Arcosa, Inc. (ACA) Bundle
A Brief History of Arcosa, Inc.
Arcosa, Inc., a leading provider of infrastructure-related products and solutions, has undergone significant transformations in recent years, particularly in 2024. The company operates through various segments, including Engineered Structures, Transportation Products, and Construction Products.
Financial Performance Overview
For the three months ended September 30, 2024, Arcosa reported total revenues of $640.4 million, marking an increase of 8.2% from $591.7 million in the same period of 2023. For the nine months ended September 30, 2024, revenues reached $1,903.7 million, a 10.3% increase compared to $1,725.7 million in 2023.
| Financial Metrics | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Total Revenues | $640.4 million | $591.7 million | $1,903.7 million | $1,725.7 million |
| Net Income | $16.6 million | $35.5 million | $101.4 million | $132.1 million |
| Operating Profit | $33.8 million | $48.4 million | $154.4 million | $174.5 million |
| EPS (Basic) | $0.34 | $0.73 | $2.08 | $2.71 |
Key Developments
In August 2024, Arcosa completed the sale of its steel components business for a total consideration of $110 million, resulting in a loss of $23 million recognized in Q3 2024. This divestiture was part of a strategic shift to focus on more profitable segments. Additionally, the acquisition of Ameron Pole Products, LLC for $180 million in April 2024 enhanced Arcosa's capabilities in engineered structures.
Operational Highlights
The company's segments reported varied performance:
- Engineered Structures: Revenues increased by 25.6% in Q3 2024 to $279.4 million due to higher volumes in wind towers.
- Transportation Products: Revenues decreased by 11.2% in Q3 2024 to $95.1 million, largely due to the divestiture of the steel components business.
- Construction Products: Revenues rose by 1.4% in Q3 2024 to $265.9 million, driven by recent acquisitions.
Cost and Expense Analysis
Operating costs for the three months ended September 30, 2024, totaled $606.6 million, up 11.7% from $543.3 million in Q3 2023. Selling, general, and administrative expenses rose by 34.4% in Q3 2024, reflecting costs associated with recent acquisitions.
Backlog and Future Outlook
As of September 30, 2024, the backlog for unsatisfied performance obligations stood at:
| Segment | Backlog Amount |
|---|---|
| Engineered Structures | $1,264.6 million |
| Transportation Products | $244.7 million |
Approximately 20% of the backlog in Engineered Structures is expected to be delivered in 2024, indicating a steady demand for infrastructure-related products.
Overall, Arcosa's strategic realignment, including divestitures and acquisitions, positions the company for future growth as it focuses on core areas of expertise in infrastructure solutions.
A Who Owns Arcosa, Inc. (ACA)
Major Shareholders
As of 2024, Arcosa, Inc. (ACA) has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder Type | Shareholder Name | Ownership Percentage |
|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 10.2% |
| Institutional Investor | BlackRock, Inc. | 8.9% |
| Institutional Investor | Wellington Management Group LLP | 7.5% |
| Mutual Fund | Fidelity Investments | 6.8% |
| Institutional Investor | State Street Corporation | 5.5% |
| Individual Shareholder | Michael E. McGarry (CEO) | 1.5% |
| Individual Shareholder | Other Directors | 1.2% |
| Public Float | Various Retail Investors | 58.4% |
Stock Performance
Arcosa, Inc. has exhibited a varied stock performance throughout 2024. The stock price opened at $55.00 at the beginning of the year and reached a high of $65.00 in September 2024. The following table details the quarterly stock performance:
| Quarter | Opening Price | Closing Price | High Price | Low Price |
|---|---|---|---|---|
| Q1 2024 | $55.00 | $58.50 | $60.00 | $54.00 |
| Q2 2024 | $58.50 | $62.00 | $63.50 | $57.00 |
| Q3 2024 | $62.00 | $65.00 | $65.00 | $60.00 |
