million attributable to acquisitions completed during or subsequent to the three months ended June 30, 2024, and $25.8 million in the Company's existing markets. The mix of total revenue growth for the quarter was approximately 5% organic and approximately 46% from recent acquisitions.

Gross profit was $131.8 million in the third quarter of fiscal 2025, compared to $83.5 million in the same quarter last year.

General and administrative expenses were $51.0 million in the third quarter of fiscal 2025, compared to $38.0 million in the same quarter last year, and as a percentage of total revenues, decreased 70 basis points to 6.6%, compared to 7.3% in the same quarter last year.

Net income was $44.0 million in the third quarter of fiscal 2025, or $0.79 per diluted share, compared to net income of $30.9 million, or $0.59 per diluted share, in the same quarter last year.

Adjusted net income(1) in the third quarter was $45.2 million, or $0.81 per diluted share, compared to $30.9 million, or $0.59 per diluted share, for the same quarter last year.

Adjusted EBITDA(1) in the third quarter of fiscal 2025 was $131.7 million, an increase of 80% compared to $73.2 million in the same quarter last year. Adjusted EBITDA margin(1) in the third quarter of fiscal 2025 was 16.9%, compared to 14.1% in the same quarter last year.

Project backlog was a record $2.94 billion at June 30, 2025, compared to $1.86 billion at June 30, 2024 and $2.84 billion at March 31, 2025.

Smith added, “Reflecting the expected contribution of the newly acquired Durwood Greene and the third quarter weather-related headwinds, we are maintaining our fiscal 2025 outlook ranges. We continue to see customer demand for both publicly funded and commercial project work throughout our well-funded and growing Sunbelt states, and we remain focused on delivering long-term value to our investors and other stakeholders.”

Fiscal 2025 Outlook

The Company is maintaining its outlook ranges for fiscal 2025 with regard to revenue, net income, Adjusted net income, Adjusted EBITDA and Adjusted EBITDA margin as follows:

— Revenue in the range of $2.77 billion to $2.83 billion

— Net income in the range of $106.0 million to $117.0 million

— Adjusted net income(1) in the range of $124.0 million to $135.0 million

— Adjusted EBITDA(1) in the range of $410.0 million to $430.0 million

— Adjusted EBITDA margin(1) in the range of 14.8% to 15.2%

Ned N. Fleming, III, the Company's Executive Chairman, stated, “Construction Partners' consistent operational and financial performance reflects the strength of our leadership, culture, and disciplined execution of a proven growth strategy. Our strategically located operations across the Sunbelt are uniquely positioned to leverage the scale and resources of our broader organization, allowing us to effectively bid, win, and deliver critical infrastructure projects for a diverse and recurring customer base-both public and commercial. As infrastructure repair, maintenance, and expansion needs accelerate nationwide, particularly with the push for increased roadway capacity, CPI is well-positioned to capitalize on long-term, generational investment in infrastructure and the ongoing population migration into the Sunbelt. Our expansion strategy focuses on scaling operations and growing our geographic footprint in a highly fragmented market, where we see continued opportunities to drive strong returns and create lasting value for our shareholders.”

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 June 30, 2025. 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 telephonic replay will be available through August 14, 2025 by calling (201) 612-7415 and using passcode ID: 13753223#. 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.

Contacts:

Rick Black / Ken Dennard Dennard Lascar Investor Relations ROAD@DennardLascar.com (713) 529-6600

(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.

