Knife River Corp (KNF) 2024 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Knife River Corporation second quarter results conference. (Operator Instructions) Also note that this call is being recorded on Tuesday, August 6, 2024.

早安，女士們、先生們，歡迎參加 Knife River 公司第二季業績發表會。（操作員說明）另請注意，此通話的錄音時間為 2024 年 8 月 6 日星期二。

I would now like to turn the conference over to Nathan Ring. Please go ahead, sir.

我現在想把會議交給內森·林（Nathan Ring）。請繼續，先生。

Thank you, operator, and welcome to everyone joining us for the Knife River Corporation second quarter results conference call. My name is Nathan Ring, Chief Financial Officer of Knife River, and I'm joined by our President and Chief Executive Officer, Brian Gray.

謝謝您，運營商，並歡迎大家加入我們參加 Knife River Corporation 第二季度業績電話會議。我是 Knife River 財務長 Nathan Ring，我們的總裁兼執行長 Brian Gray 也與我一起。

Today's discussion will contain forward-looking statements about future operational and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the SEC.

今天的討論將包含有關未來營運和財務預期的前瞻性陳述。由於各種風險和不確定性，包括我們向美國證券交易委員會提交的定期報告中所述的風險，實際結果可能與今天的前瞻性聲明中預測的結果有顯著差異。

For further details, please refer to the legal disclaimers contained in today's earnings release and other public filings, which are available on our website and the SEC website. Except as required by law, we undertake no obligation to update our forward-looking statements.

如欲了解更多詳情，請參閱今天的收益報告和其他公開文件中包含的法律免責聲明，這些文件可在我們的網站和 SEC 網站上找到。除法律要求外，我們不承擔更新前瞻性聲明的義務。

During this presentation, we will make references to certain non-GAAP information. These non-GAAP measures are defined and reconciled to the most directly comparable GAAP measure in the appendix to today's presentation. These materials are also available on our website.

在本次演示中，我們將引用某些非 GAAP 資訊。這些非公認的會計準則衡量標準是根據今天的簡報附錄中最直接可比較公認會計準則衡量標準進行定義和調整。這些資料也可以在我們的網站上找到。

Brian Gray will begin today's call with a high-level overview of our second quarter 2024 results, followed by an update on our competitive edge plan and a segment recap. Following his remarks, I will provide a product line summary, a balance sheet update and a review of our revised 2024 financial guidance. At the conclusion of our prepared remarks, we will open the line for a question and answer session.

Brian Gray 將在今天的電話會議開始時對我們 2024 年第二季度的業績進行高級概述，然後介紹我們的競爭優勢計劃的最新情況和細分市場回顧。在他發表演講之後，我將提供產品線摘要、資產負債表更新以及對我們修訂後的 2024 年財務指引的回顧。在我們準備好的發言結束後，我們將開通問答環節。

With that, I'll now turn the call over to Brian.

現在，我將把電話轉給布萊恩。

Thank you, Nathan. Welcome everyone, and thank you for joining us today. The second quarter is typically when our construction activity takes off for the year and that certainly was the case for us in 2024 in record fashion. We hit our stride early and maintained that momentum leading to record second quarter revenue, net income and adjusted EBITDA.

謝謝你，內森。歡迎大家，感謝您今天加入我們。第二季度通常是我們全年建築活動起飛的時期，2024 年的情況無疑是創紀錄的。我們很早就邁出了步伐，並保持了這一勢頭，導致第二季收入、淨利潤和調整後 EBITDA 創紀錄。

Our adjusted EBITDA of $154.3 million was a 22% increase from the prior year record. Our markets are strong and our team is delivering. We're leveraging our competitive EDGE strategy to generate profitable growth. I'll provide more detail on our EDGE plan and the progress we are making in a minute. But quickly, I'd like to highlight a key metric in that plan, adjusted EBITDA margin.

我們調整後的 EBITDA 為 1.543 億美元，比上年記錄成長 22%。我們的市場很強大，我們的團隊正在交付。我們正在利用具有競爭力的 EDGE 策略來實現獲利成長。我將在一分鐘內提供有關我們的 EDGE 計劃以及我們正在取得的進展的更多詳細資訊。但很快，我想強調該計劃中的一個關鍵指標，即調整後的 EBITDA 利潤率。

A year ago, we pointed adjusted EBITDA margin as a benchmark to track as we profitably grow our business. As you recall, our initial goal was to achieve 15% adjusted EBITDA margin by 2025. We surpassed that goal at the end of last year, a full two years early hitting 15.3%.

一年前，我們將調整後的 EBITDA 利潤率作為追蹤我們業務獲利成長的基準。您還記得，我們​​最初的目標是到 2025 年實現 15% 的調整後 EBITDA 利潤率。我們在去年年底就超越了這個目標，提前兩年達到了 15.3%。

Now as of June 30, 2024, our trailing 12 month adjusted EBITDA margin is 15.9%. That is a 240 basis point improvement from where we were just a year ago. We continue to move forward and make meaningful progress for our long term goal of 20% adjusted EBITDA margin.

截至 2024 年 6 月 30 日，我們過去 12 個月的調整後 EBITDA 利潤率為 15.9%。這比一年前提高了 240 個基點。我們繼續前進，並為實現 20% 調整後 EBITDA 利潤率的長期目標取得有意義的進展。

I'm very proud of our Knife River team members. It's exciting to see the strategy, the hard work and the execution come together in a record quarter for our team and our shareholders. Given these results and opportunities ahead of us, we have increased our financial guidance for the year. Nathan will provide detail on our guidance in just a few minutes. But first, I'd like to share additional details about our EDGE strategy and some of the driving factors that supported our results.

我為我們的 Knife River 團隊成員感到非常自豪。看到我們的團隊和股東在創紀錄的季度中實現策略、努力和執行力，真是令人興奮。鑑於這些成果和我們面前的機遇，我們提高了今年的財務指導。內森將在幾分鐘內提供有關我們指導的詳細資訊。但首先，我想分享有關我們 EDGE 策略的更多詳細資訊以及支持我們結果的一些驅動因素。

As a quick recap, competitive EDGE is the plan we began to implement in 2023 to drive long term profitable growth. EDGE stands for EBITDA margin improvement, discipline, growth and excellence. The first E, EBITDA margin Improvement is a focal point in our strategy. We are committed to increasing our adjusted EBITDA margin. Our primary objectives here are optimizing prices, controlling costs and successfully executing on our work.

快速回顧一下，競爭性 EDGE 是我們於 2023 年開始實施的計劃，旨在推動長期獲利成長。EDGE 代表 EBITDA 利潤率提高、紀律、成長和卓越。第一個 E，EBITDA 利潤率的提高是我們策略的重點。我們致力於提高調整後的 EBITDA 利潤率。我們的主要目標是優化價格、控製成本並成功執行我們的工作。

Let me provide some highlights. During the second quarter, we continue to see traction with price increases. Year over year prices are up across all of our core product lines with the exception of liquid asphalt as we expected and discussed on our previous calls. We see pricing momentum in each geographic segment for aggregates and ready mix. So we are increasing our pricing assumptions for 2024 to high single digits for those two product lines.

讓我提供一些亮點。在第二季度，我們繼續看到價格上漲的動力。正如我們在先前的電話會議中所預期和討論的那樣，除液體瀝青外，我們所有核心產品線的價格均逐年上漲。我們看到每個地理區域的骨材和預混料的定價動能。因此，我們將這兩個產品線 2024 年的定價假設提高到高個位數。

While average selling prices for aggregates was impacted by product mix during the quarter, we believe our year to date results and projected full year pricing support our updated assumptions. To reinforce this continued optimization, we've expanded the training on our dynamic pricing efforts across each segment.

雖然本季骨材的平均銷售價格受到產品組合的影響，但我們相信我們今年迄今的業績和預計的全年定價支持我們最新的假設。為了加強這種持續優化，我們擴大了每個細分市場的動態定價工作培訓。

In addition to our materials pricing initiatives, we continue to be disciplined on bid day targeting construction projects that meet our EDGE strategy most prominently the pull through of higher margin upstream materials.

除了我們的材料定價舉措外，我們還繼續在投標日遵守針對符合我們 EDGE 策略的建設項目的紀律，最突出的是利潤率較高的上游材料的拉動。

Moving from pricing optimization to cost control and productivity, our process improvement teams or PIT crews continue to work to identify and share best practices across our operations. We've expanded the number of teams to 10 focusing on all aspects of our business including operations, commercial excellence and standardizing our support services.

從定價優化到成本控制和生產力，我們的流程改善團隊或 PIT 人員繼續努力在我們的營運中識別和分享最佳實踐。我們已將團隊數量擴大到 10 個，專注於我們業務的各個方面，包括營運、卓越商業和標準化我們的支援服務。

While it is still early in the process, our PIT crews have been successful. The original PIT crew which is focused on materials operations has visited 98 sites across 10 states since it was launched last year. These site visits have resulted in nearly 1,300 improvement opportunities of which approximately 60% have been completed to date.

雖然這個過程仍處於早期階段，但我們的 PIT 團隊已經取得了成功。自去年推出以來，專注於材料運營的最初 PIT 團隊已訪問了 10 個州的 98 個地點。這些現場訪問帶來了近 1,300 個改進機會，其中約 60% 迄今已完成。

Let me provide a few examples of these early successes. In 2023, the operations PIT crew visit our Medford aggregate site in Southern Oregon and recommended new mining practices including the installation of an overland conveyor system to eliminate trucking and reduce harvesting costs. We expect this price to be complete in the fourth quarter of this year and the annual benefit will be over $1 million.

