Construction Partners Inc

Previous wording

We are a civil infrastructure company that specializes in the building and maintenance of transportation networks. Our operations leverage a highly-skilled workforce, strategically located HMA plants, substantial construction assets and select material deposits. We provide construction products and services to both public and private infrastructure projects, with an emphasis on highways, roads, bridges, airports and commercial and residential sites in the southeastern United States.

Current wording

We are a civil infrastructure company that specializes in the building and maintenance of transportation networks. Our operations leverage a highly-skilled workforce, strategically located HMA plants, substantial construction assets and select material deposits. We provide construction products and services to both public and private infrastructure projects, with an emphasis on highways, roads, bridges, airports and commercial and residential sites across the Sunbelt in Alabama, Florida, Georgia, North Carolina, Oklahoma, South Carolina, Tennessee and Texas.

Previous 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.

Current wording

At December 31, 2024, our contract backlog was $2.66 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 $2.1 billion at December 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 $0.6 billion at December 31, 2024.

Previous wording

For more information about the Credit Agreement, see Note 8 - Debt to the unaudited consolidated financial statements included elsewhere in this report.

Current wording

On November 1, 2024, we entered into a Term Loan Credit Agreement with Bank of America, N.A., as administrative agent, BofA Securities, Inc., PNC Capital Markets LLC, Regions Capital Markets, a division of Regions Bank, and TD Securities (USA) LLC, each as joint lead arranger and joint bookrunner, and certain other lenders. The Term Loan B Credit Agreement provides for a senior secured first lien term loan facility in the aggregate principal amount of $850.0 million, which amount was fully drawn on November 1, 2024. A portion of the proceeds of the Term Loan B was used to finance the cash portion of the consideration for the Lone Star Acquisition, including the repayment of certain outstanding indebtedness of Lone Star Paving and its subsidiaries at closing. The remaining loan proceeds were used to repay the Company’s outstanding borrowings under the Revolving Credit Facility provided by the Term Loan A / Revolver Credit Agreement and to pay fees and expenses incurred in connection with the Lone Star Acquisition and related debt financing transaction. For more information about the Term Loan B Credit Agreement, see Note 8 - Debt to the consolidated financial statements included elsewhere in this report.

Previous wording

General and administrative expenses include costs related to our operational offices that are not allocated to direct contract costs and expenses related to our corporate offices. These expenses consist primarily of salaries and personnel costs for our administration, finance and accounting, legal, information systems, human resources and certain managerial employees. General and administrative expenses also include acquisition expenses, audit, consulting and professional fees, share-based compensation expense, travel, insurance, office space rental costs, property taxes and other corporate and overhead expenses.

Current wording

General and administrative expenses include costs related to our operational offices that are not allocated to direct contract costs and expenses related to our corporate offices. These expenses consist primarily of salaries and personnel costs for our administration, finance and accounting, legal, information systems, human resources and certain managerial employees. General and administrative expenses also include audit, consulting and professional fees, share-based compensation expense, travel, insurance, office space rental costs, property taxes and other corporate and overhead expenses.

Previous wording

Other Key Performance Indicators - Adjusted EBITDA and Adjusted EBITDA Margin

Current wording

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

Previous 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.

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, (v) loss on the extinguishment of debt and (vi) nonrecurring expenses related to transformative acquisitions, which management considers to include acquisitions requiring clearance under federal antitrust laws, such as the Lone Star Acquisition. 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 acquisitions requiring clearance under federal antitrust laws, such as the Lone Star Acquisition, and (ii) nonrecurring fees associated with financing arrangements incurred in connection with transformative acquisitions, such as a bridge loan associated with the Lone Star Acquisition. 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.

Previous 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):

Current 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):

Previous 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.

Current wording

Revenues. Revenues for the three months ended December 31, 2024 increased $165.1 million, or 41.6%, to $561.6 million from $396.5 million for the three months ended December 31, 2023. The increase included $120.9 million of revenues attributable to acquisitions completed during or subsequent to the three months ended December 31, 2023 and an increase of approximately $44.2 million of revenues in our existing markets from contract work and sales of HMA and aggregates to third parties. The 11.2% increase in revenues 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 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.

