Arcosa Inc. reported record third-quarter revenues of $559.1 million, up 14%; net income of $23.7 million; and adjusted net income of $27.8 million.
Construction Products revenues increased 55% to $227.4 million, primarily driven by the acquisitions of StonePoint and Southwest Rock and strong organic growth. Revenues increased across its legacy aggregates and specialty materials businesses, especially those serving construction end markets, due to favorable pricing and overall higher volumes.
“Record third-quarter results were led by the strong performance of our Construction Products and Engineered Structures business segments, which more than offset lower year-over-year results in Transportation Products. This performance reflects the continued transformation of our portfolio and the considerable progress we have made over the last three years advancing our portfolio shift into higher margin and more stable Construction Products,” commented Antonio Carrillo, president and chief executive officer.
“Construction activity was strong overall in the third quarter, benefiting from improved weather conditions. Contributions from recent acquisitions, where integration is progressing well, and from broad-based pricing and volume gains drove significant Adjusted Segment EBITDA growth during the quarter. In addition, we completed a reorganization of our expanded natural aggregates platform into four key regions: Texas, Gulf Coast, Ohio River Valley, and West, leveraging the experience and talents of our combined teams.
“Order activity for our utility, telecom, and traffic structures businesses was healthy during the quarter driven by continuing positive fundamentals. In addition, we received approximately $175 million of wind tower orders, providing a base level of production visibility for 2022. While long-term fundamentals for the wind industry remain positive, some short-term headwinds continue primarily attributable to uncertainty surrounding the renewal of federal tax incentives. Conversely, we were pleased to see higher order activity trends in our steel
components business serving the North American railcar market.
“We continue to execute well during this period of inflationary pressures, as high demand across most of our businesses enabled us to act quickly to raise prices to mitigate the impact on margins. High steel prices continue to depress order activity in our barge business, and to
a lesser extent, in our wind towers business. In both businesses, we have taken action to align our capacity and cost structures with demand as we plan for a lower level of production in 2022. We are in the early stages of planning for next year and have time to reposition should conditions improve.”
Carrillo also noted, “Our balance sheet and liquidity position remain healthy, ending the quarter with leverage comfortably within our targeted long-term range. In the near-term, we intend to continue leveraging the size and scale of our expanded platforms, through both
organic growth and completion of our acquisition integrations, and advancing our strategy to reduce the complexity of our portfolio.”