讓我提供一些早期成功的例子。2023 年，營運 PIT 工作人員參觀了我們位於俄勒岡州南部的梅德福骨料場，並推薦了新的採礦實踐，包括安裝陸上輸送系統，以消除卡車運輸並降低採伐成本。我們預計該價格將在今年第四季完成，年度效益將超過 100 萬美元。

Later in 2023, our PIT crews visited Casper, Wyoming and recommended a process change that reconfigured sand washing equipment to increase production capability, decrease waste and improve quality. We expect the annual benefit to be approximately $200,000.

2023 年晚些時候，我們的 PIT 工作人員訪問了懷俄明州卡斯珀，並建議進行製程變更，重新配置洗砂設備，以提高生產能力、減少浪費並提高品質。我們預計每年的收益約為 20 萬美元。

And in Portland, Oregon, our team visited a large aggregate site just a few months ago and recommended a change to reintroduce a quarry byproduct back into the production of base rock resulting in an increase of sellable products and reduction of waste. This is expected to provide a benefit of approximately $1.1 million per year starting immediately.

在俄勒岡州波特蘭，我們的團隊幾個月前參觀了一個大型骨材場，並建議進行更改，將採石場副產品重新引入基岩生產中，從而增加可銷售產品並減少廢物。預計立即開始每年將帶來約 110 萬美元的收益。

Our operations PIT crews have been extremely busy and their work is far from being complete. They are currently out in the field working to identify additional improvements and expect to reach 31 locations in the second half of this year.

我們的營運 PIT 人員一直非常忙碌，他們的工作還遠遠沒有完成。他們目前正在現場尋找其他改進措施，預計今年下半年將涵蓋 31 個地點。

Moving to the D in EDGE, discipline, I'd like to especially thank our contracting services teams for an excellent quarter and for embracing our quality over quantity initiative. They continue to stay disciplined while bidding work, securing $400 million of additional work for the second quarter at slightly higher margins than the same period last year. From the bid room into the field, our construction teams delivered. By hitting production schedules and exceeding project specifications for quality work, they improved contracting margins over what was originally bid.

轉向 EDGE 中的 D（紀律），我要特別感謝我們的承包服務團隊，他們在本季度表現出色，並支持我們的品質重於數量的舉措。他們在投標工作中繼續保持紀律，以比去年同期略高的利潤率確保了第二季度 4 億美元的額外工作。從標房到現場，我們的施工團隊交付了。透過滿足生產計劃和超越項目品質規格，他們提高了合約利潤，高於最初的投標價格。

For the quarter, our gross profit in contracting services improved by $14 million year-over-year. Along with that, our gross margins improved by 320 basis points. Looking at the contracting services backlog, we anticipate some moderation in gross margin expansion as our year over year comparisons will now include the significant improvements we have made through our EDGE strategy over the past four quarters.

本季度，我們的承包服務毛利年增 1,400 萬美元。同時，我們的毛利率提高了 320 個基點。考慮到承包服務積壓，我們預計毛利率擴張將有所放緩，因為我們的同比比較現在將包括我們在過去四個季度透過 EDGE 策略取得的重大改進。

I'm very proud of the advancements of the product line has made such a short amount of time. Knife Rivers contracting services are generating industry leading margins and will continued the stable contributor to overall success.

我非常自豪該產品線在如此短的時間內取得了進展。Knife Rivers 承包服務正在創造領先業界的利潤，並將繼續為整體成功做出穩定的貢獻。

The GE in EDGE is growth and we have a highly experienced and respected corporate development team leading these efforts. They are currently advancing several possible deals across our market areas focusing on materials based operations within or adjacent to our current operations.

EDGE 中的 GE 代表成長，我們擁有一支經驗豐富且受人尊敬的企業開發團隊來領導這些工作。他們目前正在我們的市場領域推進幾項可能的交易，重點是我們當前業務內部或鄰近的基於材料的業務。

We closed on the purchase of a small quarry operation in Northwest Region since our last call and we continue to identify additional acquisition opportunities. We have many deals in our pipeline ranging from small acquisitions that strategically support our current operations to midsize bolt-on that help us grow in our current regions to new platforms to expand our footprint at adjacent markets.

自上次電話會議以來，我們完成了西北地區一家小型採石場的收購，並將繼續尋找其他收購機會。我們正在進行許多交易，從策略性地支持我們當前業務的小型收購，到幫助我們在當前地區發展的中型補強，再到擴大我們在鄰近市場足跡的新平台。

Knife River has completed over 85 acquisitions in our history. Our experienced team combined with our local relationships and reputation position us as the acquirer of choice in our midsize high growth markets. I look forward to some deal announcements as we bring these opportunities in the Knife River family.

Knife River 歷史上已完成超過 85 起收購。我們經驗豐富的團隊加上我們在當地的關係和聲譽，使我們成為中型高成長市場的首選收購者。當我們為 Knife River 家族帶來這些機會時，我期待著一些交易公告。

Lastly, in our EDGE recap, I'd like to highlight our relentless efforts to be excellent in everything we do which includes the safety and well-being of our team. We continue to make progress on our goal of keeping everyone safe, which is at the heart of being a people first company. We will maintain our focus on this core value.

最後，在我們的 EDGE 回顧中，我想強調我們為在所做的一切事情上表現出色所做的不懈努力，其中包括我們團隊的安全和福祉。我們在確保每個人安全的目標上不斷取得進展，這是成為一家以人為本的公司的核心。我們將繼續關注這一核心價值。

We firmly believe that one of the multiple trails to our 20% adjusted EBITDA goal is the safety trail. Keeping our teams healthy, our plans well maintained and implementing additional safety tools is the right thing to do and we expect it to positively impact our financial performance.

我們堅信，實現 20% 調整後 EBITDA 目標的多種途徑之一就是安全途徑。保持我們團隊的健康，維護我們的計劃並實施額外的安全工具是正確的做法，我們希望這對我們的財務表現產生積極影響。

We believe in our life at Knife culture of putting people first and we'll continue supporting our core values of people, safety, quality and the environment. Combining each of our competitive EDGE initiatives is providing positive outcomes for our shareholders and our team.

我們堅信 Knife 文化以人為本，我們將繼續支持我們的人、安全、品質和環境的核心價值。結合我們每個具有競爭力的 EDGE 計劃，將為我們的股東和團隊帶來積極的成果。

In addition to the actions we are taking, our markets have provided a strong backdrop for our year over year success. Our vertical integration strategy targets low risk publicly funded work with strong pull through of higher margin upstream materials.

除了我們正在採取的行動之外，我們的市場也為我們逐年取得成功提供了強有力的背景。我們的垂直整​​合策略的目標是低風險的公共資助工作，並大力推動利潤率較高的上游材料。

You've heard me say this before and it continues to be true, our national infrastructure needs repair and there is growing support to fund that work. At the federal level, funding from the Infrastructure Investment and Jobs Act is still being allocated. Approximately 56% of IIJA formula funding has yet to be obligated in our markets. We expect to benefit from that funding as it continues to be dispersed.

你以前聽過我說過這句話，而且這仍然是事實，我們的國家基礎設施需要修復，並且有越來越多的支持來資助這項工作。在聯邦層面，《基礎設施投資和就業法案》的資金仍在分配中。大約 56% 的 IIJA 公式資金尚未在我們的市場上履行。由於資金繼續分散，我們預計將從中受益。

On top of that state and local governments are continuing to be proactive in funding infrastructure projects. As of July 1, lawmakers in 8 of Knife River's 14 states have introduced additional legislation to fund construction projects.

除此之外，州和地方政府繼續積極為基礎設施項目提供資金。截至 7 月 1 日，刀河 14 個州中的 8 個州的立法者已經出台了額外的立法來資助建設項目。

Funding in our states is at record or near record levels and they are continuing to pursue long-term dedicated revenue solutions. It is clear there is public demand for safer, less congested roads and bridges. We will continue to support and monitor the status of those bills.

我們各州的資金處於創紀錄或接近創紀錄的水平，他們正在繼續尋求長期專用的收入解決方案。顯然，大眾需要更安全、更少擁擠的道路和橋樑。我們將繼續支持並監督這些法案的進展。

Approximately 87% of our current backlog is publicly funded with dedicated dollars from Federal, State and local government agencies. The work needs to get done and we are well positioned to perform it.

我們目前積壓的大約 87% 是由聯邦、州和地方政府機構的專用資金公開資助的。這項工作需要完成，我們已經做好了完成這項工作的準備。

Now taking a closer look at our performance for the quarter, EBITDA improved in each geographic segment over last year. Starting in Pacific, we had record revenue, primarily driven by price increases across all our product lines along with increased contracting services activity in Northern California.

現在仔細看看我們本季的業績，每個地理區域的 EBITDA 都比去年有所改善。從太平洋地區開始，我們的收入創歷史新高，這主要是由於我們所有產品線的價格上漲以及北加州承包服務活動的增加所致。

Overall, gross margin was down for the quarter driven by lower gross profit on ready mix and aggregates. This was related to increased repair and maintenance expenses as we took additional steps to improve production capabilities particularly in Hawaii and Alaska.

