What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-07 compared with 2025-05-09 · 102 added, 105 removed, 179 unchanged (54% of the section changed)

18 unchanged sentences

Contract Backlog

At March 31, 2025, our contract backlog was $2.8 billion.

At June 30, 2025, our contract backlog was $2.9 billion.

Contract backlog is a financial measure that reflects the dollar value of work that the Company expects to perform in the future.

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For uncompleted work on contracts in progress, we include (i) executed change orders, (ii) pending change orders for which we expect to receive confirmation in the ordinary course of business and (iii) claims that we have made against our customers for which we have determined we have a legal basis under existing contractual arrangements and as to which we consider collection to be probable.

Backlog of uncompleted work on contracts under which work was either in progress or had not yet begun was $2.2 billion at March 31, 2025.

Backlog of uncompleted work on contracts under which work was either in progress or had not yet begun was $2.2 billion at June 30, 2025.

Our contract backlog also includes low bid/no contract projects, which consist of (i) public bid projects for which we were the low bidder and no contract has been executed and (ii) private work projects for which we have been notified that we are the low bidder or have been given a notice to proceed, but no contract has been executed.

Low bid/no contract backlog was $0.6 billion at March 31, 2025.

Low bid/no contract backlog was $0.7 billion at June 30, 2025.

Recent Developments

Business Acquisitions

On January 2, 2025, we acquired all of the outstanding capital stock of Overland Corporation, establishing our first platform company in Oklahoma.

As a result of this acquisition, we added eight HMA plants in southern and western Oklahoma.

Overland Corporation also provides paving services in northern Texas.

For further discussion regarding this transaction, see Note 4 - Business Acquisitions to the unaudited consolidated financial statements included elsewhere in this report.

On February 3, 2025, we acquired substantially all of the assets of Mobile Asphalt Company LLC, an HMA manufacturing and paving company headquartered in Theodore, Alabama.

As a result of this acquisition, we added five HMA plants and expanded our operations in the greater Mobile and southwestern Alabama market areas.

On May 1, 2025, we acquired all of the outstanding capital stock of "PRI".

The transaction established our first platform company in Tennessee, with operations including an HMA plant and related crews and equipment serving northeastern Tennessee and a specialized pavement preservation and sitework business serving multiple southeastern states.

For further discussion regarding this transaction, see Note 4 - Business Acquisitions to the unaudited consolidated financial statements included elsewhere in this report.

On May 1, 2025, we acquired all of the outstanding capital stock of PRI of East Tennessee, Inc., and Pavement Restorations, Inc., (collectively PRI), establishing our first platform company in Tennessee.

As a result of this acquisition, we added an HMA plant in Knoxville to expand our operations in northeastern Tennessee.

PRI also provides pavement preservation and specialized sitework services across Tennessee.

On August 1, 2025, we acquired all the outstanding capital stock of Durwood Greene, an asphalt manufacturing and construction business headquartered in Stafford, Texas.

The transaction expanded the our operations in Texas, adding three HMA plants and related crews and equipment serving the Houston, Texas metropolitan area.

For further discussion regarding this transaction, see Note 20 - Subsequent Events to the unaudited consolidated financial statements included elsewhere in this report.

Amendment to Term Loan A / Revolver Credit Agreement

On June 30, 2025, we entered into an amendment to the Term Loan A/ Revolver Credit Agreement to, among other things, (i) increase the existing Revolving Credit Facility thereunder from $400.0 million to $500.0 million, (ii) increase the existing Term Loan A thereunder from $400.0 million to $600.0 million, (iii) permit us to request one or more incremental term loans or an increase in the commitments under the Revolving Credit Facility on certain terms and conditions specified therein, and (iv) extend the maturity date for all outstanding borrowings under the Term Loan A / Revolver Credit Agreement to June 28, 2030.

The amendment also (i) modified certain negative covenants, (ii) replaced the consolidated fixed charge coverage ratio covenant with a consolidated interest coverage ratio covenant, (iii) adjusted the maximum consolidated net leverage ratio permitted thereunder and (iv) removed the 0.10% adjustment to SOFR-based interest rates under the Term Loan A / Revolver Credit Agreement.

