Construction Partners, Inc. Announces Fiscal 2026 Second Quarter Results

Published: 2026-05-08 07:01:13 ET ROAD

Published on 05/08/2026 at 07:01 am EDT

Revenue Up 35% Compared to Q2 FY25Adjusted Net Income Up 136% Compared to Q2 FY25Adjusted EBITDA Up 35% Compared to Q2 FY25Record Backlog of $3.14 BillionCompany Raises FY26 Outlook

DOTHAN, Ala., May 8, 2026 /PRNewswire/ -- 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, 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:

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 BlackDennard Lascar Investor [email protected] (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 MonthsEnded 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)

262

Income before provision for income taxes and earnings frominvestment 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

(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

—

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

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 sharesissued 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

Class B common stock, par value $0.001; 100,000,000 shares authorized, 11,481,568 sharesissued 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

Additional paid-in capital

609,457

541,179

Treasury stock, Class A common stock, par value $0.001, at cost, 745,456 shares at March31, 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 byoperating 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)

Share-based compensation expense

22,410

18,883

Distribution of earnings from investment in joint venture

—

Loss from investment in joint venture

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

Tax impact due to above reconciling items

(3,800)

(4,000)

Adjusted net income

$ 170,400

$ 174,200

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SOURCE Construction Partners, Inc.