Slide 1: Second Quarter 2021 Earnings Conference Call
Second Quarter 2021 Earnings Conference Call August 5, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some statements in this presentation, which are not historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about Arcosa’s estimates, expectations, beliefs, intenti
Slide 3: How to Find Us
How to Find Us OUR WEBSITE NYSE TICKER www.arcosa.com ACA HEADQUARTERS INVESTOR CONTACT Arcosa, Inc. InvestorResources@arcosa.com 500 North Akard Street, Suite 400 Dallas, Tx 75201 3 / Moving Infrastructure Forward
Slide 4: Key messages from today's call
Key messages from today’s call Q2-2021 results were in-line with last year’s record results led by growth in Construction Products Overall construction activity was strong with some impact from weather, and our outlook remains positive We have proactively increased prices to manage steel price
Slide 5: Arcosa's Value Proposition
Arcosa’s Value Proposition Leading Experienced Healthy balance Disciplined capital Track record of businesses management sheet and ample allocation process executing on serving critical team with history liquidity to to grow in strategic priorities infrastructure of managing navigate cycles attracti
Slide 6: Q2 2021 Results
1 Q2 2021 Results 6 / Moving Infrastructure Forward
Slide 7: Q2-2021 Financial Results
Q2-2021 Financial Results Revenues and Adjusted EBITDA were in line with last year’s record results as growth in Construction Products was offset by year-over-year weakness in Transportation Products Revenues Net Income Adjusted Adjusted EBITDA ($M) ($M) ($M) +3% Decline in Adjusted Net Income prima
Slide 8: Southwest Rock Products Overview
Southwest Rock Products Overview Leading Arizona pure-play aggregates producer serving the greater Phoenix metro area that will help accelerate the growth of our Construction Products segment Strategic Rationale $36M $14M Scaled regional aggregates platform that aligns with our Revenue Adjusted EB
Slide 9: Phoenix AZ is One of the Fastest Growing Megaregions
Phoenix AZ is One of the Fastest Growing Megaregions Sizable Aggregates Phoenix is one of the top 11 aggregates markets by Market Demand volume in the United States ~$6 billion approved investment at Phoenix Sky Harbor Large-Scale Capital airport and ~$53 billion estimated funding required for Inves
Slide 10: Segment Results: Construction Products
Segment Results: Construction Products Adjusted Segment EBITDA increased 17% driven by the StonePoint acquisition, partially offset by abnormally wet weather, especially in our largest markets in Texas and along the Gulf Coast Revenues Aggregates & Specialty Materials Adjusted Segment EBITDA ($M) Co
Slide 11: Segment Results: Engineered Structures
Segment Results: Engineered Structures Revenue growth driven by higher steel pricing and margins benefit from a number of factors Revenues Adjusted Segment EBITDA ($M) Utility, Wind Towers, and Related Structures ($M) Storage Tanks and Other +25% +9% 38.0 242.5 222.8 50.9 30.4 45.9 176.9 191.6 Q2-20
Slide 12: Segment Results: Transportation Products
Segment Results: Transportation Products Adjusted Segment EBITDA declined primarily from a 54% decrease in barge revenues, resulting from weak order levels since the onset of the pandemic and rising steel prices Revenues Barges Adjusted Segment EBITDA ($M) Rail Components ($M) -47% 128.2 21.2 -73% 2
Slide 13: Balance Sheet Highlights
Balance Sheet Highlights Our balance sheet remains healthy with over $300 million of available liquidity and no material near-term debt maturities Net Debt / Adjusted EBITDA Debt Maturity Schedule Ratio at end of quarter $ Millions 400 2.4 320 Long term target of 2.0 -2.5x Track record of de-leverag
Slide 14: Updated 2021 Outlook
2 Updated 2021 Outlook 14 / Moving Infrastructure Forward
Slide 15: Near-Term Outlook
Near-Term Outlook Construction Products and Engineered Structures end markets remain well positioned for growth, with offsetting impacts from barge and wind tower near-term expectations Near-Term Outlook by Segment Engineered Structures % of TTM Adjusted EBITDA, Pro-Forma for Southwest Positive Ou
Slide 16: 2021 Outlook
2021 Outlook Our consolidated Adjusted EBITDA guidance is unchanged and is on pace to meet or exceed 2020’s strong results, despite additional barge weakness 284 270-290 Adjusted EBITDA ($M’s) 241 • Transportation 187 Products Segment Adjusted EBITDA guidance revised to ~$25M from previous range of
Slide 17: Arcosa's Long-Term Vision
Arcosa’s Long-Term Vision Grow in attractive markets Reduce the complexity Improve long-term Integrate Environmental, where we can achieve and cyclicality of the returns on invested Social, and Governance sustainable competitive overall business capital initiatives (ESG) into our advantages long-ter
Slide 18: Appendix
Appendix
Slide 19: Arcosa Sustainability
Arcosa Sustainability We continue to integrate ESG into our business through our strategic planning process, ESG-focused initiatives, and innovative continuous improvement projects Safety: Arcosa team members achieved a 56% reduction in our Total Recordable Incident Rate (TRIR) in 2020. Our ARC 100
Slide 20: Additional Financial Guidance for 2021
Additional Financial Guidance for 2021 Commentary Corporate ~$13-14M per quarter in Q3 and Q4, excluding non-recurring items related to acquisitions and costs integration ~$2M per quarter in Q3 and Q4 of acquisition and integration-related costs that are excluded from the above range Tax rate
Slide 21: Non-GAAP Measures
Non-GAAP Measures Refer to slides that follow for accompanying reconciliations “EBITDA” is defined as net income plus interest, taxes, depreciation, depletion, and amortization. “Adjusted EBITDA” is defined as EBITDA adjusted for certain items that are not reflective of the normal earnings of our bu
Slide 22: Reconciliation of Adjusted EBITDA and Adjusted Net Income
Reconciliation of Adjusted EBITDA and Adjusted Net Income ($’s in millions) (unaudited) Twelve Months Three Months Ended Six Months Ended Full Year 2021 Guidance Ended June 30, June 30, June 30, 2021 2020 2021 2020 Low High 2021 Net income $ 20.8 $ 33.3 $ 36.7 $ 64.9 $ 65.0 $ 77.0 $ 78.4 Add: Intere
Slide 23: Reconciliation of Adjusted Segment EBITDA
Reconciliation of Adjusted Segment EBITDA ($’s in millions) (unaudited) Three Months Ended Six Months Ended June June 30, 30, 2021 2020 2021 2020 Construction Products Operating Profit $ 17.9 $ 24.3 $ 33.7 $ 41.1 Add: Depreciation, depletion, and amortization expense(1) 22.5 13.9 39.6 27.7 Segment E
Slide 24: Reconciliation of Net Debt to Adjusted EBITDA
Reconciliation of Net Debt to Adjusted EBITDA ($’s in millions) (unaudited) As of Pro Forma Pro Forma for September 30, December 31, December 31, March 31, June 30, September 30, December 31, March 31, June 30, Southwest Rock June 30, 2021 2018(1) 2018 2019 2020(1) 2020(1) 2020(1) 2020(1) 2021(1) 20
Slide 25: Reconciliation of Southwest Rock Pro forma Adjusted EBITDA
Reconciliation of Southwest Rock Pro forma Adjusted EBITDA (in millions) (unaudited) Twelve Months Ended May 31, 2021 Net Income $ 11.7 Add: Interest expense, net 0.2 Provision for income taxes(1) - Depreciation, depletion, and amortization expense 2.6 EBITDA 14.5 Add: Pro forma adjustments (0.5) Pr