U.S. Concrete Q4 2025 Earnings Call: Contradictions Emerge on Market Recovery, Pricing, Growth Strategy, and CapEx

Date of Call: Jan 13, 2026

Financials Results

• Revenue: $108.8 million, compared to $111.5 million in the prior year quarter (down 2.4% YOY)
• EPS: $0.09 per diluted share, compared to $0.16 per diluted share in the prior year quarter (down 43.8% YOY)
• Gross Margin: 39.8%, declined 170 basis points from 41.5% a year ago

Guidance:

• Revenue for fiscal 2026 expected to range between $390 million and $410 million.
• Adjusted EBITDA for fiscal 2026 expected to range between $90 million and $100 million.
• Free cash flow expected to be at least $40 million.
• Expects 2026 revenue to be roughly flat year-over-year in infrastructure and residential end markets.
• Guidance assumes no meaningful recovery in construction markets during fiscal 2026.

Business Commentary:

Revenue and Market Conditions:

• Concrete Pumping Holdings reported revenue of $108.8 million for Q4 2025, compared to $111.5 million in the prior year quarter, reflecting a slight year-over-year decline.
• The decline was driven by continued timing delays in commercial construction activity and softness in residential demand due to high interest rates.

Segment Performance:

• The U.S. Concrete Pumping segment reported revenue of $72.2 million, down from $74.5 million in the prior year quarter.
• Infrastructure projects accounted for 24% of U.S. Concrete Pumping revenue in fiscal 2025, showing year-over-year improvement, while residential demand softened late in the fiscal year.

Eco-Pan Waste Management Services Growth:

• The U.S. Concrete Waste Management Services segment increased revenue by 8% to $21.3 million, driven by higher pan pickup volumes and continued pricing momentum.
• This growth underscores the durability of the business despite challenges in the broader U.S. construction markets.

Capital Investment and Regulatory Compliance:

• The company is accelerating a $22 million investment from fiscal 2027 into fiscal 2026 to comply with upcoming 2027 stricter NOx emission standards.
• This decision is based on anticipated disruptions from first-generation truck technologies and expected increases in OEM production costs.

Outlook and Guidance:

• For fiscal 2026, the company expects revenue to range between $390 million and $410 million, with adjusted EBITDA between $90 million and $100 million.
• The outlook assumes no meaningful recovery in construction markets, with infrastructure and residential end markets expected to have roughly flat revenue year-over-year.

Sentiment Analysis:

Overall Tone: Neutral

• Management acknowledges a 'challenging macroeconomic backdrop' and 'softness in residential demand,' but highlights 'durability of our operating model' and 'steady year-over-year growth' in waste management. They are 'well positioned to benefit as construction activity ultimately improves' and have 'confidence in our ability to deliver healthy financial and operating results through a variety of environments.'

Q&A:

• Question from Timothy Mulrooney (William Blair & Company L.L.C.): So a couple of questions on the guide here. I know you're expecting construction end markets to remain challenged this year, but it looks like you're actually expecting revenue to be up modestly at the midpoint. So can you just talk about the drivers behind that? Is the year-over-year growth primarily from the acquisition? Or are you expecting some organic growth as well?
  Response: The expected revenue growth at the midpoint is primarily driven by some pricing improvement, with volumes largely expected to be flat year-over-year.

• Question from Timothy Mulrooney (William Blair & Company L.L.C.): And then sticking on the guidance for a minute. It looks like you expect revenue to be up a little bit, but margins to contract, correct me if I'm wrong on that math. But if I'm right, how should we think about the primary drivers of that margin pressure in 2026 in the context of that low single-digit top line growth implied by the midpoint of your outlook? Is it just fleet utilization? Or is there more that I should take into consideration now?
  Response: The expected margin pressure is mostly due to lower fleet utilization, as volume scaling provides incremental margin, but flat volume leads to a marginal decline in margin percentage.

• Question from Timothy Mulrooney (William Blair & Company L.L.C.): And if I could just sneak one more in, if you'd permit me. I wanted to ask about your outlook for residential construction, which I know continues to be a challenge right now, but it was a source of strength not all that long ago. Would you characterize this market right now for you for new home construction as getting progressively softer in recent months or stabilizing or on a slow path to recovery? I asked because we're getting all sorts of different signals and opinions from macro data points out there.
  Response: In key regions, residential demand was softer last year but is starting to improve slightly, and management is somewhat optimistic on residential, expecting improvement during the year.