A portion of the proceeds from the increased Term Loan A / Revolver Credit Agreement were used to pay off the outstanding principal balance under the Revolving Credit Facility.

For further discussion regarding the amendment and the terms of the Term Loan A / Revolved Credit Agreement following the amendment, see Note 8 - Debt to the unaudited consolidated financial statements included elsewhere in this report.

How We Assess Performance of Our Business

30 unchanged sentences

Interest Expense, Net

Interest expense, net primarily represents interest incurred on our long-term debt, such as the Term Loans and the Revolving Credit Facility, and amortization of deferred debt issuance costs.

Interest expense, net primarily represents interest incurred on our long-term debt, such as the Term Loans and the Revolving Credit Facility, fees associated with debt modifications and amortization of deferred debt issuance costs.

These amounts are partially offset by interest income earned on short-term investments of cash balances in excess of our current operating needs.

Other Key Performance Indicators - Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income (Loss)

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 acquisitions requiring clearance under federal antitrust laws, such as the Lone Star Acquisition.

Other Key Performance Indicators - Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Net Income

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, such as the Lone Star Acquisition.

Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of revenues for each period.

Adjusted Net Income (Loss)represents net income before (i) nonrecurring expenses related to transformative acquisitions, which management considers to include acquisitions requiring clearance under federal antitrust laws, such as the Lone Star Acquisition, and (ii) nonrecurring fees associated with financing arrangements incurred in connection with transformative acquisitions, such as a bridge loan associated with the Lone Star Acquisition.

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, such as the Lone Star Acquisition, and (ii) nonrecurring fees associated with financing arrangements incurred in connection with transformative acquisitions, such as a bridge loan associated with the Lone Star Acquisition.

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 (Loss) 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 (Loss) may not be comparable to similarly named measures reported by other companies.

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 table presents a reconciliation of net income (loss), the most directly comparable measure calculated in accordance with GAAP, to Adjusted EBITDA and the calculation of Adjusted EBITDA margin for the periods presented (unaudited, in thousands, except percentages):

For the Three Months Ended March 31, For the Six Months Ended March 31,

The following table 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 (unaudited, in thousands, except percentages):

For the Three Months Ended June 30, For the Nine Months Ended June 30,

2025 2024 2025 2024

Net income (loss) $ 4,215 $ (1,124) $ 1,164 $ 8,719

Net income $ 44,047 $ 30,908 $ 45,211 $ 39,627

Interest expense, net 25,239 4,673 64,961 12,987

Provision (benefit) for income taxes 1,310 (321) 461 2,797

Provision for income taxes 13,903 10,108 14,364 12,905

Depreciation, depletion, accretion and amortization 39,294 23,507 107,741 67,468

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Adjusted EBITDA Margin 16.9 % 14.1 % 14.1 % 11.2 %

The following table presents a reconciliation of net income (loss), the most directly comparable measure calculated in accordance with GAAP, to adjusted net income (loss) for the periods presented (in thousands):

For the Three Months Ended March 31, For the Six Months Ended March 31,

The following table presents a reconciliation of net income, the most directly comparable measure calculated in accordance with GAAP, to Adjusted Net Income for the periods presented (in thousands):

For the Three Months Ended June 30, For the Nine Months Ended June 30,

2025 2024 2025 2024

Net income (loss) $ 4,215 $ (1,124) $ 1,164 $ 8,719

Net income $ 44,047 $ 30,908 $ 45,211 $ 39,627

Transformative acquisition expenses 663 — 19,347 —

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Tax impact due to above reconciling items (382) — (5,634) —

Adjusted net income (loss) $ 4,383 $ (1,124) $ 17,653 $ 8,719

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

The following table sets forth selected financial data for the three months ended March 31, 2025 and 2024 (unaudited, in thousands, except percentages):

Adjusted Net Income $ 45,248 $ 30,908 $ 62,901 $ 39,627

Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024

The following table sets forth selected financial data for the three months ended June 30, 2025 and 2024 (unaudited, in thousands, except percentages):

