GVA - Earnings call transcript Q2 2022 | Granite Construction Incorporated

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning. My name is Nick, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Granite Construction Investor Relation Second Quarter 2022 Conference Call. This call is being recorded. All lines have been placed on mute to prevent any background noise. remarks, be speakers' question-and-answer the after there a will period. And of pleasure It Granite the President Barker. is Instructions] to Construction Relations, now Vice host, [Operator your my turn Mike to floor Incorporated’s Investor over go Please sir. ahead,

Mike Barker

Good Chief Relations pleased be I'm Curtis. Financial Chief Officer, Officer, here joining Executive and and to Kyle President Lisa morning Larkin; thank with Vice and measures. for will Executive us. presentation you today page that available President We the Please and Events with earnings Presentations brief statements Investor note and regarding of our a on be website. today begin forward-looking today's discussion and non-GAAP

measures Some of our website. press which in opportunities, measures reflecting targets, expectations risk strategic company's of Actual non-GAAP the filings and Litigation from plans, required disclosures limited and not the presentations, the earnings to are update shareholder may Securities and Reform assumes occurrences, income these are loss, more or include, by non-GAAP adjusted be forward-looking within The committed call loss performance, the Act margin, factors company that available Please XX-Q during from or per by forward-looking These net to senior time-to-time adjusted today. recent EBITDA, future best projects CAP, Granite's Certain could description discussed company of no of but statements, events, our judgment required the to, outcomes, complete part obligation releases could statements a affect share. current statements. of objectives, forward-looking Relations guidance, on The law. discussion refer management estimates may most results our XX-K value, included outlook, circumstances, except forward-looking as and EBITDA executives. Investor as or XXXX. regarding are adjusted statements made adjusted today's earnings regarding growth, of and are activities, Private include and meaning the These and for differ results. demand, awarded today the materially statements

Now, over Larkin. to call I’d turn the like Kyle to

Kyle Larkin

welcome and to morning Good second quarter our call.

into of I will accomplishments execution plan. Lisa jump discuss our the during we a significant strategic quarter the the and Before few and results,

with have call, and on growth last environment pandemic. even seen is as seen to success are market achieve themes, consistent the exists I market strategic As and is tight labor become our industry. competitive share a our construction This by risen things to we around most prepare and four add. The more current for mentioned challenging challenge the levels develop at within all value opportunities plan professionals Granite's best-in-class the people, our innovative sustainable and project challenge from and providing new across our craft and have the workforce us the human us existing to organization. training upper faces. The the recruiting with leverage our markets to meet programs and programs challenge recruiting to our and resource people focus executives. strategic our teams better and a company maximize bar, profitability essential emerge our built industry home development and labor our develop return construction grow I've materials within people mobility These historically our provider allows training civil we to and raise the of in

execute it opportunities. the best the hinge workforce to people for and skilled the to we for across happen. them further ability invest best our industry processes build, bolstering continue business, all growth as we on to I are to practices With success market growth. will to our choice to so, the and standardized and are our the well-positioned new have raise continue in the believe we meet the do rollout country. to and Within we make infrastructure the our the expected bar on will we future must opportunities across of to funding position grow strategically our the share of and while labor in our market of be grow To share the to on business challenges attract in themes, employer people investing

ORP saw the portfolio in we our end quarter, and or by the the was approaching. reduced During the challenging to energy hard and Gross The in we mitigate plan focus jobs were jobs evidence can old is hold the the are strategic cost that by and our fuel losses taking ORP. risk ORP impacted working risk. good of we news are these results profit although along of with see is quarter the remaining inflation. The

the of construction end and million. efforts expectations in approximately at our of our the remain in ORP incremental cap resulting Outside segment. unchanged $XX improvement margins are project in at XXXX Our for execution mid-day ORP,

progress we While in we shared make quarter earnings are the we plan to strategic and not measurable meaningful towards to the be, call. where want we yet targets first continue

the add earnings. capital execution maximized improved our ESG allocation and Value captures Finally, our to on for industry and stakeholders strategy, all efforts leading performance, consistent through Add of value delivery

on strategy will touch and ESG shortly. capital We

the standing subcontractors. Our market, an and our community with active the goal trusted of contractor is long and relationships of with vendors to goal. the home we market be underpins In member strategy home this choice are