Current wording

Gross Profit. Gross profit for the three months ended December 31, 2024 increased $24.7 million, or 47.6%, to $76.6 million from $51.9 million for the three months ended December 31, 2023. The increase in gross profit was primarily the result of the 41.6% increase in revenues for the three months ended December 31, 2024 compared to the three months ended December 31, 2023 and a higher gross profit margin. The higher gross profit margin was due to (i) efficient utilization of our plants, terminals and equipment fleet and (ii) completion of new backlog with more favorable margins.

Previous 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.

Current wording

General and Administrative Expenses. General and administrative expenses for the three months ended December 31, 2024 increased $8.8 million, or 24.9%, to $44.3 million from $35.5 million for the three months ended December 31, 2023. The increase was attributable to general and administrative expenses associated with the operations of businesses acquired during or subsequent to December 31, 2023 and an increase in share-based compensation expense.

Previous 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.

Current wording

Gain on Sale of Property, Plant and Equipment. Gain on sale of property, plant and equipment for the three months ended December 31, 2024 increased $0.2 million, or 26.2%, to $1.0 million from $0.8 million for the three months ended December 31, 2023.

Previous 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.

Current wording

Provision for Income Taxes. Our effective tax rate decreased to 21.8% for the three months ended December 31, 2024, from 24.1% for the three months ended December 31, 2023. Our lower effective tax rate during the three months ended December 31, 2024 was due to differences in state tax rates at our operating subsidiaries.

Previous 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.

Current wording

Net Income (loss). Net income (loss) decreased $12.9 million, or 131.0%, to a net loss $3.1 million for the three months ended December 31, 2024, compared to net income of $9.8 million for the three months ended December 31, 2023. The decrease in net income was primarily a result of higher general and administrative expenses, acquisition-related expenses and interest expense,net partially offset by an increase in gross profit, all as described above.

Previous 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”.

Current wording

Adjusted EBITDA and Adjusted EBITDA Margin. Adjusted EBITDA and Adjusted EBITDA Margin were $68.8 million and 12.3%, respectively, for the three months ended December 31, 2024, compared to $40.9 million and 10.3%, respectively, for the three months ended December 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, 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

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.

Current wording

Adjusted Net Income. Adjusted Net Income increased $3.5 million or 34.8%, to adjusted net income of $13.3 million for the three months ended December 31, 2024, from $9.8 million for the three months ended December 31, 2023. The increase in adjusted net income was primarily a result of higher gross profit partially offset by higher general and administrative expenses and interest expense due to the Term Loan B, all as described above.

Previous 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:

Current wording

During the three months ended December 31, 2024, cash provided by operating activities, net of acquisitions, was $40.7 million, primarily as a result of:

Previous 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;

Current wording

•a decrease in contracts receivable including retainage, net of $62.6 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

Previous 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;

Current wording

•an increase in inventories of $10.4 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 $9.2 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 $54.0 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 $22.8 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 $0.5 million due to the timing of performing and closing projects.

Previous 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:

Current wording

During the three months ended December 31, 2023, cash provided by operating activities, net of acquisitions, was $60.4 million, primarily as a result of:

Previous 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;

Current wording

•net income of $9.8 million, including $21.1 million of depreciation, depletion, accretion and amortization and $2.9 million of share-based compensation expense, and $0.8 million gain on sale of property, plant and equipment;

Previous 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;

Current wording

•a decrease in contracts receivable including retainage, net of $63.5 million due to normal fluctuations resulting from the timing of processing transactions in our accounts receivable cycle;

Previous 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;

Current wording

•an increase in inventories of $9.9 million due to increased inventories from acquisitions, growth in existing markets, higher inventory costs and normal fluctuations in our inventory cycle;

Previous 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

Current wording

•a decrease in accounts payable and accrued expenses and other current liabilities of $34.7 million due to the timing of processing transactions in our accounts payable cycle; and

Previous 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.

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 $6.4 million due to the timing of performing and closing projects.

Previous 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.

Current wording

During the three months ended December 31, 2024, cash used in investing activities was $679.0 million, of which $654.2 million related to acquisitions completed in the period, $26.8 million was invested in property, plant and equipment and $2.3 million was purchases of restricted investments, partially offset by $1.8 million of proceeds from the sale of property, plant and equipment and $2.4 million of proceeds from the sale of restricted investments.

Previous 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.

