Knife River : First Quarter 2025 Q1 2025 Presentation

Published: 2025-05-06 10:57:24 ET KNF

Published on 05/06/2025 at 10:57

May 6, 2025

Investing for Long-Term Growth

2025 Guidance1

First Quarter Results

2025 Opportunities

Revenue

$3.25B - $3.45B

Previously: $3.0B - $3.2B

Adjusted EBITDA2

$530M - $580M

Previously: $485M - $535M

Adjusted EBITDA Margin2,3

16.6%

Previously: 16.5%

Revenue

$329.6M

$353.5M

2024 2025

Adjusted EBITDA2

($17.7M)

2024 2025

($38.0M)

Adjusted EBITDA Margin2

2024 2025

(5.4%)

(10.7%)

Infrastructure investment supporting growth

Acquisition and integration of high-quality, strategic assets

Expansion of EDGE initiatives

Continued adjusted EBITDA margin2 expansion

1 Guidance does not include the expected impact of potential acquisitions or material impacts related to tariffs. 2 See Appendix for reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure.

3 Reflects the midpoint of Adjusted EBITDA guidance divided by the midpoint of Revenue guidance.

EBITDA1 Seasonality

As a % of Full-Year Results

Average Temperature5

January - March 2025

KNF

10 20 30 40 50 60 70 80 90 100

56%

31%

18%

(5%) (8%)

Degrees Fahrenheit

1 See Appendix for reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure. 2 Based on 5-year average 2020-2024. 3 Percentage of 2025 midpoint guidance. 4 Strata acquired on March 7, 2025, and Albina acquired on Nov. 2, 2024. 5 NOAA National Centers for Environmental Information.

SG&A Step-Up

$5.8M

$1.9M

EDGE

Business Development Costs

$1.7M $73.1M

Investments in business development and EDGE expected to drive growth in 2025 and beyond

$60.2M

$3.5M

Other

Strata / Albina SG&A

$20M step-up expected for full-year 2025,

for business development and EDGE-related costs

Step-up in SG&A costs front-loaded in first half of the year, with approximately $8M in Q1

1Q24 1Q25

Public Funding Supports Healthy Backlog

Roads Need Rebuilding

Funding Supports Infrastructure Development

KNF Backlog

($ in millions)

ASCE Issues 2025 Infrastructure Report1

DOT Budgets at or Near Record Levels2

Backlog near 1Q24 record, at similar expected margins

"D+" grade for roads and aviation, and a "C" for bridges

62% of IIJA funds yet to be spent in 14 KNF states

1Q25

$938.7

$959.5

1Q24

Highlights $2.2T in funding needed from 2024-2033 to get roads to a state of good repair

Tracking 51 transportation bills in KNF states:

ND passed SB2012, adding $414M over the next two years in key Strata market

WA passed SB5801, adding $3.2B over the next six years

ID passed HB25 and SB1218, adding a combined $1.3B over the next three years

Approximately 87% public work

Average project size $3M

Approximately 87% completed in 1 year

Record Q1 backlog in Mountain Segment

U.S. Roads

D+

1 American Society of Civil Engineers "2025 Report Card for America's Infrastructure," March 2025. 2 ARTBA and Company analysis.

EBITDA Margin Improvement

Discipline Growth Excellence

Commercial and operational excellence initiatives

Strong balance sheet and disciplined allocation of capital

Strengthen position through organic and acquisition investments

Be best in class in all aspects of the business

EDGE-aligned materials pricing and quoting software being deployed across company

