North American Construction Group Ltd. Announces Results for the Third Quarter Ended September 30, 2025

About this update from North American Construction Group Ltd.

ACHESON, Alberta, Nov. 12, 2025 (GLOBE NEWSWIRE) -- North American Construction Group Ltd. (“NACG”) (TSX:NOA/NYSE:NOA) today announced results for the third quarter ended September 30, 2025. Unless otherwise indicated, financial figures are expressed in Canadian dollars, and comparisons are to the prior third quarter ended September 30, 2024. Third Quarter 2025 Financial Highlights: Combined revenue was $390.8 million and increased 6% (reported revenue of $317.2 million, increased 11%) Combined gross profit was $57.1 million (15.7%) and decreased 23% (reported gross profit of $49.7 million (15.7%), decreased 25%) Adjusted EPS was $0.67 and decreased 44% (basic earnings per share of $0.59, increased 9%) Adjusted EBITDA was $99.0 million and decreased 12% (net income of $17.3 million, increased 19%) Free cash flow was an inflow of cash of $45.7 million and increased $56.3 million Net debt was $904.0 million and increased $7.1 million during the quarter Third Quarter 2025 Operational Highlights: Revenue and combined revenue for the third quarter increased, driven primarily by incremental contract wins and commissioned growth assets in the Heavy Equipment - Australia Segment. Heavy Equipment - Australia revenue increased 26% to $188.5 million from $149.5 million, driven by a 20% expansion in fleet size, strong operational performance under favourable weather, and higher volumes from three major Australian contracts secured over the past year. Heavy Equipment - Canada revenue decreased 5% to $125.7 million from $132.7 million, primarily due to reduced scopes at the Syncrude mines and lower overburden and reclamation activity in the oil sands. Revenue generated by joint ventures and affiliates decreased 8% to $73.5 million from $80.3 million, largely related to decreased volumes generated from the Nuna Group of Companies. Our portion of revenue generated by the civil-infrastructure Fargo project remained strong this year, comparable to the prior year, as the project continued strong production momentum and progressed towards 80% complete. Compared to 2025 Q2, 2025 Q3 results demonstrated solid sequential improvement with a 5% increase in combined revenue but was highlighted by significantly improved gross profit margins. In Australia, strong operational execution, favourable weather, lower third-party maintenance and scale efficiencies gained from fleet expansion supported gross profit margin gains of 4.5%. In Canada, gross margin improved by 4.8% as steady operations replaced the temporary shutdowns experienced in the prior quarter. Overall combined gross margin improved 5.7%, from 8.9% 1 to 14.6%, reflecting operational consistency, improved cost control across the business and enhanced heavy equipment productivities. 1 Certain prior period costs within our Fargo joint venture have been reclassified from non-operating to operating to better align with NACG classifications. This reclassification changed combined gross profit and combined gross profit margin, but has no impact on revenue, income before taxes, or net income. Gross profit for the current quarter came in lower than the prior year. Heavy Equipment - Australia experienced higher operating costs relating primarily to the mix of contract and mine site work, offset by cost savings on parts spend relating to favourable dry weather conditions. Heavy Equipment - Canada margins were impacted by demobilization costs and investment in equipment maintenance. Adjusted EPS of $0.67 compared to $1.19 in the prior year Q3 reflects our earnings and the impact of a higher average share count of 29.2 million (up from 26.8 million in 2024 Q3), driven by the issuance of 3.0 million shares from convertible debentures in February 2025, partially offset by share repurchases. Interest expense of $18.5 million, including contingent liability accretion, reduced EPS by approximately $0.50. The Q3 adjusted EBITDA was lower year-over-year due to the same factors that impacted gross profit; however, we experienced a 3.7% improvement to our EBITDA margin compared to 2025 Q2, primarily due to consistent operation in the oil sands region, increased productive maintenance headcount in Australia, and steady operations within the Fargo joint ventures. Free cash flow for the quarter was $45.7 million and was primarily based on adjusted EBITDA of $99.0 million offset by sustaining capital additions ($47.0 million) and cash interest expense ($14.5 million). Our net debt increased $7.1 million in the quarter as free cash flow was more than offset by growth capital of $23.3 million, share purchases of $13.8 million and the unrealized impact of the higher foreign exchange rate on Australian-denominated debt (impact of approximately $10 million). Joe Lambert, President and CEO stated "With our encouraging third quarter in the books, we are locked and loaded looking to deliver on our second half commitments and finishing the year strong. I appreciate your continued support and look forward to sharing our 2026 outlook with you in December." Declaration of Quarterly Dividend On November 10, 2025, the NACG Board of Directors declared a regular quarterly dividend (the “Dividend”) of twelve Canadian cents ($0.12) per common share, payable to common shareholders of record at the close of business on November 26, 2025. The Dividend will be paid on January 9, 2026, and is an eligible dividend for Canadian income tax purposes. NACG’s outlook for 2025 The following table provides projected key measures for the remainder of 2025. Actual results for the six months ended Outlook for the six months ended December 31, 2024 June 30, 2025 December 31, 2025 Current Previous Key measures Combined revenue (i) $740M $762M $700 - $750M No Change Adjusted EBITDA (i) $202M $180M $190 - $210M No Change Adjusted EPS (i) $2.15 $0.54 $1.40 - $1.60 No Change Sustaining capital (i) $69M $158M $60 - $70M No Change Free cash flow (i) $68M ($42M) $95 - $105M No Change Capital allocation Growth spending (i) $45M $53M Approx. $25M No Change Net debt leverage (i) 2.2x 2.2x Targeting 2.2x Targeting 2.1x (i) See “Non-GAAP Financial Measures”. Results for the three and nine months ended September 30, 2025 Consolidated Financial Highlights Three months ended Nine months ended September 30, September 30, (dollars in thousands, except per share amounts) 2025 2024 2025 2024 Revenue $ 317,248 $ 286,857 $ 978,715 $ 860,197 Cost of sales (i) 218,033 177,041 690,554 555,515 Depreciation (i) 49,492 43,902 164,717 134,915 Gross profit (i) $ 49,723 $ 65,914 $ 123,444 $ 169,767 Gross profit margin (i)(ii) 15.7 % 23.0 % 12.6 % 19.7 % General and administrative expenses (excluding stock-based compensation) (ii) 13,026 9,291 35,814 32,609 Stock-based compensation (benefit) expense (156 ) 1,332 (2,600 ) 3,081 Operating income (i) 35,747 54,621 89,118 132,496 Interest expense, net 15,265 15,003 42,904 44,939 Net income (i) 17,296 14,489 33,709 40,503 Comprehensive income (i) 28,449 15,604 44,781 42,256 Adjusted EBITDA (i)(ii) 99,039 112,876 278,928 301,246 Adjusted EBITDA margin (i)(ii)(iii) 25.3 % 30.7 % 24.2 % 28.9 % Per share information Basic net income per share $ 0.59 $ 0.54 $ 1.17 $ 1.51 Diluted net income per share $ 0.56 $ 0.48 $ 1.11 $ 1.36 Adjusted EPS (ii) $ 0.67 $ 1.19 $ 1.20 $ 2.77 (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". (ii) See "Non-GAAP Financial Measures". (iii) Adjusted EBITDA margin is calculated using adjusted EBITDA over total combined revenue. Free cash flow Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Consolidated Statements of Cash Flows Cash provided by operating activities (i) $ 91,824 $ 55,278 $ 207,916 $ 140,668 Cash used in investing activities (i) (65,862 ) (65,857 ) (231,466 ) (218,969 ) Effect of exchange rate on changes in cash 2,278 (73 ) 2,118 (1,047 ) Add back of growth and non-cash items included in the above figures: Growth capital additions (ii) 23,275 8,985 75,804 60,987 Capital additions financed by leases (ii) (5,845 ) (8,985 ) (50,653 ) (30,054 ) Free cash flow (i) $ 45,670 $ (10,652 ) $ 3,719 $ (48,415 ) (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". (ii) See "Non-GAAP Financial Measures". Net debt (dollars in thousands) September 30, 2025 June 30, 2025 December 31, 2024 Credit Facility (i) $ 264,519 $ 257,536 $ 395,844 Equipment financing (i) 334,057 314,414 253,639 Mortgage (i) 26,959 27,175 27,600 Senior-secured debt (ii) 625,535 599,125 677,083 Senior unsecured notes 225,000 225,000 — Contingent obligations (i) 100,090 96,837 127,866 Convertible debentures (i) 55,000 55,000 129,106 Cash (101,637 ) (79,025 ) (77,875 ) Net debt (ii) $ 903,988 $ 896,937 $ 856,180 (i) Includes current portion. (ii) See "Non-GAAP Financial Measures". Conference Call and Webcast Management will hold a conference call and webcast to discuss our financial results for the quarter ended September 30, 2025, tomorrow, Thursday, November 13, 2025, at 7:00 am Mountain Time (9:00 am Eastern Time). The call can be accessed by dialing: Toll Free: 1-800-717-1738 Conference