GVA Granite Construction Inc

• Q4 revenue increased 5% year-over-year to $977 million, and fiscal year revenue increased 14% year-over-year to $4.0 billion
• Q4 diluted EPS of $0.84 and adjusted diluted EPS (1) of $1.23, and fiscal year diluted EPS of $2.62 and adjusted diluted EPS (1) of $4.82
• Fiscal year operating cash flow of $456 million, or 11.4% of revenue
• Committed and Awarded Projects ("CAP") (2) of $5.3 billion

Granite Construction Incorporated (NYSE: GVA) today announced results for the quarter and year ended December 31, 2024.

Fourth Quarter 2024 Results

Net income totaled $41 million, or $0.84 per diluted share, compared to net income of $26 million, or $0.55 per diluted share, for the same period in the prior year. Adjusted net income (1) totaled $56 million, or $1.23 per diluted share, compared to adjusted net income (1) of $38 million, or $0.85 per diluted share, for the same period in the prior year.

• Revenue increased $43 million to $977 million compared to $934 million for the same period in the prior year.
• Gross profit increased $57 million to $151 million compared to $94 million for the same period in the prior year.
• Selling, general and administrative (“SG&A”) expenses totaled $84 million, or 8.6% of revenue, compared to $82 million, or 8.8% of revenue, for the same period in the prior year.
• Adjusted EBITDA (1) increased $33 million to $109 million compared to $76 million for the same period in the prior year.

"I want to thank our teams across the company for all of their hard work and dedication. 2024 was a record year for Granite,” said Kyle Larkin, Granite President and Chief Executive Officer. “We set company records for revenue, adjusted net income, adjusted EBITDA, operating cash flow and safety. We expect to continue our organic revenue growth, execute on M&A, expand margins and generate consistent cash flow as we drive toward our 2027 targets. Our markets continue to be robust, as high levels of public funding and strong private investment are creating attractive opportunities for both our construction and materials segments. Against this backdrop, I believe we can meet our organic growth guidance while also growing CAP during 2025. In addition, with $586 million in cash and marketable securities and revolver borrowing capacity, Granite is well positioned to capitalize on M&A opportunities and strategic investments.”

Fiscal Year 2024 Results

Net income totaled $126 million, or $2.62 per diluted share, compared to net income of $44 million, or $0.97 per diluted share, in the prior year. Adjusted net income (1) totaled $214 million, or $4.82 per diluted share, compared to adjusted net income (1) of $147 million, or $3.31 per diluted share, in the prior year.

• Revenue increased $498 million to $4.0 billion compared to $3.5 billion in the prior year.
• Gross profit increased $177 million to $573 million compared to $396 million in the prior year.
• SG&A expenses totaled $334 million, or 8.3% of revenue, compared to $294 million, or 8.4% of revenue, in the prior year.
• Adjusted EBITDA (1) increased $123 million to $402 million compared to $279 million for the same period in the prior year.

(1)

 

Adjusted net income, adjusted diluted earnings per share, earnings before interest, taxes, depreciation, and amortization (“EBITDA”), EBITDA margin, adjusted EBITDA, and adjusted EBITDA margin are non-GAAP measures. Please refer to the description and reconciliation of non-GAAP measures in the attached tables.

(2)

 

CAP is comprised of revenue we expect to record in the future on executed contracts, including 100% of our consolidated joint venture contracts and our proportionate share of unconsolidated joint venture contracts, as well as the general construction portion of construction manager/general contractor, construction manager/at risk and progressive design build contracts to the extent contract execution and funding is probable.