PIT Crew investments at aggregates plants in Q1 expected to improve margins

Revolver with $477M in available capacity1

Net leverage1,2 of 2.5x, in line with LT target

Maintenance Capex remains 5% to 7% of expected revenue, including Strata

Closed on Strata Corporation and Kalama River Quarry in Q1

Pipeline of organic and acquisition opportunities is robust across each segment

In 2025, $68M of Capex approved for organic growth initiatives

Excellence Summit in April with 100 company leaders

New safety initiative to build on safety culture

PIT Crew update and direction for 2025

Updated our sustainability priority assessment

"Coaching 101" training

1 As of 3/31/2025. 2 See Appendix for reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure.

Strata Corporation

Kalama River Quarry

Closed in Q1 for $419M1

30+ years of aggregate reserves, with rail

24 ready-mix plants, 3 asphalt plants, contracting services

Infill growth in Central Segment, expect to be margin accretive in 2025

Closed in Q1 for $10M

50 years of aggregate reserves

Growth corridor north of Vancouver, WA

Expect to be margin accretive in 2025

Acquisition Pipeline

Pipeline remains robust

Focused on materials-led

Staying disciplined on strategic fit

1 Cash paid net of working capital adjustments, proceeds from the divestiture of four ready-mix plants and cash acquired.

Operations: Improving Plant Production

Commercial

10 plants visited 1Q25

Investments included throughput improvements at four plants:

Waco, TX

Kona, HI

Medford, OR

Cheyenne, WY

30% to 40% avg. improvement in production capacity

Deploying standard pricing/quoting system across materials product lines

Visibility into materials sales pipelines, backlogs, pricing forecasts and transactional margin analytics

Training

Provided new "Coaching 101" training to 315 supervisors YTD

Sales immersion training to 210 team members to date, reinforcing Dynamic Pricing strategy

West

Mountain

Central

Geographic Segments

Energy Services

Consolidated3

Revenue

$208.3M

$66.0M

$67.9M

$342.2M

$13.9M

$353.5M

Revenue Growth

10%

11%

Adjusted EBITDA1

$24.9M

($16.3M)

($24.3M)

($15.7M)

($7.8M)

($38.0M)

Contracting Services Backlog

$242.1M

$418.3M

$278.3M

$938.7M

TTM Adjusted EBITDA Margin1,2

18.0%

15.4%

15.3%

16.5%

19.8%

15.1%

1 See Appendix for a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure. 2 TTM refers to twelve trailing months. 3 Consolidated results include Corporate Services and Eliminations.

Q1 Volumes Have Limited Influence on Full-Year Results

Volume (in thousands)

Q1 2025

Q1 2024

Change

Average Selling Price1

Q1 2025

Q1 2024

Change

Aggregates (tons)

3,867

4,255

(9%)

Aggregates (per ton)

$21.05

$19.80

Ready-mix concrete (cubic yards)

544

530

Ready-mix concrete (per cubic yard)

$199.26

$188.41

Asphalt (tons)

199

221

(10%)

Asphalt (per ton)

$81.05

$74.50

Product Line Revenue Seasonality2

Aggregates

28%

22%

15%

35%

Ready-Mix

Asphalt

49%

Contracting Services

41%

27%

20%

28%

22%

33%

28%

23%

16%

Q1 Q2 Q3 Q4

1 Average selling price includes freight and delivery and other revenue. 2 Based on three-year average revenue (2022-2024).

Available Liquidity

Debt Schedule 1Q25

Net Leverage2

Senior Notes

Unrestricted Cash

$86M

Revolver1

$477M

Fixed 7.75% Due 2031

Term Loan A Agreement

Floating 6.05% Due 2030

Term Loan B Agreement

Floating 6.29% Due 2032

Revolving Credit Agreement

Floating 6.05% Due 2030 - $500M capacity

$425.0M

$264.7M

$500.0M

$0.0M

2.3x

1.4x

1.5x

1.3x

1.1x 1.0x 1.0x

2.5x

Other Notes

$0.3M

Total Debt

$1,190.0M

Less: Cash and cash equivalents, excluding restricted cash

$86.1M

Net Debt2

$1,103.9M

TTM Adjusted EBITDA2

$442.7M

Net leverage22.5x

1Q25

1 Revolver total is net of Letters of Credit. 2 See Appendix for reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure.

