FALSE000087423800008742382024-11-062024-11-06

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 6, 2024

Sterling Infra Inc Logo_4C.jpg
STERLING INFRASTRUCTURE, INC.
(Exact name of registrant as specified in its charter)
Delaware001-3199325-1655321
(State or other jurisdiction of incorporation
or organization)		(Commission File Number)(I.R.S. Employer
Identification No.)
1800 Hughes Landing Blvd.
The Woodlands, Texas
 
77380
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code:  (281) 214-0777
Securities registered pursuant to Section 12(b) of the Act:
Common Stock, $0.01 par value per shareSTRLThe NASDAQ Stock Market LLC
(Title of Class)(Trading Symbol)(Name of each exchange on which registered)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR § 240.12b-2 of this chapter).
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐



Item 2.02     Results of Operations and Financial Condition.
On November 6, 2024, Sterling Infrastructure, Inc. (the “Company”) issued a press release announcing financial results for the three and nine months ended September 30, 2024 and providing an update on full year 2024 guidance. The press release is being furnished with this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference.
 
The information provided in this Item 2.02 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, unless the Company specifically states that the information is to be considered “filed” under the Exchange Act, nor shall it be incorporated by reference in any filing made by the Company pursuant to the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), other than to the extent that such filing incorporates by reference any or all of such information by express reference thereto.
Item 7.01     Regulation FD Disclosure.
On November 7, 2024, the Company will host a conference call to discuss the third quarter 2024 results as well as corporate developments. The slides to be used during the conference call are being furnished with this Current Report on Form 8-K as Exhibit 99.2 and are incorporated herein by reference.

The information provided in this Item 7.01 shall not be deemed to be “filed” for the purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, unless the Company specifically states that the information is to be considered “filed” under the Exchange Act, nor shall it be incorporated by reference in any filing made by the Company pursuant to the Exchange Act or the Securities Act, other than to the extent that such filing incorporates by reference any or all of such information by express reference thereto.

Item 9.01     Financial Statements and Exhibits.
(d)    Exhibits
Exhibit Number Description
99.1
99.2
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 STERLING INFRASTRUCTURE, INC.
   
Date:November 6, 2024By:/s/ Sharon R. Villaverde
  Sharon R. Villaverde
  Chief Financial Officer





Exhibit 99.1

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NEWS RELEASE
For Immediate Release:
November 6, 2024
Sterling Reports Record Third Quarter 2024 Results
and Raises Full Year Profitability Guidance
THE WOODLANDS, TX – November 6, 2024 – Sterling Infrastructure, Inc. (NasdaqGS: STRL) (“Sterling” or the “Company”) today announced financial results for the third quarter 2024.
The financial comparisons herein are to the prior year quarter, unless otherwise noted.
Third Quarter 2024 Results
•Revenues of $593.7 million, an increase of 6%
•Gross margin of 21.9%, up from 16.4%
•Net Income of $61.3 million, or $1.97 per diluted share, an increase of 56% for both metrics
•EBITDA(1) of $100.8 million, an increase of 42%
•Cash flows from operations totaled $322.8 million for the nine months ended September 30, 2024
•Cash and Cash Equivalents totaled $648.1 million at September 30, 2024
•Backlog at September 30, 2024 was $2.06 billion
•Combined backlog(2) at September 30, 2024 was $2.37 billion
CEO Remarks and Outlook
“In the third quarter we delivered 6% revenue growth and a remarkable 56% increase in diluted EPS. Our focus on margin expansion continues to drive profitability growth well in excess of revenue growth. Gross profit margins of 21.9% marked a new record, and we continue to look for opportunities to drive further expansion,” stated Joe Cutillo, Sterling’s Chief Executive Officer. “We closed the third quarter with combined backlog of $2.37 billion, which was in line with prior year levels. What the backlog metrics do not capture is that our business has moved toward large, multi-phase projects. As a result, we have built a pipeline of high probability future phase work that now totals over half a billion dollars. Our operating cash flow generation in the quarter was again excellent at $152 million, driving our net cash position to $326 million, and supporting share repurchases of $20 million in the quarter. Our business is performing very well and we feel great about the opportunities ahead.”
Mr. Cutillo continued, “In E-Infrastructure Solutions, we achieved 89% operating income growth as operating margins expanded over 1,100 basis points to reach 25.8%. This excellent margin profile reflects our shift toward large mission-critical projects, including data centers and manufacturing. E-Infrastructure revenue increased 4% in the quarter, driven by strength in data center work, which more than offset a tough revenue comparison in the manufacturing market and some continued softness in the small project market. Notably, data center-related revenue increased approximately 90% in the quarter and now represents over 50% of segment backlog.
Transportation Solutions had another excellent quarter, delivering 18% revenue growth and 28% operating profit growth. The transportation markets are the strongest that they have been in our company’s history, and we still have two and a half years remaining under the Infrastructure Investment and Jobs Act (IIJA) authorization.
(1) See the “Non-GAAP Measures” and “EBITDA Reconciliation” sections below for more information.
(2) Combined Backlog includes Unsigned Awards of $319.6 million at September 30, 2024.