Fourth Quarter and Fiscal Year 2024 Segment Results (Unaudited - dollars in thousands)

Construction Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2024

 

 

 

2023

 

 

Change

 

 

2024

 

 

 

2023

 

 

Change

Revenue

$

821,353

 

 

$

793,727

 

 

$

27,626

 

3.5

%

 

$

3,415,225

 

 

$

2,992,254

 

 

$

422,971

 

14.1

%

Gross profit

$

128,117

 

 

$

72,034

 

 

$

56,083

 

77.9

%

 

$

491,002

 

 

$

325,055

 

 

$

165,947

 

51.1

%

Gross profit as a percent of revenue

 

15.6

%

 

 

9.1

%

 

 

 

 

 

 

14.4

%

 

 

10.9

%

 

 

 

 

Committed and Awarded Projects

December 31, 2024

 

September 30, 2024

 

Change - Quarter over Quarter

 

December 31, 2023

 

Change - Year over Year

Public

$

4,120,821

 

$

4,365,669

 

$

(244,848

)

 

(5.6

)%

 

$

4,368,904

 

$

(248,083

)

 

(5.7

)%

Private

 

1,175,246

 

 

1,254,126

 

 

(78,880

)

 

(6.3

)%

 

 

1,176,850

 

 

(1,604

)

 

(0.1

)%

Total

$

5,296,067

 

$

5,619,795

 

$

(323,728

)

 

(5.8

)%

 

$

5,545,754

 

$

(249,687

)

 

(4.5

)%

Construction revenue increased 3% and 14% year-over-year in the three months and year ended December 31, 2024, respectively. The revenue increase was driven by a strong market environment, revenue from acquired companies and more favorable weather conditions early in the year. Construction gross profit and gross profit margin increased significantly in both the three months and year ended December 31, 2024, respectively, driven by increased revenue and improved project execution across our higher quality project portfolio.

CAP totaled $5.3 billion, a decrease of $324 million sequentially and $250 million year-over-year. Bidding activity remained robust, and several significant project awards are expected to be added to CAP during the first half of 2025. Given the current market environment, we believe there are substantial opportunities to build CAP in 2025.

Materials Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2024

 

 

 

2023

 

 

Change

 

 

2024

 

 

 

2023

 

 

Change

Revenue

$

155,950

 

 

$

139,971

 

 

$

15,979

 

11.4

%

 

$

592,349

 

 

$

516,884

 

 

$

75,465

 

14.6

%

Gross profit

$

22,635

 

 

$

22,277

 

 

$

358

 

1.6

%

 

$

81,695

 

 

$

71,344

 

 

$

10,351

 

14.5

%

Gross profit as a percent of revenue

 

14.5

%

 

 

15.9

%

 

 

 

 

 

 

13.8

%

 

 

13.8

%

 

 

 

 

Cash gross profit(1)

$

37,068

 

 

$

30,529

 

 

$

6,539

 

21.4

%

 

$

126,786

 

 

$

98,110

 

 

$

28,676

 

29.2

%

Cash gross profit as a percent of revenue(1)

 

23.8

%

 

 

21.8

%

 

 

 

 

 

 

21.4

%

 

 

19.0

%

 

 

 

 

(1)

 

Materials segment cash gross profit and cash gross profit as a percent of revenue are non-GAAP measures. Please refer to the description and reconciliation of non-GAAP measures in the attached tables.

Materials revenue for the fourth quarter and fiscal year ended December 31, 2024, respectively, increased compared to the same periods in the prior year, driven primarily by acquired businesses and higher asphalt and aggregate prices. Gross profit margin decreased in the fourth quarter and was flat for the fiscal year ended December 31, 2024, year-over-year, mainly due to increased depreciation, depletion and amortization. Cash gross profit margin, which excludes depreciation, depletion and amortization, increased in both the fourth quarter and fiscal year ended December 31, 2024, respectively, demonstrating the progress made in 2024 by the materials business following the internal reorganization and the addition of acquired businesses.