Financial Statements Follow –

Construction Partners, Inc.Consolidated Statements of Comprehensive Income(unaudited, in thousands, except share and per share data) For the Three Months For the Nine Months Ended June 30, Ended June 30, 2025 2024 2025 2024Revenues $ 779,277 $ 517,794 $ 1,912,507 $ 1,285,726Cost of revenues 647,467 434,302 1,632,776 1,111,553Gross profit 131,810 83,492 279,731 174,173General and administrative expenses (51,026) (37,987) (141,954) (109,422)Acquisition-related expenses (1,816) (941) (22,174) (2,239)Gain on sale of property, plant and equipment, net 3,975 1,093 8,437 2,960Operating income 82,943 45,657 124,040 65,472Interest expense, net (25,239) (4,673) (64,961) (12,987)Other income 246 32 508 50Income before provision for income taxes and earnings from 57,950 41,016 59,587 52,535investment in joint ventureProvision for income taxes 13,903 10,108 14,364 12,905Loss from investment in joint venture – – (12) (3)Net income 44,047 30,908 45,211 39,627Other comprehensive income (loss), net of taxUnrealized (loss) on interest rate swap contract, net (1,996) (540) (2,017) (5,167)Unrealized gain (loss) on restricted investments, net 102 (34) – 279Other comprehensive (loss) (1,894) (574) (2,017) (4,888)Comprehensive income $ 42,153 $ 30,334 $ 43,194 $ 34,739Net income per share attributable to common stockholders:Basic $ 0.80 $ 0.60 $ 0.82 $ 0.76Diluted $ 0.79 $ 0.59 $ 0.82 $ 0.75Weighted average number of common shares outstanding:Basic 55,164,260 51,913,124 54,853,715 51,914,508Diluted 55,654,653 52,654,882 55,302,958 52,572,429Construction Partners, Inc.Consolidated Balance Sheets(in thousands, except share and per share data) June 30, September 30, 2025 2024ASSETS (unaudited)Current assets:Cash and cash equivalents $ 114,336 $ 74,686Restricted cash 1,969 1,998Contracts receivable including retainage, net 464,529 350,811Costs and estimated earnings in excess of billings on uncompleted contracts 54,564 25,966Inventories 148,541 106,704Prepaid expenses and other current assets 25,504 24,841Total current assets 809,443 585,006Property, plant and equipment, net 1,147,613 629,924Operating lease right-of-use assets 70,323 38,932Goodwill 775,756 231,656Intangible assets, net 81,864 20,549Investment in joint venture 72 84Restricted investments 21,954 18,020Other assets 18,816 17,964Total assets $ 2,925,841 $ 1,542,135LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilities:Accounts payable $ 244,123 $ 182,572Billings in excess of costs and estimated earnings on uncompleted contracts 124,152 120,065Current portion of operating lease liabilities 17,548 9,065Current maturities of long-term debt 38,500 26,563Accrued expenses and other current liabilities 127,875 42,189Total current liabilities 552,198 380,454Long-term liabilities:Long-term debt, net of current maturities and deferred debt issuance costs 1,392,639 486,961Operating lease liabilities, net of current portion 53,225 30,661Deferred income taxes, net 52,989 53,852Other long-term liabilities 21,462 16,467Total long-term liabilities 1,520,315 587,941Total liabilities 2,072,513 968,395Stockholders' equity:Preferred stock, par value $0.001; 10,000,000 shares authorized and no shares issued and – -outstanding at June 30, 2025 and September 30, 2024Class A common stock, par value $0.001; 400,000,000 shares authorized, 47,963,617 47 44shares issued and 47,433,440 shares outstanding at June 30, 2025 and 44,062,830 sharesissued and 43,819,102 shares outstanding at September 30, 2024Class B common stock, par value $0.001; 100,000,000 shares authorized, 11,463,770 12 12shares issued and 8,538,165 shares outstanding at June 30, 2025 and 11,784,650 sharesissued and 8,861,698 shares outstanding at September 30, 2024Additional paid-in capital 535,259 278,065Treasury stock, Class A common stock, par value $0.001, at cost, 530,177 shares at June (31,850) (11,490)30, 2025 and 243,728 shares at September 30, 2024Treasury stock, Class B common stock, par value $0.001, at cost, 2,925,605 shares at June (16,046) (15,603)30, 2025 and 2,922,952 shares at September 30, 2024Accumulated other comprehensive income, net 5,485 7,502Retained earnings 360,421 315,210Total stockholders' equity 853,328 573,740Total liabilities and stockholders' equity $ 2,925,841 $ 1,542,135Construction Partners, Inc.Consolidated Statements of Cash Flows(unaudited, in thousands) For the Nine Months Ended June 30, 2025 2024Cash flows from operating activities:Net income $ 45,211 $ 39,627Adjustments to reconcile net income to net cash, cash equivalents and restricted cashprovided by operating activities: Depreciation, depletion, accretion and amortization 107,741 67,468 Amortization of deferred debt issuance costs 3,379 223 Unrealized loss on derivative instruments – 184 Provision for bad debt 260 370 Gain on sale of property, plant and equipment (8,437) (2,960) Realized loss on sales, calls and maturities of restricted investments 81 53 Share-based compensation expense 26,863 10,206 Loss from investment in joint venture 12 3 Deferred income tax benefit (300) (194)Other non-cash adjustments (665) (179)Changes in operating assets and liabilities, net of business acquisitions: Contracts receivable including retainage, net 6,159 (11,310) Costs and estimated earnings in excess of billings on uncompleted contracts (22,577) (4,273) Inventories (4,880) (16,959) Prepaid expenses and other current assets 5,422 (1,194) Other assets (3,119) (915) Accounts payable 15,975 635 Billings in excess of costs and estimated earnings on uncompleted contracts (9,481) 27,042 Accrued expenses and other current liabilities 18,641 5,370 Other long-term liabilities (967) (16)Net cash provided by operating activities, net of business acquisitions 179,318 113,181Cash flows from investing activities:Purchases of property, plant and equipment (104,886) (70,410)Proceeds from sale of property, plant and equipment 11,250 8,047Proceeds from sales, calls and maturities of restricted investments 8,351 2,860Business acquisitions, net of cash acquired (935,663) (135,219)Purchase of restricted investments (12,182) (4,376)Net cash used in investing activities (1,033,130) (199,098)Cash flows from financing activities:Proceeds from revolving credit facility 218,438 149,385Proceeds from issuance of long-term debt, net of debt issuance costs 833,524 -Repayments of long-term debt (137,726) (47,500)Purchase of treasury stock (20,803) (6,605)Net cash provided by financing activities 893,433 95,280Net change in cash, cash equivalents and restricted cash 39,621 9,363Cash, cash equivalents and restricted cash:Cash, cash equivalents and restricted cash, beginning of period 76,684 49,080Cash, cash equivalents and restricted cash, end of period $ 116,305 $ 58,443Supplemental cash flow information:Cash paid for interest $ 58,151 $ 15,201Cash paid for income taxes $ 3,576 $ 4,285Cash paid for operating lease liabilities $ 11,699 $ 4,306Non-cash items: Operating lease right-of-use assets obtained in exchange for operating lease liabilities $ 17,620 $ 22,986 Property, plant and equipment financed with accounts payable $ 5,693 $ 2,490 Amounts payable to sellers in business combinations, net $ 64,938 $ –