In Building Solutions, revenue declined 10% and operating profit declined 12%. Our residential concrete slab and plumbing businesses were impacted by a slowdown in the Dallas market in the quarter, as prospective homebuyers appear to be waiting on the sidelines in expectation of future interest rate reductions. We remain very bullish on the multi-year demand trends in our key geographies and anticipate a rebound in 2025.”
“We believe 2024 will be another excellent year for Sterling. Given our strong results through the third quarter and backlog position, we are raising our full year profitability guidance. The midpoint of our 2024 guidance would represent 10% revenue growth, 32% net income growth and 21% EBITDA growth,” Mr. Cutillo concluded.
Full Year 2024 Guidance
•Revenue of $2.150 billion to $2.175 billion
•Net Income of $180 million to $185 million
•Diluted EPS of $5.85 to $6.00
•EBITDA(1) of $310 million to $315 million
Conference Call
Sterling’s management will hold a conference call to discuss these results and recent corporate developments on Thursday, November 7, 2024 at 10:00 a.m. ET/9:00 a.m. CT. Interested parties may participate in the call by dialing (800) 836-8184. Please call in 10 minutes before the conference call is scheduled to begin and ask for the Sterling Infrastructure call. To coincide with the conference call, Sterling will post a slide presentation at www.strlco.com on the Events & Presentations section of the Investor Relations tab. Following management’s opening remarks, there will be a question and answer session.
To listen to a simultaneous webcast of the call, please go to the Company’s website at www.strlco.com at least 15 minutes early to download and install any necessary audio software. If you are unable to listen live, the conference call webcast will be archived on the Company’s website for 30 days.
About Sterling
Sterling operates through a variety of subsidiaries within three segments specializing in E-Infrastructure, Transportation and Building Solutions in the United States, primarily across the Southern, Northeastern, Mid-Atlantic and Rocky Mountain regions and the Pacific Islands. E-Infrastructure Solutions provides advanced, large-scale site development services for manufacturing, data centers, e-commerce distribution centers, warehousing, power generation and more. Transportation Solutions includes infrastructure and rehabilitation projects for highways, roads, bridges, airports, ports, rail and storm drainage systems. Building Solutions includes residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs, other concrete work and plumbing services for new single-family residential builds. From strategy to operations, we are committed to sustainability by operating responsibly to safeguard and improve society’s quality of life. Caring for our people and our communities, our customers and our investors – that is The Sterling Way.
Joe Cutillo, CEO, “We build and service the infrastructure that enables our economy to run,
our people to move and our country to grow.”

(1) See the “Non-GAAP Measures” and “EBITDA Guidance Reconciliation” sections below for more information.


