Construction Partners Inc

Previous wording

Our public projects are funded by federal, state and local governments and include roads, highways, bridges, airports and other forms of infrastructure. Public transportation infrastructure projects historically have been a relatively stable portion of state and federal budgets and represent a significant share of the United States construction market. Federal funds are allocated on a state-by-state basis, and each state is required to match a portion of the federal funds that it receives. Federal highway spending uses funds predominantly from the Highway Trust Fund, which derives its revenues from fuel taxes and other user fees.

Current wording

Our public projects are funded by federal, state and local governments and include roads, highways, bridges, airports and other forms of infrastructure. Public transportation infrastructure projects historically have been a relatively stable portion of state and federal budgets and represent a significant share of the U.S. construction market. Federal funds are allocated on a state-by-state basis, and each state is required to match a portion of the federal funds that it receives. Federal highway spending uses funds predominantly from the Highway Trust Fund, which derives its revenues from fuel taxes and other user fees.

Previous wording

At March 31, 2024, our contract backlog was $1.8 billion. Contract backlog is a financial measure that reflects the dollar value of work that the Company expects to perform in the future. We include a construction project in our contract backlog at the time it is awarded and to the extent we believe funding is probable. Our backlog consists of uncompleted work on contracts in progress and contracts for which we have executed a contract but have not commenced the work. 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 $1.4 billion at March 31, 2024. 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 $0.4 billion at March 31, 2024.

Current wording

At June 30, 2024, our contract backlog was $1.9 billion. Contract backlog is a financial measure that reflects the dollar value of work that the Company expects to perform in the future. We include a construction project in our contract backlog at the time it is awarded and to the extent we believe funding is probable. Our backlog consists of uncompleted work on contracts in progress and contracts for which we have executed a contract but have not commenced the work. 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 $1.5 billion at June 30, 2024. 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 $0.4 billion at June 30, 2024.

Previous wording

During the three months ended March 31, 2024, we completed the acquisition of Littlefield Construction Company, a soil base, surface treatment and sitework company headquartered in Waycross, Georgia. As a result of this acquisition, we expanded our service offerings in southern and central Georgia. For further discussion regarding this transaction, see Note 4 - Business Acquisitions to the unaudited consolidated financial statements included elsewhere in this report.

Current wording

During the three months ended June 30, 2024, we completed two acquisitions, expanding our operations in Georgia and North Carolina. As a result of these acquisitions, we added two asphalt plants, a greenfield asphalt plant site, a diverse fleet of equipment and vehicles, as well as skilled construction professionals. For further discussion regarding these transactions, see Note 4 - Business Acquisitions to the unaudited consolidated financial statements included elsewhere in this report.

Previous wording

Interest expense, net primarily represents interest incurred on our long-term debt, such as the Term Loan and the Revolving Credit Facility, 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.

Current wording

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

Previous wording

Adjusted EBITDA represents net income (loss) 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, and (v) loss on the extinguishment of debt. Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of revenues for each period. 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 and Adjusted EBITDA Margin 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 and Adjusted EBITDA Margin 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.

Current wording

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, and (v) loss on the extinguishment of debt. Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of revenues for each period. 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 and Adjusted EBITDA Margin 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 and Adjusted EBITDA Margin 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.

Previous wording

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):

Current wording

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):

Previous wording

(1)The Company has historically included within the definition of Adjusted EBITDA an adjustment for management fees and expenses related to the Company’s management services agreement with an affiliate of SunTx Capital Partners, a member of the Company’s control group. Effective October 1, 2023, the term of the management services agreement was extended to October 1, 2028. As a result of the term extension, the Company no longer views the management fees and expenses paid under the management services agreement as a non-recurring expense. Accordingly, periods commencing subsequent to September 30, 2023 do not include an adjustment for management fees and expenses, and the Company has recast comparative Adjusted EBITDA and Adjusted EBITDA Margin for the three and six months ended March 31, 2023 to conform to the current definition.

Current wording

(1)The Company has historically included within the definition of Adjusted EBITDA an adjustment for management fees and expenses related to the Company’s management services agreement with an affiliate of SunTx Capital Partners, a member of the Company’s control group. Effective October 1, 2023, the term of the management services agreement was extended to October 1, 2028. As a result of the term extension, the Company no longer views the management fees and expenses paid under the management services agreement as a non-recurring expense. Accordingly, periods commencing subsequent to September 30, 2023 do not include an adjustment for management fees and expenses, and the Company has recast comparative Adjusted EBITDA and Adjusted EBITDA Margin for the three and nine months ended June 30, 2023 to conform to the current definition.

