GVA - Granite Reports Third Quarter 2023 Results

October, 31 2023 06:45 AM Granite Construction Incorporated

Q3 revenue increased 11% year-over-year to $1.1 billion
Q3 diluted EPS of $1.13 and adjusted diluted EPS (1) of $1.69
Operating cash flow increased $153 million sequentially
Record Committed and Awarded Projects ("CAP") (2) of $5.6 billion, a sequential increase of $147 million and year-over-year increase of $1.5 billion
2023 guidance and 2024 targets unchanged

Granite Construction Incorporated (NYSE: GVA) today announced results for the quarter ended September 30, 2023.

Third Quarter 2023 Results

Net income totaled $58 million, or $1.13 per diluted share, compared to net income of $69 million, or $1.36 per diluted share, for the same period in the prior year. Adjusted net income (1) totaled $75 million, or $1.69 per diluted share, compared to adjusted net income (1) of $57 million, or $1.28 per diluted share, for the same period in the prior year.

Revenue increased $108 million to $1.1 billion compared to $1.0 billion for the same period in the prior year. Both Construction and Materials segments posted year-over-year increases with the California and Mountain Groups up 15% and 11%, respectively, as well as a slight increase in revenue in the Central Group.
Gross profit increased $52 million to $167 million compared to $115 million for the same period in the prior year.
Selling, general, and administrative (“SG&A”) expenses increased $13 million to $75 million, or 6.7% of revenue, compared to $62 million, or 6.1% of revenue, for the same period in the prior year. The increase in SG&A expenses was primarily due to $11 million of additional incentive compensation expense year-over-year.
Adjusted EBITDA (1) totaled $124 million, compared to $91 million for the same period in the prior year.

"I am pleased with our third quarter performance,” said Kyle Larkin, Granite President and Chief Executive Officer. “These results demonstrate the strong progress we are making towards the goals identified in our strategic plan that we introduced just over two years ago. We have built record CAP while also de-risking our project portfolio by focusing on best value projects. During this same time, we have also bolstered our materials business through both greenfield and bolt-on investments, and we improved segment margins. We are growing revenue and increasing adjusted EBITDA margin and believe we are on track to reach our 2024 financial targets.”

Nine Months Ended September 30, 2023 Results

Net income totaled $18 million, or $0.40 per diluted share, compared to net income of $61 million, or $1.25 per diluted share, for the same period in the prior year. Adjusted net income (1) totaled $103 million, or $2.32 per diluted share, compared to adjusted net income (1) of $79 million, or $1.75 per diluted share, for the same period in the prior year.

Revenue increased $63 million to $2.58 billion compared to $2.51 billion for the same period in the prior year.
Gross profit increased $29 million to $302 million compared to $273 million for the same period in the prior year.
SG&A expenses were $212 million, or 8.3% of revenue, compared to $192 million, or 7.6% of revenue, for the same period in the prior year. The increase was primarily driven by higher incentive compensation and non-qualified deferred compensation expenses in 2023.
Adjusted EBITDA (1) totaled $195 million compared to $160 million for the same period in the prior year.

(1)

Adjusted net income, adjusted diluted earnings per share, earnings before interest, taxes, depreciation, and amortization (“EBITDA”), EBITDA margin, adjusted EBITDA, and adjusted EBITDA margin are non-GAAP measures. Please refer to the description and reconciliation of non-GAAP measures in the attached tables.

(2)

CAP is comprised of revenue we expect to record in the future on executed contracts, including 100% of our consolidated joint venture contracts and our proportionate share of unconsolidated joint venture contracts, as well as the general construction portion of construction manager/general contractor, construction manager/at risk and progressive design build contracts to the extent contract execution and funding is probable.

