Knife River Corp. set several high marks in its second quarter, including records in revenue, gross profit and net income.
Knife River’s revenue in the second quarter was up 3 percent to $806.9 million, while its gross profit jumped 15 percent to $176.2 million. The second-quarter net income at Knife River was up 37 percent to $77.9 million.
Price increases in aggregates and contracting services drove revenue increases, according to the company.
“We had a very strong second quarter and start to our construction season, and I’d like to thank our team for their continued effort to execute on our Competitive EDGE plan to help deliver record results,” says Brian Gray, president and CEO of Knife River. “We are pleased to report record second-quarter revenue, net income and adjusted EBITDA, building upon the previous records set in the second quarter of 2023.”
By completing more preconstruction activities in the first quarter, Gray says Knife River pulled costs forward. As a result, the company was “able to hit the ground running earlier in the second quarter.”
“Gross profit margin for contracting services increased by 320 basis points from the same quarter last year,” Gray says. “Additionally, we have nearly $1 billion in backlog, at margins we expect to be slightly higher than the prior-year period.”
“At the same time, we continue to optimize the pricing of our materials to reflect their value in the market,” he adds. “These efforts are creating record profitability and have more than offset volume declines.”
Gray is particularly optimistic about the coming months for nonbuilding construction.
“Looking ahead, we see continued support for infrastructure investment,” Gray says. “We still expect to benefit from the Infrastructure Investment & Jobs Act (IIJA) – approximately 56 percent of IIJA funding has yet to be obligated in our market areas.
“Further, our states are continuing to be proactive,” he adds. “As of July 1, lawmakers in eight of Knife River’s 14 states have introduced additional legislation to fund construction projects. Funding in our states is at or near record levels, and the states are continuing to pursue long-term, resilient revenue solutions. It is clear there is public demand for safer, less-congested roads and bridges.”
Additionally, Gray says Knife River is actively working on several potential acquisitions.
“We have the strong balance sheet to support these investments,” he says. “We are in the right markets, with the right team and the right plan to deliver for our shareholders.”