Important Information for Investors and Stockholders
Non-GAAP Measures
This press release contains “Non-GAAP” financial measures as defined under Regulation G of the amended U.S. Securities Exchange Act of 1934. The Company reports financial results in accordance with U.S. generally accepted accounting principles (“GAAP”), but the Company believes that certain Non-GAAP financial measures provide useful supplemental information to investors regarding the underlying business trends and performance of the Company’s ongoing operations and are useful for period-over-period comparisons of those operations.
Non-GAAP measures may include adjusted net income, adjusted EPS, EBITDA and adjusted EBITDA, in each case excluding the impacts of certain identified items. The excluded items represent items that the Company does not consider to be representative of its normal operations. The Company believes that these measures are useful for investors to review, because they provide a consistent measure of the underlying financial results of the Company’s ongoing business and, in the Company’s view, allow for a supplemental comparison against historical results and expectations for future performance. Furthermore, the Company uses each of these to measure the performance of the Company’s operations for budgeting and forecasting, as well as for determining employee incentive compensation. However, Non-GAAP measures should not be considered as substitutes for net income, EPS, or other data prepared and reported in accordance with GAAP and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.
Reconciliations of Non-GAAP financial measures to the most comparable GAAP measures are provided in the tables included within this press release.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains statements that are considered forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about: our business strategy; our financial strategy; our industry outlook; our guidance; our expected margin growth; and our plans, objectives, expectations, forecasts, outlook and intentions. All of these types of statements, other than statements of historical fact included in this press release, are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursue,” “target,” “guidance,” “continue,” the negative of such terms or other comparable terminology. The forward-looking statements contained in this press release are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this press release are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to factors listed in the “Risk Factors” section in our filings with the U.S. Securities and Exchange Commission and elsewhere in those filings. Additional factors or risks that we currently deem immaterial, that are not presently known to us or that arise in the future could also cause our actual results to differ materially from our expected results. Given these uncertainties, investors are cautioned that many of the assumptions upon which our forward-looking statements are based are likely to change after the date the forward-looking statements are made. The forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements for any reason, whether as a result of new information, future events or developments, changed circumstances, or otherwise, notwithstanding any changes in our assumptions, changes in business plans, actual experience or other changes. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
Company Contact:
Sterling Infrastructure, Inc.
Noelle Dilts, VP Investor Relations and Corporate Strategy
281-214-0795


STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
Revenues$593,741 $560,347 $1,616,923 $1,486,251 
Cost of revenues(463,942)(468,480)(1,297,477)(1,240,368)
Gross profit129,799 91,867 319,446 245,883 
General and administrative expense(30,672)(25,237)(85,826)(72,592)
Intangible asset amortization(4,280)(3,736)(12,857)(11,209)
Acquisition related costs(72)(103)(209)(352)
Other operating expense, net(7,283)(5,654)(18,203)(11,703)
Operating income87,492 57,137 202,351 150,027 
Interest income7,591 4,150 19,798 8,327 
Interest expense(6,286)(7,257)(19,463)(22,516)
Income before income taxes88,797 54,030 202,686 135,838 
Income tax expense(23,404)(13,891)(48,960)(35,429)
Net income, including noncontrolling interests65,393 40,139 153,726 100,409 
Less: Net income attributable to noncontrolling interests(4,072)(786)(9,478)(1,927)
Net income attributable to Sterling common stockholders$61,321 $39,353 $144,248 $98,482 
Net income per share attributable to Sterling common stockholders:
Basic$2.00 $1.28 $4.67 $3.20 
Diluted$1.97 $1.26 $4.63 $3.17 
Weighted average common shares outstanding:
Basic30,73530,80030,87530,733
Diluted31,07031,21731,18431,048



STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
SEGMENT INFORMATION
(In thousands)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
Revenues2024% of Revenue2023% of Revenue2024% of Revenue2023% of Revenue
E-Infrastructure Solutions$263,899 45%$253,948 45%$689,687 43%$719,936 48%
Transportation Solutions227,251 38%192,996 35%608,995 37%455,223 31%
Building Solutions102,591 17%113,403 20%318,241 20%311,092 21%
Total Revenues$593,741 $560,347 $1,616,923 $1,486,251 
Operating Income
E-Infrastructure Solutions$68,076 25.8%$35,945 14.2%$146,922 21.3%$103,381 14.4%
Transportation Solutions18,573 8.2%14,487 7.5%42,154 6.9%29,649 6.5%
Building Solutions11,249 11.0%12,848 11.3%39,837 12.5%35,029 11.3%
Segment Operating Income97,898 16.5%63,280 11.3%228,913 14.2%168,059 11.3%
Corporate G&A Expense(10,334)(6,040)(26,353)(17,680)
Acquisition Related Costs(72)(103)(209)(352)
Total Operating Income$87,492 14.7%$57,137 10.2%$202,351 12.5%$150,027 10.1%


STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)