Outlook

Our guidance for 2025 is described below:

• Revenue in the range of $4.2 billion to $4.4 billion
• Adjusted EBITDA margin in the range of 11.0% to 12.0%
• SG&A expense of approximately 9.0% of revenue, inclusive of an estimated $45 million of stock-based compensation expense
• Mid-20s effective tax rate for adjusted net income
• Capital expenditures of approximately $140 million to $160 million

We do not provide a reconciliation of forward-looking adjusted EBITDA margin or the most directly comparable forward-looking GAAP measure of net income attributable to Granite Construction Incorporated because we cannot predict with a reasonable degree of certainty and without unreasonable efforts certain components or excluded items that are inherently uncertain and depend on various factors. For these reasons, we are unable to assess the potential significance of the unavailable information.

“Our guidance reflects our belief in the strength of our project portfolio and market environment as we enter 2025,” said Executive Vice President and Chief Financial Officer Staci Woolsey. “The projected revenue growth is consistent with our 2027 organic revenue growth target of 6.0% to 8.0%. We also expect to continue to expand margins while maintaining SG&A discipline to reach our range of adjusted EBITDA margin of 11.0% to 12.0% in 2025, led by an increase in construction segment gross profit margin. Finally, we expect to invest in our business through capital expenditures in a range of $140 million to $160 million, including strategic materials investments of approximately $50 million.”

Conference Call

Granite will conduct a conference call today, February 13, 2025, at 8:00 a.m. Pacific Time/11:00 a.m. Eastern Time to discuss the results of the quarter and fiscal year ended December 31, 2024. The Company invites investors to listen to a live audio webcast of the investor conference call on its Investor Relations website, https://investor.graniteconstruction.com. The investor conference call will also be available by calling 1-877-328-5503; international callers may dial 1-412-317-5472. An archive of the webcast will be available on Granite's Investor Relations website approximately one hour after the call. A replay will be available after the live call through February 20, 2025, by calling 1-877-344-7529, replay access code 7965862; international callers may dial 1-412-317-0088.

About Granite

Granite is America’s Infrastructure Company™. Incorporated since 1922, Granite (NYSE:GVA) is one of the largest diversified vertically-integrated civil contractors and construction materials producers in the United States. Granite’s Code of Conduct and strong Core Values guide the Company and its employees to uphold the highest ethical standards. Granite is an industry leader in safety and an award-winning firm in quality and sustainability. For more information, visit graniteconstruction.com, and connect with Granite on LinkedIn, X, Facebook and Instagram.

Forward-looking Statements

Any statements contained in this press release that are not based on historical facts, including statements regarding future events, occurrences, opportunities, circumstances, activities, performance, growth, demand, strategic plans, shareholder value, outcomes, outlook, our expectation that we will continue our organic revenue growth, execute on M&A, expand margins and generate consistent cash flow, that high levels of public funding and strong private investment are creating attractive opportunities, our expectation to meet our organic growth guidance while growing CAP in 2025, that we are well positioned to capitalize on M&A opportunities and strategic investments, our expectation that several significant project awards will be added to CAP during the first half of 2025, our belief that there are substantial opportunities to build CAP in 2025, 2025 fiscal year guidance for revenue, adjusted EBITDA margin, SG&A expense, estimated stock based compensation expense, effective tax rate and capital expenditures, including strategic materials investments, our guidance, including our 2027 organic revenue growth target, continued expansion of margins while maintaining SG&A discipline to reach our Adjusted EBITDA margin guidance in 2025 led by an increase in construction segment gross margin, CAP and results constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by words such as “future,” “outlook,” “assumes,” “believes,” “expects,” “estimates,” “anticipates,” “intends,” “plans,” “appears,” “may,” “will,” “should,” “could,” “would,” “continue,” "guidance" and the negatives thereof or other comparable terminology or by the context in which they are made. These forward-looking statements are estimates reflecting the best judgment of senior management and reflect our current expectations regarding future events, occurrences, opportunities, circumstances, activities, performance, growth, demand, strategic plans, shareholder value, outcomes, outlook, our expectation that we will continue our organic revenue growth, execute on M&A, expand margins and generate consistent cash flow, that high levels of public funding and strong private investment are creating attractive opportunities, our expectation to meet our organic growth guidance while growing CAP in 2025, that we are well positioned to capitalize on M&A opportunities and strategic investments, our expectation that several significant project awards will be added to CAP during the first half of 2025, our belief that there are substantial opportunities to build CAP in 2025, 2025 fiscal year guidance for revenue, adjusted EBITDA margin, SG&A expense, estimated stock based compensation expense, effective tax rate and capital expenditures, including strategic materials investments, our guidance, including our 2027 organic revenue growth target, continued expansion of margins while maintaining SG&A discipline to reach our Adjusted EBITDA margin guidance in 2025 led by an increase in construction segment gross margin, CAP and results. These expectations may or may not be realized. Some of these expectations may be based on beliefs, assumptions or estimates that may prove to be incorrect. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our business, financial condition, results of operations, cash flows and liquidity. Such risks and uncertainties include, but are not limited to, those described in greater detail in our filings with the Securities and Exchange Commission, particularly those described in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