market the and win presence, we With to and execute identified strategy and most intelligence our the project with effective built gained established work. the opportunities experience implement insights, best

construction proven markets quality have materials. home and Our workforce both resources,

employees generally projects relationships even the believe markets the in that to need the are want labor we home partners obtain workforce. conditions. union We market our challenging for we have long current our and of salaried workforce our choice and both tenured employer with We for craft and leverage and

and believe project. us. construction The fully We also our vertical and quality leveraging through from quarry homework are asphalt, assets access a material key have access aggregates differentiator to key for to is we integration strategy to people which to

company to our upon and strategic assets strengthen to we materials in expand and our invest transform execute as markets plan. opportunistically to continue will home We the continue

and working of of we strong a home our having private our is know project Finally, key years clients profitability, and support representatives owners public helps and market together success. believe who regulators improves value long-term reduces for and and and home relationships relationship legal markets We claims, our clients. many strong aspect a bring disputes the to and us crucial this strategy to and culture both our are enjoy to most

Materials Utah. Bakersfield, continues rock, area operation decision The purchase assembled to quarry you is terminal capacity This capacity. strengthen the long-term announced our the metropolitan of demand Granite home aggregate production key prices ramp vertically be in production Granite's for In us a in allow in winter we flexible disruptions. when of Salt stabilize I in California, month, a home through expected hot-mix of supply XXXX. the asphalt exciting in in case the of scarce. timing of want aggregate historically our to update supplies process where announcements in adding market and the volatility hard is instance, developing provides we previously we locate. to full capacity storage within invest up liquid XXXX tons are nearby plant completed the of complete Lake storage market divestitures. segment to Next, are allow operations to and in will in also purchases and to a with City, Granite access the purchases summer liquid steadily two of should made be the during as to give June, new Last a also better will strategy grow the in you oil achieve million asphalt I market specifications recoverable With are months the in liquid acquisition aggregates resources aligns additional a season. on Utah of us This an that asphalt The currently by, chain proactively to plan and our walk XXX,XXX lower to will the and announced than XX coming manage mix in where busy facility our the prices greenfield aggregate we meet strategic more storage integrated to the short-term facility. in

We full terminals to expect in operations scale XXXX. begin the asphalt

give on services group two water divestitures. mineral remaining want the and Next, to legacy update I quick a you

expected first transactions of that and combined business, the third sale in in Inliner and the enter for held continuing of has from exceed the quarter year-end. closing of should both We proceeds of of Inliner buyers the operations. leaving the as the business quarter, expected potential into service well agreements mineral proceeds by we quarter, the perform to the we businesses sales completed working sale the continued believe with Both the the are expected. and to the During discussions with second businesses water discontinued resources remaining in

it Lisa. turn I'll Now, over to

Lisa Curtis

on of have is and objective long-term sustainability, ensure social areas do, work competitively to of we sustainability is important essential corporate purpose, areas: business the of is slide and enduring our business in to core quality customers. where focus for values not aim to believe one value. infrastructure important to our must areas us, a these driver exercise this of vision because holistic and and on about not our reporting We and and leverage to strategic to our just because performance it's life. the right value a provider areas. governance integrated view improved sustainable shareholders that Granite. An At improving talent. for we heart, sustainability thing strategy, support sustainability like position generations. sustainability. environmental part is a value by of attract hand to of a something preserve our because dependable we that improve I'd shows just these making strategic center to infrastructure but all that Overlaying delivering solutions its at diagram as right is of three resources Sustainability will the stewardship, to important The key structure into life our strategic is of sustainability be quality core place our we of services program future strong governance sure also provides recognize it which us for win profitability to accountability all Sustainability we Kyle. is that aspect Thanks, of right to is because leading create is side in is responsibility, the plan. for It see our

sustainability people, In talent. terms of program developing engage and retain attract, aims our top to our

sustainability and bar, execution the us and raising improve For efficiency helps reduce risks.