總體而言，由於預混料和骨材毛利潤下降，本季毛利率有所下降。這與維修和維護費用增加有關，因為我們採取了額外措施來提高生產能力，特別是在夏威夷和阿拉斯加。

Looking ahead, our Northern California market continues to see strong demand both in private and public construction. We are committed to our EDGE plan and we'll keep our focus on optimizing pricing, disciplined bidding and lowering production costs.

展望未來，我們的北加州市場繼續看到私人和公共建築的強勁需求。我們致力於執行 EDGE 計劃，並將重點放在優化定價、嚴格投標和降低生產成本。

In the Northwest, we continue to see growth building on the records we set last year. Revenue was up 12% and EBITDA was up 31%. Our contracting services projects in Southern Oregon and Central Oregon are progressing well, helping to drive a 260 basis points improvement in the segment's gross margin.

在西北地區，我們繼續看到成長在去年創下的記錄基礎上繼續增長。營收成長 12%，EBITDA 成長 31%。我們在俄勒岡州南部和俄勒岡州中部的承包服務項目進展順利，幫助推動該部門的毛利率提高了 260 個基點。

Looking ahead, we see additional opportunities for growth in this region with the prestressed concrete division recently securing projects related to data centers, parking garages and bridge infrastructure. Also as I mentioned, we purchased a quarry during the quarter to provide aggregates for the growing suburbs southeast of Portland.

展望未來，我們看到該地區有更多的成長機會，預力混凝土部門最近獲得了與資料中心、停車場和橋樑基礎設施相關的專案。正如我所提到的，我們在本季度購買了一個採石場，為波特蘭東南部不斷發展的郊區提供骨材。

Moving to our Mountain segment, we continue to benefit from very strong markets. We had record revenue and EBITDA and our EBITDA margins increased by 500 basis points. Driving these records were price increases on all product lines and increased contracting services activity.

轉向我們的山地業務，我們繼續受益於非常強勁的市場。我們的營收和 EBITDA 創歷史新高，我們的 EBITDA 利潤率增加了 500 個基點。推動這些記錄的是所有產品線的價格上漲和承包服務活動的增加。

Our Idaho and Western Montana markets are particularly strong and we see some additional upside ahead in Wyoming with potential wind farm and data center work. There continues to be substantial work bidding in this region and we are well prepared to deliver on it.

我們的愛達荷州和蒙大拿州西部市場尤其強勁，我們認為懷俄明州還有一些額外的上升空間，有潛在的風電場和資料中心工作。該地區仍有大量工程招標，我們已做好充分準備來交付。

In our Central segment, you can clearly see the impacts of our EDGE strategy. Price increases, disciplined bidding and solid project execution helped drive EBITDA up 27% to a record $36 million. Revenue decreased 7% for the quarter largely related to weather as this segment had a wet June with heavy rainfall in parts of Minnesota, South Dakota, Iowa and Texas.

在我們的中央部分，您可以清楚地看到我們的邊緣策略的影響。價格上漲、嚴格的投標和紮實的項目執行幫助 EBITDA 成長 27%，達到創紀錄的 3,600 萬美元。本季收入下降 7%，很大程度上與天氣有關，因為該部門的 6 月氣候潮濕，明尼蘇達州、南達科他州、愛荷華州和德克薩斯州部分地區降雨量大。

Looking ahead, we are seeing an increase in bidding opportunities for the remainder of the year and into next year. Minnesota, Iowa, Nebraska and Texas have each been adding projects funded by statewide infrastructure initiatives.

展望未來，我們預計今年剩餘時間和明年的投標機會將會增加。明尼蘇達州、愛荷華州、內布拉斯加州和德克薩斯州都在​​增加由全州基礎設施計劃資助的項目。

Moving from our geographic segments to energy services, we had a strong second quarter. While financial results were well above the historic average, they were down from last year's all-time records as anticipated. Pricing for liquid asphalt decreased across all markets from last year due to lower input costs. While EBITDA decreased approximately 11% from the 2023 record, EBITDA margins held steady as a result of those lower input costs.

從我們的地理區域轉向能源服務，我們第二季度表現強勁。儘管財務業績遠高於歷史平均水平，但仍低於預期的去年歷史記錄。由於投入成本下降，所有市場的液體瀝青價格都比去年下降。儘管 EBITDA 較 2023 年的記錄下降了約 11%，但由於投入成本較低，EBITDA 利潤率保持穩定。

As I mentioned on our last two calls, we have good visibility into this segment and have updated our guidance accordingly which Nathan will cover in his remarks. Before turning the call over to Nathan, I would again like to thank our entire team for this outstanding quarter.

正如我在最近兩次電話會議中提到的，我們對該細分市場有很好的了解，並相應地更新了我們的指導，內森將在他的演講中介紹這一點。在將電話轉給內森之前，我要再次感謝我們整個團隊在這個出色的季度。

We delivered record results while also working safely. During the quarter, we hit our one-year anniversary as an independent company. In that time, we made significant progress on our competitive EDGE goals and have generated meaningful value for our shareholders. Our strategy is working. We have the right team, in the right markets, with the right plan and we're just getting started. I'll now turn the call back over to Nathan for his remarks. Nathan?

我們在安全工作的同時取得了創紀錄的成果。本季度，我們迎來了作為獨立公司一周年紀念日。當時，我們在競爭性 EDGE 目標上取得了重大進展，並為股東創造了有意義的價值。我們的策略正在發揮作用。我們有合適的團隊、合適的市場、正確的計劃，而我們才剛開始。現在我將把電話轉回給內森聽他的演講。內森？

Thank you, Brian. I'll begin with an overview of our product line results, then provide a summary of our capital position and by outlining the increase to our 2024 guidance. Our core product lines continued to benefit from our EDGE initiatives. As aggregates, ready-mix and asphalt all saw price gross profit and gross margin improvements for the quarter compared to prior year.

謝謝你，布萊恩。我將首先概述我們的產品線業績，然後概述我們的資本狀況，並概述 2024 年指導的成長。我們的核心產品線繼續受益於我們的 EDGE 計劃。與去年同期相比，本季骨材、預拌混凝土和瀝青的價格毛利和毛利率均有所改善。

Average selling prices for aggregates increased 6%, ready-mix 11%, and asphalt 1% contributing to a record consolidated gross profit of $176.2 million, an increase of 15% for the quarter.

骨材平均銷售價格上漲 6%，預拌混凝土平均銷售價格上漲 11%，瀝青平均銷售價格上漲 1%，本季綜合毛利創歷史新高，達 1.762 億美元，成長 15%。

Taking a closer look at aggregates, our dynamic pricing initiatives have been effective and as we continue these efforts, we have confidence in our ability to further optimize prices. Therefore, we are raising our full year assumptions for aggregate prices to increase by high single digits compared to 2023.

仔細觀察總量，我們的動態定價措施是有效的，隨著我們繼續這些努力，我們對進一步優化價格的能力充滿信心。因此，與 2023 年相比，我們上調了全年總價格上漲高個位數的假設。

As Brian mentioned, the quarter was impacted by product mix as we sold more lower-priced unprocessed material this year compared to prior year. These materials cost less to produce and are a solid contributor to our overall aggregates gross profit margins.

正如布萊恩所提到的，該季度受到產品組合的影響，因為與去年相比，我們今年銷售了更多價格較低的未加工材料。這些材料的生產成本較低，是我們整體毛利率的重要貢獻者。

We often have product mix variations like this that may impact pricing for the quarter, but have less of an effect on the full year. While our average selling price is up 6% for the quarter, it is up 8% year-to date and we expect that positive trend to continue. Volumes for our product lines were mixed for the quarter.

我們經常會有這樣的產品組合變化，可能會影響本季的定價，但對全年的影響較小。雖然本季我們的平均售價上漲了 6%，但今年迄今已上漲 8%，我們預計這種正面趨勢將持續下去。本季我們產品線的銷售量好壞參半。

Aggregates were up 2%, largely as a result of the higher volumes of unprocessed material mentioned previously. Ready mix and asphalt volumes declined 12% and 5%, respectively, related in part to our initiatives to capture improved prices and in part to weather related delays in our Central segment. However, even though volumes declined, the price over cost improvement in each product line helped us achieve record consolidated gross profit.

總量上漲了 2%，主要是由於前面提到的未加工材料數量增加。預拌混凝土和瀝青銷售量分別下降 12% 和 5%，部分原因是我們為提高價格而採取的舉措，部分原因是中部路段因天氣原因造成延誤。然而，儘管銷量下降，但每個產品線的價格與成本的改善幫助我們實現了創紀錄的綜合毛利。

Moving to contracting services, we saw substantially higher gross margin at 13.8% in the second quarter compared to 10.6% last year. This increase of $14 million in gross profit is directly related to our disciplined approach in pursuing higher margins on bid day and then executing on that backlog. Furthermore, our backlog continues to benefit from infrastructure funding and is 87% public work. Of our total backlog, 85% of our projects are less than $5 million and approximately 95% of our projects are completed within 12 months.

轉向承包服務，我們看到第二季的毛利率大幅提高，達到 13.8%，而去年為 10.6%。毛利增加 1,400 萬美元與我們在投標日追求更高利潤並執行積壓訂單的嚴格方法直接相關。此外，我們的積壓工作繼續受益於基礎設施資金，其中 87% 是公共工作。在我們的未完成訂單總額中，85% 的項目金額低於 500 萬美元，大約 95% 的項目在 12 個月內完成。

We believe the size and duration of these projects, coupled with our reliable public funding, lowers our risk profile while also providing pull through demand for our upstream product lines. Next, I would like to provide some additional information on our corporate services department and consolidated SG&A expenses.