Previous wording

Revenues. Revenues for the three months ended March 31, 2024 increased $46.5 million, or 14.3%, to $371.4 million from $324.9 million for the three months ended March 31, 2023. The increase included $25.1 million of revenues attributable to acquisitions completed during or subsequent to the three months ended March 31, 2023 and an increase of approximately $21.4 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties. The 6.6% increase in revenue in our existing markets was due to strong demand in both public and private work.

Current wording

Revenues. Revenues for the three months ended June 30, 2024 increased $95.9 million, or 22.7%, to $517.8 million from $421.9 million for the three months ended June 30, 2023. The increase included $40.9 million of revenues attributable to acquisitions subsequent to June 30, 2023, and an increase of approximately $55.0 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties. The 13.0% increase in revenue in our existing markets was due to strong demand in both public and private work.

Previous wording

Gross Profit. Gross profit for the three months ended March 31, 2024 increased $12.5 million, or 47.6%, to $38.8 million from $26.3 million for the three months ended March 31, 2023. The increase in gross profit was primarily the result of a 14.3% increase in revenues for the three months ended March 31, 2024 compared to the three months ended March 31, 2023 and a higher gross profit margin. The higher gross profit margin was due to efficient utilization of our plants and equipment fleet and completion of new backlog with more favorable margins.

Current wording

Gross Profit. Gross profit for the three months ended June 30, 2024 increased $19.4 million, or 30.3%, to $83.5 million from $64.1 million for the three months ended June 30, 2023. The increase in gross profit was primarily the result of a 22.7% increase in revenues for the three months ended June 30, 2024 compared to the three months ended June 30, 2023 and a higher gross profit margin. The higher gross profit margin was due to efficient utilization of our plants and equipment fleet and completion of new backlog with more favorable margins.

Previous wording

General and Administrative Expenses. General and administrative expenses for the three months ended March 31, 2024 increased $4.8 million, or 14.9%, to $36.8 million from $32.0 million for the three months ended March 31, 2023. The increase was the result of (i) a $0.9 million increase in share-based compensation expense, (ii) a $2.1 million increase attributable to general and administrative expenses associated with the operations of businesses acquired subsequent to March 31, 2023, (iii) a $0.6 million increase in management personnel payroll and benefits, and (iv) a $1.2 million increase in other general and administrative expenses.

Current wording

General and Administrative Expenses. General and administrative expenses for the three months ended June 30, 2024 increased $6.7 million, or 20.8%, to $38.9 million from $32.2 million for the three months ended June 30, 2023. The increase was the result of (i) a $1.3 million increase in share-based compensation expense, (ii) a $2.6 million increase attributable to general and administrative expenses associated with the operations of businesses acquired subsequent to June 30, 2023, (iii) a $1.3 million increase in management personnel payroll and benefits, and (iv) a $1.5 million increase in other general and administrative expenses.

Previous wording

Gain on Sale of Property, Plant and Equipment. Gain on sale of property, plant and equipment for the three months ended March 31, 2024 decreased $2.1 million, or 67.4%, to $1.0 million from $3.2 million for the three months ended March 31, 2023. The decrease was attributable to lower disposals of equipment and components during the quarter.

Current wording

Gain on Sale of Property, Plant and Equipment. Gain on sale of property, plant and equipment for the three months ended June 30, 2024 decreased $0.4 million, or 27.1%, to $1.1 million from $1.5 million for the three months ended June 30, 2023. The decrease was attributable to lower disposals of equipment and components during the quarter.

Previous wording

Interest Expense, Net. Interest expense, net for the three months ended March 31, 2024 decreased $0.2 million, or 4.9%, to $4.6 million compared to $4.8 million for the three months ended March 31, 2023. The decrease in interest expense, net was primarily due to an increase in interest income from an overnight sweep program established in fiscal year 2024. This increase in interest income was primarily offset by an increase in interest expense due to an increase in the average principal debt balance outstanding during the three months ended March 31, 2024 compared to the corresponding period in 2023.

Current wording

Interest Expense, Net. Interest expense, net for the three months ended June 30, 2024 decreased $0.3 million, or 7.3%, to $4.7 million compared to $5.0 million for the three months ended June 30, 2023. The decrease in interest expense, net was primarily due to an increase in interest income from an overnight sweep program established in fiscal 2024. This increase in interest income was primarily offset by an increase in interest expense due to an increase in the average principal debt balance outstanding during the three months ended June 30, 2024 compared to the corresponding period in 2023.