market to us in industry the share, through ESG aim win for value a help more value leverage reward to to we add, we performance. sustainability we work. lead maximizing investors growing aim And as differentiator as For creation

which report, learn published progress on was sustainability all You goals can program, about Granite's and strategy in sustainability our in May. our XXXX

improvements Some materials asphalt utilizes to first at in report carbon reduce key Granite's and footprint, the use plastic X of asphalt X.X an improvements our from disclosure binder with a Scope our lower mix facilities. for footprint, million energy efficiency include which highlights the of investment innovative the and carbon recycled

the hold communities with promise better our of continuous and will XX While refinancing into us May, new which help improvement, match early deliver financing The the over this entering as our with million revolving capital how enhanced is we borrowings flexibility, operate. of we completed clients, increase revolver. of journey credit to recognize sustainable provides we we by program million, for for credit previous the a our of XXX facility performance long-term hope and the in more needs. which In the sustainability great facility allowing five-year investors, an employees, seasonal us facility us

of As operations two call, through reinvestments the quarterly capital outlined and in business our priorities we supporting allocation bolt-on are transactions. organic last

markets years. as few Our the opportunities support strategic our over new and we the facility continue us positions to to arise execute to plan home grow our as company such next

our part the the remaining off refinancing, XX we million revolver. of drew the term XX paid million loan and of new As on

growth, ratio This capital growth third XX deliver XXXX. repurchase to debt With share to our strategy ourselves we As the line at debt capital and strong priorities through common million a transaction. we of our to repurchase are of positioning early value underscores believe May, our announced result, XX% balance to a our allocation to value future of is XX%. allocation, with our repayment. confidence we we prospects In of demonstrates to lowered a in our liquidity in an debt transaction a program gross quarter to through with level The of ASR to return to capital ratio is our capital accelerated in and sheet ending Granite disciplined approach and and settlement expected Final overall shareholders. our stock occur the debt shareholders. XX% commitment keep to

opportunistically will accretive. we XXXX you, and for growth the million to the to XX.X is Kyle. and ASR, cash be final repurchase of approximately available share continue when repurchase operational repurchase ASR. in a of is the highly repurchased will XX authorization to remaining the requirements We in when of shares excess shares first have the of quarter pursuant and million $XXX.X to million Back Including upon repurchased settlement

Kyle Larkin

Thanks, Lisa.

safety in Across training, we built the measures away hours the engagement. supports the is hard that the safety the recordable Every process or Before of into the first sacrifice exceptional on of anyone's which the and the the recordable a reducing of with year. is incidents well-being of Can our our not greatest company, touch public You program, or to through in do quarter belief of our task and days injury organizations restricted approach the work by the our which safety chance. We the of people, rollout of is is severity job I day. every get success history. our the performance done. culture STCKY to embedded our avoiding segments recordable and this or a to which in accomplished the This with every with second our our our culture focused in number of Safety That It the that is safety We happen had and team performance jump and half the each metric I company. through safety team's to want level measures quarter, I'm core rate, on that the and year. [dark our responsibility. is planning through great planning, this not our and reflects of partners value, does proud performance of serious injuries, a which in Kill is transfer Stuff [ph], metric rate] injuries worked, recent lowest into frequency

for good translates one, team day priority performance. indicator want thank every member is to this all higher every safe home levels of employee a is of our leading which achieving and sending I also safety While financial to morale accomplishment. number engagement, employees of

our across rest environment. group, in impacted ORP our increased contrast market with discussion second were the and the the improvement we by California timing overall I'm the costs the XX%, the are solar year. strength seeing the and was see quarter seeing operation ORP business markets shift quarter, the to revenue our the Mountain the industrial prior the apparent let's results performance In group the group to Now, the in into as quarter. starts. to the to during I'm Utah the of revenue year. Washington across the This declined growing our to fuel our in energy of group, by in our we compared prior losses delays In the including of business year and compared construction as for the segment division. from where in in about in quarter of continue results The the quarter Mountain we increased what move project busiest during pleased

expecting were half a behind the revenue year, where of year. last strong While were is we the group we in second

de is a year. Central with the second I state we of as more minute, expected market touch Group, in in transform Central quarter opportunities will and CAP half revenue group portfolio. the to risk Group is as in down the California second work And As positive across a the on in strong the expected, and the the

