Construction Partners, Inc. (ROAD): Business Model Canvas [Dec-2025 Updated]

You're looking to cut through the noise and see exactly how Construction Partners, Inc. (ROAD) built its business, especially after a big year where they pulled in $2.812 billion in revenue and secured a $3.03 billion backlog as of late 2025. Honestly, their model isn't rocket science, but it is disciplined: they combine vertical integration-owning the asphalt plants and quarries-with a relentless, strategic acquisition pace across the high-growth Sunbelt states. If you want to know how they manage over 6,800 employees and keep their cost of revenue tight while servicing primarily government clients (about 65% of their work), the nine building blocks below lay it all out clearly for your review.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Key Partnerships

The Key Partnerships for Construction Partners, Inc. (ROAD) center on aggressive, debt-fueled expansion and deep vertical integration across its Sunbelt footprint as of late 2025.

The company's scale is heavily reliant on its ability to secure financing for its acquisition strategy and its relationships with key material providers. The fiscal year 2025 was transformational, marked by entering Texas and Oklahoma and strengthening positions in Tennessee and Alabama through M&A activity.

The vertical integration strategy directly impacts material sourcing partnerships. Construction Partners, Inc. manages its own supply chain for core inputs, reducing reliance on external market fluctuations for these critical components.

• Suppliers for essential materials like liquid asphalt and aggregates are managed through in-house production, including operating its own aggregate facilities and liquid asphalt terminals.
• The addition of a liquid asphalt terminal and a rail-served aggregates terminal through FY2025 acquisitions bolstered internal sourcing capabilities.
• Energy costs, including liquid asphalt and diesel, were reported as stable in 2025, contributing to a benign inflation year for construction materials.
• The acquisition of the Houston terminal significantly increased the percentage of internally sourced liquid asphalt.

Local construction firms serve as targets for bolt-on M&A, immediately expanding the geographic footprint and adding skilled teams. For instance, the acquisition of Durwood Greene Construction Co. added nearly 200 employees to the Texas platform company in the greater Houston area.

The October 6, 2025, deal to acquire eight hot-mix asphalt plants in Houston from affiliates of Vulcan Materials Company is a prime example of integrating a local firm's assets into the existing platform, Durwood Greene Construction Co.

Equipment manufacturers and leasing companies are key partners supporting the large fleet necessary for operations across eight states. The FY2025 acquisitions added a 'diverse fleet of equipment and vehicles' to the company's assets.

Financial institutions are central to the growth model, providing the necessary capital structure to execute the acquisition strategy. The company restructured its capital base, extending the maturity date for the Term Loan A and Revolving Credit Facility to June 28, 2030.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Key Activities

The core of Construction Partners, Inc.'s operations revolves around the physical transformation of roadways and infrastructure across the Sunbelt. This involves significant internal material production to control costs and ensure supply for their projects. The company is vertically integrated, supporting its construction work with its own material production capabilities.

Manufacturing and distributing Hot Mix Asphalt (HMA) internally and to third parties is a primary function. This activity is supported by the company's network of hot-mix asphalt plants and liquid asphalt terminals, which handle distribution for both internal use and sales to external customers. The scale of the entire operation, which includes these material components, resulted in total revenue of $2.812 billion for fiscal year 2025, a 54 percent increase compared to fiscal year 2024's $1.824 billion.

Executing roadway construction, paving, and maintenance projects is where the majority of the revenue is generated. These projects are predominantly publicly funded, covering local and state roadways, interstate highways, airport runways, and bridges. The company also performs private sector work for commercial developments and residential sites. The disciplined execution across their Sunbelt operations, powered by more than 6,800 employees in fiscal 2025, drove an Adjusted EBITDA of $423.7 million.

Strategic M&A integration to expand geographic footprint in the Sunbelt is a deliberate growth lever. Fiscal 2025 was marked by five strategic acquisitions that allowed Construction Partners, Inc. to enter Texas and Oklahoma and deepen its presence in Tennessee and Alabama. This expansion strategy is aimed at scaling operations in a highly fragmented market. The company also completed two subsequent acquisitions in October 2025 to enter the Daytona Beach market in Florida and expand in Houston, Texas.

Mining and processing aggregates like sand and construction stone is the upstream component of their material supply chain. These materials serve as raw inputs for HMA production, which is then used internally or sold to third parties. This vertical integration helps manage costs and secure essential supplies for their paving work. The company's overall financial performance reflects the success of this integrated model, with an Adjusted EBITDA Margin reaching 15.1% in fiscal 2025, up from 12.1% in fiscal 2024.

Bidding and securing large public infrastructure contracts is crucial for maintaining a robust pipeline of work. The company maintains a significant project backlog, which stood at approximately $3.03 billion as of September 30, 2025. This backlog is built upon sustained and consistent organic revenue growth of 8.4 percent compared to the prior year, demonstrating continued success in winning new work alongside growth from acquisitions.