我們相信，這些項目的規模和持續時間，加上我們可靠的公共資金，可以降低我們的風險狀況，同時也為我們的上游產品線提供拉動需求。接下來，我想提供一些有關我們企業服務部門和綜合 SG&A 費用的額外資訊。

As of May 31, we have essentially completed our transition services agreement with MDU Resources and successfully set up the corporate functions needed to operate our businesses. We truly appreciate all the work our team has done to accomplish this.

截至 5 月 31 日，我們已基本完成與 MDU Resources 的過渡服務協議，並成功建立了營運業務所需的公司職能。我們衷心感謝我們的團隊為實現這一目標所做的所有工作。

Furthermore, we have seen the recurring stand alone cost for these departments come in lower than expected as we are focused on finding efficiencies and managing costs. Consolidated SG&A expenses were the same year-over-year for the quarter at $59.5 million as increased costs were partially offset by gains on the sale of assets. Looking ahead for the second half of the year, we expect our corporate and consolidated SG&A expenses to remain in line with prior year.

此外，我們發現這些部門的經常性獨立成本低於預期，因為我們專注於提高效率和管理成本。該季度的綜合銷售、管理和行政費用與去年同期相同，為 5,950 萬美元，因為成本增加被資產出售收益部分抵銷。展望今年下半年，我們預期公司和綜合銷售、管理及行政費用將與去年保持一致。

Moving to our balance sheet, we ended the quarter with no amount drawn on our $350 million revolving credit facility compared to $155 million last year. Our continued disciplined use of cash has contributed to an improved net leverage of 1.5 times compared to 2.3 times in the second quarter last year. With this strong balance sheet and liquidity, we believe we are well positioned to support our acquisition growth strategy that Brian mentioned.

轉向我們的資產負債表，本季結束時，我們沒有提取 3.5 億美元的循環信貸額度，而去年為 1.55 億美元。我們持續嚴格使用現金，使淨槓桿率從去年第二季的 2.3 倍提高到 1.5 倍。憑藉強大的資產負債表和流動性，我們相信我們有能力支持布萊恩提到的收購成長策略。

We also continue to reinvest in our operations. During the first half of 2024, we invested approximately $103.6 million on capital projects, with the majority being spent on replacement of fixed assets as well as organic growth projects that are focused on increasing return on invested capital.

我們也繼續對我們的營運進行再投資。2024 年上半年，我們在資本項目上投資了約 1.036 億美元，其中大部分用於固定資產置換以及注重提高投資資本回報率的有機成長項目。

Lastly, our industry leading ROIC for the quarter was 15.9% on a trailing 12-month basis, reflecting the efficiency and discipline of our capital deployment. As we look back on a successful quarter and look ahead to the remainder of the year, we are excited to be increasing financial guidance for the full year 2024.

最後，我們本季業界領先的投資回報率為過去 12 個月的 15.9%，反映了我們資本部署的效率和紀律。當我們回顧成功的季度並展望今年剩餘時間時，我們很高興能夠增加 2024 年全年的財務指引。

We are raising consolidated revenue guidance to a range of $2.8 billion to $3 billion. For consolidated adjusted EBITDA, we are raising and narrowing guidance to a range of $445 million to $485 million. This includes adjusted EBITDA for our geographic segments in corporate services of $390 million to $425 million as well as adjusted EBITDA at energy services between $55 million and $60 million.

我們將綜合收入指引提高至 28 億至 30 億美元的範圍。對於合併調整後 EBITDA，我們將指引範圍提高並縮小至 4.45 億美元至 4.85 億美元。這包括我們企業服務地理部門調整後的 EBITDA 為 3.9 億至 4.25 億美元，以及能源服務調整後的 EBITDA 為 5,500 萬至 6,000 萬美元。

And lastly, we expect total capital expenditures between 5% and 7% of revenue, excluding any potential future acquisitions.

最後，我們預計總資本支出將佔收入的 5% 至 7%，不包括任何未來潛在的收購。

Additionally, our 2024 guidance includes the following assumptions. We anticipate average selling prices for our aggregates and ready mix product lines to increase high single digits and asphalt pricing to be flat to up low single digits. We expect aggregates volumes to be flat to down low single digits, ready mix down low to mid-single digits and asphalt down to mid to high single digits.

此外，我們的 2024 年指引包括以下假設。我們預計骨材和預拌產品線的平均銷售價格將上漲至高個位數，而瀝青價格將持平至低個位數。我們預期骨材產量將持平至低個位數，預拌混凝土產量將下降至中個位數，瀝青產量將下降至中個位數至高個位數。

And finally, guidance is based on normal weather, economic and operating conditions for the remainder of the year. We are very excited about our second quarter record results, which have helped set the stage for increased financial guidance and what we expect will be another record year.

最後，指導意見是基於今年剩餘時間的正常天氣、經濟和營運條件。我們對第二季創紀錄的業績感到非常興奮，這有助於為增加財務指導奠定基礎，我們預計這將是另一個創紀錄的一年。

For our geographic segments, the midpoint of our adjusted EBITDA guidance represents a 15% increase from our full year 2023 adjusted EBITDA. We believe these results are achievable given implementation of our competitive EDGE initiatives, committed infrastructure funding, market position and opportunities for growth.

對於我們的地理細分市場，調整後 EBITDA 指引的中點比 2023 年全年調整後 EBITDA 成長了 15%。我們相信，鑑於我們實施具有競爭力的 EDGE 計劃、承諾的基礎設施資金、市場地位和成長機會，這些成果是可以實現的。

With that, I'd like to open the call for questions.

至此，我想開始提問。

(Operator Instructions) Brent Thielman, DA Davidson & Co.

（操作員說明）Brent Thielman，DA Davidson & Co.

Hey, thanks. Good morning.

嘿，謝謝。早安.

Hi Brent.

嗨布倫特。

Brian or Nathan, I guess first question just if you can talk through a little more the progression of the dynamic pricing strategy as you're advancing that across more of the regions of the business. I know this is sort of a careful methodical approach, might be less visible in the reported averages you're showing here. So just be curious if there's some case studies or examples you've seen of success in that strategy.

Brian 或 Nathan，我想第一個問題是，當您在更多業務區域推進動態定價策略時，您是否可以多談談動態定價策略的進展。我知道這是一種謹慎、有條理的方法，在您此處顯示的報告平均值中可能不太明顯。因此，請好奇是否有一些您在該策略中看到的成功案例研究或例子。

Yes. So that's a blueprint from the Northwest region, as you know, Brent. And so we've taken what we've been doing in the Northwest region for the last eight years and we rolled that out at the beginning of this year. We talked a lot about it last year, but really we are in the early innings of rolling that dynamic pricing out to the other regions and so as part of that, we've brought on a full time trainer that is helping training our sales team around commercial excellence.

是的。如你所知，布倫特，這是西北地區的藍圖。因此，我們採取了過去八年在西北地區所做的事情，並在今年年初推出了這項計劃。去年我們對此進行了很多討論，但實際上我們正處於將動態定價推廣到其他地區的早期階段，因此作為其中的一部分，我們聘請了一名全職培訓師來幫助培訓我們的銷售團隊圍繞商業卓越。

We've got out and done some additional training through Sandler training with our sales team. We're out hiring some additional sales staff in some of our regions that frankly didn't have them because as part of dynamic pricing, as you well know, we have to price we're pricing every job, to every customer, in every market to where we can maximize, optimize our pricing based on the proximity of our locations to those job sites.

我們已經透過桑德勒培訓與我們的銷售團隊一起進行了一些額外的培訓。我們正在一些地區招募一些額外的銷售人員，坦白說，這些地區沒有這些人員，因為作為動態定價的一部分，正如您所知，我們必須定價，我們為每項工作、每一位客戶、每項工作定價。

And so we truly are giving out quotes every single day to customers and can control the pricing around what our current costs are doing, what our current backlog is doing, but most importantly, where is that job in proximity to our location.

因此，我們確實每天都會向客戶提供報價，並且可以圍繞我們當前的成本、當前的積壓工作來控制定價，但最重要的是，該工作靠近我們的位置在哪裡。

So we're still I've talked that we've been in the 1st or second innings. I'd say today, Brent, we're probably in the third innings in most of those regions and still by the eighth or ninth inning there in the Northwest region.

所以我們仍然是我說過的，我們已經進入了第一局或第二局。我想說，布倫特，今天我們可能在大多數地區都處於第三局，而在西北地區仍然處於第八或第九局。

Okay, that's great. And Brian, you mentioned the 15.9% moving to our adjusted EBITDA margin.

好的，太好了。Brian，您提到我們調整後的 EBITDA 利潤率為 15.9%。

Yes.

是的。

I guess as you indicated, you're gradually sort of moving toward that eventual 20% target. As you think about the next 12, 24, 36 months, however long it is, Brian, what do you think you've yet to see leverage from some of your internal initiatives -- operational initiatives, et cetera, that sort of EDGEs you closer towards that 20% target? What are going to -- what's kind of beyond the low hanging fruit? What do you still get leverage from here?