September 30, 2024December 31, 2023
Assets
Current assets:
Cash and cash equivalents$648,127 $471,563 
Accounts receivable329,882 252,435 
Contract assets79,736 88,600 
Receivables from and equity in construction joint ventures7,814 17,506 
Other current assets 18,086 17,875 
Total current assets1,083,645 847,979 
Property and equipment, net270,532 243,648 
Operating lease right-of-use assets, net54,748 57,235 
Goodwill281,363 281,117 
Other intangibles, net315,540 328,397 
Other non-current assets, net17,757 18,808 
Total assets$2,023,585 $1,777,184 
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable$160,199 $145,968 
Contract liabilities563,531 444,160 
Current maturities of long-term debt 26,425 26,520 
Current portion of long-term lease obligations19,531 19,641 
Accrued compensation 43,198 27,758 
Other current liabilities26,152 14,121 
Total current liabilities839,036 678,168 
Long-term debt 296,185 314,996 
Long-term lease obligations35,445 37,722 
Members’ interest subject to mandatory redemption and undistributed earnings23,417 29,108 
Deferred tax liability, net82,894 76,764 
Other long-term liabilities15,666 16,573 
Total liabilities1,292,643 1,153,331 
Stockholders’ equity:
Common stock312 309 
Additional paid in capital295,831 293,570 
Treasury stock, at cost(48,901)— 
Retained earnings469,282 325,034 
Total Sterling stockholders’ equity716,524 618,913 
Noncontrolling interests14,418 4,940 
Total stockholders’ equity730,942 623,853 
Total liabilities and stockholders’ equity$2,023,585 $1,777,184 


STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

Nine Months Ended September 30,
20242023
Cash flows from operating activities:
Net income$153,726 $100,409 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization50,546 42,529 
Amortization of debt issuance costs and non-cash interest877 1,334 
Gain on disposal of property and equipment(3,280)(4,102)
Deferred taxes6,107 10,188 
Stock-based compensation13,753 10,975 
Changes in operating assets and liabilities101,106 169,882 
Net cash provided by operating activities322,835 331,215 
Cash flows from investing activities:
Acquisitions, net of cash acquired(4,827)— 
Disposition proceeds— 14,000 
Capital expenditures(65,309)(49,244)
Proceeds from sale of property and equipment7,834 9,607 
Net cash used in investing activities(62,302)(25,637)
Cash flows from financing activities:
Repayments of debt(19,931)(76,850)
Repurchase of common stock(50,596)— 
Withholding taxes paid on net share settlement of equity awards(13,408)(4,579)
Other(34)(16)
Net cash used in financing activities(83,969)(81,445)
Net change in cash, cash equivalents, and restricted cash176,564 224,133 
Cash, cash equivalents and restricted cash at beginning of period471,563 185,265 
Cash, cash equivalents and restricted cash at end of period648,127 409,398 
Less: restricted cash— — 
Cash and cash equivalents at end of period$648,127 $409,398 


STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
EBITDA RECONCILIATION
(In thousands)
(Unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
Net income attributable to Sterling common stockholders$61,321 $39,353 $144,248 $98,482 
Depreciation and amortization17,363 14,857 50,546 42,529 
Interest expense, net of interest income(1,305)3,107 (335)14,189 
Income tax expense23,404 13,891 48,960 35,429 
EBITDA(1)
100,783 71,208 243,419 190,629 
Acquisition related costs72 103 209 352 
Adjusted EBITDA(2)
$100,855 $71,311 $243,628 $190,981 
(1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders adjusted for depreciation and amortization, net interest expense and taxes.
(2) The Company defines adjusted EBITDA as EBITDA excluding the impact of acquisition related costs.


STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES
EBITDA GUIDANCE RECONCILIATION
(In millions)
(Unaudited)
 Full Year 2024 Guidance
 LowHigh
Net income attributable to Sterling common stockholders$180 $185 
Depreciation and amortization67 67 
Interest expense, net of interest income— — 
Income tax expense63 63 
EBITDA (1)
$310 $315 
(1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders, adjusted for depreciation and amortization, net interest expense, and taxes.

We build and service the infrastructure that enables our economy to run, our people to move, and our country to grow. Q3 2024 Earnings Call November 7, 2024