Change From the Three Months Ended

For the Three Months Ended March 31, March 31, 2024

For the Three Months Ended June 30, June 30, 2024

to the Three Months Ended

2025 2024 March 31, 2025

2025 2024 June 30, 2025

Revenues Dollars % of

7 unchanged sentences

Interest expense, net (25,239) (3.2) % (4,673) (0.9) % (20,566) 440.1 %

Other income (loss) (159) — % 46 — % (205) (445.7) %

Income (loss) before provision for income taxes and earnings from investment in joint venture 5,538 1.0 % (1,442) (0.4) % 6,980 (484.0) %

Provision (benefit) for income taxes 1,310 0.2 % (321) (0.1) % 1,631 (508.1) %

Loss from investment in joint venture (13) — % (3) — % (10) 333.3 %

Net income (loss) $ 4,215 0.7 % $ (1,124) (0.3) % $ 5,339 (475.0) %

Other income 246 — % 32 — % 214 668.8 %

Income before provision for income taxes and earnings from investment in joint venture 57,950 7.4 % 41,016 7.9 % 16,934 41.3 %

Provision for income taxes 13,903 1.7 % 10,108 2.0 % 3,795 37.5 %

Net income $ 44,047 5.7 % $ 30,908 5.9 % $ 13,139 42.5 %

Adjusted EBITDA $ 131,710 16.9 % $ 73,235 14.1 % $ 58,475 79.8 %

Adjusted net income (loss) $ 4,383 0.8 % $ (1,124) (0.3) % $ 5,507 (489.9) %

Revenues for the three months ended March 31, 2025 increased $200.3 million, or 53.9%, to $571.7 million from $371.4 million for the three months ended March 31, 2024.

The increase included $173.1 million of revenues attributable to acquisitions completed during or subsequent to the three months ended March 31, 2024 and an increase of approximately $27.2 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties.

The 7.3% increase in revenue in our existing markets was due to strong demand in both public and private work.

Adjusted Net Income $ 45,248 5.8 % $ 30,908 6.0 % $ 14,340 46.4 %

Revenues for the three months ended June 30, 2025 increased $261.5 million, or 50.5%, to $779.3 million from $517.8 million for the three months ended June 30, 2024.

The increase included $235.7 million of revenues attributable to acquisitions completed during or subsequent to the three months ended June 30, 2024 and $25.8 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties.

The 5.0% increase in revenues in our existing markets was due to strong demand in both public and private work.

Gross Profit.

Gross profit for the three months ended March 31, 2025 increased $32.6 million, or 83.9%, to $71.4 million from $38.8 million for the three months ended March 31, 2024.

The increase in gross profit was primarily the result of a 53.9% increase in revenues for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 and a higher gross profit margin.

The higher gross profit margin was due to (i) efficient utilization of our plants, terminals and equipment fleet and (ii) completion of new backlog with more favorable margins.

Gross profit for the three months ended June 30, 2025 increased $48.3 million, or 57.9%, to $131.8 million from $83.5 million for the three months ended June 30, 2024.

The increase in gross profit was primarily the result of a 50.5% increase in revenues for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 and a higher gross profit margin on such revenues due to efficient utilization of our plants, terminals and equipment fleet and completion of new backlog with more favorable margins.

General and Administrative Expenses.

General and administrative expenses for the three months ended March 31, 2025 increased $10.7 million, or 29.7%, to $46.7 million from $36.0 million for the three months ended March 31, 2024.

The increase was attributable to general and administrative expenses associated with the operations of businesses acquired during or subsequent to March 31, 2024 and an increase in share-based compensation expense.

General and administrative expenses for the three months ended June 30, 2025 increased $13.0 million, or 34.3%, to $51.0 million from $38.0 million for the three months ended June 30, 2024.

The increase was primarily attributable to general and administrative expenses associated with the operations of businesses acquired during or subsequent to June 30, 2024 and an increase in share-based compensation expense.

Acquisition-Related Expenses.