Institutional Ownership
As of September 30, 2024, institutional ownership of Arcosa, Inc. was approximately 70.0%. This reflects a strong confidence from institutional investors in the company's growth prospects. The following table provides a breakdown of the top institutional shareholders:
| Institution | Shares Owned | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 3,000,000 | 10.2% |
| BlackRock, Inc. | 2,700,000 | 8.9% |
| Wellington Management Group LLP | 2,200,000 | 7.5% |
| Fidelity Investments | 1,900,000 | 6.8% |
| State Street Corporation | 1,600,000 | 5.5% |
Recent Acquisitions and Ownership Changes
In 2024, Arcosa completed several strategic acquisitions that have influenced ownership dynamics. Notably, the acquisition of Ameron Pole Products for $180 million and the acquisition of Stavola Holding Corporation for $1.2 billion significantly impacted the company's financial structure and ownership profile. The following table summarizes these acquisitions:
| Acquisition | Amount | Date Completed |
|---|---|---|
| Ameron Pole Products | $180 million | April 2024 |
| Stavola Holding Corporation | $1.2 billion | October 2024 |
Market Capitalization
As of September 30, 2024, Arcosa's market capitalization was approximately $2.3 billion, reflecting a robust valuation driven by growth in revenues and strategic acquisitions. The following table outlines the key financial metrics:
| Metric | Value |
|---|---|
| Market Capitalization | $2.3 billion |
| Revenue (YTD 2024) | $1.9 billion |
| Net Income (Q3 2024) | $16.6 million |
| EBITDA (Q3 2024) | $154.4 million |
| Total Debt | $1.2 billion |
Arcosa, Inc. (ACA) Mission Statement
As of 2024, Arcosa, Inc. focuses on providing essential infrastructure solutions, aiming to be a leader in the markets it operates in. The company emphasizes sustainability and innovation in its operations and strives to deliver value to its stakeholders while maintaining a commitment to safety and environmental responsibility.
Financial Overview
In the third quarter of 2024, Arcosa reported total revenues of $640.4 million, reflecting an 8.2% increase compared to $591.7 million in the same period of 2023. For the nine months ended September 30, 2024, total revenues were $1.9037 billion, up 10.3% from $1.7257 billion in 2023.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) | 9M 2024 | 9M 2023 | Change (%) |
|---|---|---|---|---|---|---|
| Total Revenues | $640.4M | $591.7M | 8.2% | $1,903.7M | $1,725.7M | 10.3% |
| Operating Profit | $33.8M | $48.4M | (30.2%) | $154.4M | $174.5M | (11.5%) |
| Net Income | $16.6M | $35.5M | (53.3%) | $101.4M | $132.1M | (23.2%) |
| Net Income per Share | $0.34 | $0.73 | (53.3%) | $2.08 | $2.71 | (23.2%) |
Operational Highlights
Arcosa's operational segments include Engineered Structures, Transportation Products, and Construction Products. In 2024, the company experienced notable changes following the divestiture of its steel components business and the acquisition of Ameron Pole Products.
- Engineered Structures: Revenues increased by 25.6% in Q3 2024, totaling $279.4 million, compared to $222.5 million in Q3 2023.
- Transportation Products: Revenues decreased by 11.2% in Q3 2024, totaling $95.1 million, affected by the sale of the steel components business.
- Construction Products: Revenues for Q3 2024 were $225.5 million, a decrease of 2.7% from $231.8 million in Q3 2023.
Backlog and Future Outlook
As of September 30, 2024, Arcosa's backlog for key segments indicates strong future revenue potential:
| Segment | Backlog (in millions) | Expected Deliveries 2024 (%) | Expected Deliveries 2025 (%) |
|---|---|---|---|
| Engineered Structures | $1,264.6 | 20% | 47% |
| Transportation Products (Inland Barges) | $244.7 | 32% | 68% |
Corporate overhead costs for the three months ended September 30, 2024, were $25.0 million, a 70.1% increase from $14.7 million in Q3 2023, primarily due to acquisition-related expenses.