• Question from Brent Thielman (D.A. Davidson & Co.): Yes, just I wanted to maybe just follow up on the overall kind of growth outlook for 2026 as you sit here today and maybe just ask in a different way your high-level views and expectations for each of the business groups. I guess I'm thinking a little more towards the U.K. group and Eco-Pan. What's sort of a good framework for us to think about for those 2 businesses with what you see in front of them?
  Response: For the U.K., public funded work (HS2, energy) should keep revenue strong; the Ireland acquisition is a small but complementary addition; the timing of a commercial market rebound is uncertain. For Eco-Pan, high single-digit to double-digit growth is expected. For U.S. Concrete Pumping, infrastructure is performing better, but the commercial market recovery depends on factors like tariff discussions.

• Question from Brent Thielman (D.A. Davidson & Co.): Really helpful, Bruce. Appreciate all that. Maybe just on Eco-Pan and getting to that high single, potentially low double-digit kind of growth. Is that contingent on your ability to get into new markets? Or can you get there in the existing sort of geographies that you're operating in?
  Response: Eco-Pan growth is driven by both new market entries (which take time to develop) and the continued maturation of existing markets, though there is still room for greater density in current areas.

• Question from Brent Thielman (D.A. Davidson & Co.): Got it. Maybe just the last question, the CapEx pull forward. Does this address all of your requirements associated with the upcoming regulations? Or should we think there's another big flood in CapEx in the next year, too?
  Response: The accelerated CapEx addresses almost all the requirements for the 2027 NOx emission standards, aiming to avoid the disruptions seen during the previous major regulation change.

• Question from Andrew J. Wittmann (Robert W. Baird & Co. Incorporated): It's nice to have a CEO that has been around long enough to learn from the 2008 truck crisis to avoid in the past. So that's a good thing. I guess just Eco-Pan margins, good revenue growth. EBITDA didn't come through quite as much, Iain. Was that a comp issue? Or you had to mention that you said that the pickups of the deliveries were a big driver. So I guess that's probably a little lower margin. Is that what it is? Is that the bridge? Normally, I would expect positive leverage out of the business here, but that you could address?
  Response: The lower EBITDA margin percentage was partly due to overhead investments in new regions, but the underlying ROI remains healthy.

• Question from Andrew J. Wittmann (Robert W. Baird & Co. Incorporated): Okay. And then I just thought I'd ask about fuel actually. Crude prices are way down, but it doesn't look like diesel's followed suit quite as much. I was hoping you could just address what the net impact was in fuel to the quarter? And what you're looking for what's kind of underwritten in your guidance? I know obviously, there's a range, so there's a range in your fuel outcomes as well. But so are you thinking is that a headwind year-over-year in '26 tailwind? I know that diesel prices in November were super low actually, but they've kind of popped up a little bit more since then. So just maybe if you could address the topic a hole would be helpful for us.
  Response: Fuel costs were largely flat year-over-year in the quarter and are not expected to be a significant headwind or tailwind in fiscal 2026.

• Question from Andrew J. Wittmann (Robert W. Baird & Co. Incorporated): Got it. And then just, Bruce, just I know the Ireland investment is not that significant, but it feels kind of like a bit of a change. I guess you're not in Dublin. I know the whole country is kind of growing, but is this a one-off? Or do you feel like now that you've got at least some kind of a flag planted here that you need to build out the rest of the Republic. And maybe if you could just talk about any things that we should think about for modeling that one, Iain, that would be just helpful cash outlay or how much revenue we should expect from it just so we can understand what it might contribute?
  Response: The Ireland acquisition is not a one-off; there are opportunities for further acquisitions and growth in Ireland. It contributed about $2 million in revenue and $0.5 million in EBITDA.