Acquisition-related expenses for the three months ended March 31, 2025 increased $0.1 million to $0.8 million from $0.7 million for the three months ended March 31, 2024.

Acquisition-related expenses for the three months ended June 30, 2025 increased $0.9 million to $1.8 million from $0.9 million for the three months ended June 30, 2024.

Gain on Sale of Property, Plant and Equipment .

Gain on sale of property, plant and equipment for the three months ended March 31, 2025 increased $2.4 million, or 230.5%, to $3.4 million from $1.0 million for the three months ended March 31, 2024.

The increase was primarily the result of higher disposals of equipment and components during the three months ended March 31, 2025.

Gain on sale of property, plant and equipment for the three months ended June 30, 2025 increased $2.9 million, or 263.7%, to $4.0 million from $1.1 million for the three months ended June 30, 2024.

The increase was primarily the result of higher disposals of equipment and components during the three months ended June 30, 2025.

Interest Expense, Net.

Interest expense, net for the three months ended March 31, 2025 increased $17.0 million, or 372.7%, to $21.6 million compared to $4.6 million for the three months ended March 31, 2024.

The increase in interest expenses, net was primarily related to borrowings under the Term Loan B Credit Agreement that was entered into on November 1, 2024.

Interest expense, net for the three months ended June 30, 2025 increased $20.6 million, or 440.1%, to $25.2

million compared to $4.7 million for the three months ended June 30, 2024.

The increase in interest expense, net was primarily related to borrowings under the Term Loan B Credit Agreement that we entered into on November 1, 2024 and fees associated with amendments to, and additional borrowings under, our Term Loan A/ Revolver Credit Agreement.

Provision for Income Taxes.

Our effective tax rate increased to 23.7% for the three months ended March 31, 2025, from 22.2% for the three months ended March 31, 2024.

Our higher effective tax rate during the three months ended March 31, 2025 was due to differences in state tax rates at our operating subsidiaries.

Net income increased $5.3 million to $4.2 million for the three months ended March 31, 2025, compared to net loss of $1.1 million for the three months ended March 31, 2024.

The increase in net income was primarily the result of higher gross profit and gain on sale of property, plant and equipment, partially offset by an increase in general and administrative expenses and interest expense, all as described above.

Our effective tax rate decreased to 24.0% for the three months ended June 30, 2025, from 24.6% for the three months ended June 30, 2024.

Our lower effective tax rate during the three months ended June 30, 2025 was due to differences in state tax rates at our operating subsidiaries.

Net income increased $13.1 million to $44.0 million for the three months ended June 30, 2025, compared to $30.9 million for the three months ended June 30, 2024.

The increase in net income was primarily the result of higher gross profit and gain on sale of property, plant and equipment, partially offset by higher general and administrative expenses, interest expense and provision for income taxes, all as described above.

Adjusted EBITDA and Adjusted EBITDA Margin.

Adjusted EBITDA and Adjusted EBITDA Margin were $69.3 million and 12.1%, respectively, for the three months ended March 31, 2025, compared to $29.5 million and 7.9%, respectively, for the three months ended March 31, 2024.

Adjusted EBITDA and Adjusted EBITDA Margin were $131.7 million and 16.9%, respectively, for the three months ended June 30, 2025, compared to $73.2 million and 14.1%, respectively, for the three months ended June 30, 2024.

The increase in Adjusted EBITDA and Adjusted EBITDA Margin resulted from an increase in gross profit and gain on sale of property, plant and equipment, partially offset by higher general and administrative expenses, all as described above.

See the description of Adjusted EBITDA and Adjusted EBITDA Margin, as well as a reconciliation of Adjusted EBITDA to net income, under the heading “How We Assess Performance of Our Business”.

Adjusted Net Income (Loss).

Adjusted Net Income increased $5.5 million to $4.4 million for the three months ended March 31, 2025, compared to adjusted net loss of $1.1 million for the three months ended March 31, 2024.

The increase in adjusted net income was primarily a result of higher gross profit and gain on sale of property, plant and equipment, partially offset by higher general and administrative expenses and interest expense, all as described above.