2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 1Q25

Updated Full-Year Revenue and Adjusted EBITDA1 Guidance

FY 2025 Guidance

(in millions)

Low

High

Revenue

(Knife River Consolidated)

$3,250M

$3,450M

Adjusted EBITDA1

All Geographic Segments & Corporate Services and Eliminations

Energy Services

$465M

$65M

$505M

$75M

Consolidated Adjusted EBITDA1

$530M

$580M

Key Assumptions2

Pricing

Volume

Aggregates

Mid-Single-Digit Increase

High-Single-Digit Increase

Ready-Mix

Mid-Single-Digit Increase

High-Teens Increase

Asphalt

Low-Single-Digit Increase

Normal weather, economic and operating conditions, no expected impact of potential acquisitions, no material impacts from tariffs

1 See Appendix for reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure. 2 Key assumptions compared to the prior year.

Appendix and Non-GAAP Financial Measures

Population Growth in Knife River States

Gross State Product2 CAGR (2014 - 2024)

State 2014 -2024 Population CAGR1 % of 2024 Revenue

1.5%

1.2%

1.1%

0.8%

0.7%

0.6%

0.4%

0.2%

0.1%

0.0%

Idaho Texas Washington Montana South Dakota North Dakota

Oregon Nebraska Minnesota

Iowa Hawaii California Wyoming Alaska

U.S. national average

0.7%

2.1%

13%

23%

10%

~65% of revenue generated in states growing faster than the US average

3.3%

3.0%

2.8%

KNF State Avg. U.S. National Avg. Non-KNF State Avg.

1 Knife River weighted-average equal to 0.8%; 2 Represents the total monetary value of all finished goods and services produced within a state's borders; 3 Represents the total value of state/local construction and private construction put in place by state. Source: U.S. Census Bureau, IHS Markit and Federal Reserve Economic Data (FRED).

Attractive High-Growth Markets

Three Months Ended March 31, 2025

($ in millions)

West

Mountain

Central

Geographic Regions

Energy Services

Corporate Services and Eliminations

Consolidated

Net income (loss)

$8.0

$(23.5)

$(35.5)

$(51.0)

$(11.0)

$(6.7)

$(68.7)

Depreciation, depletion and amortization

16.9

7.2

11.2

35.3

3.2

0.3

38.8

Interest expense, net

13.1

Income taxes

(24.7)

EBITDA

$24.9

$(16.3)

$(24.3)

$(15.7)

$(7.8)

$(18.0)

$(41.5)

Unrealized (gains) losses on benefit plan investments

0.7

Stock-based compensation expense

2.8

Adjusted EBITDA

$24.9

$(16.3)

$(24.3)

$(15.7)

$(7.8)

$(14.5)

$(38.0)

Revenue

$208.3

$66.0

$67.9

$342.2

$13.9

$(2.6)

$353.5

Net Income Margin

3.9%

(35.6)%

(52.2)%

(14.9)%

(78.7)%

n.m.

(19.4)%

EBITDA Margin

12.0%

(24.6)%

(35.8)%

(4.6)%

(56.0)%

n.m.

(11.7)%

Adjusted EBITDA Margin

12.0%

(24.6)%

(35.8)%

(4.6)%

(56.0)%

n.m.

(10.7)%

Three Months Ended March 31, 2024

($ in millions)

West

Mountain

Central

Geographic Regions

Energy Services

Corporate Services and Eliminations

Consolidated

Net income (loss)

$3.7

$(12.4)

$(27.4)

$(36.1)

$(3.7)

$(7.8)

$(47.6)

Depreciation, depletion and amortization

15.7

6.3

8.7

30.7

1.2

0.3

32.2

Interest expense, net

11.1

Income taxes

(16.3)

EBITDA

$19.4

$(6.1)

$(18.7)

$(5.4)

$(2.5)

$(12.7)

$(20.6)

Unrealized (gains) losses on benefit plan investments

(1.2)

Stock-based compensation expense

1.8

One-time separation costs

2.3

Adjusted EBITDA

$19.4

$(6.1)

$(18.7)

$(5.4)

$(2.5)

$(9.8)

$(17.7)

Revenue

$198.7

$59.8

$61.0

$319.5

$12.8

$(2.7)

$329.6

Net Income Margin

1.9%

(20.8)%

(44.9)%

(11.3)%

(29.1)%

n.m.