Due to the inherent risks and uncertainties associated with our forward-looking statements, the reader is cautioned not to place undue reliance on them. The reader is also cautioned that the forward-looking statements contained herein speak only as of the date of this press release and, except as required by law; we undertake no obligation to revise or update any forward-looking statements for any reason.

GRANITE CONSTRUCTION INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited - in thousands, except share and per share data)

 

December 31, 2024

 

December 31, 2023

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$ 578,330

 

$ 417,663

Short-term marketable securities

7,311

 

35,863

Receivables, net

511,742

 

598,705

Contract assets

328,353

 

262,987

Inventories

108,175

 

103,898

Equity in unconsolidated construction joint ventures

140,928

 

171,233

Other current assets

41,824

 

53,102

Total current assets

1,716,663

 

1,643,451

Property and equipment, net

716,184

 

662,864

Investments in affiliates

94,031

 

92,910

Goodwill

214,465

 

155,004

Intangible assets

127,886

 

117,322

Right of use assets

89,791

 

78,176

Deferred income taxes, net

—

 

8,179

Other noncurrent assets

66,635

 

55,634

Total assets

$ 3,025,655

 

$ 2,813,540

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

Current liabilities:

 

 

 

Current maturities of long-term debt

$ 1,109

 

$ 39,932

Accounts payable

407,223

 

408,363

Contract liabilities

299,671

 

243,848

Accrued expenses and other current liabilities

323,956

 

337,740

Total current liabilities

1,031,959

 

1,029,883

Long-term debt

737,939

 

614,781

Long-term lease liabilities

73,638

 

63,548

Deferred income taxes, net

13,874

 

3,708

Other long-term liabilities

88,882

 

74,654

Commitments and contingencies

 

 

 

Equity:

 

 

 

Preferred stock, $0.01 par value, authorized 3,000,000 shares, none outstanding

—

 

—

Common stock, $0.01 par value, authorized 150,000,000 shares; issued and outstanding: 43,424,646 shares as of December 31, 2024 and 43,944,118 shares as of December 31, 2023

434

 

439

Additional paid-in capital

410,739

 

474,134

Accumulated other comprehensive income (loss)

(582)

 

881

Retained earnings

604,635

 

501,844

Total Granite Construction Incorporated shareholders’ equity

1,015,226

 

977,298

Non-controlling interests

64,137

 

49,668

Total equity

1,079,363

 

1,026,966

Total liabilities and equity

$ 3,025,655

 

$ 2,813,540

GRANITE CONSTRUCTION INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited - in thousands, except per share data)

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Total revenue

$

977,303

 

 

$

933,698

 

 

$

4,007,574

 

 

$

3,509,138

 

Total cost of revenue

 

826,551

 

 

 

839,387

 

 

 

3,434,877

 

 

 

3,112,739

 

Gross profit

 

150,752

 

 

 

94,311

 

 

 

572,697

 

 

 

396,399

 

Selling, general and administrative expenses

 

84,467

 

 

 

81,987

 

 

 

334,162

 