Previous wording

Provision for Income Taxes. Our effective tax rate increased to 22.2% for the three months ended March 31, 2024, from 21.1% for the three months ended March 31, 2023. Our higher effective tax rate during the three months ended March 31, 2024 was due to differences in state tax rates at our operating subsidiaries.

Current wording

Provision for Income Taxes. Our effective tax rate decreased to 24.6% for the three months ended June 30, 2024, from 24.7% for the three months ended June 30, 2023. Our lower effective tax rate during the three months ended June 30, 2024 was due to differences in state tax rates at our operating subsidiaries.

Previous wording

Net Loss. Net loss decreased $4.4 million to a net loss of $1.1 million for the three months ended March 31, 2024, compared to net loss of $5.5 million for the three months ended March 31, 2023. The decrease in net loss was primarily a result of higher gross profit, partially offset by an increase in general and administrative expenses and decreased gains on sale of property, plant and equipment, all as described above.

Current wording

Net Income. Net income increased $9.2 million to $30.9 million for the three months ended June 30, 2024, compared to $21.7 million for the three months ended June 30, 2023. The increase in net income was primarily a result of higher gross profit, partially offset by an increase in general and administrative expenses and decreased gains on sale of property, plant and equipment, all as described above.

Previous wording

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin were $29.5 million and 7.9%, respectively, for the three months ended March 31, 2024, compared to $20.4 million and 6.3%, respectively, for the three months ended March 31, 2023. The increase in Adjusted EBITDA and Adjusted EBITDA Margin resulted from an increase in gross profit, partially offset by higher general and administrative expenses and decreased gains on sale of property, plant and equipment, 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”.

Current wording

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin were $73.2 million and 14.1%, respectively, for the three months ended June 30, 2024, compared to $56.1 million and 13.3%, respectively, for the three months ended June 30, 2023. The increase in Adjusted EBITDA and Adjusted EBITDA Margin resulted from an increase in gross profit, partially offset by higher general and administrative expenses and decreased gains on sale of property, plant and equipment, 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”.

Previous wording

The following table sets forth selected financial data for the six months ended March 31, 2024 and 2023 (unaudited, in thousands, except percentages):

Current wording

The following table sets forth selected financial data for the nine months ended June 30, 2024 and 2023 (unaudited, in thousands, except percentages):

Previous wording

Revenues. Revenues for the six months ended March 31, 2024 increased $101.3 million, or 15.2%, to $767.9 million from $666.6 million for the six months ended March 31, 2023. The increase included $54.7 million of revenues attributable to acquisitions completed subsequent to March 31, 2023 and $46.5 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties. The 7.0% increase in revenues in our existing markets compared to the prior year period was due to strong demand in both public and private work.

Current wording

Revenues. Revenues for the nine months ended June 30, 2024 increased $197.2 million, or 18.1%, to $1.3 billion from $1.1 billion for the nine months ended June 30, 2023. The increase included $95.6 million of revenues attributable to acquisitions completed subsequent to June 30, 2023 and $101.6 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.

Previous wording

Gross Profit. Gross profit for the six months ended March 31, 2024 increased $33.9 million, or 59.7%, to $90.7 million from $56.8 million for the six months ended March 31, 2023. The increase in gross profit was primarily the result of a 15.2% increase in revenues for the six months ended March 31, 2024 compared to the six months ended March 31, 2023 and a higher gross profit margin. The higher gross profit margin was due to efficient utilization of our plants and equipment fleet and completion of new backlog with more favorable margins.

Current wording

Gross Profit. Gross profit for the nine months ended June 30, 2024 increased $53.4 million, or 44.1%, to $174.2 million from $120.8 million for the nine months ended June 30, 2023. The increase in gross profit was primarily the result of a 18.1% increase in revenues for the nine months ended June 30, 2024 compared to the nine months ended June 30, 2023 and a higher gross profit margin. The higher gross profit margin was due to efficient utilization of our plants and equipment fleet and completion of new backlog with more favorable margins.