Three and Nine Months ended September 30, 2023 ( Unaudited - dollars in thousands)

Construction Segment

Three Months Ended September 30,

Nine Months Ended September 30,


2023


As Restated

Change


2023


As Restated

Change


2022





2022


Revenue
$
945,698


$
847,371


$
98,327

11.6
%

$
2,198,527


$
2,138,858


$
59,669

2.8
%
Gross profit
$
137,162


$
93,017


$
44,145

47.5
%

$
253,021


$
231,748


$
21,273

9.2
%
Gross profit as a percent of revenue

14.5
%


11.0
%






11.5
%


10.8
%

Committed and Awarded Projects
September 30, 2023

June 30, 2023

Change - Quarter over Quarter

September 30, 2022

Change - Year over Year
California
$
2,345,294

$
2,345,611

$
(317
)

—
%

$
1,552,939

$
792,355

51.0
%
Central

1,811,426


1,599,538


211,888


13.2
%


1,527,112


284,314

18.6
%
Mountain

1,427,803


1,492,439


(64,636
)

(4.3
%)


996,685


431,118

43.3
%
Total
$
5,584,523

$
5,437,588

$
146,935


2.7
%

$
4,076,736

$
1,507,787

37.0
%

Revenue in the third quarter increased 12% year-over-year. This increase overcame a weather-related slow start to the year and resulted in a revenue increase of 3% for the nine-months-ended September 30, 2023 compared to the same period in the prior year. The year-over-year revenue increase in the quarter was driven by strong performances by the California and Mountain Groups, which increased revenue by 21% and 12%, respectively. Central Group revenue was flat compared to the same period in the prior year as newer projects ramp up and replace several large projects that are nearing completion.

Gross profit and gross profit margin during the three and nine months ended September 30, 2023 increased over the same periods in the prior year despite the negative impact of the I-64 High Rise Bridge Project in Virginia, which reduced gross profit in the third quarter by $8 million, and after non-controlling interest by $4 million. For the nine months ended September 30, 2023, the impact to gross profit from the project was $40 million and the impact after non-controlling interest was $20 million. Final completion for the project is expected in the fourth quarter.

CAP increased $147 million sequentially and $1.5 billion year-over-year. Both public and private markets continue to be strong and contribute to our record CAP as of the end of the quarter. With the current market environment, we believe there are substantial opportunities to build CAP in the fourth quarter and into 2024.

Materials Segment

Three Months Ended September 30,

Nine Months Ended September 30,


2023



2022


Change


2023



2022


Change
Revenue
$
171,122


$
161,539


$
9,583

5.9
%

$
376,913


$
373,185


$
3,728

1.0
%
Gross profit
$
29,481


$
22,038


$
7,443

33.8
%

$
49,067


$
40,965


$
8,102

19.8
%
Gross profit as a percent of revenue

17.2
%


13.6
%






13.0
%


11.0
%

Materials revenue and gross profit for the three and nine months ended September 30, 2023 increased compared to the same periods of the prior year driven by higher asphalt and aggregate sales prices. Additionally, in 2023, oil and energy costs have normalized compared to the significant inflation in 2022 which negatively impacted materials gross profit margin in the prior year.

Outlook

Our guidance for 2023 is unchanged as noted below:

Revenue in the range of $3.35 billion to $3.45 billion
Adjusted EBITDA margin in the range of 7.5% to 8.5%
SG&A expense in the range of 8.0% to 8.5% of revenue
Mid-20s effective tax rate for adjusted net income
Capital expenditures of approximately $120 million

The Company does not provide a reconciliation of forward-looking adjusted EBITDA margin to the most directly comparable forward-looking GAAP measure of net income attributable to Granite Construction Incorporated because the Company cannot predict with a reasonable degree of certainty and without unreasonable efforts certain excluded items that are inherently uncertain and depend on various factors. For these reasons, we are unable to assess the probable significance of the unavailable information.

Conference Call

Granite will conduct a conference call today, October 31, 2023, at 8:00 a.m. Pacific Time/11:00 a.m. Eastern Time to discuss the results of the quarter ended September 30, 2023. The Company invites investors to listen to a live audio webcast of the investor conference call on its Investor Relations website, https://investor.graniteconstruction.com . The investor conference call will also be available by calling 1-877-328-5503; international callers may dial 1-412-317-5472. An archive of the webcast will be available on Granite's Investor Relations website approximately one hour after the call. A replay will be available after the live call through November 7, 2023, by calling 1-877-344-7529, replay access code 5819938; international callers may dial 1-412-317-0088.