See the description of adjusted net income (loss), as well as a reconciliation of adjusted net income to net income, under the heading “How We Assess Performance of Our Business”.

Six Months Ended March 31, 2025 Compared to Six Months Ended March 31, 2024

The following table sets forth selected financial data for the six months ended March 31, 2025 and 2024 (unaudited, in thousands, except percentages):

Change From the Six Months Ended

For the Six Months Ended March 31, March 31, 2024

to the Six Months Ended

2025 2024 March 31, 2025

Adjusted Net Income.

Adjusted Net Income increased $14.3 million to $45.2 million for the three months ended June 30, 2025, compared to $30.9 million for the three months ended June 30, 2024.

The increase in Adjusted Net Income was primarily a result of higher gross profit and gain on sale of property, plant and equipment, partially offset by higher general and administrative expenses and interest expense under the Term Loan B, all as described above.

See the description of Adjusted Net Income, as well as a reconciliation of Adjusted Net Income to net income, under the heading “How We Assess Performance of Our Business”.

Nine Months Ended June 30, 2025 Compared to Nine Months Ended June 30, 2024

The following table sets forth selected financial data for the nine months ended June 30, 2025 and 2024 (unaudited, in thousands, except percentages):

Change From the Nine Months Ended

For the Nine Months Ended June 30, June 30, 2024

to the Nine Months Ended

2025 2024 June 30, 2025

Revenues Dollars % of

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Other income 508 — % 50 — % 458 916.0 %

Income (loss) before provision for income taxes and earnings from investment in joint venture 1,637 0.1 % 11,519 1.5 % (9,882) (85.8) %

Income before provision for income taxes and earnings from investment in joint venture 59,587 3.1 % 52,535 4.1 % 7,052 13.4 %

Provision for income taxes 14,364 0.8 % 12,905 1.0 % 1,459 11.3 %

3 unchanged sentences

Adjusted Net Income $ 62,901 3.3 % $ 39,627 3.1 % $ 23,274 58.7 %

Revenues for the six months ended March 31, 2025 increased $365.3 million, or 47.6%, to $1,133.2 million from $767.9 million for the six months ended March 31, 2024.

The increase included $293.9 million of revenues attributable to acquisitions completed during or subsequent to the six months ended March 31, 2024 and $71.4 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties.

The 9.3% increase in revenues in our existing markets compared to the prior year period was due to strong demand in both public and private work.

Revenues for the nine months ended June 30, 2025 increased $0.6 billion, or 48.7%, to $1.9 billion from $1.3 billion for the nine months ended June 30, 2024.

The increase included $529.6 million of revenues attributable to acquisitions completed during or subsequent to the nine months ended June 30, 2024 and $97.2 million of revenues attributable to our existing markets from contract work and sales of HMA and aggregates to third parties.

The 7.6% increase in revenues in our existing markets was due to strong demand in both public and private work.

Gross Profit.

Gross profit for the six months ended March 31, 2025 increased $57.2 million, or 63.1%, to $147.9 million from $90.7 million for the six months ended March 31, 2024.

The increase in gross profit was primarily the result of a 47.6% increase in revenues for the six months ended March 31, 2025 compared to the six months ended March 31, 2024 and a higher gross profit margin.

The higher gross profit margin was due to (i) efficient utilization of our plants, terminals and equipment fleet and (ii) completion of new backlog with more favorable margins.

Gross profit for the nine months ended June 30, 2025 increased $105.6 million, or 60.6%, to $279.7 million from $174.2 million for the nine months ended June 30, 2024.

The increase in gross profit was primarily the result of a 48.7% increase in revenues for the nine months ended June 30, 2025 compared to the nine months ended June 30, 2024 and a higher gross profit margin on such revenues due to efficient utilization of our plants, terminals and equipment fleet and completion of new backlog with more favorable margins.

General and Administrative Expenses.

General and administrative expenses for the six months ended March 31, 2025 increased $19.5 million, or 27.3%, to $90.9 million from $71.4 million for the six months ended March 31, 2024.