ID: 98296 A replay will be available through December 13, 2025, by dialing: Toll Free: 1-888-660-6264 Conference ID: 98296 Playback Passcode: 98296 The 2025 Q3 earnings presentation for the webcast will be available for download on the company’s website at www.nacg.ca/presentations/ The live presentation and webcast can be accessed at: https://onlinexperiences.com/scripts/Server.nxp?LASCmd=AI:4;F:QS!10100&ShowUUID=1232A1F2-254A-427C-99C4-C518946DF7BB A replay will be available until December 13, 2025, using the link provided. About the Company North American Construction Group Ltd. is a premier provider of heavy civil construction and mining services in Australia, Canada, and the U.S. For over 70 years, NACG has provided services to the mining, resource and infrastructure construction markets. For further information contact: Jason Veenstra, CPA, CA Chief Financial Officer North American Construction Group Ltd. (780) 960-7171 [email protected] www.nacg.ca Basis of Presentation We have prepared our consolidated financial statements in conformity with accounting principles generally accepted in the United States ("US GAAP"). Unless otherwise specified, all dollar amounts discussed are in Canadian dollars. Please see the Management’s Discussion and Analysis (“MD&A”) for the quarter ended September 30, 2025, for further detail on the matters discussed in this release. In addition to the MD&A, please reference the dedicated 2025 Q3 Results Presentation for more information on our results and projections which can be found on our website under Investors - Presentations. Change in significant accounting policy - Classification of heavy equipment tires Effective in the first quarter of 2025, we have changed our accounting policy for the classification of heavy equipment tires. These tires are now recognized as property, plant, and equipment on the Consolidated Balance Sheets and are amortized through depreciation on the Consolidated Statements of Operations and Comprehensive Income. Previously, all tires were classified as inventories and expensed through cost of sales when placed into service. This change in accounting policy provides a more accurate reflection of the role of tires as components of the heavy equipment in which they are utilized, aligning the accounting treatment with the economic substance of their use. We have applied this change retrospectively in accordance with Accounting Standards Codification ("ASC") 250, Accounting Changes and Error Corrections, by restating the comparative period. For further details regarding the retrospective adjustments, refer to Note 16 in the consolidated financial statements for the period ended September 30, 2025. Forward-Looking Information The information provided in this release contains forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words “anticipate”, “believe”, “expect”, “should” or similar expressions. The material factors or assumptions used to develop the above forward-looking statements include, and the risks and uncertainties to which such forward-looking statements are subject, are highlighted in the MD&A for the three and nine months ended September 30, 2025. Actual results could differ materially from those contemplated by such forward-looking statements because of any number of factors and uncertainties, many of which are beyond NACG’s control. Undue reliance should not be placed upon forward-looking statements and NACG undertakes no obligation, other than those required by applicable law, to update or revise those statements. For more complete information about NACG, please read our disclosure documents filed with the SEC and the CSA. These free documents can be obtained by visiting EDGAR on the SEC website at www.sec.gov or on the CSA website at www.sedarplus.com . Non-GAAP Financial Measures This press release presents certain non-GAAP financial measures because management believes that they may be useful to investors in analyzing our business performance, leverage and liquidity. The non-GAAP financial measures we present include "adjusted EBIT", "adjusted EBITDA", "adjusted EBITDA margin", "adjusted EPS", "adjusted net earnings", "capital additions", "capital work in progress", "cash liquidity", "cash provided by operating activities prior to change in working capital", "cash related interest expense", "combined gross profit", "combined gross profit margin", "equity investment depreciation and amortization", "equity investment EBIT", "free cash flow", "general and administrative expenses (excluding stock-based compensation)", "gross profit margin", "growth capital", "margin", "net debt", "net debt leverage", "senior-secured debt", "sustaining capital", "total capital liquidity", and "total combined revenue". A non-GAAP financial measure is defined by relevant regulatory authorities as a numerical measure of an issuer's historical or future financial performance, financial position or cash flow that is not specified, defined or determined under the issuer’s GAAP and that is not presented in an issuer’s financial statements. These non-GAAP measures do not have any standardized meaning and therefore are unlikely to be comparable to similar measures presented by other companies. They should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Each non-GAAP financial measure used in this press release is defined and reconciled to its most directly comparable GAAP measure in the "Non-GAAP Financial Measures" section of our Management’s Discussion and Analysis filed concurrently with this press release. Reconciliation of net income to adjusted net earnings, adjusted EBIT and adjusted EBITDA Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Net income (i) $ 17,296 $ 14,489 $ 33,709 $ 40,503 Adjustments: Stock-based compensation (benefit) expense (156 ) 1,332 (2,600 ) 3,081 Loss (gain) on disposal of property, plant and equipment 740 348 (344 ) 641 Unrealized foreign exchange loss 845 114 689 9 Change in FV of contingent obligations - estimate adjustments (2,771 ) 17,727 (21,573 ) 26,585 Loss on derivative financial instruments 1,684 572 9,346 845 Equity investment loss on derivative financial instruments 855 1,836 2,766 2,806 Equity investment restructuring costs — — — 4,517 Depreciation expense relating to early component failures — — 4,274 — Post-acquisition asset relocation and integration costs — — 1,640 — Write-down on assets held for sale — — — 4,181 Tax effect of the above items 988 (4,489 ) 6,761 (8,974 ) Adjusted net earnings (i)(ii) 19,481 31,929 34,668 74,194 Adjustments: Tax effect of the above items (988 ) 4,489 (6,761 ) 8,974 Income tax expense 6,229 6,996 16,244 16,809 Equity investment EBIT (ii) 5,690 4,365 3,943 7,152 Equity loss (earnings) in affiliates and joint ventures (5,232 ) (4,428 ) (3,382 ) (9,545 ) Change in FV of contingent obligations - interest accretion 3,276 4,262 11,870 12,360 Interest expense, net 15,265 15,003 42,904 44,939 Adjusted EBIT (i)(ii) 43,721 62,616 99,486 154,883 Adjustments: Depreciation (i) 49,492 43,902 164,717 134,915 Amortization of intangible assets 366 322 1,456 940 Depreciation expense relating to early component failures — — (4,274 ) — Write-down on assets held for sale — — — (4,181 ) Equity investment depreciation and amortization (ii) 5,460 6,036 17,543 14,689 Adjusted EBITDA (i)(ii) $ 99,039 $ 112,876 $ 278,928 $ 301,246 Adjusted EBITDA margin (i)(ii)(iii) 25.3 % 30.7 % 24.2 % 28.9 % (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". (ii) See "Non-GAAP Financial Measures". (iii) Adjusted EBITDA margin is calculated using adjusted EBITDA over total combined revenue. Reconciliation of equity earnings in affiliates and joint ventures to equity investment EBIT Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Equity (loss) earnings in affiliates and joint ventures $ 5,232 $ 4,428 $ 3,382 $ 9,545 Adjustments: (Gain) loss on disposal of property, plant and equipment (44 ) (183 ) 113 (358 ) Income tax expense (benefit) 431 738 223 (698 ) Interest expense (income) 71 (618 ) 225 (1,337 ) Equity investment EBIT (i) $ 5,690 $ 4,365 $ 3,943 $ 7,152 (i) See "Non-GAAP Financial Measures". Reconciliation of total reported revenue to total combined revenue Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Revenue from wholly-owned entities per financial statements $ 317,248 $ 286,857 $ 978,715 $ 860,197 Share of revenue from investments in affiliates and joint ventures 134,946 144,574 392,686 382,789 Elimination of joint venture subcontract revenue (61,417 ) (64,276 ) (218,832 ) (200,395 ) Total combined revenue (i) $ 390,777 $ 367,155 $ 1,152,569 $ 1,042,591 (i) See "Non-GAAP Financial Measures". Reconciliation of reported gross profit to combined gross profit Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Gross profit from wholly-owned entities per financial statements $ 49,723 $ 65,914 $ 123,444 $ 169,767 Share of gross (loss) profit from investments in affiliates and joint ventures 7,423 7,860 10,783 18,624 Combined gross profit (i)(ii)(iii) $ 57,146 $ 73,774 $ 134,227 $ 188,391 Combined gross profit margin (i)(ii)(iii) 14.6 % 20.1 % 11.6 % 18.1 % (i) See "Non-GAAP Financial Measures". (ii) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". (iii) Certain prior period costs within the Fargo joint venture have been reclassified from non-operating to operating to better align with NACG classifications. This reclassification has no impact on revenue, income before taxes, or net income. Reconciliation of basic net income per share to adjusted EPS Three months ended Nine months ended September 30, September 30, (dollars in thousands) 2025 2024 2025 2024 Net income (i) $ 17,296 $ 14,489 $ 33,709 $ 40,503 Interest from convertible debentures (after tax) 624 1,509 2,352 4,490 Diluted net income available to common shareholders (i) $ 17,920 $ 15,998 $ 36,061 $ 44,993 Adjusted net earnings (i)(ii) $ 19,481 $ 31,929 $ 34,668 $ 74,194 Weighted-average number of common shares 29,166,135 26,823,124 28,798,450 26,762,439 Weighted-average number of diluted common shares 32,283,751 33,087,074 32,588,696 33,087,074 Basic net income per share $ 0.59 $ 0.54 $ 1.17 $ 1.51 Diluted net income per share $ 0.56 $ 0.48 $ 1.11 $ 1.36 Adjusted EPS (ii) $ 0.67 $ 1.19 $ 1.20 $ 2.77 (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". (ii) See "Non-GAAP Financial Measures". Interim Consolidated Balance Sheets (Expressed in thousands of Canadian Dollars) (Unaudited) September 30, 2025 December 31, 2024 (i) Assets Current assets Cash $ 101,637 $ 77,875 Accounts receivable 175,933 166,070 Contract assets 12,168 4,135 Inventories 74,229 69,027 Prepaid expenses and deposits 8,674 7,676 Assets held for sale 112 683 372,753 325,466 Property, plant and equipment, net of accumulated depreciation of $576,366 (December 31, 2024 – $500,303) 1,386,512 1,251,874 Operating lease right-of-use assets 11,051 12,722 Investments in affiliates and joint ventures 85,365 84,692 Intangible assets 10,657 9,901 Other assets 5,509 9,845 Total assets $ 1,871,847 $ 1,694,500 Liabilities and shareholders’ equity Current liabilities Accounts payable $ 122,699 $ 110,750 Accrued liabilities 77,434 78,010 Contract liabilities 22,878 1,944 Current portion of long-term debt 152,439 84,194 Current portion of contingent obligations 31,424 39,290 Current portion of operating lease liabilities 1,576 1,771 408,450 315,959 Long-term debt 746,894 719,399 Contingent obligations 68,666 88,576 Operating lease liabilities 9,923 11,441 Other long-term obligations 27,759 44,711 Deferred tax liabilities 139,067 125,378 1,400,759 1,305,464 Shareholders' equity Common shares (authorized – unlimited number of voting common shares; issued and outstanding – September 30, 2025 - 29,449,960 (December 31, 2024 – 27,704,450)) 288,524 228,961 Treasury shares (September 30, 2025 - 873,970 (December 31, 2024 - 1,000,328)) (14,743 ) (15,913 ) Additional paid-in capital 7,727 20,819 Retained earnings 179,610 156,271 Accumulated other comprehensive income (loss) 9,970 (1,102 ) Shareholders' equity 471,088 389,036 Total liabilities and shareholders’ equity $ 1,871,847 $ 1,694,500 (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy". Interim Consolidated Statements of Operations and Comprehensive Income (Expressed in thousands of Canadian Dollars, except per share amounts) (Unaudited) Three months ended Nine months ended September 30, September 30, 2025 2024 (i) 2025 2024 (i) Revenue $ 317,248 $ 286,857 $ 978,715 $ 860,197 Cost of sales 218,033 177,041 690,554 555,515 Depreciation 49,492 43,902 164,717 134,915 Gross profit 49,723 65,914 123,444 169,767 General and administrative expenses 12,870 10,623 33,214 35,690 Amortization of intangible assets 366 322 1,456 940 Loss (gain) on disposal of property, plant and equipment 740 348 (344 ) 641 Operating income 35,747 54,621 89,118 132,496 Interest expense, net 15,265 15,003 42,904 44,939 Equity earnings in affiliates and joint ventures (5,232 ) (4,428 ) (3,382 ) (9,545 ) Loss on derivative financial instruments 1,684 572 9,346 845 Change in fair value of contingent obligations 505 21,989 (9,703 ) 38,945 Income before income taxes 23,525 21,485 49,953 57,312 Current income tax expense 206 2,466 2,781 5,487 Deferred income tax expense 6,023 4,530 13,463 11,322 Net income $ 17,296 $ 14,489 $ 33,709 $ 40,503 Other comprehensive income Unrealized foreign currency translation gain (11,153 ) (1,115 ) (11,072 ) (1,753 ) Comprehensive income $ 28,449 $ 15,604 $ 44,781 $ 42,256 Per share information Basic net income per share $ 0.59 $ 0.54 $ 1.17 $ 1.51 Diluted net income per share $ 0.56 $ 0.48 $ 1.11 $ 1.36 (i) The prior year amounts are adjusted to reflect a change in policy. See "Change in significant accounting policy".

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