Arcosa Inc. announced results for the quarter ended March 31, including revenues of $440.4 million, down 10%, net income of $15.9 million and Adjusted Net Income of $17.6 million.
Construction Products revenues increased 3% to $153.2 million in the first quarter, led by higher volumes in its legacy natural aggregates business, as well as revenues from acquisitions completed in the second half of 2020.
Revenues were lower in its Specialty Materials businesses compared to the pre-pandemic first quarter of 2020. First quarter Adjusted Segment EBITDA increased 2% to $32.9 million, representing a 21.5% margin in both the current and prior year, despite a full quarter impact of COVID-19 and the impact of winter storm Uri on 2021 results.
Commenting on the company’s performance, Antonio Carrillo, president and chief executive officer, noted, “Our portfolio demonstrated further resilience as our first quarter results came in better than expected due to strong performance from our Construction Products businesses. Construction activity was robust, particularly in our key Texas markets, producing improved profitability. We finished the quarter with strong momentum as better weather returned, helping to offset the negative impacts from winter storm Uri that broadly impacted our Texas and Southern United States footprint in February.
“We have also dealt with rapid steel price inflation in a disciplined manner. We proactively implemented price increases across our businesses in the fourth quarter of 2020, which has helped mitigate the impact on margins. However, we expect our steel-related businesses to continue to experience the impact of inflationary pressures. In our barge business, high steel prices continue to impact conversion of inquiries to new orders. Given soft order activity, we announced the planned idling of one of our three barge manufacturing plants, in an effort to match our operating footprint to industry demand.”
Carrillo also noted, “During the first quarter, we made measurable progress advancing our ESG initiative and released our first full-year sustainability report in mid-April. At Arcosa, our goal is to integrate sustainability into our daily practices as well as our long-term strategy. I want to
thank our entire team for their dedication to ESG.”
The company raised its 2021 full-year guidance to incorporate the acquisition of StonePoint Materials, a top 25 U.S. aggregates company, which closed on April 9. The new guidance incorporates StonePoint’s expected 2021 results from the date of acquisition, including:
- An increase in full-year 2021 revenue guidance to a range of $1.88 billion to $2.00 billion, from prior guidance range of $1.78 billion to $1.90 billion.
- An increase in full-year 2021 Adjusted EBITDA guidance to a range of $270 million to $290 million, from the prior guidance range of $250 million to $270 million.
Commenting on the outlook for 2021, Carrillo noted, “Overall, our key growth businesses, Construction Products and Engineered Structures, are positioned well for the future, and we remain optimistic on a recovery in our barge and rail components businesses once steel prices moderate.
“The recent StonePoint acquisition is an outstanding strategic fit for Arcosa, aligning with our strategy to expand our Aggregates business in our current footprint and to enter new, attractive geographies.
“Our updated 2021 Adjusted EBITDA guidance puts us on a path to meet or exceed 2020’s strong results. Our balance sheet and liquidity remain solid, and we expect to supplement this with another year of healthy free cash flow. We look forward to integrating StonePoint and will continue to look for other disciplined capital allocation opportunities in attractive infrastructure markets.”