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Knife River Corporation Reports Second Quarter 2026 Financial Results

KNF
  • Knife River Corporation reported second quarter 2026 revenue of $938.6 million, a 13% increase from the prior year, driven by 20% growth in contracting services revenue.
  • Net income for the quarter was $43.9 million, a 13% decrease from $50.6 million in the same period last year, primarily due to lower asset sale gains.
  • Adjusted EBITDA was $139.7 million, a 1% decline year-over-year, as higher gross profits were offset by energy costs, project delays, and reduced asset sale gains.
  • The company raised its full-year 2026 financial guidance, projecting revenue between $3.4 billion and $3.6 billion, and Adjusted EBITDA between $520 million and $560 million.
  • Contracting services backlog increased sequentially to $1.2 billion as of June 30, 2026.
  • West segment revenue fell 9% year-over-year to $290.4 million due to public-agency work delays in Oregon, Hawaii, and Alaska.
  • Mountain segment revenue surged 34% to $236.5 million, driven by contracting services growth and acquisitions, though EBITDA remained flat.
  • Central segment revenue rose 28% to $325.6 million, supported by volume increases and the Texcrete acquisition, with EBITDA up 21%.
  • Energy Services segment revenue grew 6% to $103.0 million, with EBITDA increasing 16% due to California volumes and lower railcar maintenance expenses.
  • Aggregate pricing improved by 8% on a product mix-adjusted basis, while aggregates volumes are expected to increase in the high-single digits for the full year.
  • The company spent $244.5 million on growth initiatives in the first half of 2026, including $184.4 million for acquisitions and $60.1 million for aggregate expansions.
  • On May 15, 2026, Knife River issued a $400 million Term Loan B facility to finance acquisitions, repay debt, and support working capital.
  • Net leverage stood at 3.2x as of June 30, 2026, with $40.7 million in unrestricted cash and $1.6 billion in gross debt.
  • Gross profit growth was double-digit across material product lines, with ready-mix volumes expected to increase in the mid-teens for the full year.