我想正如您所指出的，您正在逐漸朝著最終 20% 的目標邁進。當你思考接下來的 12、24、36 個月時，無論有多長，Brian，你認為你還沒有看到一些內部計劃的槓桿作用——運營計劃等等，你所看到的那種邊緣更接近20% 的目標嗎？除了容易達成的目標之外，我們還會做什麼？你還能從這裡獲得什麼槓桿作用？

Yes, let's go through the major initiatives within EDGE. So when we rolled out our EDGE at Investor Day back in May of last year, we said we can get to 15% EBITDA margin by 2025 and so obviously, Brent, it's taken on a lot more traction than we had originally anticipated and then it gets them from 15% to 20%, it would evolve into some of the other initiatives within EDGE.

是的，讓我們來看看 EDGE 內的主要舉措。因此，當我們在去年5 月的投資者日推出EDGE 時，我們表示到2025 年我們可以實現15% 的EBITDA 利潤率，所以很明顯，布倫特，它的吸引力比我們最初預期的要大得多，然後它如果將其從 15% 提高到 20%，它將演變成 EDGE 內的一些其他舉措。

So the early phases of EDGE was to immediately begin our quality over quantity initiative in the bid room, and that is really to maximize our margin opportunities in the bid room on contracting services, and we've seen some significant improvements as it related to our contracting services margins.

因此，EDGE 的早期階段是立即在投標室開始我們的質量重於數量的舉措，這實際上是為了最大化我們在承包服務投標室的利潤機會，並且我們已經看到了一些重大改進，因為它與我們的承包服務利潤。

At the same time, we began rolling out dynamic pricing and doing a lot of the training, but we did honor our 2023 prices that we've given late in 2022. We honor those prices in most of those regions. So we're still in the early innings of that and there's still some upside there.

同時，我們開始推出動態定價並進行大量培訓，但我們確實兌現了 2022 年末給出的 2023 年價格。我們在大多數地區都遵守這些價格。所以我們仍處於早期階段，仍然有一些好處。

We've talked a fair amount about our PIT crews, our process improvement teams, and we started off with 1 team, and now, like I said in my prepared remarks, we're up to 10 and I'd say that initiative is again in the very early innings of going out and implementing best practices, identifying opportunities to reduce our production costs and we are rolling that out into the other product lines and throughout the organization. It's been well received by the entire team.

我們已經談論了很多關於我們的PIT 人員、我們的流程改進團隊的內容，我們一開始只有1 個團隊，現在，就像我在準備好的發言中所說的那樣，我們已經達到10 個團隊，我想說該舉措是再次，在走出去並實施最佳實踐的最初階段，尋找降低生產成本的機會，我們正在將其推廣到其他產品線和整個組織中。得到了整個團隊的好評。

So that's specifically as it relates to margin improvement, but to get to from where we're at today, from 16% as far as our midpoint, that 15.9% that you talked about, the trailing 12 month. To get to that 20%, I mean, we know that our strategy is going to continue to evolve, which will include growth, and we're very much targeting those higher margin upstream materials businesses and so we are actively filling our pipeline of those growth opportunities.

這特別是因為它與利潤率改善有關，但從我們今天的情況來看，從 16% 到我們的中點，即你談到的 15.9%，即過去 12 個月。為了達到 20%，我的意思是，我們知道我們的策略將繼續發展，其中包括成長，我們非常瞄準那些利潤率較高的上游材料業務，因此我們正在積極填補這些業務的管道成長機會。

We also will be shifting slowly our product mix towards those higher profit margin lines. Then the last thing is we just have that relentless drive to be excellent in everything that we do, and that also is going to help us get to that 20% EBITDA margin. So overall, we are still we have a lot of things to do, a lot of self-help that we can go get, Brent, in that EDGE strategy.

我們也將慢慢地將我們的產品組合轉向利潤率更高的產品線。最後一件事是，我們擁有不懈的動力，在我們所做的每件事上都做到卓越，這也將幫助我們實現 20% 的 EBITDA 利潤率。所以總的來說，我們仍然有很多事情要做，布倫特，在 EDGE 策略中我們可以得到很多自助。

Okay. I appreciate the comments. I'll get back in queue.

好的。我很欣賞這些評論。我會回到隊列中。

Great. Thanks.

偉大的。謝謝。

Trey Grooms, Stephens Inc.

特雷·格魯姆斯，斯蒂芬斯公司

Hey, good morning and well done in the quarter.

嘿，早上好，本季做得很好。

Thank you, Trey.

謝謝你，特雷。

I wanted to touch on contracting services, the really nice margin improvement you're seeing there and I know this is all by design and part of all the initiatives you guys are executing on, but as I kind of think about that part of the business, contracting services, how do you think about the kind of the long-term margin potential for that and how that plays a role in the 20% EBITDA margin targets that you guys have laid out?

我想談談承包服務，你在那裡看到的非常好的利潤率改善，我知道這都是設計使然，也是你們正在執行的所有計劃的一部分，但當我想到這部分業務時，承包服務，您如何看待其長期利潤潛力，以及它如何在您所製定的20% EBITDA 利潤目標中發揮作用？

Yeah. So it's certainly a path to that 20% flag and we are still on that path and marching forward and up on our margins. Yeah, we are very excited at the amount of improvement we've made. I mean, just if you go look at our trailing 12 month gross profit margin in contracting services at the end of June, it was 12.7%. If you go back to the end of 2022, just a year and a half ago, it was 8.4%.

是的。因此，這肯定是通往 20% 旗幟的道路，我們仍然在這條道路上前進，並在我們的邊緣上前進。是的，我們對所取得的進步感到非常興奮。我的意思是，如果你看看 6 月底我們過去 12 個月的承包服務毛利率，你會發現它是 12.7%。如果你回到 2022 年底，也就是一年半前，這個數字是 8.4%。

So we've had a 430 basis points improvement since the beginning of last year and so we have made a lot of progress and the majority of that, a lot of that has come in the bid room but I would give a shout out to our teams out in the field too. I mean, you've got to go out and execute that work and I can say that, I mean, we've taken a very disciplined approach how we do that, meeting our project schedules, delivering quality materials and putting asphalt down where we can get compaction bonuses and other job site incentives.

自去年年初以來，我們已經取得了 430 個基點的改進，因此我們取得了很大的進展，其中大部分已經在投標室中進行了，但我要對我們的團隊也在現場。我的意思是，你必須出去執行這項工作，我可以說，我的意思是，我們採取了非常嚴格的方法來做到這一點，滿足我們的專案時間表，提供優質材料並在我們需要的地方鋪設瀝青。

So, you always look at how you bid a job and whether or not you gain or fade on those jobs from the time you bid them to the time you perform them and our crews have gone out and executed that work very well.

因此，你總是會專注於你如何競標一項工作，以及從你競標到執行這些工作，你是否在這些工作中獲得或消失，而我們的工作人員已經很好地執行了這項工作。

That being said, I mean, we are now peeling that onion back with one more layer and looking at what type of work do we do is the most profitable and can we transition more of our work to maybe higher margin subcontract work versus prime work. We continue to look at how can we increase our margins, but really it goes back to our bid room and taking on quality of backlog over quantity.

話雖如此，我的意思是，我們現在正在將洋蔥再剝一層，看看我們所做的哪種類型的工作是最有利可圖的，以及我們是否可以將更多的工作轉移到利潤更高的分包工作而不是主要工作。我們繼續研究如何增加利潤，但實際上這又回到了我們的投標室，並重視積壓的品質而不是數量。

We don't have a record backlog today and that's by design and really just taking on those jobs that pull through the higher margin upstream materials and then go out and execute that work. So we couldn't be more proud of that contracting services group, but it plays a really critical role in our overall organization. It's about 38% of our revenue.

我們今天沒有創紀錄的積壓，這是設計使然，實際上只是承擔那些透過利潤較高的上游材料進行的工作，然後出去執行該工作。因此，我們對承包服務團隊感到非常自豪，但它在我們的整個組織中發揮著非常關鍵的作用。這約占我們收入的 38%。

It provides resiliency to our strategy of pulling through those high stream those high margin upstream materials and operating in an environment right now with very strong funding and you've seen the DOT budgets and they're at or near record levels and we see that for the foreseeable future. So very pleased with what was going on in contracting services.

它為我們的策略提供了彈性，即透過那些高流量、高利潤的上游材料，並在目前資金非常雄厚的環境中運營，你已經看到了交通部的預算，它們處於或接近創紀錄的水平，我們看到這一點可預見的未來。對承包服務的進展非常滿意。

Great. Thanks for that, Brian. Yeah, I mean, I know aggregates gets a lot of attention, but I did just have to highlight the great job you guys are doing on the contracted services side as well. But speaking to aggregates here for a second, it sounded like repair and maintenance impacted margins a bit in the quarter. Should that continue as we look into the back half or any color around that? And then maybe if you could also give us some color on the overall cost outlook for aggregates?

偉大的。謝謝你，布萊恩。是的，我的意思是，我知道聚合得到了很多關注，但我確實必須強調你們在合約服務方面所做的出色工作。但就這裡的總體而言，聽起來維修和維護對本季的利潤率產生了一些影響。當我們觀察後半部分或周圍的任何顏色時，這種情況是否應該繼續下去？那麼您是否也可以給我們一些有關骨材整體成本前景的資訊？

Yeah. As we've deployed our PIT crews, I mean, they've certainly gone out and these 1,300 opportunities improve our margins is having our repair and maintenance costs go up temporarily for a longer term benefit and so part of the PIT crew recommendations are some larger longer term capital improvements that are going through the system now, but also there is some immediate opportunities to change how we're maintaining the facilities and doing some additional repairs and maintenance to increase our uptime.