About Granite

Granite is America’s Infrastructure Company™. Incorporated since 1922, Granite (NYSE:GVA) is one of the largest diversified construction and construction materials companies in the United States as well as a full-suite civil construction provider. Granite’s Code of Conduct and strong Core Values guide the Company and its employees to uphold the highest ethical standards. Granite is an industry leader in safety and an award-winning firm in quality and sustainability. For more information, visit graniteconstruction.com , and connect with Granite on LinkedIn , Twitter , Facebook and Instagram .

Forward-looking Statements

Any statements contained in this news release that are not based on historical facts, including statements regarding future events, occurrences, opportunities, circumstances, activities, performance, growth, demand, strategic plans, shareholder value, outcomes, outlook, 2023 fiscal year guidance for revenue, adjusted EBITDA margin, SG&A expense, effective tax rate, and capital expenditures, 2024 targets unchanged, Committed and Awarded Projects (“CAP”), results, our belief that we are on track to reach our 2024 financial targets, the final completion of the I-64 project is expected in the fourth quarter and our belief that there are substantial opportunities to continue to build CAP in the fourth quarter and into 2024 constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by words such as “future,” “outlook,” “assumes,” “believes,” “expects,” “estimates,” “anticipates,” “intends,” “plans,” “appears,” “may,” “will,” “should,” “could,” “would,” “continue,” "guidance" and the negatives thereof or other comparable terminology or by the context in which they are made. These forward-looking statements are estimates reflecting the best judgment of senior management and reflect our current expectations regarding future events, occurrences, opportunities, circumstances, activities, performance, growth, demand, strategic plans, shareholder value, outcomes, outlook, 2023 fiscal year guidance for revenue, adjusted EBITDA margin, SG&A expense, effective tax rate, and capital expenditures, 2024 targets unchanged, CAP, results, our belief that we are on track to reach our 2024 financial targets, the final completion of the I-64 project is expected in the fourth quarter and our belief that there are substantial opportunities to continue to build CAP in the fourth quarter and into 2024. These expectations may or may not be realized. Some of these expectations may be based on beliefs, assumptions or estimates that may prove to be incorrect. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our business, financial condition, results of operations, cash flows and liquidity. Such risks and uncertainties include, but are not limited to, those described in greater detail in our filings with the Securities and Exchange Commission, particularly those described in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

Due to the inherent risks and uncertainties associated with our forward-looking statements, the reader is cautioned not to place undue reliance on them. The reader is also cautioned that the forward-looking statements contained herein speak only as of the date of this news release and, except as required by law; we undertake no obligation to revise or update any forward-looking statements for any reason.

GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited - in thousands, except share and per share data)


September 30, 2023

December 31, 2022
ASSETS



Current assets



Cash and cash equivalents
$
292,124

$
293,991
Short-term marketable securities

31,278


39,374
Receivables, net

743,091


463,987
Contract assets

282,280


241,916
Inventories

92,131


86,809
Equity in construction joint ventures

206,669


183,808
Other current assets

47,477


37,411
Total current assets

1,695,050


1,347,296
Property and equipment, net

569,722


509,210
Long-term marketable securities

5,750


26,569
Investments in affiliates

91,101


80,725
Goodwill

74,264


73,703
Right of use assets

56,874


49,079
Deferred income taxes, net

29,043


22,208
Other noncurrent assets

58,517


59,143
Total assets
$
2,580,321

$
2,167,933




LIABILITIES AND EQUITY



Current liabilities



Current maturities of long-term debt
$
1,475

$
1,447
Accounts payable

477,031


334,392
Contract liabilities

221,983


173,286
Accrued expenses and other current liabilities

355,987


288,469
Total current liabilities

1,056,476


797,594
Long-term debt

403,785


286,934
Long-term lease liabilities

42,198


32,170
Deferred income taxes, net

3,812


1,891
Other long-term liabilities

67,473


64,199
Commitments and contingencies



Equity



Preferred stock, $0.01 par value, authorized 3,000,000 shares, none outstanding

—


—
Common stock, $0.01 par value, authorized 150,000,000 shares; issued and outstanding: 43,926,576 shares as of September 30, 2023 and 43,743,907 shares as of December 31, 2022