• Question from Andrew J. Wittmann (Robert W. Baird & Co. Incorporated): Okay. Last one for me. Sorry to keep going here, but just run all up. Bruce, just kind of on the environment, I guess, for lack of a better term. At first, when interest rates were going up and things were kind of slowing down, there was talk about projects delayed timing, not cancellation, you still kind of had them on the roster for doing the job someday. I just wanted to check in on that, has there been, in fact, now cancellations that you're going to have to kind of rewin the jobs? Or what is kind of status of some of the stuff that was a onetime plan, but has been kind of slow moving now for a while. I'm just kind of curious what you kind of see there and kind of where your backlog stands today as a result of that.
  Response: Some office building and manufacturing projects have been shelved due to economic conditions and tariff uncertainty, but there is potential for them to resume. The company is currently in a strong position with chip plant and data center projects.

Contradiction Point 1

U.S. Concrete Pumping Market Recovery and Volume Outlook

A shift in the expected timing and drivers for market recovery and volume growth.

What are your views and expectations for the U.K. group and Eco-Pan in 2026? - Brent Thielman (D.A. Davidson & Co.)

2025Q4: The commercial market rebound is uncertain, as it may be 6 months behind the U.S. market. - Bruce Young(CEO)

Can you address the guidance suggesting margins could increase despite lower Q4 revenue, and what informs the updated recovery timeline pushing out the expected positive volume growth compared to last quarter? - Andrew J. Wittmann (Robert W. Baird & Co. Incorporated)

2025Q3: Some more positive signals are emerging... The company is becoming more optimistic for next year but it's too early to tell the exact timing of the recovery. - Bruce Young(CEO)

Contradiction Point 2

Pricing Pressure and Margin Drivers in U.S. Pumping

A change in the primary driver of margin pressure from lower volumes to fleet utilization.

For 2026 guidance, with slight revenue growth but contracting margins, what are the primary drivers of margin pressure? - Timothy Mulrooney (William Blair & Company L.L.C.)

2025Q4: The margin pressure is primarily due to fleet utilization. With volumes flat, the margin percentage is expected to decline slightly... - Iain Humphries(CFO)

What pricing pressures are you seeing in the U.S. pumping business, and are they stabilizing? Additionally, what's driving the lower margins, and will they reverse as volumes recover? - Brent Thielman (D.A. Davidson & Co.)

2025Q3: Lower volumes are the primary driver of margin pressure. Cost control initiatives helped but did not fully offset the impact... - Iain Humphries(CFO)

Contradiction Point 3

Eco-Pan Growth Strategy and Market Penetration

A contradiction on whether Eco-Pan's growth is primarily through new markets or also through density in existing ones.

Is Eco-Pan's growth dependent on expanding into new markets, or can it grow within current markets? - Brent Thielman (D.A. Davidson & Co.)

2025Q4: Eco-Pan grows through expanding into new markets each year, though these take time to develop. There is limited opportunity for significant density increase in existing mature markets. - Bruce Young(CEO)

How does your geographic footprint align with the concentration of large projects like semiconductor fabs and data centers in specific regions? - Benjamin Luke McFadden (William Blair & Company L.L.C.)

2025Q3: The company has recently expanded into new areas to capture sizable projects and will continue to do so in the future. - Bruce Young(CEO)

Contradiction Point 4

Outlook for Construction Market Recovery

Expectations for a commercial construction recovery shifted from 2026 to an uncertain timeline, influenced by tariff and interest rate factors.

What is your outlook for each of the U.K. group and Eco-Pan in 2026? - Brent Thielman (D.A. Davidson & Co.)

2025Q4: The commercial market rebound is uncertain, as it may be 6 months behind the U.S. market. - Bruce Young(CEO)

What factors could delay construction market recovery beyond 2026? - Benjamin Luke McFadden (William Blair & Company L.L.C.)

2025Q2: The company is optimistic a recovery will follow once tariff uncertainty settles and interest rates come down at the end of the year. - Bruce F. Young(CEO)

Contradiction Point 5

Capital Expenditure Outlook

Contradiction on the expected level and timing of capital investments.

Does the accelerated CapEx cover all upcoming emission regulation requirements, or will another major CapEx wave be needed next year? - Brent Thielman (D.A. Davidson & Co., Research Division)

2025Q4: The pull-forward of $22 million from 2027 into 2026 addresses almost all of the regulatory requirements. - Bruce Young(CEO)

With recent low CapEx, will there be an increase in capital spending? - Brent Thielman (D.A. Davidson)

2025Q1: **No meaningful change** is expected in capital investment. - Bruce Young(CEO)