Arcosa has revealed a strong set of fourth-quarter and full-year results for 2024.
The results included double-digit revenue and adjusted EBITDA growth, which generated significant margin expansion. The company recorded a robust fourth-quarter operating cash flow of $248 Million and a free cash flow of $199 Million.
A major milestone from Arcosa included completing the acquisition of the construction materials business of Stavola Holding Corporation and its affiliated entities. The acquisition was completed for $1.2billion and included Stavola’s network of five hard rock natural aggregates quarries, twelve asphalt plants, and three recycled aggregates sites.
“2024 was a transformative year for Arcosa as we undertook strategic actions to enhance our growth businesses, reduce cyclicality, and drive margin expansion across the organization. Notably, the acquisition of aggregates-led Stavola, which we completed at the start of the fourth quarter, provided entry into the nation’s largest MSA with increased exposure to lower volatility, infrastructure-driven end markets,” Arcosa president and chief executive officer Antonio Carrillo said.
“Earlier in the year, we completed the acquisition of Ameron Pole Products which enhanced the growth profile of our Engineered Structures segment. We also divested certain non-core assets during the year to further optimize our portfolio, including the sale of our cyclical steel components business within the Transportation Products segment.
“Our actions combined to deliver record full year revenues, Adjusted EBITDA, and margin in 2024. With roughly balanced organic and inorganic contribution, Adjusted EBITDA increased 35 per cent and margin expanded 260 basis points year-over-year, normalizing for the steel components divestiture and the large land sale completed in 2023. All three segments contributed to our strong results.”
Arcosa’s revenues from its construction products segment increased by 31 per cent to $311.9 million including Stavola which contributed $78.2 million.
According to Arcosa, organic revenues declined four per cent primarily due to lower freight revenue and the divestiture of several small underperforming operations executed in the second quarter. The company highlighted in its commentary that organic product sales revenue increased as higher pricing offset lower overall volumes in our aggregates and specialty materials businesses.
“Looking ahead, the strategic actions we completed in 2024 should accelerate our profitable growth in 2025,” Carrillo said.
“At the mid-point of our 2025 full year guidance range, we anticipate a 30 per cent increase in Adjusted EBITDA and another year of significant margin expansion. As we benefit from nine months of inorganic contribution from Stavola this year, we also expect roughly 40 per cent of our growth in 2025 to stem from a double-digit organic increase.”
“Overall, we are optimistic about Arcosa’s prospects in 2025 and beyond. Infrastructure-led demand fundamentals are expected to continue to positively impact many of our businesses, our proven track record of execution of our strategic vision to grow in attractive markets and simplify our portfolio, and the rapid progress we have made toward our commitment to delever the balance sheet underpin our confidence for 2025.
“As a predominantly US-centric company, we are encouraged by the pro-growth agenda of the new administration. While the potential impacts of both tariffs and renewable energy policy changes are unknown, we maintain an optimistic outlook that broadly policies will support the rebuilding, strengthening, and advancement of America’s infrastructure.”