You can see the financial scale tied to these activities in the table below:

The operational focus areas that drive these results include:

• Executing projects for recurring customers, both public and commercial.
• Expanding geographic footprint through disciplined M&A integration.
• Maintaining operational excellence to expand margins.
• Securing work in high-growth local markets across the Sunbelt.
• Managing material inputs via aggregate processing and HMA production.

The company's family of companies now includes more than 6,800 employees across its operational footprint.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Key Resources

You're looking at the core assets that let Construction Partners, Inc. (ROAD) actually build roads and materials, which is the heart of their business. These aren't just line items on a balance sheet; they are the physical means of production and the secured pipeline of future work. Honestly, the aggressive acquisition strategy in fiscal 2025 really beefed up this section of the canvas.

The vertical integration is key here, meaning they control more steps in the process, from digging up the rock to laying down the final asphalt. This is what lets them manage costs and supply better than a pure contractor. Here's a look at the tangible assets that form this foundation, especially considering the major additions from the 2025 fiscal year:

The secured revenue stream is another massive resource. As of September 30, 2025, the record project backlog stood at approximately $3.03 billion. That's a huge chunk of future revenue already locked in. To be fair, about 78% of that backlog was expected to convert within the next 12 months, which gives you a very clear near-term revenue visibility.

Next up is the human capital. Construction Partners, Inc. powers its operations with a workforce of over 6,800 employees across the Sunbelt region as of September 30, 2025. That number reflects a significant jump, showing the scale of their recent integration efforts. These are the skilled professionals executing the work, so their capacity and expertise are critical resources.

Finally, the intangible but vital resources are the local relationships and the right to operate. Construction Partners, Inc. maintains local market relationships and necessary operating permits across eight Sunbelt states. This geographic footprint is essential for capturing demand driven by infrastructure spending.

These relationships translate directly into the customer base they serve:

• Public customers accounted for roughly 65% of fiscal 2025 revenues.
• Projects for all state DOTs (Departments of Transportation) represented 43.4% of fiscal 2025 revenues.
• Private customers include commercial developers and businesses.
• Operations span high-growth local markets in states like Texas, Oklahoma, Alabama, Tennessee, and Florida.

The company's ability to secure these state and local contracts is a defintely key resource supporting that massive backlog.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Value Propositions

You're looking at the core reasons why Construction Partners, Inc. (CPI) captures value in the market, especially after a year like fiscal 2025. It's about control, focus, scale, and growth capacity.

Vertically integrated model ensures quality control and cost efficiency.

This integration means controlling the materials supply chain, which is a major lever for margin performance. CPI's strategy includes manufacturing and distributing hot mix asphalt, paving, site development, and mining aggregates. This control helped drive the Adjusted EBITDA Margin up to 15.1% in fiscal 2025, compared to 12.1% in fiscal 2024. Furthermore, the company expanded its hot mix asphalt plant base by 33% through acquisitions and greenfield investments, directly supporting this cost control and quality assurance.

The financial results from fiscal 2025 clearly show the benefit of this integrated, acquisition-heavy strategy:

Specialization in the stable, recurring roadway maintenance market.

CPI focuses on roadway construction and maintenance, which benefits from steady government funding and population shifts. Even with weather delays in Q3 fiscal 2025, the company's teams executed well, and the backlog remained high at $2.94 billion as of June 30, 2025. The company's organic growth held at a consistent 8.4 percent in fiscal 2025, showing underlying demand strength outside of acquisitions. This market focus is supported by federal programs like the IIJA and state-specific funding initiatives.

Reliable execution of large, complex public civil infrastructure projects.

The company's work includes local and state roadways, interstate highways, airport runways, and bridges, with publicly funded projects forming the majority of its business. Despite challenges like record rainfall in the Southeast during Q3 fiscal 2025, the company delivered robust operational results. The record project backlog of approximately $3.03 billion at September 30, 2025, demonstrates customer confidence in CPI's ability to execute on large commitments.

Localized market expertise across the high-growth Sunbelt region.

Construction Partners, Inc. operates across eight states in the Sunbelt, including Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee, Texas, and Oklahoma. This geographic focus capitalizes on strong economic growth and favorable demographic trends driving migration to these areas. The company grew its employee base to more than 6,800 employees across these markets, showing scale in its localized expertise.

Capacity for rapid expansion via strategic, accretive acquisitions.

Fiscal 2025 was a transformative year marked by accelerated financial performance driven by M&A. CPI completed five strategic acquisitions in fiscal 2025, entering Texas and Oklahoma and strengthening its presence in Tennessee and Alabama. In Q3 fiscal 2025, the revenue increase of $261.5 million included $235.7 million attributable to acquisitions completed during or subsequent to the three months ended June 30, 2024. Acquisitions, such as the one adding eight hot-mix asphalt plants in the Houston Metro area, feature higher margin profiles, which materially increased overall profitability.