是的。當我們部署 PIT 人員時，我的意思是，他們肯定已經出去了，這 1,300 個機會提高了我們的利潤，使我們的維修和維護成本暫時上升，以獲得長期利益，因此 PIT 人員建議的一部分是現在系統正在進行更大規模的長期資本改進，但也有一些直接的機會來改變我們維護設施的方式，並進行一些額外的維修和維護，以增加我們的正常運作時間。

And I'd say that almost everywhere our PIT crews have gone, they had an impact of increasing our uptime and as related to that, I mean, we have had a bump in our repairs and maintenance costs. Going forward, I think we still feel very comfortable in our guidance as far as mid-single digit costs increases inflation for the rest of this year. Diesel has been a little bit of a tailwind for the first couple of quarters. I'd say that's leveling out and it will just be kind of a neutral to our business going forward. So that's what we're seeing right now with our costs.

我想說，幾乎我們的 PIT 工作人員去過的所有地方，他們都對增加我們的正常運行時間產生了影響，與此相關，我的意思是，我們的維修和維護成本有所增加。展望未來，我認為我們仍然對我們的指導感到非常滿意，因為今年剩餘時間中個位數的成本會增加通膨。柴油引擎在前幾個季度起到了一定的推動作用。我想說，這正在趨於平穩，這對我們未來的業務來說是一種中性。這就是我們現在所看到的成本情況。

Well, thanks, Brain. I'll pass it on.

嗯，謝謝，布萊恩。我會把它傳遞下去。

Kathryn Thompson, Thompson Research Group. .

凱瑟琳·湯普森，湯普森研究小組。。

Hi. Thank you for taking my questions today. Just one follow-up clarification on aggregate pricing. How much of it was pricing actions versus an impact from mix or geographic mix in the quarter.

你好。感謝您今天回答我的問題。只是對總定價的一項後續澄清。其中有多少是定價行為與本季混合或地理混合的影響。

Yeah, the bigger impact, Kathryn, was what Nathan had mentioned and I had mentioned is the product mix and so we have our way you should look at our pricing is year-to-date and so our year-to-date right now is about 8% increase is up from last year's year to date numbers.

是的，凱瑟琳，更大的影響是內森提到的，我提到的是產品組合，所以我們有我們的方式，你應該看看我們的定價是今年迄今為止的，所以我們今年迄今為止的定價是與去年迄今的數字相比，增幅約為 8%。

We have good visibility with our new dashboards that we've created to really look at like for like products. I mean, taking a sand product coming out of the same PIT and what are we doing with that pricing and so we've got that visibility through new dashboards and so that's why we've raised our guidance to high single digits.

我們創建的新儀表板具有良好的可見性，這些儀表板可以真正查看類似產品的情況。我的意思是，從同一個 PIT 中取出沙子產品，我們如何處理該定價，因此我們通過新的儀表板獲得了這種可見性，這就是為什麼我們將指導提高到高個位數。

I would say that on the product mix side of things, we had a large sale -- I mean, we had a 350,000 ton sale in Oregon of unprocessed materials and that can absolutely have an impact just like geographic mix can as well.

我想說的是，在產品組合方面，我們進行了大量銷售——我的意思是，我們在俄勒岡州銷售了 35 萬噸未加工材料，這絕對會產生影響，就像地理組合一樣。

So as we bring on some additional sales in the North Central region, their pricing may be slightly lower than what it is in the Northwest region or Pacific regions where we're importing materials into Hawaii and so that definitely has an impact, but for the quarter, the bigger impact was that sale of the unprocessed material on product mix. Does that make sense?

因此，當我們在中北部地區進行一些額外銷售時，他們的定價可能會略低於我們向夏威夷進口材料的西北地區或太平洋地區，因此這肯定會產生影響，但對於本季度，較大的影響是未加工材料的銷售對產品結構的影響。這樣有道理嗎？

Yes. No, it does. Absolutely. And I know you responded earlier just about some good progress on margins in the quarter, but when you parse out the upside to margins for your ready mix and your asphalt segments in the quarter, help us clarify like how much of that is part of the pricing discipline that you've been executing on versus, better product like, better, job mix versus any other factor.

是的。不，確實如此。絕對地。我知道您早些時候回應了本季度利潤率方面的一些良好進展，但是當您解析本季度預拌粉和瀝青細分市場的利潤率上升趨勢時，請幫助我們澄清其中有多少是您一直執行的定價規則與更好的產品（例如更好的工作組合）與任何其他因素相比。

Really just kind of helping us understand the puts and takes for that 140 basis points improvement in both ready mix and asphalt gross margins in the quarter. Thank you.

實際上只是幫助我們了解本季預拌混凝土和瀝青毛利率提高 140 個基點的影響因素。謝謝。

Yeah. I would say that a lot of it, Kathryn, has to do with our price increases. I mean, our average selling price for ready mix went up 11% and we had 12% less yardage going out and so this is that classic case of quality of work over quantity and less is more and in this case, we have taken on and we are being more selective on jobs and customers that we are servicing and definitely have done a great job through dynamic pricing of raising our prices above our input costs and the same could be said with asphalt.

是的。凱瑟琳，我想說，這很大程度上與我們的價格上漲有關。我的意思是，我們預混料的平均售價上漲了11%，我們的發貨碼數減少了12%，所以這是工作品質勝過數量的經典案例，少即是多，在這種情況下，我們採取了我們對我們所服務的工作和客戶更加挑剔，並且透過動態定價將我們的價格提高到高於我們的投入成本，這無疑做得很好，瀝青也是如此。

I mean, we had less tonnage in asphalt by about 5%. Average sales price went up slightly and obviously that's a big function of your input costs being liquid asphalt and natural gas. So a lot of it is pricing, but I also wouldn't dismiss the work that the PIT crews are doing.

我的意思是，我們的瀝青噸位減少了約 5%。平均銷售價格略有上升，顯然這是液體瀝青和天然氣投入成本的重要函數。因此，其中很大一部分是定價，但我也不會忽視 PIT 工作人員正在做的工作。

The PIT crews when they are out looking at our aggregate operations, spend about a half a day to a full day on each one of the ready mix and asphalt plants, and we have some cost initiatives and best practices being implemented in those facilities as well. So it's really a function of strong dynamic pricing and controlling our costs.

PIT 工作人員在查看我們的骨料運作時，會在每個預拌混凝土和瀝青工廠上花費大約半天到一整天的時間，我們也在這些設施中實施了一些成本計劃和最佳實踐。因此，這實際上是強大的動態定價和控製成本的功能。

Okay, great. And then just one quick follow-up question. Certainly, all the feedback in the field that we're receiving is that the volumes are more delayed and not necessarily lost. Just wanted to get your thoughts on that just in terms of the delayed versus lost and how you're thinking about things, particularly focusing in on some of the points that you laid out on backlogs?

好的，太好了。然後是一個快速的後續問題。當然，我們收到的該領域的所有回饋都是數量延遲更多，但不一定會遺失。只是想了解您對延遲與丟失的看法，以及您如何看待事情，特別是關注您在積壓方面提出的一些要點？

Yes, I would say that that's definitely the case in some of the markets that had a very wet June. So that central segment for us, whether that's Minnesota, South Dakota, Iowa or Texas, certainly, some of those projects that we should have been working on both in contracting services, which is consuming those upstream materials like asphalt and aggregates and then the ready mix business was definitely impacted by weather in that month of June for us.

是的，我想說，在一些六月非常潮濕的市場中，情況確實如此。因此，對我們來說，無論是明尼蘇達州、南達科他州、愛荷華州還是德克薩斯州，我們的核心部分當然是我們應該在承包服務方面開展的一些項目，這些項目消耗瀝青和骨料等上游材料，然後準備好對我們來說，六月的混合業務肯定受到天氣的影響。

So yes, I think some of that work has certainly been delayed. I think there's some timing of projects as it relates to asphalt. So I think I would share that same sentiment with you. I think on the ready mix in certain markets, there is certainly a softening of that.

所以，是的，我認為其中一些工作肯定被推遲了。我認為與瀝青相關的項目有一些時間安排。所以我想我會和你分享同樣的感受。我認為，就某些市場的現成組合而言，這種情況肯定會減弱。

As you know, most of that ready mix is consumed in the private sector, whether that's residential or commercial industrial projects and so there is softening that's driving some of those volumes that is not necessarily being delayed, but the good news there is, there is a pent up demand for residential and commercial and industrial to get going. So primarily on asphalt contracting services, certainly some work is being pushed forward into the next quarters.

如您所知，大部分預混料是在私營部門消費的，無論是住宅項目還是商業工業項目，因此疲軟推動了其中一些數量不一定會被推遲，但好消息是，有被壓抑的住宅、商業和工業需求得以啟動。因此，主要是在瀝青承包服務方面，一些工作肯定會被推進到下幾個季度。

Okay, great. Thanks very much.

好的，太好了。非常感謝。

Yeah.

是的。

Timna Tanners, Wolfe Research.

蒂姆納坦納斯，沃爾夫研究。

Hey, good morning. I wanted to follow-up actually on the asphalt outlook, so just along those same lines. If the asphalt, volumes are getting pushed out, why lower the volume outlook? And kind of just wanted a little bit more color on what you're seeing there in light of some of the commentary. I think PCA came out recently with the lower forecast for IIJ spending. So just wondering if you could provide some more color?

