10-Q · May 8, 2026
Construction Partners, Inc. reported a significant growth in revenue and net income for Q2 FY2026, with revenues of $769.2 million representing a 34.6% increase year-over-year. The company also achieved an EPS of $0.16,…
Earnings analysis · 10-Q
ROAD earnings analysis
Filed August 7, 2026 · Our reading of the company's report
The latest report
Construction Partners delivered strong year-over-year growth, with revenue up 28.2% to $999.4 million, operating income up 31.9% to $109.4 million and diluted EPS up to $1.06 from $0.79. Gross margin was essentially…
Read full summary
Construction Partners delivered strong year-over-year growth, with revenue up 28.2% to $999.4 million, operating income up 31.9% to $109.4 million and diluted EPS up to $1.06 from $0.79. Gross margin was essentially flat year over year, while operating leverage and nine-month operating cash flow improved materially. The principal offsets are increased debt and interest-rate exposure, acquisition and capex funding requirements, and a newly disclosed geopolitical risk that could raise fuel and asphalt costs.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.06
What stood out
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Revenue growth accelerated
Second-quarter revenue increased 28.2% year over year to $999.4 million from $779.3 million. Acquisitions contributed $151.0 million, while existing-market revenue rose 8.9% on strong public and private demand.
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Operating leverage improved
Operating income rose 31.9% to $109.4 million from $82.9 million, lifting operating margin to 10.9% from 10.6%. Gross margin was broadly stable at 16.8% versus 16.9%.
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EPS and net income expanded
Diluted EPS increased to $1.06 from $0.79, while net income rose 35.2% to $59.6 million from $44.0 million. EPS was $0.01 below the reported $1.07 consensus estimate, but revenue exceeded the $960.0 million estimate by approximately $39.4 million.
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Cash generation strengthened
Nine-month operating cash flow increased to $240.9 million from $179.3 million. Capital expenditures were $144.2 million, implying approximately $96.6 million of nine-month operating cash flow less capex, although the filing does not label or report free cash flow.
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Backlog supports near-term activity
Contract backlog was $3.4 billion at June 30, 2026, including $2.7 billion of uncompleted contracted work and $0.7 billion of low-bid/no-contract backlog. Management expects approximately $0.9 billion of revenue from existing performance obligations during the rest of fiscal 2026.
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Liquidity capacity expanded
The revolving credit facility was increased from $500.0 million to $700.0 million, with $599.2 million of availability at quarter-end. The Term Loan B refinancing also included $300.0 million of incremental term loans and reduced applicable interest-rate margins.
What to watch
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Higher leverage and rate exposure
Total principal debt was $1.803 billion at June 30, 2026, up from $1.626 billion at September 30, 2025. Net interest expense increased 20.0% year over year to $30.3 million, and a 1% change in borrowing rates would affect annual interest expense by approximately $18.0 million.
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Acquisition and capex intensity
Nine-month investing cash outflow was $445.0 million, including $337.4 million for acquisitions and $144.2 million of capital expenditures. Management expects fiscal 2026 capital expenditures of $185.0 million-$205.0 million, sustaining substantial funding needs.
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Working-capital investment increased
Contracts receivable including retainage increased to $593.5 million from $549.9 million, while inventories increased to $185.3 million from $155.1 million. Management attributed the $18.3 million inventory increase to acquisitions, market growth, higher inventory costs and normal inventory-cycle fluctuations.
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New energy-supply disruption risk
The filing added a geopolitical risk concerning potential disruption to crude-oil shipping through the Strait of Hormuz, which could raise liquid asphalt and diesel costs. The company has $1.80 billion of variable-rate debt, providing an additional quantified sensitivity to broader energy and interest-rate volatility.
Management's outlook
The 10-Q does not reiterate quantitative FY2026 revenue or EPS guidance. Management expects fiscal 2026 capital expenditures of approximately $185.0 million to $205.0 million and expects to recognize approximately $0.9 billion of revenue from existing performance obligations during the remainder of fiscal 2026. Prior FY2026 revenue guidance of $3.59 billion-$3.65 billion was provided in the prior analysis but was not reiterated in this filing.
Earlier filings 4
10-Q · February 9, 2026
Construction Partners reported strong year-over-year top-line and profitability improvement for the quarter: revenues of $809,469,000 and net income of $17,205,000 (diluted EPS $0.31) versus revenue $561,580,000 and net…
10-Q · August 7, 2025
Construction Partners reported a strong quarter: revenue rose to $779,277,000 (Q vs. prior-year quarter $517,794,000), gross margin improved to 16.9% and operating income increased to $82,943,000, producing diluted EPS…
10-Q · February 7, 2025
Construction Partners reported strong top-line growth driven by acquisition activity: revenue rose to $561,580,000 for the three months ended December 31, 2024 versus $396,505,000 a year earlier. Profitability declined…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.