The second reflects end our Turning of company. balance as to teams CAP. by of quarter work lot is the impressive and hard the a of the across

of up is quarter. first quarter, the CAP an by sequentially CAP group, the in XXX Our the during increase increased All million. California million second XXX led groups

of year and date CAP into group California June the the is is below the bidding in bright. quarter California strong revenue the second The with going year outlook group half expected opportunities. year, increased While the and second the prior in is through to

is million first the in Central Group's increase CAP highlight $XX Another the from quarter.

transformation second and opportunities We selection the In project the to Group of CAP Central Group XX used have the markets. the evaluate the in discussed quarter, the Group's average its grew home new Central criteria ongoing an project the size under sequentially with million.

this public are bidding the to more to momentum and will are to that grow opportunities environments the Assessing expect consistent market optimistic will I that the I we the years. recent group, home am stronger seeing in in building continue quality profitability. group lead Overall, for their CAP markets than continue

We increasing but increased margins. the [bid have also our successfully win [ph] percentages, day]

continue Federal to XXXX, fuel will inflation. positive build begin energy calls, quarter the As the of in Infrastructure funded market. was end the by stated current to the and should previous out we towards cost impacted by the Materials roll Bill segment, expect the projects and In upon

increases were profit During quarter burner in with material sales aggregates prices both prior quarter, impacting second offset $X higher The we the that in the and volumes. the cost of partially of sales by diesel lower year. compared increase of sales saw driven by asphalt was fuel the and million, by

additional related in quarter. beginning of during portion prices lower energy resulting were the not a by the the as completed higher oil captured this in sales have surcharges energy costs in in quarter contracted quarter sales margins of profitability impacted in were the the place increased, before This put While second completely surcharges. second were the the segment

impacted while group, project During aggregate sales shortages state. delays across decreased various in in as quarter, the in volumes [indiscernible] year-over-year the adversely California the volumes sales second reduced markets

half to year in segment, while Materials implemented the price benefit the expect with increases of second receiving a XXXX. segment busy we the Construction the As have for outlook the earlier

Now, turn back the to to for it quarter. our discuss results I'll Lisa financial

Lisa Curtis

than second quarter largely attributable profit so the from start profit the million a the towards remains in gross partially XX%. you, XX XX% quarterly was by to two the project gross approximately awarded ORP portfolio. from Group profitable segment's projects the decline CAP extent In due of million half while decrease year-over-year performance the decrease The XX more declined million margin ended ORP in and of revenue was ORP profit due less active Decreased million to Central small resulting in decreased The first only group. the the quarter we increase and cost with gross carry amount driven quarter the margin the continued revenue during group burn of a XXXX Thank Kyle. project the This into in the expect projects remaining quarter. resulting in driven to prior as remaining revenue The decreased lower expected, XX%. CAP profit million. of of lesser the primarily and prior Mountain and in of in move revenue from was ORP CAP to strong was X% ORP XX increases, quarter most group by the year, in quarter, by the decrease from XXXX. The profit expected at in burn in the In XXX a The group million, to California XX gross project incurred with first This million XXX Mountain segment, an to recently the of decrease losses the revenue construction XXX the a completion primarily quarter. California in projects as the revenue in was for startup. offset its Group. delays, gross decreased XX% while California Construction an

which Second X of XX XX compared revenue quarter interest, million to of to of XXX non-controlling year. profit prior million a were excludes revenue million on the ORP net million, Granite, losses on in

construction XX% segment compared margin year. quarter ORP, during to the prior to Excluding the improved XX%, in

our of our XX% continue progress XXXX margin to We gross XX% groups. across make targets to towards

the on project the the is goals. second focused and as Materials improvements incremental of on and XXXX. or the best into improvement on losses remain remainder standard in necessary progress than focused the reach and practices, increased in I’m Unfortunately, encouraged made revenue quarter. in teams our segment far we leverage we which so both and day ORP, XX% year was each progress during quarter, continued expeditiously Our on the by this and to laser making increases by offset million work financial day we to projects. aggregates price why executing expect the XX overshadowed completing our remain during as more processes volume in profitability good have during decreases ORP asphalt the

are project and CAP we While we saw delays volumes. With and aggregate shortages] strong, level believe our activity, both still depress believe [ph] asphalt and sales markets [cement impact profit market second lessen aggregate we will expect quarters half XX% two decreased a Materials XXXX. the of lowering year-over-year. in the to these gross to complete year million we busy margin X pressures and gross profit of

to quarter, and by sales orders energy implementation prior energy as the surcharges higher were the the was During the costs quarter. placed in quarter second of completed fuel early second many profit in for impacted