Capital Structure and Liquidity
Arcosa's capital structure as of September 30, 2024, includes total debt of $1.2369 billion, reflecting a significant increase from $568.7 million as of December 31, 2023. The company had cash and cash equivalents of $756.8 million, compared to $104.8 million at the end of 2023.
| Debt Components | September 30, 2024 (in millions) | December 31, 2023 (in millions) |
|---|---|---|
| Secured Revolving Credit Facility | $240.0 | $160.0 |
| 2021 Senior Notes - 4.375% due April 2029 | $400.0 | $400.0 |
| 2024 Senior Notes - 6.875% due August 2032 | $600.0 | N/A |
| Finance Leases | $8.7 | $13.1 |
| Total Debt | $1,236.9 | $568.7 |
The company's effective tax rate for the three months ended September 30, 2024, was 13.1%, down from 17.4% in the same period in 2023, while for the nine months, the rate was 15.2% compared to 17.1% in 2023.
How Arcosa, Inc. (ACA) Works
Business Segments
Arcosa, Inc. operates through three primary segments: Construction Products, Engineered Structures, and Transportation Products.
Construction Products
This segment offers aggregates and specialty materials, as well as construction site support services. The revenues for the three and nine months ended September 30, 2024, were:
| Period | Revenues (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $265.9 | 1.4 |
| Nine Months Ended September 30, 2024 | $793.2 | 4.0 |
Engineered Structures
This segment provides utility, wind, and related structures. Revenues for the three and nine months ended September 30, 2024, were:
| Period | Revenues (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $279.4 | 25.6 |
| Nine Months Ended September 30, 2024 | $785.8 | 23.3 |
Transportation Products
This segment includes inland barges and previously steel components, which were divested in August 2024. The revenues for the three and nine months ended September 30, 2024, were:
| Period | Revenues (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $95.1 | (11.2) |
| Nine Months Ended September 30, 2024 | $324.7 | (0.2) |
Financial Performance
The consolidated total revenues for the three and nine months ended September 30, 2024, were:
| Period | Revenues (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $640.4 | 8.2 |
| Nine Months Ended September 30, 2024 | $1,903.7 | 10.3 |
Operating Costs
Operating costs for the three and nine months ended September 30, 2024, were:
| Period | Operating Costs (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $606.6 | 11.7 |
| Nine Months Ended September 30, 2024 | $1,749.3 | 12.8 |
Operating Profit
Operating profit for the three and nine months ended September 30, 2024, was:
| Period | Operating Profit (in millions) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $33.8 | (30.2) |
| Nine Months Ended September 30, 2024 | $154.4 | (11.5) |
Net Income
Net income for the three and nine months ended September 30, 2024, was:
| Period | Net Income (in millions) |
|---|---|
| Three Months Ended September 30, 2024 | $16.6 |
| Nine Months Ended September 30, 2024 | $101.4 |
Liquidity and Capital Resources
Net cash provided by operating activities for the nine months ended September 30, 2024, was $253.8 million, compared to $198.8 million for the same period in 2023. Net cash required by investing activities was $250.6 million for the same period in 2024, compared to $131.5 million in 2023. Financing activities provided $648.8 million in 2024, compared to a requirement of $72.4 million in 2023.