General and administrative expenses for the nine months ended June 30, 2025 increased $32.5 million, or 29.7%, to $141.9 million from $109.4 million for the nine months ended June 30, 2024.

Acquisition-Related Expenses.

Acquisition-related expenses for the six months ended March 31, 2025 increased $19.1 million to $20.4 million from $1.3 million for the six months ended March 31, 2024.

Acquisition-related expenses for the nine months ended June 30, 2025 increased $20.0 million to $22.2 million from $2.2 million for the nine months ended June 30, 2024.

The increase was primarily due to the $19.0 million of acquisition-related expenses attributable to the Lone Star Acquisition.

Gain on Sale of Property, Plant and Equipment .

Gain on sale of property, plant and equipment for the six months ended March 31, 2025 increased $2.6 million, or 139.0%, to $4.5 million from $1.9 million for the six months ended March 31, 2024.

The increase was primarily the result of higher disposals of equipment and components during the six months ended March 31, 2025.

Gain on sale of property, plant and equipment for the nine months ended June 30, 2025 increased $5.4 million, or 185.0%, to $8.4 million from $3.0 million for the nine months ended June 30, 2024.

The increase was primarily the result of higher disposals of equipment and components during the nine months ended June 30, 2025.

Interest Expense, Net.

Interest expense, net for the six months ended March 31, 2025 increased $31.4 million, or 377.8%, to $39.7 million compared to $8.3 million for the six months ended March 31, 2024.

The increase in interest expenses, net was primarily related to borrowings under the Term Loan B Credit Agreement that was entered into on November 1, 2024.

Interest expense, net for the nine months ended June 30, 2025 increased $52.0 million, or 400.2%, to $65.0 million compared to $13.0 million for the nine months ended June 30, 2024.

The increase in interest expenses, net was primarily related to borrowings under the Term Loan B Credit Agreement that we entered into on November 1, 2024, and fees associated with amendments to, and additional borrowings under, our Term Loan A / Revolver Credit Agreement.

Provision for Income Taxes.

Our effective tax rate increased to 28.4% for the six months ended March 31, 2025, from 24.3% for the six months ended March 31, 2024.

Our higher effective tax rate during the six months ended March 31, 2025 was due to differences in state tax rates at our operating subsidiaries.

Net income decreased $7.6 million to $1.2 million for the six months ended March 31, 2025, compared to net income of $8.7 million for the six months ended March 31, 2024.

The decrease in net income was primarily a result of higher general and administrative expenses, acquisition-related expenses and interest expense,net partially offset by an increase in gross profit and gain on sale of property, plant and equipment, all as described above.

Our effective tax rate decreased to 24.1% for the nine months ended June 30, 2025, from 24.6% for the nine months ended June 30, 2024.

Our lower effective tax rate during the nine months ended June 30, 2025 was due to differences in state tax rates at our operating subsidiaries.

Net income increased $5.6 million to $45.2 million for the nine months ended June 30, 2025, compared to $39.6 million for the nine months ended June 30, 2024.

The increase in net income was primarily a result of higher gross profit and gain on sale of property, plant and equipment, partially offset by an increase in general and administrative expenses, acquisition-related expenses, interest expense and provision for income taxes, all as described above.

Adjusted EBITDA and Adjusted EBITDA Margin.

Adjusted EBITDA and Adjusted EBITDA Margin were $138.1 million and 12.2%, respectively, for the six months ended March 31, 2025, compared to $70.4 million and 9.2%, respectively, for the six months ended March 31, 2024.

Adjusted EBITDA and Adjusted EBITDA Margin were $269.8 million and 14.1%, respectively, for the nine months ended June 30, 2025, compared to $143.6 million and 11.2%, respectively, for the nine months ended June 30, 2024.

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Adjusted Net Income.

Adjusted Net Income increased $8.9 million to $17.7 million for the six months ended March 31, 2025, compared to adjusted net income of $8.7 million for the six months ended March 31, 2024.

