NASDAQ$STRL

Sterling Infrastructure Inc · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

Reported strong Q4 results, driven by the Plateau acquisition and growth in revenues.

Sterling Construction Company reported a revenue increase of $91.4 million compared to the prior year quarter, primarily driven by $84.6 million generated from Plateau. Net income attributable to Sterling common stockholders was $22.3 million, compared to $5.6 million in the same quarter of the previous year. The Plateau acquisition was immediately accretive to the fourth quarter results.

  • Revenues were $346.5 million compared to $255.2 million.
  • Net income attributable to Sterling common stockholders was $22.3 million compared to $5.6 million.
  • Adjusted EBITDA was $20.2 million compared to $12.7 million.
  • Combined Backlog at December 31, 2019 was $1.3 billion, up from $1.1 billion at December 31, 2018.

Headline financials

Total Revenue

$347M

Previous: $255M+35.8%
EPS (adj)

$0.22

Previous: $0.21+4.8%
EBITDA

$18M

No prior period
Adjusted EBITDA

$20.2M

Previous: $12.7M+59.1%
Gross Margin

9.7%

Previous: 11.0%-11.8%
Capital Expenditures

$7.53M

Previous: $3.64M+106.9%
Free Cash Flow

$25.1M

Previous: $12M+108.8%
Net Income

$22.5M

Previous: $5.61M+300.6%
Operating Income

$9.73M

Previous: $9.41M+3.4%
Gross Profit

$33.6M

Previous: $26.7M+25.6%
Cash & Equivalents

$45.7M

Previous: $94.1M-51.4%
Total Assets

$962M

Previous: $483M+99.3%
Stock-Based Comp

$1.3M

Previous: $883K+47.1%

Revenue & EPS history

Sterling · Revenue · Quarterly

$347M

Q4 2019+35.8%vs Q4 2018
Beat estimate in 8 of 16 quarters(50%)
ActualEstimate

Forward guidance

The company expects to generate full year 2020 revenues of between $1.375 billion and $1.4 billion. With the integration of Plateau into Sterling, the company expects that its blended gross margin will rise to the 13% to 14% range. The company expects 2020 EBITDA to be $125 million to $135 million.

Tailwinds

  • Anticipated contribution from Plateau.
  • Record high Backlog.
  • Current booking trends.
  • Market strength.
  • Improved execution.

Headwinds

  • Effective income tax rate of approximately 26%.
  • Non-cash income tax expense of approximately 21% of pretax income.
  • No major positive changes in government investment in infrastructure assumed.
  • Acquisition related costs of $2 million to $3 million.
  • Revenue growth pressured by a shift in demand towards smaller square footage slabs.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

+1.8%

Avg return

Earnings day

+5.6%

Avg return

5 days after

+6.6%

Avg return

30 days after

54%

35 / 65 earnings

Positive

+52.2%

Q1 2026

Best reaction

-20.9%

Q1 2015

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+52.2%+59.5%+87.5%
Q4 2025-5.4%-8.7%-7.7%
Q3 2025-2.8%-3.8%-15.4%
Q1 2025+3.2%+6.6%+17.1%
Q4 2024+5.4%+4.9%+0.2%
Q3 2024+10.9%+23.8%+24.5%
Q2 2024+1.2%-0.3%+4.3%
Q1 2024+20.6%+27.4%+15.2%
Q4 2023+22.1%+27.5%+30.3%
Q3 2023-17.5%-12.4%-12.0%
Q2 2023+23.9%+32.4%+31.3%
Q1 2023+9.0%+15.8%+24.8%
Q4 2022+1.1%+7.0%-0.1%
Q3 2022+9.8%+19.3%+20.2%
Q2 2022-3.3%-1.9%-1.6%
Q1 2022+2.4%+0.7%+8.0%
Q4 2021-3.1%-2.2%-4.1%
Q3 2021+3.1%+9.0%+4.3%
Q2 2021+2.0%+1.0%+4.5%
Q1 2021+11.4%+11.2%+13.0%
Q4 2020-17.9%-11.8%-3.0%
Q3 2020-0.2%-6.2%+9.6%
Q2 2020+6.1%+11.5%+10.7%
Q1 2020-5.1%-7.9%+16.2%
Q4 2019+7.5%-9.2%-32.9%
Q3 2019-0.1%-8.0%-14.2%
Q2 2019-9.3%-9.7%-8.1%
Q1 2019-12.7%-12.2%-4.0%
Q4 2018-1.6%-6.1%-11.8%
Q3 2018+1.7%+8.8%-3.8%
Q2 2018+7.7%+19.5%+11.6%
Q1 2018+17.8%+15.3%+16.8%
Q4 2017-4.4%+6.9%-5.5%
Q3 2017+15.5%+12.9%+10.9%
Q2 2017-17.9%-17.3%-3.3%
Q1 2017+7.2%+12.4%+6.8%
Q4 2016+7.9%+5.2%-3.4%
Q3 2016-16.0%-9.9%+8.5%
Q2 2016+1.4%+6.2%+10.8%
Q1 2016-17.7%
Q4 2015-3.9%
Q3 2015+12.1%
Q2 2015+14.6%
Q1 2015-20.9%
Q4 2014+35.3%
Q3 2014-8.6%
Q2 2014+0.0%
Q1 2014+10.9%
Q4 2013-3.5%
Q3 2013+1.3%
Q2 2013-0.5%
Q1 2013+3.7%
Q4 2012-1.4%
Q3 2012-7.0%
Q2 2012+1.1%
Q1 2012+0.2%
Q4 2009+4.0%
Q4 2011+4.0%
Q3 2011-7.8%
Q3 2010-7.8%
Q4 2010-9.0%
Q2 2010-9.0%
Q2 2011-9.0%
Q1 2011-4.3%
Q1 2010+8.7%

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