 
2Sterling | STRL: Third Quarter 2024 DISCLOSURE: Forward-Looking Statements This presentation contains, and the officers and directors of the Company may from time to time make, statements that are considered forward- looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond our control, which may include statements about: our business strategy; our financial strategy; our industry outlook; our guidance; our expected margin growth; and our plans, objectives, expectations, forecasts, outlook and intentions. All of these types of statements, other than statements of historical fact included in this presentation, are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” "would," “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursue,” “target,” "guidance," “continue,” the negative of such terms or other comparable terminology. The forward-looking statements contained in this presentation are largely based on our expectations, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management’s assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this presentation are not guarantees of future performance, and we cannot assure any reader that such statements will be realized or the forward- looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to factors listed in the “Risk Factors” section in our filings with the U.S. Securities and Exchange Commission and elsewhere in those filings. Additional factors or risks that we currently deem immaterial, that are not presently known to us or that arise in the future could also cause our actual results to differ materially from our expected results. Given these uncertainties, investors are cautioned that many of the assumptions upon which our forward-looking statements are based are likely to change after the date the forward-looking statements are made. The forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward- looking statements for any reason, whether as a result of new information, future events or developments, changed circumstances, or otherwise, notwithstanding any changes in our assumptions, changes in business plans, actual experience or other changes. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf. This presentation may contain the financial measures: adjusted net income, EBITDA, adjusted EBITDA, and adjusted EPS, which are not calculated in accordance with U.S. GAAP. When presented, a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measure will be provided in the Appendix to this presentation.

 
E-Infrastructure Solutions + Fastest growing segment in revenue growth + Provides value-added solutions to blue-chip customers in all major East Coast markets + Develops advanced, large-scale site development services for manufacturing, data centers, e-commerce distribution centers, warehousing, power generation and more Building Solutions + Serves the Nation's Top Builders in the Nation's Top Housing Markets: Texas & Arizona + Residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs, other concrete work and plumbing services for new single- family residential builds Transportation Solutions + Enhanced business mix + Provides infrastructure solutions in the Rocky Mountain States and Texas + Infrastructure and rehabilitation projects for highways, roads, bridges, airports, ports, rail and storm drainage systems Sterling | STRL: Third Quarter 2024 3 WHO is Sterling? NASDAQ STRL Shares outstanding(2) 30.7M HQ The Woodlands, TX Market cap(2) $4.83B Employees ~3,000(1) Revenue(3) $2.16B Segments E-Infrastructure Solutions Building Solutions Transportation Solutions EBITDA(3) $313M Projects underway ~220(1) Total Backlog(1) $2.06B A market-leading infrastructure service provider of e-infrastructure, building and transportation solutions. A story of successful execution of a multi-year strategic business transformation; born of a vision that levers our entrepreneurial spirit. We offer a customer-centric, market-focused portfolio of goods and services geographically positioned in the right markets. (1) At September 30, 2024. (2) Shares outstanding and Market Cap as of November 5, 2024. (3) Full Year 2024 Revenue and EBITDA Mid-Point Guidance. *See EBITDA Reconciliation in the Appendix.

 
4 Revenue CAGR 2019-2023: +21% R ev en ue ($ m ill io ns )* O p erating m arg in % * (4.9)% (2.0)% 2.2% 4.0% 3.4% 7.5% 7.6% 9.0% 10.4% E-Infrastructure Solutions Transportation Solutions Building Solutions Operating Margin 2015 2016 2017 2018 2019 2020 2021 2022 2023 -1,000 -500 0 500 1,000 1,500 2,000 2,500 (6)% (4)% (2)% 0% 2% 4% 6% 8% 10% 12% 2015 – 2019: Strategic Transformation 2020 +: Leveraging the Platform Transformation Built the Foundation for Success * Revenue and Operating margin from continuing operations Sterling | STRL: Third Quarter 2024

 
5 EPS CAGR 2019-2023: +38% 2015 – 2019: Strategic Transformation 2020 +: Leveraging the Platform D ilu te d E PS * $(2.40) $(0.66) $0.10 $0.60 $1.24 $1.53 $2.11 $3.16 $4.44 2015 2016 2017 2018 2019 2020 2021 2022 2023 $(3.00) $(2.00) $(1.00) $— $1.00 $2.00 $3.00 $4.00 $5.00 Transformation Built the Foundation for Success * Diluted EPS from continuing operations Sterling | STRL: Third Quarter 2024

 
+ Third Quarter 2024 Results Sterling | STRL: Third Quarter 2024 6

 
Third Quarter 2024 Results Highlights + Revenues: $593.7 million + Net Income: $61.3 million + Diluted EPS: $1.97 + EBITDA(1): $100.8 million + Cash Flow from Operations(2): $322.8 million + Cash & Cash Equivalents(3): $648.1 million + Backlog(3): $2.06 billion with 16.8% margin + Combined Backlog(4): $2.37 billion Sterling | STRL: Third Quarter 2024 7 (1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders adjusted for depreciation and amortization, net interest expense and taxes. See EBITDA reconciliation in the Appendix. (2) Cash flow from operations for the nine months ended September 30, 2024. (3) Cash & Cash Equivalents and Backlog at September 30, 2024. (4) Combined Backlog includes Unsigned Awards of $319.6 million at September 30, 2024.