 

 

294,466

 

Other costs, net

 

10,158

 

 

 

12,244

 

 

 

39,936

 

 

 

50,217

 

Gain on sales of property and equipment, net

 

(4,417

)

 

 

(20,553

)

 

 

(8,764

)

 

 

(28,346

)

Operating income

 

60,544

 

 

 

20,633

 

 

 

207,363

 

 

 

80,062

 

Other (income) expense:

 

 

 

 

 

 

 

Loss on debt extinguishment

 

—

 

 

 

—

 

 

 

27,552

 

 

 

51,052

 

Interest income

 

(6,534

)

 

 

(6,251

)

 

 

(24,349

)

 

 

(17,538

)

Interest expense

 

7,863

 

 

 

6,563

 

 

 

29,188

 

 

 

18,462

 

Equity in income of affiliates, net

 

(4,061

)

 

 

(6,370

)

 

 

(16,982

)

 

 

(25,748

)

Other income, net

 

(2,888

)

 

 

(3,307

)

 

 

(4,238

)

 

 

(6,020

)

Total other (income) expense, net

 

(5,620

)

 

 

(9,365

)

 

 

11,171

 

 

 

20,208

 

Income before income taxes

 

66,164

 

 

 

29,998

 

 

 

196,192

 

 

 

59,854

 

Provision for income taxes

 

19,113

 

 

 

8,289

 

 

 

55,749

 

 

 

30,267

 

Net income

 

47,051

 

 

 

21,709

 

 

 

140,443

 

 

 

29,587

 

Amount attributable to non-controlling interests

 

(5,568

)

 

 

4,289

 

 

 

(14,097

)

 

 

14,012

 

Net income attributable to Granite Construction Incorporated

$

41,483

 

 

$

25,998

 

 

$

126,346

 

 

$

43,599

 

 

 

 

 

 

 

 

 

Net income per share attributable to common shareholders:

 

 

 

 

 

 

 

Basic

$

0.95

 

 

$

0.59

 

 

$

2.88

 

 

$

0.99

 

Diluted

$

0.84

 

 

$

0.55

 

 

$

2.62

 

 

$

0.97

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

Basic

 

43,644

 

 

 

43,934

 

 

 

43,846

 

 

 

43,879

 

Diluted

 

52,954

 

 

 

53,605

 

 

 

52,514

 

 

 

52,565

 

GRANITE CONSTRUCTION INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited - in thousands)

Years Ended December 31,

 

2024

 

 

 

2023

 

Operating activities:

 

 

 

Net income

$

140,443

 

 

$

29,587

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation, depletion and amortization

 

126,331

 

 

 

92,270

 

Amortization related to long-term debt

 

4,501

 

 

 

2,390

 

Loss on debt extinguishment

 

27,552

 

 

 

51,052

 

Gain on sales of property and equipment, net

 

(8,764

)

 

 

(28,346

)

Deferred income taxes

 

13,655

 

 

 

26,556

 

Stock-based compensation

 

19,595

 

 

 

10,477

 

Equity in net loss from unconsolidated construction joint ventures

 

5,102

 

 

 

18,617

 

Net income from affiliates

 

(16,982

)

 

 

(25,748

)

Other non-cash adjustments

 

3,958

 

 

 

5,695

 

Changes in assets and liabilities

 

140,952

 

 

 

1,157

 

Net cash provided by operating activities

$

456,343

 

 

$

183,707

 

Investing activities:

 

 

 

Purchases of marketable securities

$

(10,977

)

 

$

(9,740

)

Maturities of marketable securities

 

38,000

 

 

 

40,000

 

Purchases of property and equipment

 

(136,405

)

 

 

(140,384

)

Proceeds from sales of property and equipment

 

13,852

 

 

 

38,109

 

Acquisitions of businesses, net of cash acquired

 

(121,178

)

 

 

(294,018

)

Cash paid for purchase price adjustments on business acquisition

 