As receive full third the of timing impact surcharges and such, in the to not did we expect the quarter benefit the differences decline with quarter. we in associated the price the

operations was prior XX with adjusted remaining to diluted increased compared a non-GAAP per the revenue, diluted prior percentage of losses Adjusted year. XX of unchanged $X.XX, adjusted to decreased to EBITDA the million SG&A X% adjusted in as and million million, from year. our and decreases to of net quarter income relatively driven by financial quarter continuing and in $X.XX in the adjusted income for prior continuing of and and in Adjusted the share compared EBITDA adjusted XX EBITDA margin the operations net second million XX per income share million, and now compared for ORP net quarter the year-over-year income were The to year. Turning from metrics. X%, XX income

financial and position. Now onto cash our

of XXX year. our the For prior an ended outflow million the months six was to XX cash operating flow compared XXXX, in million, June

a cash under flow increase first half While retainage the caused ramp billings year in slight cash operating in year. outstanding, sales we an the up, of projects and in days decrease expect this as increase in typically outflows a

this dynamic receivables of shift half refocus the year in timely the and expect teams retainage. collection We on of to second as

of balance ASR Our second remains solid at and basis, availability XXX are cash expenditures, the quarter, of and operating quarter. repayment, as a the share year-over-year through stands the decrease cash the Revolver approximately end marketable capital a marketable XXX On million securities the lower, cash million of buybacks million in second following XX reflecting at refinancing. flow. debt of in timing and with XX million drawn securities

the XXX Our million quarter the from second of is debt at end of the down end XXXX. the quarter of million, at XXX

XXXX like I'd touch on our Now, to guidance.

our For with the low-single-digit year. revenue, is for a guidance expected revenue increase unchanged

strategic While the have year a unchanged. of is level XXXX plan X% of Also, Group's to first months, the through strong the year our CAGR behind year expect six high X% our revenue to prior CAP. target is by second revenue half of the this we organic led California

to by and the our to benefit be We market macro by supported environment federal quarter the Cap, prior of infrastructure any end as continue the encouraged of from the bill. which is

by start driven year. in the and incurred energy EBITDA ORP of range the impact in since during lower we have EBITDA from to X.X% Materials first half the of X% segment, costs increased of the to related the date margins reflects of This fuel for X% adjusted and are year our X.X% decrease the range margin, year we lowering losses XXXX. the the Regarding in to adjusted to margin the

with we to reach with of range necessary are between second and adjusted We the making of the a XX% in XXXX are a with and in is pleased the our EBITDA [outside] XX%. quarter. raising gross in ORP of strategic our X% target This [ph] margins progress profitability profit consistent with expectations plan improving of margin margin

to continue our this attainable and on focus we is are target reach and to execution. progress bid day making through daily believe We this

X% range track the of on unchanged for our of SG&A as remain Finally, and guidance a a for revenue to we X.X% percentage year. is

turn Kyle closing I'll remarks. back it Now, to for

Kyle Larkin

with and In strategic soon investments and Lisa. planned plan, the complete are business core the materials ORP our strategic as Thanks, alignment points. with I'll our markets. close on We following projects focused we moving forward home civil can't construction enough. our in with divestitures

ORP While the shifted behind some be the of to on work continue in of has ORP the we XXXX. year, the us track largely half to can to second put

losses, the in second overshadowed by profit we with we margin While increase in progress Construction quarter financial to ORP. XX% profitability in [as] making results, are [ph] our our the ORP gross segment would

We the level and business reach profit profit of our expect value continue strategic for XXXX strides to across to discussed shareholders. make we to by our that reach unlocking quarter consistent plan expect margins last

the Finally, into the in amount of and not is stronger quality second of recent our half going CAP the XXXX history.

time. are Our [ph] teams being same the selected with opportunities] [bringing while growing at CAP

and result quarter late seen the back infrastructure through to now should should we in I questions. second Operator, increasing in believe you XXXX build opportunities the the build for not will then carry into any that have from We turn it benefit XXXX.

Operator

with Russo [Operator Instructions] First go question, comes Sidoti. from ahead. Brian Please

Brian Russo

morning. Hi, good Yes.