439


437
Additional paid-in capital

472,379


470,407
Accumulated other comprehensive income

894


788
Retained earnings

481,636


481,384
Total Granite Construction Incorporated shareholders’ equity

955,348


953,016
Non-controlling interests

51,229


32,129
Total equity

1,006,577


985,145
Total liabilities and equity
$
2,580,321

$
2,167,933

GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited - in thousands, except per share data)





Three Months Ended September 30,

Nine Months Ended September 30,


2023


As Restated ⁽¹⁾


2023


As Restated ⁽¹⁾


2022




2022

Revenue







Construction
$
945,698


$
847,371


$
2,198,527


$
2,138,858

Materials

171,122



161,539



376,913



373,185

Total revenue

1,116,820



1,008,910



2,575,440



2,512,043

Cost of revenue







Construction

808,536



754,354



1,945,506



1,907,110

Materials

141,641



139,501



327,846



332,220

Total cost of revenue

950,177



893,855



2,273,352



2,239,330

Gross profit

166,643



115,055



302,088



272,713

Selling, general and administrative expenses

74,794



61,795



212,479



192,036

Other costs, net

19,843



(490
)


37,973



22,401

Gain on sales of property and equipment, net

(1,812
)


(949
)


(7,793
)


(10,462
)
Operating income

73,818



54,699



59,429



68,738

Other (income) expense







Loss on debt extinguishment

—



—



51,052



—

Interest income

(4,293
)


(1,894
)


(11,287
)


(3,246
)
Interest expense

4,877



2,519



11,899



10,003

Equity in income of affiliates, net

(7,147
)


(3,491
)


(19,378
)


(9,656
)
Other (income) expense, net

462



77



(2,713
)


4,646

Total other (income) expense, net

(6,101
)


(2,789
)


29,573



1,747

Income before income taxes

79,919



57,488



29,856



66,991

Provision for (benefit from) income taxes

22,423



(7,710
)


21,978



7,310

Net income

57,496



65,198



7,878



59,681

Amount attributable to non-controlling interests

128



4,104



9,723



1,569

Net income attributable to Granite Construction Incorporated
$
57,624


$
69,302


$
17,601


$
61,250









Net income per share attributable to common shareholders:







Basic
$
1.31


$
1.58


$
0.40


$
1.37

Diluted
$
1.13


$
1.36


$
0.40


$
1.25

Weighted average shares outstanding:







Basic

43,924



43,973



43,861



44,739

Diluted

53,612



51,863



44,447



52,613

(1)

As previously disclosed in our 2022 Annual Report on Form 10-K filed on February 21, 2023, the restatement of our unaudited quarterly financial information for the first three quarters in the year ended December 31, 2022 was necessary.

GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ( Unaudited - in thousands )

Nine Months Ended September 30,

2023


As Restated


2022

Operating activities



Net income
$
7,878


$
59,681

Adjustments to reconcile net income to net cash used in operating activities:



Depreciation, depletion and amortization

65,298



61,714

Amortization related to long-term debt

1,689



1,901

Non-cash loss on debt extinguishment

51,052



—

Gain on sale of business

—



(3,278
)
Gain on sales of property and equipment, net

(7,793
)


(10,462
)
Deferred income taxes

1,542



(17,819
)
Stock-based compensation

8,630



6,151

Equity in net (income) loss from unconsolidated joint ventures

(4,535
)


25,066

Net income from affiliates

(19,378
)


(9,656
)
Other non-cash adjustments

5,659



38

Changes in assets and liabilities

(75,844
)


(127,967
)
Net cash provided by (used in) operating activities
$
34,198


$
(14,631
)
Investing activities



Purchases of marketable securities

(9,740
)


(59,810
)
Maturities of marketable securities

40,000



15,000

Purchases of property and equipment

(108,963
)


(97,753
)
Proceeds from sales of property and equipment

14,613



21,110

Proceeds from company owned life insurance

1,545



—

Proceeds from the sale of business

—



142,571

Acquisition of business

(26,933
)


—

Issuance of notes receivable

—



(7,560
)
Collection of notes receivable

208



316

Net cash provided by (used in) investing activities
$
(89,270
)

$
13,874

Financing activities



Proceeds from long-term debt

55,000



50,000

Debt principal repayments

(304,851
)


(124,911
)
Capped call transactions

(53,035
)


—

Redemption of warrants

(13,201
)