(14.5)%

EBITDA Margin

9.8%

(10.1)%

(30.7)%

(1.7)%

(19.4)%

n.m.

(6.2)%

Adjusted EBITDA Margin

9.8%

(10.1)%

(30.7)%

(1.7)%

(19.4)%

n.m.

(5.4)%

Note: Totals may not sum due to rounding. N.M. reflects not meaningful.

EBITDA and Adjusted EBITDA - Segment Reconciliation

Twelve Months Ended December 31, 2024

($ in millions)

West

Mountain

Central

Geographic Segments

Energy Services

Corporate Services and Eliminations

Consolidated

Net income (loss)

$143.4

$87.1

$94.7

$325.2

$53.9

$(177.4)

$201.7

Depreciation, depletion and amortization

66.3

26.2

36.9

129.4

6.3

1.2

136.9

Interest expense, net

0.2

46.2

46.4

Income taxes

69.3

EBITDA

$209.7

$113.5

$131.6

$454.8

$60.2

$(60.7)

$454.3

Unrealized (gains) losses on benefit plan

investments

(2.9)

Stock-based compensation expense

7.8

One-time separation costs

3.8

Adjusted EBITDA

$209.7

$113.5

$131.6

$454.8

$60.2

$(52.0)

$463.0

Revenue

$1,185.5

$663.1

$818.1

$2,666.7

$275.7

$(43.4)

$2,899.0

Net Income Margin

12.1%

13.1%

11.6%

12.2%

19.5%

n.m.

7.0%

EBITDA Margin

17.7%

17.1%

16.1%

17.1%

21.8%

n.m.

15.7%

Adjusted EBITDA Margin

17.7%

17.1%

16.1%

17.1%

21.8%

n.m.

16.0%

EBITDA and Adjusted EBITDA - Segment Reconciliation

2024

($ in millions)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Full Year

Net income (loss)

$(47.6)

$77.9

$148.1

$23.3

$201.7

Depreciation, depletion and amortization

32.2

34.5

34.8

35.4

136.9

Interest expense, net

11.1

12.8

12.1

10.3

46.4

Income taxes

(16.3)

26.2

49.6

9.8

69.3

EBITDA

$(20.6)

$151.4

$244.6

$78.8

$454.3

Unrealized (gains) losses on benefit plan investments

(1.2)

(0.4)

(1.2)

(2.9)

Stock-based compensation expense

1.8

2.4

7.8

One-time separation costs

2.3

1.5

3.8

Adjusted EBITDA

$(17.7)

$154.3

$245.2

$81.2

$463.0

Revenue

$329.6

$806.9

$1,105.3

$657.2

$2, 899.0

Net Income Margin

(14.5)%

9.7%

13.4%

3.5%

7.0%

EBITDA Margin

(6.2)%

18.8%

22.1%

12.0%

15.7%

Adjusted EBITDA Margin

(5.4)%

19.1%

22.2%

12.4%

16.0%

Note: Totals may not sum due to rounding.

EBITDA and Adjusted EBITDA - Historical Reconciliation

2023

($ in millions)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Full Year

Net income (loss)

$(41.3)

$56.8

$146.7

$20.7

$182.9

Depreciation, depletion and amortization

29.6

31.1

31.8

31.3

123.8

Interest expense, net

9.5

17.1

14.7

11.5

52.9

Income taxes

(11.9)

20.1

48.2

6.1

62.4

EBITDA

$(14.1)

$125.1

$241.4

$69.6

$422.0

Unrealized (gains) losses on benefit plan investments

(1.3)

(0.4)

0.6

(1.5)

(2.7)

Stock-based compensation expense

0.9

(0.1)

1.5

0.8

3.1

One-time separation costs

0.8

1.7

4.0

3.5

10.0

Adjusted EBITDA

$(13.7)

$126.3

$247.5

$72.4

$432.4

Revenue

$307.9

$785.2

$1,090.4

$646.9

$2,830.3

Net Income Margin

(13.4)%

7.2%

13.4%

3.2%

6.5%

EBITDA Margin

(4.6)%

15.9%

22.1%

10.8%

14.9%

Adjusted EBITDA Margin

(4.5)%

16.1%

22.7%

11.2%

15.3%

2022

($ in millions)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Full Year

Net income (loss)