(13,183

)

 

 

—

 

Collection of notes receivable

 

—

 

 

 

5,198

 

Other investing activities

 

1,335

 

 

 

1,545

Net cash used in investing activities

$

(228,556

)

 

$

(359,290

)

Financing activities:

 

 

 

Proceeds from issuance of convertible notes

$

373,750

 

 

$

373,750

 

Proceeds from long-term debt

 

—

 

 

 

305,000

 

Debt principal repayments

 

(310,498

)

 

 

(305,118

)

Capped call transactions

 

(46,046

)

 

 

(53,035

)

Redemption of warrants

 

(497

)

 

 

(13,201

)

Debt issuance costs

 

(10,474

)

 

 

(10,865

)

Cash dividends paid

 

(22,813

)

 

 

(22,811

)

Repurchases of common stock

 

(50,631

)

 

 

(4,124

)

Contributions from non-controlling partners

 

24,000

 

 

 

43,300

 

Distributions to non-controlling partners

 

(25,587

)

 

 

(14,224

)

Other financing activities, net

 

1,676

 

 

 

583

 

Net cash provided by (used in) financing activities

$

(67,120

)

 

$

299,255

 

Net increase in cash and cash equivalents

$

160,667

 

 

$

123,672

 

Cash and cash equivalents at beginning of period

 

417,663

 

 

 

293,991

 

Cash and cash equivalents at end of period

$

578,330

 

 

$

417,663

 

Non-GAAP Financial Information

The tables below contain financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Specifically, management believes that non-GAAP financial measures such as EBITDA and EBITDA margin are useful in evaluating operating performance and are regularly used by securities analysts, institutional investors and other interested parties, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. We are also providing adjusted EBITDA and adjusted EBITDA margin, non-GAAP measures, to indicate the impact of loss on debt extinguishment, stock-based compensation expense and other costs, net, which include legal fees for the defense of a former Company officer in his ongoing civil litigation with the Securities and Exchange Commission, reorganization costs, strategic acquisition and divestiture expenses and non-cash impairment charges. In addition to the aforementioned costs, 2023 also included a litigation charge.

We provide adjusted income before income taxes, adjusted provision for income taxes, adjusted net income attributable to Granite Construction Incorporated, adjusted diluted weighted average shares of common stock and adjusted diluted earnings per share attributable to common shareholders, non-GAAP measures, to indicate the impact of the following:

• Other costs, net as described above;
• Transaction costs which include acquired intangible amortization expense and acquisition-related depreciation;
• Stock-based compensation expense;
• Loss on debt extinguishment; and
• Income taxes related to establishment of valuation allowance in 2023.

We also provide materials segment cash gross profit to exclude the impact of the segment’s depreciation, depletion and amortization from the segment’s gross profit. Management believes that non-GAAP financial measures such as materials segment cash gross profit are useful in evaluating operating performance and are regularly used by securities analysts, institutional investors and other interested parties, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures.

Management believes that these additional non-GAAP financial measures facilitate comparisons between industry peer companies, and management uses these non-GAAP financial measures in evaluating the Company's performance. However, the reader is cautioned that any non-GAAP financial measures provided by the Company are provided in addition to, and not as alternatives for, the Company's reported results prepared in accordance with GAAP. Items that may have a significant impact on the Company's financial position, results of operations and cash flows must be considered when assessing the Company's actual financial condition and performance regardless of whether these items are included in non-GAAP financial measures. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures provided by the Company may not be comparable to similar measures provided by other companies.