—

Proceeds from issuance of 3.75% Convertible Notes

373,750



—

Debt issuance costs

(10,024
)


—

Cash dividends paid

(17,101
)


(17,587
)
Repurchases of common stock

(3,900
)


(70,724
)
Contributions from non-controlling partners

35,400



11,925

Distributions to non-controlling partners

(9,100
)


(6,725
)
Other financing activities, net

267



208

Net cash provided by (used in) financing activities
$
53,205


$
(157,814
)
Net decrease in cash, cash equivalents and restricted cash

(1,867
)


(158,571
)
Cash, cash equivalents and $0 and $1,512 in restricted cash at beginning of period

293,991



413,655

Cash, cash equivalents and $0 in restricted cash at end of period
$
292,124


$
255,084

Non-GAAP Financial Information

The tables below contain financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Specifically, management believes that non-GAAP financial measures such as EBITDA and EBITDA margin are useful in evaluating operating performance and are regularly used by securities analysts, institutional investors and other interested parties, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. We are also providing adjusted EBITDA and adjusted EBITDA margin, non-GAAP measures, to indicate the impact of loss on debt extinguishment and other costs, net, which include investigation-related legal fees and settlement charges, a litigation charge, reorganization costs, strategic acquisition and divestiture expenses, non-cash impairment charges and a gain on sale of a business in 2022.

We provide adjusted income before income taxes, adjusted provision for income taxes, adjusted net income attributable to Granite Construction Incorporated, adjusted diluted weighted average shares of common stock and adjusted diluted earnings per share attributable to common shareholders, non-GAAP measures, to indicate the impact of the following:

Other costs, net as described above;
Transaction costs which includes acquired intangible amortization expense and acquisition related depreciation related to the acquisition of Layne and Liquiforce;
Loss on debt extinguishment, and
Income taxes related to the disposal of Inliner goodwill, tax basis difference on held for sale entities and establishment of valuation allowance.

Management believes that these additional non-GAAP financial measures facilitate comparisons between industry peer companies, and management uses these non-GAAP financial measures in evaluating the Company's performance. However, the reader is cautioned that any non-GAAP financial measures provided by the Company are provided in addition to, and not as alternatives for, the Company's reported results prepared in accordance with GAAP. Items that may have a significant impact on the Company's financial position, results of operations and cash flows must be considered when assessing the Company's actual financial condition and performance regardless of whether these items are included in non-GAAP financial measures. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures provided by the Company may not be comparable to similar measures provided by other companies.

GRANITE CONSTRUCTION INCORPORATED EBITDA AND ADJUSTED EBITDA ⁽¹⁾ (Unaudited - dollars in thousands)





Three Months Ended September 30,

Nine Months Ended September 30,


2023


As Restated


2023


As Restated


2022




2022

EBITDA:







Net income attributable to Granite Construction Incorporated
$
57,624


$
69,302


$
17,601


$
61,250

Net income margin (2)

5.2
%


6.9
%


0.7
%


2.4
%








Depreciation, depletion and amortization expense (3)

23,911



29,610



65,722



62,437

Provision for (benefit from) income taxes

22,423



(7,710
)


21,978



7,310

Interest expense, net

584



625



612



6,757

EBITDA(1)
$
104,542


$
91,827


$
105,913


$
137,754

EBITDA margin(1)(2)

9.4
%


9.1
%


4.1
%


5.5
%








ADJUSTED EBITDA:







Other costs, net

19,843



(490
)


37,973



22,401

Loss on debt extinguishment

—



—



51,052



—

Adjusted EBITDA(1)
$
124,385


$
91,337


$
194,938


$
160,155

Adjusted EBITDA margin(1)(2)

11.1
%


9.1
%


7.6
%


6.4
%

(1)

We define EBITDA as GAAP net income attributable to Granite Construction Incorporated, adjusted for net interest expense, taxes, depreciation, depletion and amortization. Adjusted EBITDA and adjusted EBITDA margin exclude the impact of Other costs, net, and loss on debt extinguishment, as described above.
(2)

Represents net income, EBITDA and adjusted EBITDA divided by consolidated revenue of $1.1 billion and $1.0 billion, for the three months ended September 30, 2023 and 2022, respectively and $2.6 billion and $2.5 billion for the nine months ended September 30, 2023 and 2022, respectively.
(3)

Amount includes the sum of depreciation, depletion and amortization which are classified as cost of revenue and selling, general and administrative expenses in the condensed consolidated statements of operations.