$(40.0)

$38.6

$99.7

$18.0

$116.2

Depreciation, depletion and amortization

28.4

29.7

30.5

29.2

117.8

Interest expense, net

5.2

7.4

8.8

8.6

30.1

Income taxes

(11.8)

11.6

33.1

9.7

42.6

EBITDA

$(18.2)

$87.3

$172.1

$65.5

$306.7

Unrealized (gains) losses on benefit plan investments

1.5

2.4

0.8

(0.7)

4.0

Stock-based compensation expense

0.7

0.2

1.0

2.7

One-time separation costs

Adjusted EBITDA

$(16.0)

$90.4

$173.1

$65.8

$313.4

Revenue

$310.0

$711.8

$975.4

$537.5

$2,534.7

Net Income Margin

(12.9)%

5.4%

10.2%

3.4%

4.6%

EBITDA Margin

(5.9)%

12.3%

17.6%

12.2%

12.1%

Adjusted EBITDA Margin

(5.2)%

12.7%

17.8%

12.2%

12.4%

Note: Totals may not sum due to rounding.

EBITDA and Adjusted EBITDA - Historical Reconciliation

2021

($ in millions)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Full Year

Net income (loss)

$(30.8)

$51.4

$96.3

$12.9

$129.8

Depreciation, depletion and amortization

23.4

25.3

25.5

26.8

101.0

Interest expense, net

4.7

4.8

19.2

Income taxes

(8.9)

17.4

32.3

2.6

43.4

EBITDA

$(11.6)

$98.9

$158.9

$47.1

$293.4

Unrealized (gains) losses on benefit plan investments

(2.3)

Stock-based compensation expense

3.6

One-time separation costs

Adjusted EBITDA

$(11.6)

$98.9

$158.9

$47.1

$294.7

Revenue

$265.7

$633.8

$831.3

$498.1

$2,228.9

Net Income Margin

(11.6)%

8.1%

11.6%

2.6%

5.8%

EBITDA Margin

(4.3)%

15.6%

19.1%

9.5%

13.2%

Adjusted EBITDA Margin

(4.3)%

15.6%

19.1%

9.5%

13.2%

2020

($ in millions)

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Full Year

Net income (loss)

$(38.2)

$53.0

$107.3

$25.2

$147.3

Depreciation, depletion and amortization

20.6

22.5

23.5

23.0

89.7

Interest expense, net

5.2

5.7

5.0

4.7

20.6

Income taxes

(11.4)

17.9

36.5

4.5

47.4

EBITDA

$(23.8)

$99.1

$172.3

$57.4

$305.0

Unrealized (gains) losses on benefit plan investments

(4.0)

Stock-based compensation expense

3.3

One-time separation costs

Adjusted EBITDA

$(23.8)

$99.1

$172.3

$57.4

$304.3

Revenue

$262.2

$621.1

$822.5

$472.1

$2,178.0

Net Income Margin

(14.6)%

8.5%

13.0%

5.3%

6.8%

EBITDA Margin

(9.1)%

16.0%

20.9%

12.2%

14.0%

Adjusted EBITDA Margin

(9.1)%

16.0%

20.9%

12.2%

14.0%

Note: Totals may not sum due to rounding.

EBITDA and Adjusted EBITDA - Historical Reconciliation

($ in millions, except net leverage) As of March 31, 2025 As of December 31, 2024 As of September 30, 2024 As of June 30, 2024

Long-term debt

$1,160.4

$666.9

$669.7

$672.5

Long-term debt - current portion

11.8

10.5

8.8

7.1

Total debt

$1,172.2

$677.4

$678.5

$679.6

Add: Unamortized debt issuance costs

17.8

12.6

13.2

13.9

Total debt, gross

$1,190.0

$690.0

$691.7

$693.5

Less: Cash and cash equivalents, excluding restricted cash

86.1

236.8

220.4

15.5

Total debt, net

$1,103.9

$453.2

$471.3

$678.0

TTM1 Adjusted EBITDA

$442.7

$463.0

$454.2

$456.5

Net leverage

2.5x

1.0x

1.5x

1 TTM refers to trailing twelve-month.

Net Leverage Reconciliation

($ in millions, except net leverage) As of March 31, 2024 As of December 31, 2023 As of September 30, 2023 As of June 30, 2023