GRANITE CONSTRUCTION INCORPORATED

EBITDA AND ADJUSTED EBITDA(1)

(Unaudited - dollars in thousands)

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

EBITDA:

 

 

 

 

 

 

 

Net income attributable to Granite Construction Incorporated

$

41,483

 

 

$

25,998

 

 

$

126,346

 

 

$

43,599

 

Net income margin(2)

4.2

%

 

 

2.8

%

 

 

3.2

%

 

1.2

%

 

 

 

 

 

 

 

 

Depreciation, depletion and amortization expense(3)

 

34,189

 

 

 

27,144

 

 

 

127,721

 

 

 

92,866

 

Provision for income taxes

 

19,113

 

 

 

8,289

 

 

 

55,749

 

 

 

30,267

 

Interest expense, net

 

1,329

 

 

 

312

 

 

 

4,839

 

 

 

924

 

EBITDA(1)

$

96,114

 

 

$

61,743

 

 

$

314,655

 

 

$

167,656

 

EBITDA margin(1)(2)

 

9.8

%

 

 

6.6

%

 

 

7.9

%

 

 

4.8

%

 

 

 

 

 

 

 

 

ADJUSTED EBITDA:

 

 

 

 

 

 

 

Other costs, net

$

10,158

 

 

$

12,244

 

 

$

39,936

 

 

$

50,217

 

Stock-based compensation(4)

 

2,267

 

 

 

1,847

 

 

 

19,595

 

 

 

10,477

 

Loss on debt extinguishment

 

—

 

 

 

—

 

 

 

27,552

 

 

 

51,052

 

Adjusted EBITDA(1)

$

108,539

 

 

$

75,834

 

 

$

401,738

 

 

$

279,402

 

Adjusted EBITDA margin(1)(2)

11.1

%

 

8.1

%

 

 

10.0

%

 

8.0

%

(1) 

We define EBITDA as GAAP net income attributable to Granite Construction Incorporated, adjusted for net interest expense, taxes, depreciation, depletion and amortization. Adjusted EBITDA and adjusted EBITDA margin exclude the impact of Other costs, net, loss on debt extinguishment and stock-based compensation, as described above.

(2)

Represents net income, EBITDA and adjusted EBITDA divided by consolidated revenue of $977 million and $934 million, for the three months ended December 31, 2024 and 2023, respectively, and $4.0 billion and $3.5 billion for the fiscal year ended December 31, 2024 and 2023, respectively.

(3)

Amount includes the sum of depreciation, depletion and amortization which are classified as cost of revenue and selling, general and administrative expenses in the consolidated statements of operations.

(4)

In the first quarter of 2024, we revised the adjusted EBITDA calculation to exclude the impact of stock-based compensation expense. Prior period adjusted EBITDA calculations have been recast to conform to current presentation.

GRANITE CONSTRUCTION INCORPORATED

ADJUSTED NET INCOME RECONCILIATION

(Unaudited - in thousands, except per share data)

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Income before income taxes

$

66,164

 

 

$

29,998

 

 

$

196,192

 

 

$

59,854

 

Other costs, net

 

10,158

 

 

 

12,244

 

 

 

39,936

 

 

 

50,217

 

Transaction costs

 

6,059

 

 

 

1,660

 

 

 

21,436

 

 

 

6,706

 

Stock-based compensation(1)

 

2,267

 

 

 

1,847

 

 

 

19,595

 

 

 

10,477

 

Loss on debt extinguishment

 

—

 

 

 

—

 

 

 

27,552

 

 

 

51,052

 

Adjusted income before income taxes

$

84,648

 

 

$

45,749

 

 

$

304,711

 

 

$

178,306

 

 

 

 

 

 

 

 

 

Provision for income taxes

$

19,113

 

 

$

8,289

 

 

$

55,749

 

 

$

30,267

 

Tax expense to establish valuation allowance

 

—

 

 

 

—

 

 

 

—

 

 

 

(1,542

)

Tax effect of adjusting items(2)

 

4,308

 

 

 

4,095

 

 

 

20,902

 

 

 

16,215

 

Adjusted provision for income taxes

$

23,421

 

 

$

12,384

 

 

$

76,651

 

 

$

44,940

 

 

 

 

 

 

 

 

 

Net income attributable to Granite Construction Incorporated

$

41,483

 

 

$

25,998

 

 

$

126,346

 

 