Previous wording

General and Administrative Expenses. General and administrative expenses for the six months ended March 31, 2024 increased $11.0 million, or 17.9%, to $72.7 million from $61.7 million for the six months ended March 31, 2023. The increase was primarily the result of (i) a $1.4 million increase in share-based compensation expense, (ii) a $3.7 million increase attributable to general and administrative expenses associated with the operations of businesses acquired subsequent to March 31, 2023, (iii) a $3.3 million increase in management personnel payroll and benefits, and (iv) a $2.6 million increase in other general and administrative expenses.

Current wording

General and Administrative Expenses. General and administrative expenses for the nine months ended June 30, 2024 increased $17.7 million, or 18.9%, to $111.6 million from $93.9 million for the nine months ended June 30, 2023. The increase was primarily the result of (i) a $2.7 million increase in share-based compensation expense, (ii) a $6.2 million increase attributable to general and administrative expenses associated with the operations of businesses acquired subsequent to June 30, 2023, (iii) a $5.1 million increase in management personnel payroll and benefits, and (iv) a $3.7 million increase in other general and administrative expenses.

Previous wording

Gain on Sale of Property, Plant and Equipment. Gain on sale of property, plant and equipment for the six months ended March 31, 2024 decreased $1.5 million, or 43.9%, to $1.9 million from $3.3 million for the six months ended March 31, 2023. The decrease was attributable to lower disposals of equipment and components during the period.

Current wording

Gain on Sale of Property, Plant and Equipment. Gain on sale of property, plant and equipment for the nine months ended June 30, 2024 decreased $1.8 million, or 38.7%, to $3.0 million from $4.8 million for the nine months ended June 30, 2023. The decrease was attributable to lower disposals of equipment and components during the period.

Previous wording

Gain on Facility Exchange. There was no gain on facility exchange for the six months ended March 31, 2024 compared to $5.4 million for the six months ended March 31, 2023. The gain was the result of the disposition of a quarry located near Goldston, North Carolina. In connection with this transaction, the Company acquired three HMA manufacturing plants and certain related assets located in the Nashville, Tennessee metro area.

Current wording

Gain on Facility Exchange. There was no gain on facility exchange for the nine months ended June 30, 2024 compared to a gain of $5.4 million for the nine months ended June 30, 2023. The gain was the result of the disposition of a quarry located near Goldston, North Carolina. In connection with this transaction, the Company acquired three HMA manufacturing plants and certain related assets located in the Nashville, Tennessee metro area.

Previous wording

Interest Expense, Net. Interest expense, net for the six months ended March 31, 2024 decreased $0.5 million, or 5.1%, to $8.3 million compared to $8.8 million for the six months ended March 31, 2023. The decrease in interest expense, net was primarily due to an increase in interest income from an overnight sweep program established in fiscal year 2024. This increase in interest income was primarily offset by an increase in interest expense due to an increase in the average principal debt balance outstanding during the six months ended March 31, 2024 compared to the corresponding period in 2023.

Current wording

Interest Expense, Net. Interest expense, net for the nine months ended June 30, 2024 decreased $0.8 million, or 5.9%, to $13.0 million compared to $13.8 million for the nine months ended June 30, 2023. The decrease in interest expense, net was primarily due to an increase in interest income from an overnight sweep program established in fiscal 2024. This increase in interest income was primarily offset by an increase in interest expense due to an increase in the average principal debt balance outstanding during the nine months ended June 30, 2024 compared to the corresponding period in 2023.

Previous wording

Provision for Income Taxes. Our effective tax rate increased to 24.3% for the six months ended March 31, 2024, from 21.1% for the six months ended March 31, 2023. Our lower effective tax rate during the six months ended March 31, 2023 was due to differences in state tax rates at our operating subsidiaries.

Current wording

Provision for Income Taxes. Our effective tax rate decreased to 24.6% for the nine months ended June 30, 2024, from 25.4% for the nine months ended June 30, 2023. Our higher effective tax rate during the nine months ended June 30, 2023 was due to differences in state tax rates at our operating subsidiaries.

Previous wording

Net Income (Loss). Net income increased $12.3 million to net income of $8.7 million for the six months ended March 31, 2024, compared to a net loss of $3.6 million for the six months ended March 31, 2023. The increase in net income was primarily a result of higher gross profit, partially offset by an increase in general and administrative expenses and decreased gains on the facility exchange and sale of property, plant and equipment, all as described above.

Current wording

Net Income. Net income increased $21.5 million to $39.6 million for the nine months ended June 30, 2024, compared to $18.1 million for the nine months ended June 30, 2023. The increase in net income was primarily a result of higher gross profit, partially offset by an increase in general and administrative expenses and decreased gain on the facility exchange and gains on sale of property, plant and equipment, all as described above.