Long-term debt

$673.5

$674.6

$675.6

$832.0

Long-term debt - current portion

7.1

Total debt

$680.6

$681.7

$682.7

$839.1

Add: Unamortized debt issuance costs

14.6

15.3

16.0

16.4

Total debt, gross

$695.9

$697.0

$698.7

$855.5

Less: Cash and cash equivalents, excluding restricted cash

128.4

219.3

84.0

40.1

Total debt, net

$566.8

$477.7

$614.7

$815.4

TTM1 Adjusted EBITDA

$428.4

$432.4

$425.8

$351.4

Net leverage

1.3x

1.1x

1.4x

2.3x

1 TTM refers to trailing twelve-month.

Net Leverage Reconciliation

($ in millions)

Twelve Months Ended March 31, 2025

Three Months Ended March 31, 2025

Twelve Months Ended Three Months Ended December 31, 2024 March 31, 2024

Net income (loss)

$180.6

$(68.7)

$201.7

$(47.6)

Depreciation, depletion and amortization

143.5

38.8

136.9

32.2

Interest expense, net

48.4

13.1

46.4

11.1

Income taxes

60.9

(24.7)

69.3

(16.3)

EBITDA

$443.4

$(41.5)

$454.3

$(20.6)

Unrealized (gains) losses on benefit plan investments

(1.0)

0.7

(2.9)

(1.2)

Stock-based compensation expense

8.8

2.8

7.8

1.8

One-time separation costs

1.5

3.8

2.3

Adjusted EBITDA

$442.7

$(38.0)

$463.0

$(17.7)

($ in millions)

Twelve Months Ended December 31, 2024

Net income (loss)

$201.7

Depreciation, depletion and amortization

136.9

Interest expense, net

46.4

Income taxes

69.3

EBITDA

$454.3

Unrealized (gains) losses on benefit plan investments

(2.9)

Stock-based compensation expense

7.8

One-time separation costs

3.8

Adjusted EBITDA

$463.0

Net Leverage Reconciliation

($ in millions)

Twelve Months Ended September 30, 2024

Nine Months Ended September 30, 2024

Twelve Months Ended December 31, 2023

Nine Months Ended September 30, 2023

Net income (loss)

$199.1

$178.4

$182.9

$162.2

Depreciation, depletion and amortization

132.8

101.5

123.8

92.5

Interest expense, net

47.6

36.1

52.9

41.4

Income taxes

65.5

59.4

62.4

56.3

EBITDA

$445.0

$375.4

$422.0

$352.4

Unrealized (gains) losses on benefit plan investments

(4.4)

(2.8)

(2.7)

(1.1)

Stock-based compensation expense

6.2

5.4

3.1

2.3

One-time separation costs

7.4

3.8

10.0

6.4

Adjusted EBITDA

$454.2

$381.8

$432.4

$360.0

($ in millions)

Twelve Months Ended June 30, 2024

Six Months Ended June 30, 2024

Twelve Months Ended December 31, 2023

Six Months Ended June 30, 2023

Net income (loss)

$197.7

$30.6

$182.9

$15.5

Depreciation, depletion and amortization

129.8

66.7

123.8

60.7

Interest expense, net

50.1

23.9

52.9

26.7

Income taxes

64.2

9.9

62.4

8.1

EBITDA

$441.8

$130.8

$422.0

$111.0

Unrealized (gains) losses on benefit plan investments

(2.6)

(1.6)

(2.7)

(1.7)

Stock-based compensation expense

5.9

3.6

3.1

0.8

One-time separation costs

11.4

3.8

10.0

2.4

Adjusted EBITDA

$456.5

$136.6

$432.4

$112.5

Net Leverage Reconciliation

($ in millions)