Kyle Larkin

Good morning.

Lisa Curtis

Good morning.

Brian Russo

to the up delays first quarter? ongoing be the revenue despite the to project in Group you similar year-over-year on Group, do California still what XQ in saw California expect the Just we

Kyle Larkin

California Yes, we see out do. this just And is have revenue on to expect in administration And the contract the due And accelerate. really projects key – of delayed the Kyle. of year side. to the we the some back owner in half

So, those to we up. ramp projects expect

business in expect to as materials correlate also into our well. We California over it

California. seeing we're with comfortable what still we're So, in

Brian Russo

how And give does sense some integration on the of long the us it out it's integration? XX a capture you incremental for basis to basis the mentioned improvement acquisitions points to Okay, vertical acquisition vertical a take California into these great. strategy you previously? and can of And think that laid you XXXX through I points just XX productivity and to you've integrate in Utah, the

Kyle Larkin

a of there. So, couple things

you I off margin we're our shown really at of think progress business. in there and the we we is, is, vertically what mean, QX indicators that look it. we've the in think what our really been at and quarter on working integrated we've some see actually terms first shared I our in making increasing plan – longer-term strategic hard I

margins So, our up. are

we you of outside quarter in down. pick in Central really indicates we're ORP look California really the at if and way. overcome We've that CAP, XX% we're CAP ORP, you And strong in If And the our our up about that that business. things look at have decline really on wind part and seeing of in CAP encouraging as really Mountain. up Group certainly our of we're the which and construction, is our

we in we're we're doing margins on we raise work that all want well doing. and call, improve the two the think was which that things in that day way bid to So, last our do to on execution certainly the

I teams our actually there. on think way are our well

part we question business. M&A into right around other going was of with that's the The integrate [ph] come year. of sort And shared our can we certainly do how some, quickly the that's next online that and [Grantsville Quarry] it to something

and ramp in of and it to going we're Asphalt Asphalt over Centennial will see Bakersfield. is benefits the the next so, year to then up two, that Terminal And the start or really

XXXX. in expect We provide to value really that

pursuing share, We some looking actively in year. two are in at in West one And out we the a want do we're to bolt-ons to out today. markets are or do that we that that opportunities we those the

Brian Russo

second see margin XXXX, second given basis, the through losses losses are second on the And losses burning incurred they are the just we indicative of of risks the a of further that that Is that quarter? diminished as ORP in we Okay. portfolio or you're half? half the in the look might naturally are through

Kyle Larkin

been projects, So, And based movement there's They're can big on been what projects the they're these have on we've know today. answer how forecasting so that's these them, we when projects. big. be complex is, projects, we forecasted it

So, we want suggest risk are to don't projects ever with the ORP doesn't complete. those really exist truly the until associated it that

we Now, projects. the good on along the further news is, are

As things. indicated, through we're almost you these

the [ph] We for year, expect stay] which news. track our [burns on good is

worth $XX XXXX. going to down we're into So, really ORP CAP million of

year the the we not We're to And it So, towards the these in we're down, to of our into about out. winding way is, closing have they're ORP projects XXXX. a final plan as are talk really meaningful getting to going get completion. end

in can So, forward. add, majority at venture] is as you any of want that we believe but point project focused projects, XXXX, to is which out. there on that I [sponsored just have want We're really doing we then ORP. that moving to now where I tell the in not of is we go and we're into that, but The closing we're that in And it close. we're risk do I is project something one you further $XX these wouldn't do joint [ph] about CAP million we California. partner, be tell the

So that's we so profitable bucket, actually the ORP why as it's really and into changes is ORP but called, project that putting move XXXX.