Previous wording

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin were $70.4 million and 9.2%, respectively, for the six months ended March 31, 2024, compared to $47.6 million and 7.1%, respectively, for the six months ended March 31, 2023. The increase in Adjusted EBITDA and Adjusted EBITDA Margin resulted from an increase in gross profit, partially offset by higher general and administrative expenses and decreased gains on the facility exchange and sale of property, plant and equipment, 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”.

Current wording

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin were $143.6 million and 11.2%, respectively, for the nine months ended June 30, 2024, compared to $103.7 million and 9.5%, respectively, for the nine months ended June 30, 2023. The increase in Adjusted EBITDA and Adjusted EBITDA Margin resulted from an increase in gross profit, partially offset by higher general and administrative expenses and decreased gain on the facility exchange and gains on sale of property, plant and equipment, 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”.

Previous wording

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:

Current wording

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

Previous wording

•net income of $8.7 million, including $44.0 million of depreciation, depletion, accretion and amortization, $6.2 million of share-based compensation expense and $1.9 million of gain on sale of property, plant and equipment;

Current wording

•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;

Previous wording

•a decrease in contracts receivable including retainage, net of $34.1 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

Current wording

•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;

Previous wording

•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;

Current wording

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

Previous wording

•a decrease in accounts payable and accrued expenses and other current liabilities of $19.1 million due to the timing of processing transactions in our accounts payable cycle; and

Current wording

•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; and

Previous wording

•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 $14.6 million due to the timing of performing and closing projects.

Current wording

•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.

Previous wording

During the six months ended March 31, 2023, cash provided by operating activities, net of acquisitions, was $45.7 million, primarily as a result of:

Current wording

During the nine months ended June 30, 2023, cash provided by operating activities, net of business acquisitions, was $94.5 million, primarily as a result of:

Previous wording

•net loss of $3.6 million, including $38.2 million of depreciation, depletion, accretion and amortization, unrealized losses on derivative instruments of $2.3 million, gain on sale of facility exchange of $5.4 million and share-based compensation expense of $5.2 million;

Current wording

•net income of $18.1 million, including $57.8 million of depreciation, depletion, accretion and amortization of long-lived assets, unrealized losses on derivative instruments of $1.4 million, gain on sale of property, plant and equipment of $4.8 million, gain on facility exchange of $5.4 million and share-based compensation expense of $7.9 million;

Previous wording

•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;

Current wording

•a decrease in contracts receivable including retainage, net of $22.8 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

Previous wording

•an increase in prepaid expenses and other current assets of $3.2 million primarily due to overpayment of federal and state income taxes and the timing of payments under our insurance policies;

Current wording

•an increase in prepaid expenses and other current assets of $3.2 million primarily due to the timing of payments under our insurance policies and other expenses;

Previous wording

•an increase in inventories of $10.2 million due to increased inventories from acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

Current wording

•an increase in inventories of $12.0 million due to increased inventories from acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

Previous wording

•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; and

Current wording

•a decrease in accounts payable and accrued expenses and other current liabilities of $9.2 million due to the timing of processing transactions in our accounts payable cycle; and

Previous wording

•a net increase of $8.2 million 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 due to the timing of performing and closing projects.

Current wording

•a net increase of $10.6 million in the difference between billings in excess of costs and estimated earnings on uncompleted contracts and costs and estimated earnings in excess of billings on uncompleted contracts and due to the timing of performing and closing projects.

Previous wording

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.

Current wording

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 sales, calls and maturities of restricted investments.

Previous wording

During the six months ended March 31, 2023, cash used in investing activities was $97.2 million, of which $77.8 million related to acquisitions completed in the period, $60.4 million was invested in property, plant and equipment and $5.1 million was invested in restricted investments by the Captive, partially offset by $8.3 million of proceeds from the sale of property, plant and equipment and $37.0 million of proceeds from the facility exchange.

Current wording

During the nine months ended June 30, 2023, cash used in investing activities was $118.6 million, of which $82.7 million related to acquisitions completed in the period, $79.0 million was invested in property, plant and equipment and $7.9 million was invested in restricted investments by the Captive, partially offset by $12.6 million of proceeds from the sale of property, plant and equipment, $37.0 million of proceeds from the facility exchange and $1.4 million of proceeds from sales, calls and maturities of restricted investments.