Twelve Months Ended March 31, 2024

Three Months Ended Twelve Months Ended Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023

Net income (loss) $176.6 $(47.6) $182.6 $(41.3)

Depreciation, depletion and

amortization 126.4 32.2 123.8 26.6

Interest expense, net 54.5 11.1 52.6 6.5

Income taxes 58.0 (16.3) 62.4 (11.6)

EBITDA $415.5 $(20.6) $422.0 $(14.1)

Unrealized (gains) losses on benefit

plan investments (2.6) (1.2) (2.7) (1.3)

Stock-based compensation expense 4.0 1.8 3.1 0.6

One-time separation costs 11.5 2.3 10.0 0.8

Adjusted EBITDA $428.4 $(17.7) $432.4 $(13.7)

($ in millions)

Twelve Months Ended December 31, 2023

Net income (loss)

$182.9

Depreciation, depletion and amortization

123.8

Interest expense, net

52.9

Income taxes

62.4

EBITDA

$422.0

Unrealized (gains) losses on benefit plan investments

(2.7)

Stock-based compensation expense

3.1

One-time separation costs

10.0

Adjusted EBITDA

$432.4

Net Leverage Reconciliation

($ in millions)

Twelve Months Ended September 30, 2023

Nine Months Ended September 30, 2023

Twelve Months Ended December 31, 2022

Nine Months Ended September 30, 2022

Net income (loss)

$180.2

$162.2

$116.2

$98.2

Depreciation, depletion and amortization

121.7

92.5

117.8

88.6

Interest expense, net

50.0

41.4

30.1

21.5

Income taxes

66.0

56.3

42.6

32.9

EBITDA

$417.9

$352.4

$306.7

$241.2

Unrealized (gains) losses on benefit plan investments

(1.9)

(1.1)

4.0

4.8

Stock-based compensation expense

3.4

2.3

2.7

1.6

One-time separation costs

6.4

Adjusted EBITDA

$425.8

$360.0

$313.4

$247.6

($ in millions)

Twelve Months Ended June 30, 2023

Six Months Ended June 30, 2023

Twelve Months Ended December 31, 2022

Six Months Ended June 30, 2022

Net income (loss)

$133.2

$15.5

$116.2

$(1.5)

Depreciation, depletion and amortization

120.4

60.7

117.8

58.1

Interest expense, net

44.1

26.7

30.1

12.7

Income taxes

50.9

8.1

42.6

(0.2)

EBITDA

$348.6

$111.0

$306.7

$69.1

Unrealized (gains) losses on benefit plan investments

(1.7)

4.0

Stock-based compensation expense

2.1

0.8

2.7

1.4

One-time separation costs

2.4

Adjusted EBITDA

$351.4

$112.5

$313.4

$74.5

Net Leverage Reconciliation

Full-Year Guidance

(In millions)

2025

Low High

Net income (loss) $200.0 $240.0

Interest expense, net Income taxes

Depreciation, depletion and amortization

68.8 68.8

72.0 82.0

177.0 177.0

EBITDA

$517.8 $567.8

Unrealized (gains) losses on benefit plan investments

Stock-based compensation expense

0.7 0.7

11.5 11.5

Adjusted EBITDA

$530.0 $580.0

Adjusted EBITDA Guidance Table

Our guidance for long-term Adjusted EBITDA margin, projected EBITDA contributions, and net leverage are non-GAAP financial measures that exclude or otherwise have been adjusted for non-GAAP adjustment items from our U.S. GAAP financial statements. When we provide guidance for these non-GAAP metrics described above, we do not provide reconciliations of the U.S. GAAP measures as we are unable to predict with a reasonable degree of certainty the actual impact of the non-GAAP adjustment items. By their very nature, non-GAAP adjustment items are difficult to anticipate with precision because they are generally associated with unexpected and unplanned events that impact our Company and its financial results. Therefore, we are unable to provide a reconciliation of these measures without unreasonable efforts.

Disclaimer

Knife River Corporation published this content on May 06, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 06, 2025 at 14:37 UTC.