Current wording

During the three months ended December 31, 2023, cash used in investing activities was $104.7 million, of which $81.4 million related to acquisitions completed in the period and $26.8 million was invested in property, plant and equipment, partially offset by $2.5 million of proceeds from the sale of property, plant and equipment and $1.0 million of proceeds from the sale of restricted investments.

Previous wording

During the nine months ended June 30, 2023, cash provided by financing activities was $43.5 million. We received $53.0 million of proceeds from our Credit Facility, which were primarily used for acquisitions completed in the period. This cash flow was partially offset by $9.4 million of principal payments on long-term debt.

Current wording

During the three months ended December 31, 2024, cash provided by financing activities was $694.8million. We received $835.0 million of net proceeds from our Term Loan B, which were primarily used for the Lone Star Acquisition completed in the period. This cash flow was partially offset by $128.2 million of principal payments on long-term debt and purchase of treasury stock of $12.1 million.

Previous wording

During the nine months ended June 30, 2024, cash provided by financing activities was $95.3 million. We received $149.4 million of proceeds from our Revolving Credit Facility, which were primarily used for acquisitions completed in the period. This cash flow was partially offset by $47.5 million of principal payments on long-term debt and purchase of treasury stock of $6.6 million.

Current wording

During the three months ended December 31, 2023, cash provided by financing activities was $64.9 million. We received $90.0 million of proceeds from our Revolving Credit Facility, which were primarily used for acquisitions completed in the period. This cash flow was partially offset by $23.8 million of principal payments on long-term debt and purchase of treasury stock of $1.3 million.

Previous wording

During the nine months ended June 30, 2024 and 2023, our capital expenditures were approximately $70.4 million and $79.0 million, respectively. Our capital expenditures are typically made during the fiscal year in which they are approved. At June 30, 2024, our commitments for capital expenditures were not material to our financial condition or results of operations on a consolidated basis. For fiscal 2024, we expect total capital expenditures to be $90.0 million to $95.0 million. Our capital expenditure budget is an estimate and is subject to change.

Current wording

During the three months ended December 31, 2024 and 2023, our capital expenditures were approximately $26.8 million and $26.8 million, respectively. Our capital expenditures are typically made during the fiscal year in which they are approved. At December 31, 2024, our commitments for capital expenditures were not material to our financial condition or results of operations on a consolidated basis. For fiscal 2025, we expect total capital expenditures to be approximately $130.0 million to $140.0 million. Our capital expenditure budget is an estimate and is subject to change.

Previous wording

Historically, we have required significant amounts of cash in order to make capital expenditures, purchase materials, execute our growth strategy through acquisitions and fund our organic expansion into new markets. Our working capital needs are driven by the seasonality and growth of our business, with our cash requirements increasing in periods of growth. Additional cash requirements resulting from our growth include the costs of additional personnel, production and distribution facilities, enhancements to our information systems, integration costs related to any acquisitions and our compliance with laws and rules applicable to public companies. Furthermore, on April 12, 2024, we announced that our Board of Directors authorized a stock repurchase program under which up to $40 million is available to purchase shares of our outstanding Class A common stock through September 30, 2025. We intend to utilize the stock repurchase program to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically. Shares of Class A common stock may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 plans. The stock repurchase program does not obligate the Company to repurchase any shares of Class A common stock, and the stock repurchase program may be modified, suspended, extended or terminated at any time by our Board of Directors. The actual timing, number and value of shares of Class A common stock repurchased will be determined by a committee of the Board of Directors at its discretion and will depend on a number of factors, including the market price of the Class A common stock, capital allocation alternatives, general market and economic conditions and other corporate considerations. During the nine months ended June 30, 2024, the Company purchased 93,408 shares of Class A common stock for aggregate consideration of approximately $5.3 million through open market transactions.