Adjusted Net Income increased $23.3 million to $62.9 million for the nine months ended June 30, 2025, compared to Adjusted Net Income of $39.6 million for the nine months ended June 30, 2024.

See the description of Adjusted Net Income, as well as a reconciliation of adjusted net income to net income, under the heading “How We Assess Performance of Our Business”.

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The following table sets forth our cash flows for the periods indicated (unaudited, in thousands):

For the Six Months Ended March 31,

For the Nine Months Ended June 30,

Net cash provided by operating activities, net of acquisitions $ 179,318 $ 113,181

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Operating Activities

During the six months ended March 31, 2025, cash provided by operating activities, net of acquisitions, was $96.3 million, primarily as a result of:

During the nine months ended June 30, 2025, cash provided by operating activities, net of acquisitions, was $179.3 million, primarily as a result of:

• net income of $45.2 million, including $107.7 million of depreciation, depletion, accretion and amortization, $26.9 million of share-based compensation expense and $8.4 million of gain on sale of property, plant and equipment;

• a decrease in contracts receivable including retainage, net of $6.2 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

• an increase in inventories of $4.4 million due to increased inventories from acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

• a decrease in accounts payable and accrued expenses and other current liabilities of $27.0 million due to the timing of processing transactions in our accounts payable cycle;

• an increase in inventories of $4.9 million due to acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

• an increase in accounts payable and accrued expenses and other current liabilities of $34.6 million due to the timing of processing transactions in our accounts payable cycle;

• a net decrease in the difference between costs and estimated earnings in excess of billings on uncompleted contracts and billings in excess of costs and estimated earnings on uncompleted contracts of $32.1 million due to the timing of performing and closing projects.

During the six months ended March 31, 2024, cash provided by operating activities, net of acquisitions, was $78.6 million, primarily as a result of:

During the nine months ended June 30, 2024, cash provided by operating activities, net of acquisitions, was $113.2 million, primarily as a result of:

• net income of $39.6 million, including $67.5 million of depreciation, depletion, accretion and amortization, $10.2 million of share-based compensation expense and $3.0 million of gain on sale of property, plant and equipment;

• a decrease in contracts receivable including retainage, net of $43.4 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

• an increase in inventories of $16.0 million due to increased inventories from acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

• a decrease in accounts payable and accrued expenses and other current liabilities of $24.5 million due to the timing of processing transactions in our accounts payable cycle;

• an increase in contracts receivable including retainage, net of $11.3 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

• an increase in inventories of $17.0 million due to acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

• an increase in accounts payable and accrued expenses and other current liabilities of $6.0 million due to the timing of processing transactions in our accounts payable cycle;

• a net increase in the difference between costs and estimated earnings in excess of billings on uncompleted contracts and billings in excess of costs and estimated earnings on uncompleted contracts of $22.8 million due to the timing of performing and closing projects.

Investing Activities

During the six months ended March 31, 2025, cash used in investing activities was $893.2 million, of which $828.7 million related to acquisitions completed in the period, $68.2 million was invested in property, plant and equipment and $6.2 million was invested in restricted investments by the Captive, partially offset by $6.0 million of proceeds from the sale of property, plant and equipment and $3.9 million of proceeds from the sale of restricted investments.

During the six months ended March 31, 2024, cash used in investing activities was $138.4 million, of which $87.9 million related to acquisitions completed in the period, $55.5 million was invested in property, plant and equipment and $1.9 million was invested in restricted investments by the Captive, partially offset by $5.0 million of proceeds from the sale of property, plant and equipment and $1.9 million of proceeds from the sale of restricted investments.

During the nine months ended June 30, 2025, cash used in investing activities was $1.0 billion, of which $935.7 million related to acquisitions completed in the period, $104.9 million was invested in property, plant and equipment and $12.2 million was invested in restricted investments by the Captive, partially offset by $11.3 million of proceeds from the sale of property, plant and equipment and $8.4 million of proceeds from the sale of restricted investments.