$

43,599

 

After-tax adjusting items

 

14,176

 

 

 

11,656

 

 

 

87,617

 

 

 

103,779

 

Adjusted net income attributable to Granite Construction Incorporated

$

55,659

 

 

$

37,654

 

 

$

213,963

 

 

$

147,378

 

 

 

 

 

 

 

 

 

Diluted weighted average shares of common stock

 

52,954

 

 

 

53,605

 

 

 

52,514

 

 

 

52,565

 

Less: dilutive effect of convertible notes(3)

 

(7,830

)

 

 

(9,099

)

 

 

(8,103

)

 

 

(8,103

)

Adjusted diluted weighted average shares of common stock

 

45,124

 

 

 

44,506

 

 

 

44,411

 

 

 

44,462

 

 

 

 

 

 

 

 

 

Diluted net income per share attributable to common shareholders

$

0.84

 

 

$

0.55

 

 

$

2.62

 

 

$

0.97

 

After-tax adjusting items per share attributable to common shareholders

 

0.39

 

 

 

0.30

 

 

 

2.20

 

 

 

2.34

 

Adjusted diluted net income per share attributable to common shareholders

$

1.23

 

 

$

0.85

 

 

$

4.82

 

 

$

3.31

 

(1) 

 

In the first quarter of 2024, we revised the adjusted net income calculation to exclude the impact of stock-based compensation expense. Prior period adjusted net income and diluted net income per share calculations have been recast to conform to current presentation.

(2)

 

The tax effect of adjusting items was calculated using the Company’s estimated annual statutory tax rate. The tax effect of adjusting items for the fiscal year ended December 31, 2024 includes an immaterial amount of the loss on debt extinguishment as it was almost entirely non-tax deductible. In addition, the fourth quarter and fiscal year ended December 31, 2024 excludes $2 million of non-cash impairment charges included in “Other costs, net,” which were non-tax deductible. The fiscal year ended December 31, 2023 excludes the $51 million loss on debt extinguishment and $5 million of non-cash impairment charges included in “Other costs, net” which were non-tax deductible.

(3) 

 

When calculating diluted net income attributable to common shareholders, GAAP requires that we include potential share dilution from the convertible notes when not antidilutive. Granite entered into capped call transactions relating to both the 3.75% and 3.25% convertible notes to offset the dilutive impact of the convertible notes. The impact of the capped call transactions was excluded from the GAAP diluted net income attributable to common shareholders calculation as the impact would be antidilutive. For the purpose of calculating our adjusted diluted net income per share attributable to common shareholders, the dilutive effect of the convertible notes is removed to reflect the impact of the capped call transactions.

GRANITE CONSTRUCTION INCORPORATED

MATERIALS SEGMENT CASH GROSS PROFIT RECONCILIATION

(Unaudited - in thousands)

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

2024

 

 

 

2023

 

 

 

2022

 

 

 

2024

 

 

 

2023

 

 

 

2022

 

Gross profit

$

22,635

 

 

$

22,277

 

 

$

24,648

 

 

$

81,695

 

 

$

71,344

 

 

$

65,613

 

Gross profit as a percent of revenue

 

14.5

%

 

 

15.9

%

 

 

19.9

%

 

 

13.8

%

 

 

13.8

%

 

 

13.2

%

Depreciation, depletion and amortization

 

14,433

 

 

 

8,252

 

 

 

5,785

 

 

 

45,091

 

 

 

26,766

 

 

 

23,948

 

Cash gross profit

$

37,068

 

 

$

30,529

 

 

$

30,433

 

 

$

126,786

 

 

$

98,110

 

 

$

89,561

 

Cash gross profit as a percent of revenue

 

23.8

%

 

 

21.8

%

 

 

24.5

%

 

 

21.4

%

 

 

19.0

%

 

 

18.0

%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250212880506/en/

 

Investors Wenjun Xu, 831-761-7861

Or

Media Erin Kuhlman, 831-768-4111