Key Takeaways
Cardinal Infrastructure Group (NASDAQ: CDNL) reported first-quarter revenue jumped 105% year-over-year to approximately $168 million and raised its full-year outlook on the back of record demand and a major acquisition.
"These are exceptional numbers, and they are the result of years of building this platform and a team that executes relentlessly at every level,” Chairman and Chief Executive Officer Jeremy Spivey said in a statement.
The results were bolstered by broad-based demand and the mid-February acquisition of A.L. Grading Contractors. The company's record $854 million backlog provides more than 12 months of revenue visibility at the current run rate, according to Chief Financial Officer Mike Rowe.
Shares of Cardinal Infrastructure were not yet trading pre-market. The company's raised guidance and successful expansion into the data center market signal a pivotal moment for the infrastructure services provider as it scales its operations across the Southeast.
Cardinal lifted its 2026 revenue forecast to a range of $675 million to $685 million, an increase from its prior range of $665 million to $678 million. The company attributed the stronger outlook to a better-than-expected first quarter, a robust bidding environment, and contributions from its recent acquisition. Organic revenue growth was 64% in the quarter.
The company's backlog increased 60% from the prior-year period to an all-time high of $854 million. "The runway in front of Cardinal is significant, and we are focused on executing for our customers and our shareholders," Spivey said.
The A.L. Grading Contractors deal, which closed in mid-February, was a key contributor to the quarter's results. Chief Operating Officer Benji Wood, who joined through the acquisition, said Cardinal's M&A pipeline is "the most active it has ever been," with opportunities for both tuck-in deals and larger geographic expansions.
The company is also making strategic inroads into new markets. Spivey highlighted a recently won $24 million data center contract, a significant step in diversifying from its historical residential focus, which has declined from 75% to 65% of its business mix.
Adjusted EBITDA for the quarter was $27 million, up 84% year-over-year. However, adjusted EBITDA margin contracted to 16.0% from 17.8% in the prior-year period. Management attributed the margin pressure to seasonal winter weather, which limited higher-margin work, and costs associated with growth initiatives and the A.L. Grading integration. On a gross profit level, margins expanded 280 basis points to 14.9%, reflecting scale and cost controls.
The guidance raise and successful diversification into high-demand sectors like data centers signal that management's strategy is executing effectively. Investors will watch the second-quarter results for the initial contribution from the company's new asphalt plant and further progress on new market penetration.
This article is for informational purposes only and does not constitute investment advice.