 
Sterling | STRL: Third Quarter 2024 8 Quarterly Consolidated and Segment Results ($ in millions, except per share data) Q3 2024 Q3 2023 Revenues $ 593.7 $ 560.3 Gross Profit 129.8 91.9 G&A Expense (30.7) (25.2) Intangible Amortization (4.3) (3.7) Acquisition Related Costs (0.1) (0.1) Other Operating Expense, Net (7.3) (5.7) Operating Income 87.5 57.1 Interest, Net 1.3 (3.1) Income Tax Expense (23.4) (13.9) Less: Net Income Attributable to NCI (4.1) (0.8) Net income $ 61.3 $ 39.4 Diluted EPS $ 1.97 $ 1.26 EBITDA (1) $ 100.8 $ 71.2 ($ in millions) Q3 2024 Q3 2023 E-Infrastructure Solutions Revenue $ 263.9 $ 253.9 Operating Income $ 68.1 $ 35.9 Operating Margin 25.8 % 14.2 % Transportation Solutions Revenue $ 227.3 $ 193.0 Operating Income $ 18.6 $ 14.5 Operating Margin 8.2 % 7.5 % Building Solutions Revenue $ 102.6 $ 113.4 Operating Income $ 11.2 $ 12.8 Operating Margin 11.0 % 11.3 % (1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders  adjusted for depreciation and amortization, net interest expense and taxes. See EBITDA reconciliation in the Appendix. .

 
Sterling | STRL: Third Quarter 2024 9 Remaining Performance Obligations (RPOs)(1) ($ in millions) September 30, 2024 December 31, 2023 September 30, 2023 E-Infrastructure Solutions RPOs $ 918.5 $ 813.7 $ 891.4 Transportation Solutions RPOs 1,083.6 1,184.5 1,022.9 Building Solutions RPOs - Commercial 53.0 68.8 96.1 Total RPOs $ 2,055.1 $ 2,067.0 $ 2,010.4 (1) Our remaining performance obligations do not differ from what we refer to as “Backlog,” and represent the amount of revenues we expect to recognize in the future from our contract commitments on projects.

 
Sterling | STRL: Third Quarter 2024 10 Increased EBITDA and Cash Flow Drives Liquidity Strategy Debt/EBITDA Coverage Ratio 1.3X 1.0X 12/31/23 9/30/24 0.0X 0.3X 0.5X 0.8X 1.0X 1.3X We expect to pursue strategic uses of our liquidity, such as strategic acquisitions, investing in capital equipment and managing leverage. Capital allocation focus • Long-term shareholder value • Complementing organic growth in existing and new markets • Strong cash flow profile provides flexibility and drives liquidity strategy Sterling is comfortable with a Debt/EBITDA coverage ratio of +/-2.5X. 5-Year Credit Facility $324M Term Loan Borrowings $75M Revolving Credit Facility (Undrawn) Key Cash Flow Considerations Q3 YTD 2024 Q3 YTD 2023 Cash flows from Operations $322.8M $331.2M Net CAPEX $57.5M $39.6M • Cash & Cash Equivalents at September 30, 2024 was $648.1 million • 2024 EBITDA guidance(1): $310M to $315M • Expected 2024 noncash expenses: $26M to $30M (Stock-based compensation, noncash interest expense, and deferred taxes) • Scheduled term loan debt payments total $26,300, $26,300 and $6,600 for 2024, 2025, and 2026, respectively (1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders, adjusted for depreciation and amortization, net interest expense and taxes. See EBITDA guidance reconciliation in the Appendix.

 
Robust balance sheet, FCF 11 Summary Successful strategic foundation with strong, diversified platform Continued opportunity for margin expansion Strong, multi-year, secular growth drivers Sterling, A Leading Provider of Infrastructure Services in the U.S. Strong historical stock performance Sterling | STRL: Third Quarter 2024

 
Sterling | STRL: Third Quarter 2024 12 Contact Us Sterling Infrastructure, Inc. Noelle Dilts, VP IR and Corporate Strategy Tel: (281) 214-0795 noelle.dilts@strlco.com