嘿，早安。我想實際上跟進瀝青的前景，所以就沿著同樣的路線。如果瀝青的銷量被擠出，為什麼要降低銷量前景？我只是想根據一些評論對你所看到的內容有更多的了解。我認為 PCA 最近發布了較低的 IIJ 支出預測。所以只是想知道你是否可以提供更多顏色？

Yeah. So part of that on the asphalt is by design, and I'll give you a very specific example of that. In the North Central region, we used to have more portable asphalt plants going out on the road and frankly, they were chasing high volume, low margin work and our team in the North Central region made the strategic decision early in the year to go park two of those asphalt plants in stationary, aggregate locations and providing much higher margin but lower volume work to the tune of almost 30% in that one region.

是的。因此，瀝青路面上的部分是設計使然，我將給你一個非常具體的例子。在中北部地區，我們過去有更多的便攜式瀝青廠上路行駛，坦白說，他們追求的是高產量、低利潤的工作，我們中北部地區的團隊在今年年初就做出了戰略決定，將其停放在公路上。

And so, I would say that it's intentional, Timna, on our guide as far as going forward on our volumes and asphalt specifically. I'm not seeing the PCA report. What we've seen and the information we get from ARPA and our local DOTs when we meet with the directors is that funding is still very strong and that the there's still more than half of that IIJA funding to be dispersed and spent in those states that we do business in.

因此，我想說，蒂姆納，就我們的指南而言，就具體的銷量和瀝青而言，這是有意為之的。我沒有看到 PCA 報告。當我們與董事們會面時，我們所看到的以及從 ARPA 和當地 DOT 獲得的信息是，資金仍然非常充足，並且仍有一半以上的 IIJA 資金需要分散和花在那些我們在做生意。

So our DOT budgets are really at record levels. If they're not at record level, they're very close to a record level and you talk to those DOTs and there's a lot of work to still be built. I mean, the IIJA and the current transportation funding that those states have is not enough to fix the infrastructure. So this should be continuing. There's lots of new legislation in the states we work in.

因此，我們的交通部預算確實達到了創紀錄的水平。如果它們沒有達到創紀錄的水平，那麼它們就非常接近創紀錄的水平，當你與那些 DOT 交談時，仍然有很多工作要做。我的意思是，IIJA 和這些州目前擁有的交通資金不足以修復基礎設施。所以這應該繼續下去。我們工作的州有很多新的立法。

We're very active in helping pass those bills, but because the roads need to get fixed as do the bridges. So I'm not exactly sure of the report you're looking to, but we see strong DOT budgets and 87% of our backlog in our contracting services is publicly funded and we just continue to see strong markets there.

我們非常積極地幫助通過這些法案，但因為道路和橋樑都需要修復。因此，我不太確定您要查看的報告，但我們看到 DOT 的預算強勁，而且我們承包服務中 87% 的積壓訂單都是公共資助的，而且我們繼續看到那裡的強勁市場。

Okay, great. Yes, there's some more outlook in reference to kind of slower realizations, but not lost to your point, I think. Just second question, if I could, on the M&A environment. Can you elaborate a little bit on, I know you talked about three different options. What adjacent platforms might you be looking at? And what's the dynamic of the environment? Is there more willingness to sell than normal? What are valuations looking like? Anything you can provide?

好的，太好了。是的，對於較慢的實現還有一些更多的展望，但我認為並沒有迷失你的觀點。如果可以的話，我想問第二個問題，關於併購環境。您能否詳細說明一下，我知道您談到了三種不同的選擇。您可能會關注哪些相鄰平台？環境的動態是什麼？出售意願是否比平常更高？估值如何？有什麼可以提供的嗎？

Yeah. I appreciate that question. We're very excited and pleased with the progress we've made. We've got a very reputable experienced, well respected business development team that we've assembled that's been out working, filling the pipeline up and I can tell you in my career at Knife River for 31 years, this is the healthiest pipeline of opportunities that I've seen. We've mentioned that we are our priority is to bolt on those nice $30 million to $50 million both on in our existing market areas.

是的。我很欣賞這個問題。我們對所取得的進展感到非常興奮和高興。我們組建了一支信譽良好、經驗豐富、受人尊敬的業務開發團隊，他們一直在努力工作，填補了管道，我可以告訴你，在我在Knife River 31 年的職業生涯中，這是最健康的機會管道我見過的。我們已經提到，我們的首要任務是在現有市場領域投入 3,000 萬至 5,000 萬美元。

That's our number one focus is to continue to bolt those opportunities on and there is a lot of fragmented opportunities, a lot of regionally owned family operated companies in our midsize high growth markets.

我們的首要重點是繼續抓住這些機會，在我們的中型高成長市場中存在著許多分散的機會，有很多區域性家族經營的公司。

Within the regions, we have opportunities to grow within a region that maybe in a new strategic market area and so we have a relatively small footprint in Texas and you look at some of our other footprints in some of the states that we currently do business in, there are opportunities for us to expand in those states with under our current management teams and the current region structure and then there's also states that join or adjacent to our current footprint.

在這些地區內，我們有機會在一個可能是新的戰略市場區域的地區內發展，因此我們在德克薩斯州的足跡相對較小，您可以看看我們目前在一些州開展業務的其他足跡，我們有機會在我們目前的管理團隊和目前的區域結構下在這些州進行擴張，然後還有加入或毗鄰我們目前業務的州。

So we're in 14 states, Timna and without giving any specific information, I would just tell you that, where we're looking at would be states that would be contiguous adjacent to one of our existing states. So that's really our strategy, and we've got deals in the pipeline of all sizes in all of those different markets I just mentioned.

所以我們有 14 個州，蒂姆納，在沒有提供任何具體信息的情況下，我只是告訴你，我們正在尋找的州將與我們現有的州之一相鄰。這確實是我們的策略，我們在我剛才提到的所有不同市場中都在進行各種規模的交易。

Okay. Thank you.

好的。謝謝。

Garik Shmois, Loop Capital Markets.

Garik Shmois，Loop 資本市場。

Hi, thanks. Congrats on the quarter. I know you talked to some new project wins in data centers and parking garages in the Pacific Northwest. I know private construction is a much smaller part of your end market exposure, but I was wondering if you can maybe speak to the outlook, what you're seeing, in private, and the opportunities when looking at some of the projects that you're bidding on?

你好，謝謝。恭喜本季。我知道您談到了太平洋西北部資料中心和停車場的一些新項目。我知道私人建築在您的終端市場風險中所佔的比例要小得多，但我想知道您是否可以談談您私下看到的前景，以及在考慮您的一些項目時的機會。

Yes. Very specific, Garik, to prestress. We have our new facility in Spokane, Washington that we commissioned last year and it's up and running and it's doing great. It's got a little bit more capacity than we had anticipated, and it's got some operating costs that are better than we thought and so it's going great in Spokane, and then our other facility is in near Eugene, Oregon. We provide a lot of wall panels to those data centers.

是的。加里克，預力非常具體。我們在華盛頓州斯波坎擁有新工廠，去年投入使用，現已投入運行，運作狀況良好。它的產能比我們預期的要多一些，而且它的一些運營成本比我們想像的要好，所以它在斯波坎進展順利，然後我們的另一個工廠位於俄勒岡州尤金附近。我們為這些資料中心提供了大量的牆板。

We do parking garages, whether that's for public or private parking garages and then the infrastructure work, a big part of our business is providing bridge girders for the DOT projects. So specifically to the private market, we still have a lot of opportunities that these take some time to engineer and you work directly with the owners when you're transferring or transitioning a job from cast in place or steel to precast or prestressed and so our engineering team have been working for months on several of these projects and we have contracts to get paid to help design and utilize our products.

我們做停車場，無論是公共停車場還是私人停車場，然後是基礎設施工程，我們業務的很大一部分是為交通部專案提供橋樑大樑。因此，特別是對於私人市場，我們仍然有很多機會，這些需要一些時間來設計，當您將工作從現澆或鋼轉移或過渡到預製或預應力時，您可以直接與業主合作，因此我們的工程團隊已經在其中幾個專案上工作了幾個月，我們簽訂了合約來獲得報酬，以幫助設計和使用我們的產品。

And so we see data centers in that Idaho, Oregon, Wyoming markets, there is still opportunities. We've got portable batch plants in Oregon supplying concrete to some of those projects. So that still has been a very strong market for us on the data centers and then the parking garages and bridge gears and more of the infrastructure work continues to see a lot of opportunities there.

因此，我們看到愛達荷州、俄勒岡州、懷俄明州市場的資料中心仍然存在機會。我們在俄勒岡州擁有便攜式攪拌站，為其中一些項目供應混凝土。因此，對我們來說，資料中心、停車場和橋樑裝置以及更多基礎設施工作仍然是一個非常強勁的市場，在那裡繼續看到很多機會。

Okay. That sounds good. And just want to follow-up on the progress that you're making with respect to dynamic pricing. I think you mentioned you're in the three inning in most regions outside of the Northwest. Is that where you expect it to be, at this point, in the rollout? Just, you maybe help put some context, in in that timeline as to where you're at as far as -- if it's going as well a little bit faster, a little bit slower than you expected at this point?

好的。聽起來很好。只是想跟進您在動態定價方面取得的進展。我想你提到你在西北以外的大多數地區都處於三局。這是您目前所期望的部署情況嗎？只是，你也許可以幫助在該時間線中添加一些背景信息，了解你目前所處的位置——目前進展是否比你預期的快一點，慢一點？

Yeah. I would say every region is a little bit of a different spot when it comes to where they how they're progressing with dynamic pricing and so there's certainly some regions that have had the structure in place and the point of sale systems in place and the commercial excellence teams in place to really go from your traditional way of sending out an annual price increase letter or possibly a midyear increase.