During the nine months ended June 30, 2024, cash used in investing activities was $199.1 million, of which $135.2 million related to acquisitions completed in the period, $70.4 million was invested in property, plant and equipment and $4.4 million was invested in restricted investments by the Captive, partially offset by $8.0 million of proceeds from the sale of property, plant and equipment and $2.9 million of proceeds from the sale of restricted investments.

Financing Activities

During the six months ended March 31, 2025, cash provided by financing activities was $823.8 million.

During the nine months ended June 30, 2025, cash provided by financing activities was $893.4 million.

We received $835.0 million of net proceeds from our Term Loan B, which were primarily used for the Lone Star Acquisition completed in the period, and $218.4 million of net proceeds from our Revolving Credit Facility, which were primarily used for other acquisitions completed during the period.

This cash flow was partially offset by $137.7 million of principal payments on long-term debt and purchase of treasury stock of $20.8 million.

During the six months ended March 31, 2024, cash provided by financing activities was $61.2 million.

During the nine months ended June 30, 2024, cash provided by financing activities was $95.3 million.

We received $149.4 million of proceeds from our Revolving Credit Facility, which were primarily used for acquisitions completed in the period.

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Capital Requirements and Sources of Liquidity

During the six months ended March 31, 2025 and 2024, our capital expenditures were approximately $68.2 million and $55.5 million, respectively.

During the nine months ended June 30, 2025 and 2024, our capital expenditures were approximately $104.9 million and $70.4 million, respectively.

Our capital expenditures are typically made during the fiscal year in which they are approved.

At March 31, 2025, our commitments for capital expenditures were not material to our financial condition or results of operations on a consolidated basis.

At June 30, 2025, our commitments for capital expenditures were not material to our financial condition or results of operations on a consolidated basis.

For fiscal 2025, we expect total capital expenditures to be approximately $130.0 million to $140.0 million.

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Furthermore, on April 12, 2024, we announced that our Board of Directors authorized a stock repurchase program under which up to $40 million is available to purchase shares of our outstanding Class A common stock through September 30, 2025.

We intend to utilize the stock repurchase program to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically.

intend to utilize the stock repurchase program to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically.

Shares of Class A common stock may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 plans.

The stock repurchase program does not obligate the Company to repurchase any shares of Class A

common stock, and the stock repurchase program may be modified, suspended, extended or terminated at any time by our Board of Directors.

The stock repurchase program does not obligate the Company to repurchase any shares of Class A common stock, and the stock repurchase program may be modified, suspended, extended or terminated at any time by our Board of Directors.

The actual timing, number and value of shares of Class A common stock repurchased will be determined by a committee of the Board of Directors at its discretion and will depend on a number of factors, including the market price of the Class A common stock, capital allocation alternatives, general market and economic conditions and other corporate considerations.

During the six months ended March 31, 2025, the Company purchased 111,977 shares of Class A common stock for aggregate consideration of approximately $8.0 million through open market transactions.

During the nine months ended June 30, 2025, the Company purchased 119,370 shares of Class A common stock for aggregate consideration of approximately $8.7 million through open market transactions.

We have historically relied on cash available through credit facilities, in addition to cash from operations, to finance our working capital requirements and to support our growth.

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Contractual Obligations

The following table summarizes our significant obligations outstanding as of March 31, 2025 (unaudited, in thousands):

The following table summarizes our significant obligations outstanding as of June 30, 2025 (unaudited, in thousands):

Payments Due by Fiscal Year

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Off-Balance Sheet Arrangements

As of March 31, 2025, we had aggregate letters of credit outstanding in the amount of $6.6 million, future purchase commitments of diesel fuel and natural gas of $2.8 million and $0.3 million, respectively, and $3.4 million of minimum royalty payments related to aggregates facilities.

As of June 30, 2025, we had aggregate letters of credit outstanding in the amount of $6.5 million, future purchase commitments of diesel fuel and natural gas of $2.0 million and $0.2 million, respectively, and $3.5 million of minimum royalty payments related to aggregates facilities.

Other than the letters of credit, future purchase commitments and minimum royalty payments, we do not currently have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on our financial condition, changes in our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis