Knife River Corp. reported a record-first quarter revenue, with price increases across most product lines and increased contracting services revenue driving the gain.
The $329.6 million in consolidated revenue that Knife River generated in the first quarter was a 7 percent increase from the prior-year period, the company says.
Knife River, however, experienced a seasonal net loss of $47.6 million. That compares to a seasonal net loss of $41.3 million in the prior-year period.
Adjusted EBITDA in the first quarter was a loss of $17.7 million at Knife River, versus a loss of $13.7 million in the first quarter of 2023.
“A seasonal loss in the first quarter is typical for our business, as construction activity in many of our northern markets doesn’t ramp up until the second quarter,” says Brian Gray, president and CEO of Knife River. “While we historically spend less time in the field in the first quarter, we have been active preparing for the start of the season and investing in strategic growth projects.”
According to Gray, Knife River continued to make progress in the first quarter with its pricing strategy. The company also practiced more disciplined bidding to target higher-margin work and invest in growth opportunities.
Additionally, Gray says Knife River advanced a number of organic growth investments, including upgraded plants to add capacity, a greenfield ready-mixed concrete operation in the company’s Central segment, and the redistribution of plant assets into markets where the company believes it can achieve higher returns
Knife River also acquired a small ready-mix operation in South Dakota, providing infill growth between its Sioux Falls and Yankton locations.
“This was Knife River’s 85th acquisition, and we expect it to be a sign of more deals to come,” Gray says. “We have an active acquisition pipeline, and we continue to bolster our corporate development team.”
“At the same time, we have been busy adding to our backlog,” Gray adds. “At the end of the first quarter, contracting services backlog was $959.5 million, up from the prior-year period and with higher expected margins. During the quarter, we added $423 million to our backlog, a 66 percent increase from what we added in the same period last year.”
As Gray describes, the transportation departments in Knife River’s 14 states increased their total spending authority for 2024 by 16 percent from 2023.
“We see ample opportunities to bid upcoming work,” Gray says. “We believe we have solid footing heading into the heart of the construction season.”