是的。我想說，每個地區在動態定價方面的進展情況都有所不同，因此肯定有一些地區已經建立了適當的結構和銷售點系統，並且商業卓越團隊的到位，真正改變了發送年度漲價信或可能年中漲價的傳統方式。

They had that structure in place where they were able to pick up dynamic pricing playbook and run with it and those regions are probably in that third or fourth inning. There's other regions where, again, we did not have that infrastructure in place and we're in the process of adding sales teams and doing a lot of additional training and putting in the software and the dashboards to help us implement that dynamic pricing.

他們有這樣的結構，他們能夠拿起動態定價策略並運行它，這些區域可能處於第三或第四局。同樣，在其他地區，我們沒有適當的基礎設施，我們正在增加銷售團隊並進行大量額外培訓並放入軟體和儀表板以幫助我們實施動態定價。

So what I'd say, Garik, is that we have a lot of opportunities for us to continue to go forward in optimizing our materials pricing in most of the markets. I think we still have opportunities in all the markets, frankly, even in the Northwest region, but they're all progressing well. What I would tell you is that they've embraced it. Our team and our customers have received that new way of pricing materials very positively.

因此，加里克，我想說的是，我們有很多機會繼續優化大多數市場的材料定價。我認為我們在所有市場上仍然有機會，坦白說，即使在西北地區，但它們都進展順利。我要告訴你的是，他們已經接受了它。我們的團隊和客戶非常積極地接受了這種新的材料定價方式。

And we got very low to know the existence on that. I think the customers are appreciate knowing what their cost on that particular project and that we concerned whether or not, they are not be getting a mid-year increase or not. They know what they prices are and every job they and build they just give us a call first to get a current pricing.

我們對它的存在知之甚少。我認為客戶很高興知道他們在該特定項目上的成本是多少，並且我們擔心他們是否會在年中增加費用。他們知道他們的價格是多少，他們和他們建造的每項工作都只是先打電話給我們以獲得當前的價格。

That makes sense. All right. Thanks for that. I'll pass it on.

這是有道理的。好的。謝謝你。我會把它傳遞下去。

Thaks Garik.

謝謝加里克。

(Operator Instructions) Ian Zaffino, Oppenheimer.

（操作員說明）Ian Zaffino，Oppenheimer。

Hi, great. Thank you very much. A lot of my questions have been answered, but I wanted to just kind of go back to pricing here. Can you help us understand on the pricing? What are you seeing, I guess, your bucket, the pricing, or any color you could give us there and what's driving it? Thanks.

嗨，太好了。非常感謝。我的許多問題已經得到解答，但我想回到這裡的定價問題。您能幫助我們了解定價嗎？我想，你看到了什麼，你的桶子、定價，或者你可以給我們的任何顏色，是什麼推動了它？謝謝。

Yes. I mean what I know, which is I mean near term is the demand is still strong for our products. And so that we have a heavy influence on infrastructure spending and we benefit from that a lot and so the demand is good. And keep in mind, we sell about 40% of our aggregates to our downstream businesses. That's one thing I do know is demand remains strong. The other thing I know is that we have a number one or number two market position in 75% of the markets where we're selling aggregates and so that allows us to be a market leader.

是的。我的意思是據我所知，短期內對我們產品的需求仍然強勁。因此，我們對基礎設施支出有很大影響，我們從中受益匪淺，因此需求良好。請記住，我們將大約 40% 的總量出售給下游企業。我確實知道的一件事是需求仍然強勁。我知道的另一件事是，我們在 75% 銷售骨材的市場中擁有第一或第二的市場地位，這使我們能夠成為市場領導者。

I also know from our dashboards that we've got, if you look at like for like materials, taking a product from one pit this year compared to what we're selling that same product on that same pit for is high single digits. Our year-to-date numbers are high single digits and so, Nathan and I along with the region presidents, we feel comfortable with our guidance, our assumption of being high single digits.

我還從我們的儀表板中知道，如果您查看類似材料，今年從一個坑中取出的產品與我們在同一坑中銷售的相同產品的價格相比，是高個位數。我們今年迄今為止的數字是高個位數，因此，內森和我以及地區總裁，我們對我們的指導和我們對高個位數的假設感到滿意。

You're looking at it longer term and I think again those fundamentals, we need a lot of rock to go fix our infrastructure. I mean, it's literally the foundation of America's infrastructure. You can't produce concrete or make asphalt mix or go build bridges or pave runways without aggregates and so the fundamental, the underlying demand is there long term.

你從長遠來看，我再次認為這些基本面，我們需要大量的岩石來修復我們的基礎設施。我的意思是，它確實是美國基礎設施的基礎。如果沒有骨料，你就無法生產混凝土、製造瀝青混合料、建造橋樑或鋪設跑道，因此基本的、潛在的需求是長期存在的。

As you know, it's a non-renewable resource. It's a depleting resource and they're difficult to permit and so with those things, it gives me that kind of strong conviction that we're going to continue to see pricing momentum going forward for the foreseeable future. I don't see any of those variables changing. The demand is strong and it's a nonrenewable resource that is depleting and I see that it really is the foundation of the infrastructure and so I see strong momentum in in aggregate pricing going forward.

如您所知，它是一種不可再生資源。這是一種枯竭的資源，而且很難被允許，因此，有了這些，它讓我堅信，在可預見的未來，我們將繼續看到定價動能。我沒有看到這些變數發生任何變化。需求強勁，而且它是一種正在耗盡的不可再生資源，我認為它確實是基礎設施的基礎，因此我看到未來總定價的強勁勢頭。

I don't see any those variables changing the demand is wrong and is a non-renewable resource that is depleting and I see that is really is the foundation of the infrastructure. So I see strong momentum in aggregate pricing going forward.

我不認為任何改變需求的變數是錯誤的，並且是一種正在耗盡的不可再生資源，我認為這確實是基礎設施的基礎。因此，我認為未來整體定價勢頭強勁。

Okay. Thank you, and then also just another one on M&A. Maybe help us understand what you're seeing as far as multiples and also size of deals. I know there was a large deal, one of your competitors did. Would you go into larger markets? And how do you feel about the multiples that are on recent transactions? Thanks.

好的。謝謝，還有一篇關於併購的文章。也許可以幫助我們了解您所看到的交易倍數和交易規模。我知道你們的一位競爭對手做了一筆大交易。你會進入更大的市場嗎？您對最近交易的倍數有何看法？謝謝。

Yeah. Part of our strategy is we definitely target opportunities that can be negotiated directly with the owner and stay out of an auction or a broker deal. Now with that being said, we certainly are involved and part of our pipeline includes some of those larger platform companies that are being brokered that would be part of an auction and those typically as you can well imagine are driving higher multiples than the ones that we could be negotiating in those midsize high growth markets where a very logical acquirer of those companies and so Ian, the multiples, I mean, would be a range of literally 10 times. I mean, I could say it's from 6 to 16.

是的。我們策略的一部分是，我們肯定會瞄準那些可以直接與業主談判的機會，並且不參與拍賣或經紀人交易。話雖這麼說，我們當然參與其中，我們的管道的一部分包括一些正在經紀的大型平台公司，這些公司將成為拍賣的一部分，正如你可以想像的那樣，這些公司的市盈率通常比我們預期的要高。我的意思是，我可以說是從 6 到 16。

I mean, there's just a broad range. Every deal is unique. Every deal has its own logic, strategy to it and so really, there's no way of saying what the multiples we're seeing. I'll tell you again that we target those brokered local family owned deals where we already have long standing relationships with those owners, and we've been having those conversations and that would be the majority of what's in our pipeline, but we are bidding on some larger deals and those multiples can be a little bit higher.

我的意思是，範圍很廣。每筆交易都是獨一無二的。每筆交易都有自己的邏輯和策略，所以實際上，我們無法說出我們所看到的本益比是多少。我會再次告訴你，我們的目標是那些經紀的當地家族擁有的交易，我們已經與這些所有者建立了長期的關係，並且我們一直在進行這些對話，這將是我們管道中的大部分內容，但我們正在競標在一些較大的交易中，這些倍數可能會更高一些。

All right. Thank you very much.

好的。非常感謝。

Thank you. And at this time, Mr. Gray, it appears we have no other questions registered. Please proceed, sir.

謝謝。格雷先生，目前我們似乎沒有其他問題。請繼續，先生。

All right. Well, thank you again for joining us today. We're proud of our record quarter and excited to be increasing guidance for the year. We continue to make good progress on our edge goals, and we are well positioned to grow our company and deliver long-term value for our shareholders. We appreciate the interest and support, and we'll now turn the call back over to the operator. Thank you.

好的。好的，再次感謝您今天加入我們。我們對創紀錄的季度業績感到自豪，並很高興能夠增加今年的指導。我們繼續在我們的邊緣目標上取得良好進展，並且我們有能力發展我們的公司並為股東創造長期價值。感謝您的關注和支持，我們現在會將電話轉回給接線生。謝謝。

Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending and at this time, we do ask that you please disconnect your lines.

謝謝您，先生。女士們、先生們，今天的電話會議到此結束。再次感謝您的出席，此時，我們懇請您斷開線路。