Brian Russo

great. very much. you Okay, Thank

Kyle Larkin

you. Thank

Lisa Curtis

you. Thank

Operator

you. Thank

Sachs. Goldman Jerry comes go Next question from ahead. Please Revich,

Adam Beavis

on Hi, this that back is in growth for Adam improvement a rate. the your Jerry XXXX significant half unchanged, With guidance today. pretty implies

the in your in much So, back project wondering the about and there? confidence half, you if have today driving can talk burn you levels just what's visibility how

Lisa Curtis

this Lisa. Adam, Yes, is

I'll So, points your question. some on on touch

most So, remained our for guidance the unchanged. part,

and our there did margin. change component However, that EBITDA that's a is

to projected X%, around the the the primarily And to we in million to X% had of quarter. represents is did we of equates phase and is, impact that in down lower took about X.X% the beginning range we the what $XX range X.X%. So, that QX, the a ORP at that midpoint which year took that by and with we to X%

our communicated that we is and guidance So through that release a our script. in press the change through

robust for half second of half. the second expect So, very we a the year,

As a the and best based it available we risk on our information, are talked for ORP still question, in us, forecast. remains managing do actively update last we the and Kyle about just

for is that project out rest we when reflected year. it's start, but slower California So, to have look the due of delays. the a really did

QX. we And up the that year. continued And second to Mountain in performing of so, well. into QX the is the in performed expect well and pick half very Group that They

operating continued along quarter for overall So, of groups. expect the in them a strong all in materials second three with half, our we

Adam Beavis

you $XX helpful. million pretty it. a Got roadway And the Thanks. this That's announced Alaskan project then quarter. meaningful on

full And of contractors clarification, that this you there other on $XX million? are for do any scope Just entire project? have

Kyle Larkin

Yes.

our Scope that on would be So that project. under

Adam Beavis

they with And can about for average comment you just how in-line construction Are we project? that? be margins or thinking this on segment should

Kyle Larkin

in lot – And our way. segment. in at just I what look with Yes, think way. they it is any obviously projects the are I mean, we a I the that construction at look would along will of the release margin to alignment I best we way expectations project release

Adam Beavis

much. so Thanks Okay.

Kyle Larkin

Thank you.

Operator

you. Thank

D.A. Ramirez, go question is from John next ahead. Davidson. Please Our

John Ramirez

from is Hello. John This Thielman. Ramirez Brent

Kyle Larkin

John. Hi

Lisa Curtis

morning. Good

John Ramirez

unique looking additional want – issues inflationary Good the to labor being there know or additional on are projects. is to on the themselves that project cost legacy cost impacting just We some any the first morning. of the at costs? losses were My are the or question color issues

Kyle Larkin

issues there some There some a relates [related projects, But ORP, one [ph] project they're probably are slipped of saw weather. chain punch varying in were when phase bit probably they're Well, they that and around it's to I on in large one to project delivery. with I general, all was Certainly projects, steel again, and we are would above. little in electrical it some longer a geographies. and due a complex think scheduling supply issues the project These the summarize cost they items steel the on and list to] inflation. QX

kind – down the some wind reiterate, bit projects as we So, million. as to will up be little close. are wrapped close completed where to primary get getting that's But and even harder. all year, into next projects kind a really going to well projects of we're want we These of these again, production things just getting that driver. it's down, I above, XX to those again, issues we're But as

about So, that. feel we good

John Ramirez

[slowing Thank [ph] housing] indirectly? to what on extent you. is And directly having business either impact the an or

Kyle Larkin

the question. ask that again? you that part I'm Can sorry. of I first missed

John Ramirez

No problem.

an either slowing directly to having Just indirectly? of what is the in the extent business general, impact on or housing

Kyle Larkin

us impact seen through haven't that certainly we hit QX. date, To

that's think I [ph] with mix in side in then housing shortage, associated feed] So, what this partially did something We to some aggregates was on that terms I moving forward. growth the on and that that and we'll think like ready certainly and was see business which housing. [current the eye suppliers keep of more looks slowdown fueled by materials sales an

this first that's of in we'll where the goes. kind time, at So, quarters. all in point see housing two a us big affected this But we're slowdown not seeing through

John Ramirez

Okay. Thank I appreciate time. you so much. the

Kyle Larkin

you. Thank

Operator

Mr. to Thank call the over question-and-answer the gentlemen. the of I'd and turn like to back At session, you, end Larkin. ladies

Kyle Larkin

you to meet call goals. as I for soon. day with joining do work to We And Well, employees all in and thank you all for look always, the today. allow interest our they forward strategic our every you thank of thank us to your continued Okay. want the will Granite. And speaking that

Operator

for presentation. you Thank today's attending

You may now disconnect.

Granite Construction (GVA) 29 Jul 222022 Q2 Earnings call transcript