GRANITE CONSTRUCTION INCORPORATED ADJUSTED NET INCOME (LOSS) RECONCILIATION (Unaudited - in thousands, except per share data)





Three Months Ended September 30,

Nine Months Ended September 30,


2023


As Restated


2023


As Restated


2022




2022

Income before income taxes
$
79,919


$
57,488


$
29,856


$
66,991

Other costs, net

19,843



(490
)


37,973



22,401

Transaction costs

92



8,012



5,046



8,012

Loss on debt extinguishment

—



—



51,052



—

Adjusted income before income taxes
$
99,854


$
65,010


$
123,927


$
97,404









Provision for (benefit from) income taxes
$
22,423


$
(7,710
)

$
21,978


$
7,310

Tax effect of goodwill disposal related to sale of business

—



—



—



(10,070
)
Tax basis difference on held for sale entities

—



17,691



—



17,691

Tax expense to establish valuation allowance

(1,542
)


—



(1,542
)


—

Tax effect of adjusting items (1)

3,874



1,956



9,876



4,787

Adjusted provision for income taxes
$
24,755


$
11,937


$
30,312


$
19,718









Net income attributable to Granite Construction Incorporated
$
57,624


$
69,302


$
17,601


$
61,250

After-tax adjusting items

17,603



(12,125
)


85,737



18,005

Adjusted net income attributable to Granite Construction Incorporated
$
75,227


$
57,177


$
103,338


$
79,255









Diluted weighted average shares of common stock (2)

53,612



51,863



44,447



52,613

Less: dilutive effect of Convertible Notes (3)

(9,099
)


(7,309
)


—



(7,309
)
Adjusted diluted weighted average shares of common stock

44,513



44,554



44,447



45,304









Diluted net income per share attributable to common shareholders
$
1.13


$
1.36


$
0.40


$
1.25

After-tax adjusting items per share attributable to common shareholders

0.56



(0.08
)


1.92



0.50

Adjusted diluted earnings per share attributable to common shareholders
$
1.69


$
1.28


$
2.32


$
1.75

(1)

The tax effect of adjusting items was calculated using the Company’s estimated annual statutory tax rate. The tax effect of adjusting items for the three and nine months ended September 30, 2023 excludes the $51 million loss on debt extinguishment and $5.0 million non-cash impairment charges included in “Other costs, net” which are not tax deductible. The tax effect of adjusting items for the three and nine months ended September 30, 2022 excludes a $12 million accrual related to the resolution of the SEC investigation which is not tax deductible.
(2)

Diluted weighted average shares of common stock includes the dilutive effect on net income attributable to Granite Construction Incorporated of the 2.75% Convertible Notes and the 3.75% Convertible Notes potentially converting into 9,099 shares of common stock for the three months ended September 30, 2023 and 7,309 shares of common stock for the three and nine months ended September 30, 2022. For the nine months ended September 30, 2023, the potential dilutive effect of the 9,099 shares related to the 2.75% Convertible Notes and the 3.75% Convertible Notes is not included as their inclusion would be antidilutive.
(3)

When calculating diluted net income attributable to common shareholders, GAAP requires that we include potential share dilution from the 2.75% Convertible Notes and the 3.75% Convertible Notes when not antidilutive. For the purposes of calculating adjusted diluted net income per share attributable to common shareholders, the dilutive effect from the 2.75% Convertible Notes and 3.75% Convertible Notes is removed to reflect the impact of the purchased equity derivative instruments which offset any potential share dilution above the $31.47 conversion price up to a share price of $53.44 for the 2.75% Convertible Notes and above the $46.12 conversion price up to a share price of $79.83 for the 3.75% Convertible Notes. The average share price did not exceed $53.44 in any period.

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Investors
Wenjun Xu, 831-761-7861

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Erin Kuhlman, 831-768-4111

Company Name:	Granite Construction Incorporated
Stock Symbol:	GVA
Market:	NYSE
Website:	graniteconstruction.com