Granite Construction Inc (GVA, Financial) released its earnings report for the quarter ended September 30, 2023, on October 31, 2023. The company reported an 11% year-over-year increase in Q3 revenue, reaching $1.1 billion. However, net income dropped to $58 million from $69 million in the same period last year. Adjusted net income, on the other hand, showed growth, totaling $75 million compared to $57 million in the same period last year.
Financial Highlights
Granite Construction Inc (GVA, Financial) reported a significant increase in its operating cash flow, which rose by $153 million sequentially. The company also reported a record Committed and Awarded Projects (CAP) of $5.6 billion, a sequential increase of $147 million and year-over-year increase of $1.5 billion.
Despite the drop in net income, the company's adjusted net income showed a positive trend. Adjusted net income totaled $75 million, or $1.69 per diluted share, compared to adjusted net income of $57 million, or $1.28 per diluted share, for the same period in the prior year.
Company Performance and Outlook
Granite Construction Inc (GVA, Financial) reported that both its Construction and Materials segments posted year-over-year increases, with the California and Mountain Groups up 15% and 11%, respectively. The company's gross profit increased $52 million to $167 million compared to $115 million for the same period in the prior year.
The company's 2023 guidance and 2024 targets remain unchanged. Granite Construction Inc (GVA, Financial) expects revenue in the range of $3.35 billion to $3.45 billion, adjusted EBITDA margin in the range of 7.5% to 8.5%, and SG&A expense in the range of 8.0% to 8.5% of revenue.
Commentary
Granite President and Chief Executive Officer, Kyle Larkin, expressed satisfaction with the company's Q3 performance.
These results demonstrate the strong progress we are making towards the goals identified in our strategic plan that we introduced just over two years ago. We are growing revenue and increasing adjusted EBITDA margin and believe we are on track to reach our 2024 financial targets.”
Summary
Despite a drop in net income, Granite Construction Inc (GVA, Financial) reported a strong Q3 performance with an 11% increase in revenue and growth in adjusted net income. The company remains optimistic about its future performance, maintaining its 2023 guidance and 2024 targets.
Explore the complete 8-K earnings release (here) from Granite Construction Inc for further details.
