FIRST QUARTER 2024 EARNINGS CONFERENCE CALL
MOVING INFRASTRUCTURE FORWARD | MAY 3, 2024
FORWARD LOOKING STATEMENTS
Some statements in this presentation, which are not historical facts, are "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about Arcosa's estimates, expectations, beliefs, intentions or strategies for the future. Arcosa uses the words "anticipates," "assumes," "believes," "estimates," "expects," "intends," "forecasts," "may," "will," "should," "guidance," "outlook," "strategy," "plans," and similar expressions to identify these forward-looking statements. Forward-looking statements speak only as of the date of this release, and Arcosa expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, except as required by federal securities laws. Forward-looking statements are based on management's current views and assumptions and involve risks and uncertainties that could cause actual results to differ materially from historical experience or our present expectations, including but not limited to assumptions, risks and uncertainties regarding the impact of pandemics on Arcosa's business; failure to successfully integrate acquisitions, including Ameron, or divest any business, or failure to achieve the expected benefits of acquisitions or divestitures; market conditions and customer demand for Arcosa's business products and services; the cyclical nature of, and seasonal or weather impact on, the industries in which Arcosa competes; competition and other competitive factors; governmental and regulatory factors; changing technologies; availability of growth opportunities; market recovery; ability to improve margins; the impact of inflation and costs of materials; assumptions regarding achievements of the expected benefits from the Inflation Reduction Act; the delivery or satisfaction of any backlog or firm orders; and Arcosa's ability to execute its long-term strategy, and such forward-looking statements are not guarantees of future performance. For further discussion of such risks and uncertainties, see "Risk Factors" and the "Forward-Looking Statements" section of "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Arcosa's Form 10-K for the year-ended December 31, 2023 and as may be revised and updated by Arcosa's Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
NON-GAAP FINANCIAL MEASURES
This presentation contains financial measures that have not been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). Reconciliations of non- GAAP financial measures to the closest GAAP measure are provided in the Appendix.
2 I MOVING INFRASTRUCTURE FORWARD I 2024
HOW TO FIND US
OUR WEBSITE
www.arcosa.com
HEADQUARTERS
Arcosa, Inc.
500 North Akard Street, Suite 400
Dallas, TX 75201
NYSE TICKER
ACA
INVESTOR CONTACT
InvestorResources@arcosa.com
3 I MOVING INFRASTRUCTURE FORWARD I 2024
FIRST QUARTER 2024 HIGHLIGHTS
- First quarter revenues up 9% and Adjusted EBITDA up 7%, normalizing for the $22 million land sale gain in the prior period
- Results were better than expected, recovering from broad-based weather impacts in January with double-digit Adjusted EBITDA growth and higher overall margin in the balance of the quarter on an organic basis
- Strong execution on ramping up our cyclical businesses, improving our operating performance, and integrating recent acquisitions
- Operating cash flow increased 195% year-over-year and supported significant investment in organic growth projects
- On April 9th, completed $180 million acquisition of Ameron Pole Products LLC ("Ameron"), a leading manufacturer of highly engineered concrete and steel poles for a broad range of infrastructure products, at an attractive valuation and accretive to overall margin
- Increased full year 2024 consolidated revenues and Adjusted EBITDA guidance to incorporate Ameron and solid first quarter results
- Anticipate 23% full year 2024 Adjusted EBITDA growth at the mid-point of updated guidance range, excluding the land sale gain in 2023
4 I MOVING INFRASTRUCTURE FORWARD I 2024
ARCOSA'S VALUE PROPOSITION
LEADING | EXPERIENCED | HEALTHY BALANCE | DISCIPLINED CAPITAL | TRACK RECORD |
businesses serving | management team | sheet and ample | allocation process to | of executing on |
critical | with history of | liquidity to navigate | grow in attractive | strategic priorities as |
infrastructure | managing through | cycles and pursue | markets and improve | an independent public |
markets | economic cycles | strategic growth | returns on capital | company |
5 I MOVING INFRASTRUCTURE FORWARD I 2024
01
STRATEGIC UPDATE
ARCOSA'S LONG-TERM VISION
Grow in attractive markets | Reduce the complexity and | Improve long-term | Integrate Environmental, |
where we can achieve | cyclicality of the overall | returns on invested capital | Social, and Governance (ESG) |
sustainable competitive | business | initiatives into our long-term | |
advantages | strategy |
7 I MOVING INFRASTRUCTURE FORWARD I 2024
STRATEGIC TRANSFORMATION
Today Arcosa is a less cyclical and more resilient company
Construction Products has Increased to
Approximately 60% of Adjusted EBITDA
Adjusted EBITDA, excluding Corporate($M)
408 | |
66 (16%) | |
113 | |
(28%) | |
219 | |
64 | |
(29%) | |
82 | 229 |
(38%) | (56%) |
73 | |
(33%) | |
FY 2018 | LTM 03/31/24 |
Transportation Products Engineered Structures Construction Products
Actionable Strategic Progress to Position Portfolio for
Long-Term Growth
- Completed $180 million acquisition of Ameron on April 9, 2024
- Divestiture of storage tanks business for $275 million in October 2022
- Invested ~$1.5 billion on 5 large acquisitions and multiple complementary bolt-onsto expand our Construction Products platform
-
Grew natural aggregates operations beyond Texas, now serving 11 Top 50
MSAs, up from 5 at the end of 2018 - Added recycled aggregates to complement natural aggregates platform, serving 5 Top 25 MSAs
- Expanded specialty materials platform with broader geographic presence and product diversity
- Added 4 adjacent infrastructure-related product lines of traffic, telecom, lighting and concrete structures
- Invested organically to leverage larger platforms
- Market leading positions in our cyclical businesses, including barge, wind towers, and steel components, position us well for recovery
$1T Infrastructure Bill and $370B Inflation Reduction Act Create Multi-
Year Tailwinds for Many Arcosa Businesses
See Adjusted Segment EBITDA reconciliations in the Appendix.
8 I MOVING INFRASTRUCTURE FORWARD I 2024
APRIL 9, 2024 - COMPLETED ACQUISITION OF AMERON FOR $180 MILLION
Advances our strategy to effectively deploy capital into Arcosa's growth businesses by expanding our product offerings in Engineered Structures
BUSINESS PROFILE
Ameron is a leading supplier of highly engineered, premium concrete and
steel poles for a broad range of infrastructure applications
STRATEGIC RATIONALE
• Provides entry into the complementary steel and concrete lighting |
pole market |
4
MANUFACTURING
SITES
~$20M ANNUAL
ADJUSTED EBITDA
ACCRETIVE MARGIN
~250 EMPLOYEES
REVENUE BY
PRODUCT LINE
Lighting Poles | Telecom Poles | Other | ||
Traffic Signals | Utility Distribution | |||
• Expands product offerings in traffic and telecom structures |
businesses |
• Margin accretive to both Engineered Structures segment and Arcosa |
overall |
• Similar to our utility structures business, long-term growth driven by |
increased infrastructure spending, replacement demand, energy |
transition, and population growth |
• Establishes geographic presence on the West Coast |
• Transaction accelerates our growth at an attractive 9X multiple |
Adjusted EBITDA for the Year Ended 12/31/2023; see Ameron Adjusted EBITDA reconciliation in Appendix.
9 I MOVING INFRASTRUCTURE FORWARD I 2024
02
Q1 2024 RESULTS
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Arcosa Inc. published this content on 03 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 May 2024 14:58:02 UTC.