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, such as a bridge loan associated with our acquisition of Lone Star Paving. 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 presents a reconciliation of net income, the most directly comparable measure calculated in accordance with GAAP, to Adjusted EBITDA and the calculation of Adjusted EBITDA margin for the periods presented:

Construction Partners, Inc.Net Income to Adjusted EBITDA ReconciliationFiscal Quarters Ended June 30, 2025 and 2024(unaudited, in thousands, except percentages) For the Three Months Ended June 30, 2025 2024Net income $ 44,047 $ 30,908Interest expense, net 25,239 4,673Provision for income taxes 13,903 10,108Depreciation, depletion, accretion and amortization 39,294 23,507Share-based compensation expense 8,564 4,039Transformative acquisition expenses 663 -Adjusted EBITDA $ 131,710 $ 73,235Revenues $ 779,277 $ 517,794Adjusted EBITDA margin 16.9% 14.1%Construction Partners, Inc.Net Income to Adjusted EBITDA ReconciliationFiscal Year 2025 Outlook(unaudited, in thousands, except percentages) For the Fiscal Year Ending September 30, 2025 Low HighNet income $ 106,000 $ 117,000Interest expense, net 86,000 86,000Provision for income taxes 32,000 36,000Depreciation, depletion, accretion and amortization 143,000 145,000Share-based compensation expense 23,250 26,250Transformative acquisition expenses 19,750 19,750Adjusted EBITDA $ 410,000 $ 430,000Revenues $ 2,770,000 $ 2,830,000Adjusted EBITDA Margin 14.8% 15.2%

The following tables present a reconciliation of net income, the most directly comparable measure calculated in accordance with GAAP, to Adjusted net income for the period presented:

Construction Partners, Inc.Net Income to Adjusted Net Income ReconciliationFiscal Quarters Ended June 30, 2025 and 2024(unaudited, in thousands) For the Three Months Ended June 30, 2025 2024Net income $ 44,047 $ 30,908Transformative acquisition expenses 663 -Financing fees related to transformative acquisitions 920 -Tax impact due to above reconciling items (382) -Adjusted net income $ 45,248 $ 30,908Construction Partners, Inc.Net Income to Adjusted Net Income ReconciliationFiscal Year 2025 Outlook(unaudited, in thousands) For the Fiscal Year Ending September 30, 2025 Low HighNet income $ 106,000 $ 117,000Transformative acquisition expenses 19,750 19,750Financing fees related to transformative acquisitions 4,000 4,000Tax impact due to above reconciling items (5,750) (5,750)Adjusted net income $ 124,000 $ 135,000

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