 
+ Appendix Sterling | STRL: Third Quarter 2024 13

 
Sterling | STRL: Third Quarter 2024 14 2024 Modeling Considerations(1) (1) In millions except for EPS and percentages. (2) See EBITDA guidance reconciliation on page 17. Revenue $2,150 to $2,175 Gross Margin 19.0% to 20.0% G&A Expense as % of Revenue (Excluding Intangible Amortization) ~5% Intangible Amortization $17 Other Operating Expense Net $23 to $25 JV Non-Controlling Interest Expense ~$12 Effective Income Tax Rate ~24% Net Income $180 to $185 Diluted EPS $5.85 to $6.00 Expected Dilutive Shares Outstanding 31.0 EBITDA(2) $310 to $315

 
2024 Modeling Considerations Continued* Sterling | STRL: Third Quarter 2024 15 * In Millions. Non-Cash Items FY 2024 Expectations FY 2023 Depreciation $50 $42.2 Intangible Amortization $17 $15.2 Debt Issuance Cost Amortization $1 to $2 $1.7 Stock-based Compensation $18 to $20 $14.6 Deferred Taxes $7 to $8 $14.7 Other Cash Flow Items FY 2024 Expectations FY 2023 Interest expense, net of interest income $0 $15.2 CAPEX, net of disposals $65 to $70 $50.6

 
Sterling | STRL: Third Quarter 2024 16 (1) The Company defines adjusted net income attributable to Sterling common stockholders as GAAP net income attributable to Sterling common stockholders excluding the impact of acquisition related costs. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Net income attributable to Sterling common stockholders $ 61,321 $ 39,353 $ 144,248 $ 98,482 Acquisition related costs 72 103 209 352 Adjusted net income attributable to Sterling common stockholders (1) $ 61,393 $ 39,456 $ 144,457 $ 98,834 Net income per share attributable to Sterling common stockholders: Basic $ 2.00 $ 1.28 $ 4.67 $ 3.20 Diluted $ 1.97 $ 1.26 $ 4.63 $ 3.17 Adjusted net income per share attributable to Sterling common stockholders: Basic $ 2.00 $ 1.28 $ 4.68 $ 3.22 Diluted $ 1.98 $ 1.26 $ 4.63 $ 3.18 Weighted average common shares outstanding: Basic 30,735 30,800 30,875 30,733 Diluted 31,070 31,217 31,184 31,048 STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES ADJUSTED NET INCOME RECONCILIATION (In thousands) (Unaudited)

 
Sterling | STRL: Third Quarter 2024 17 (1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders adjusted for depreciation and amortization, net interest expense and taxes. (2) The Company defines adjusted EBITDA as EBITDA excluding the impact of acquisition related costs. Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Net income attributable to Sterling common stockholders $ 61,321 $ 39,353 $ 144,248 $ 98,482 Depreciation and amortization 17,363 14,857 50,546 42,529 Interest expense, net of interest income (1,305) 3,107 (335) 14,189 Income tax expense 23,404 13,891 48,960 35,429 EBITDA (1) 100,783 71,208 243,419 190,629 Acquisition related costs 72 103 209 352 Adjusted EBITDA (2) $ 100,855 $ 71,311 $ 243,628 $ 190,981 STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES EBITDA RECONCILIATION (In thousands) (Unaudited)

 
Sterling | STRL: Third Quarter 2024 18 (1) The Company defines EBITDA as GAAP net income attributable to Sterling common stockholders, adjusted for depreciation and amortization, net interest expense and taxes. Full Year 2024 Guidance Low High Net income attributable to Sterling common stockholders $ 180 $ 185 Depreciation and amortization 67 67 Interest expense, net of interest income — — Income tax expense 63 63 EBITDA (1) $ 310 $ 315 STERLING INFRASTRUCTURE, INC. & SUBSIDIARIES EBITDA GUIDANCE RECONCILIATION (In millions) (Unaudited)

 
THANK YOU We build and service the infrastructure that enables our economy to run, our people to move, and our country to grow.

 
v3.24.3
Cover
Nov. 06, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 06, 2024
Entity Registrant Name STERLING INFRASTRUCTURE, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-31993
Entity Tax Identification Number 25-1655321
Entity Address, Address Line One 1800 Hughes Landing Blvd.
Entity Address, City or Town The Woodlands
Entity Address, State or Province TX
Entity Address, Postal Zip Code 77380
City Area Code 281
Local Phone Number 214-0777
Title of 12(b) Security Common Stock, $0.01 par value per share
Trading Symbol STRL
Security Exchange Name NASDAQ
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000874238
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