Current wording

Historically, we have required significant amounts of cash in order to make capital expenditures, purchase materials, execute our growth strategy through acquisitions and fund our organic expansion into new markets. Our working capital needs are driven by the seasonality and growth of our business, with our cash requirements increasing in periods of growth. Additional cash requirements resulting from our growth include the costs of additional personnel, production and distribution facilities, enhancements to our information systems, integration costs related to any acquisitions and our compliance with laws and rules applicable to public companies. Furthermore, on April 12, 2024, we announced that our Board of Directors authorized a stock repurchase program under which up to $40 million is available to purchase shares of our outstanding Class A common stock through September 30, 2025. We intend to utilize the stock repurchase program to minimize the dilutive impact of awards granted under our equity incentive plans and to repurchase shares opportunistically. Shares of Class A common stock may be repurchased from time to time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 plans. The stock repurchase program does not obligate the Company to repurchase any shares of Class A common stock, and the stock repurchase program may be modified, suspended, extended or terminated at any time by our Board of Directors. The actual timing, number and value of shares of Class A common stock repurchased will be determined by a committee of the Board of Directors at its discretion and will depend on a number of factors, including the market price of the Class A common stock, capital allocation alternatives, general market and economic conditions and other corporate considerations. During the three months ended December 31, 2024, the Company did not purchase any Class A common stock through our stock repurchase program.

Previous wording

We believe that our operating cash flow and available borrowings under the Credit Agreement will be sufficient to fund our operations, make planned capital expenditures and opportunistically repurchase shares of Class A common stock for at least the next 12 months. However, future cash flows are subject to a number of variables, including the potential impacts of inflation and supply chain constraints, and significant additional capital expenditures will be required to conduct our operations. There can be no assurance that operations and other capital resources will provide sufficient cash to maintain planned or future levels of capital expenditures. In the event that we make one or more acquisitions and the amount of capital required is greater than the amount of cash on hand we have available for acquisitions at that time, we could be required to reduce the expected level of capital expenditures and/or seek additional capital. If we seek additional capital, we may do so through borrowings under the Credit Agreement or other credit facilities, joint ventures, asset sales, offerings of debt or equity securities or other means. However, our ability to engage in any such transactions may be constrained by economic conditions and other factors outside of our control. We cannot guarantee that additional capital will be available on acceptable terms or at all. If we are unable to obtain the funds we need, we may not be able to complete acquisitions that may be favorable to us or finance the capital expenditures necessary to conduct our operations.

Current wording

However, future cash flows are subject to a number of variables, including the potential impacts of inflation and supply chain constraints, and significant additional capital expenditures will be required to conduct our operations. There can be no assurance that operations and other capital resources will provide sufficient cash to maintain planned or future levels of capital expenditures. In the event that we make one or more acquisitions and the amount of capital required is greater than the amount of cash on hand we have available for acquisitions at that time, we could be required to reduce the expected level of capital expenditures and/or seek additional capital. If we seek additional capital, we may do so through borrowings under the Term Loan A / Revolver Credit Agreement or other credit facilities, joint ventures, asset sales, offerings of debt or equity securities or other means. However, our ability to engage in any such transactions may be constrained by economic conditions and other factors outside of our control. We cannot guarantee that additional capital will be available on acceptable terms or at all. If we are unable to obtain the funds we need, we may not be able to complete acquisitions that may be favorable to us or finance the capital expenditures necessary to conduct our operations.

Previous wording

The following table summarizes our significant contractual obligations outstanding as of June 30, 2024 (unaudited, in thousands):

Current wording

The following table summarizes our significant obligations outstanding as of December 31, 2024 (unaudited, in thousands):

Previous wording

As of June 30, 2024, we had aggregate letters of credit outstanding in the amount of $8.5 million, future purchase commitments of diesel fuel and natural gas of $2.7 million and $0.2 million, respectively, and $2.4 million of minimum royalty payments related to aggregates facilities. Other than the letters of credit, future purchase commitments and minimum royalty payments, we do not currently have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on our financial condition, changes in our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources. See Note 17 - Commitments to our unaudited consolidated financial statements included elsewhere in this report for additional information.

Current wording

As of December 31, 2024, we had aggregate letters of credit outstanding in the amount of $6.6 million, future purchase commitments of diesel fuel and natural gas of $3.3 million and $0.4 million, respectively, and $2.4 million of minimum royalty payments related to aggregates facilities. Other than the letters of credit, future purchase commitments and minimum royalty payments, we do not currently have any off-balance sheet arrangements that have, or are reasonably likely to have, a material current or future effect on our financial condition, changes in our financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources. See Note 17 - Commitments to our unaudited consolidated financial statements included elsewhere in this report for additional information.