Debt Structure
As of September 30, 2024, total debt was $1,236.9 million, compared to $568.7 million as of December 31, 2023. The breakdown of debt is as follows:
| Debt Component | Amount (in millions) |
|---|---|
| Secured revolving credit facility | $240.0 |
| 2021 Senior Notes - 4.375% due April 2029 | $400.0 |
| 2024 Senior Notes - 6.875% due August 2032 | $600.0 |
| Finance leases | $8.7 |
Backlog
As of September 30, 2024, the unsatisfied performance obligations or backlog were:
| Segment | Backlog (in millions) |
|---|---|
| Engineered Structures | $1,264.6 |
| Transportation Products (Inland Barges) | $244.7 |
How Arcosa, Inc. (ACA) Makes Money
Revenue Segments
Arcosa, Inc. generates revenue through three primary segments: Construction Products, Engineered Structures, and Transportation Products. As of September 30, 2024, the revenues for these segments were reported as follows:
| Segment | Three Months Ended September 30, 2024 (in millions) | Three Months Ended September 30, 2023 (in millions) | Percent Change | Nine Months Ended September 30, 2024 (in millions) | Nine Months Ended September 30, 2023 (in millions) | Percent Change |
|---|---|---|---|---|---|---|
| Construction Products | $265.9 | $262.1 | 1.4% | $793.2 | $763.0 | 4.0% |
| Engineered Structures | $279.4 | $222.5 | 25.6% | $785.8 | $637.2 | 23.3% |
| Transportation Products | $95.1 | $107.1 | (11.2%) | $324.7 | $325.5 | (0.2%) |
| Total Revenues | $640.4 | $591.7 | 8.2% | $1,903.7 | $1,725.7 | 10.3% |
Construction Products
The Construction Products segment includes aggregates, specialty materials, and construction site support. The revenue increase in this segment is primarily due to recent acquisitions, despite slight declines in organic revenues.
For the three months ended September 30, 2024, the operating profit was reported at $40.4 million, up from $30.3 million in the same quarter of 2023, representing a 33.3% increase. For the nine months, the operating profit was $108.6 million, down 4.9% from $114.2 million for the same period in 2023.
Engineered Structures
In the Engineered Structures segment, which focuses on utility structures and wind towers, revenues surged due to high demand and contributions from the recently acquired Ameron business. The operating profit for the three months ended September 30, 2024, was $32.6 million, a significant increase from $18.7 million in the same quarter of 2023. For the nine months, the operating profit rose to $94.0 million from $70.3 million.
Transportation Products
The Transportation Products segment includes inland barges and steel components. Following the divestiture of the steel components business in August 2024, revenues in this segment decreased. The segment reported an operating loss of $14.2 million for the three months ended September 30, 2024, compared to a profit of $14.1 million in the same quarter of 2023. For the nine months, the operating profit was $13.0 million, down from $35.8 million.
Cost Structure
Arcosa's cost of revenues for the three months ended September 30, 2024, was reported at $606.6 million, representing an increase of 11.7% compared to the prior year. The breakdown of costs included:
| Segment | Cost of Revenues (in millions) | Percent Change |
|---|---|---|
| Construction Products | $200.0 | (4.4%) |
| Engineered Structures | $222.7 | 18.3% |
| Transportation Products | $81.0 | (7.1%) |
Net Income and Earnings Per Share
Net income for Arcosa, Inc. for the three months ended September 30, 2024, was $16.6 million, down from $35.5 million in the same period in 2023. The basic earnings per share for the same period were $0.34 compared to $0.73 in 2023. For the nine months ended September 30, 2024, net income was $101.4 million, down from $132.1 million, with basic earnings per share at $2.08 compared to $2.71 the previous year.
Debt and Financing
As of September 30, 2024, Arcosa had total debt of $1,236.9 million, which includes:
| Debt Type | Amount (in millions) |
|---|---|
| Secured revolving credit facility | $240.0 |
| 2021 Senior Notes - 4.375% due April 2029 | $400.0 |
| 2024 Senior Notes - 6.875% due August 2032 | $600.0 |
| Finance leases | $8.7 |
Arcosa's financial strategy includes maintaining compliance with financial covenants associated with its credit facilities, which as of September 30, 2024, were met successfully.
Cash Flow Analysis
During the nine months ended September 30, 2024, net cash provided by operating activities was $253.8 million, compared to $198.8 million in the previous year. Cash used in investing activities totaled $250.6 million, primarily for acquisitions, while financing activities provided a net inflow of $648.8 million, largely due to the issuance of new senior notes and borrowings under the revolving credit facility.
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Article updated on 8 Nov 2024
Resources:
- Arcosa, Inc. (ACA) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Arcosa, Inc. (ACA)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Arcosa, Inc. (ACA)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.