You can see the impact of this growth strategy on the company's scale:

• FY 2025 Revenue growth driven by acquisitions was approximately 46% in Q3.
• The company entered two new states (Texas and Oklahoma) in fiscal 2025.
• S&P upgraded Construction Partners, Inc. to a 'BB-' rating based on margin expansion from these acquisitions.
• The company expects to spend approximately $500 million on acquisitions in fiscal 2026.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Customer Relationships

You're looking at how Construction Partners, Inc. (CPI) locks in its revenue streams, which is heavily reliant on long-term government contracts in the Sunbelt. This isn't about quick, one-off jobs; it's about being the established partner for state and local transportation needs.

Long-term, stable relationships with government entities (DOTs).

CPI positions itself to capitalize on long-term, generational investment in infrastructure, especially with ongoing population migration into the Sunbelt states where it operates. The company's customer base is described as both public and commercial, with a clear focus on government-funded work. For context on the scale of this work, looking at the prior fiscal year, the nature of the business was heavily weighted toward public works:

The total expected revenue for fiscal year 2025 is projected to be in the range of $2.800 billion to $2.820 billion, a significant increase from the $1.824 billion reported in fiscal 2024. This scale suggests substantial, ongoing relationships with public agencies funding these projects. The company's backlog, a key indicator of future relationship stability, was a record $2.94 billion at June 30, 2025, and expected to be approximately $3.0 billion as of September 30, 2025.

Contractual relationships established through competitive bidding processes.

The work is secured by winning bids. The company executes projects for this recurring customer base by successfully navigating competitive bidding processes. The organic revenue growth in fiscal 2025 was 8.4 percent, showing success in winning new work against competition in existing markets, separate from growth driven by acquisitions.

Dedicated project management teams for large-scale contracts.

To manage the complexity and scale of these contracts, Construction Partners, Inc. relies on its family of companies, which employed more than 6,200 employees across eight states as of the third quarter of fiscal 2025. The company's structure involves dedicated teams to deliver on these commitments, as evidenced by the operational discipline required to generate a record Adjusted EBITDA margin of 16.9% in the third quarter of fiscal 2025, despite weather-related delays.

• The company's family of companies now includes nearly 200 employees from the recent Durwood Greene Construction Co. acquisition in the Houston area.
• The total project backlog reached a record $2.94 billion at June 30, 2025.

Direct sales and service for third-party material sales.

Construction Partners, Inc. is a vertically integrated civil infrastructure company, meaning it controls key inputs like hot-mix asphalt plants. While the primary revenue driver is construction services, this vertical integration supports both its own project delivery and the ability to sell materials. The search results do not provide a specific revenue figure for sales made directly to third parties, separate from the construction service contracts. However, the company's operations include asphalt production, which is a key component of its service offering and potential for external sales.

The total revenue for the twelve months ending September 30, 2025, was $2.812 billion.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Channels

You're looking at how Construction Partners, Inc. (ROAD) gets its work done and delivers its value proposition across the Sunbelt. The scale of their operations in late 2025 is substantial, with expected Fiscal Year 2025 revenue in the range of $2.800 billion to $2.820 billion.

The primary avenues for securing this revenue are deeply rooted in public and private sector relationships, supported by a growing, decentralized operational footprint.

The company's channel strategy relies heavily on direct engagement with government entities.

• Direct bidding and contracting with State Departments of Transportation (DOTs).
• Direct contract negotiation with local municipalities and counties.

This public sector focus is complemented by direct engagement in the private market. Fiscal Year 2025 saw the company enter two new states and complete five strategic acquisitions, expanding the reach of these channels.

• Direct sales force for private sector site development and material sales.

The execution of contracts secured through these channels is managed through a distributed network of local entities.

• Local operating companies and regional offices across the Sunbelt.

This structure supports the company's vertically integrated operations, which include hot-mix asphalt plants, aggregate facilities, and liquid asphalt terminals, all working to fulfill the backlog valued near $3.0 billion as of September 30, 2025.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Customer Segments

You're looking at the core customer base for Construction Partners, Inc. (ROAD) as of late 2025. This company's revenue engine is heavily reliant on government-funded work across the Sunbelt states where they operate, which include Alabama, Florida, Georgia, North Carolina, Oklahoma, South Carolina, Tennessee, and Texas.

The customer segments are clearly defined by the funding source and project type. Publicly funded projects, which include maintenance on local and state roadways, interstate highways, airport runways, and bridges, form the bedrock of the business. Private sector work, while important, plays a supporting role to the government contracts.

Here's the quick math on the scale of the business as of the end of fiscal year 2025:

• Total Revenue (FY 2025): $2.812B
• Project Backlog (as of September 30, 2025): $3.03 billion
• Total Employees: More than 6,800

The composition of these customers, based on the required structure and available data, looks like this:

The Public Sector Infrastructure segment is the largest driver, representing approximately 65% of total revenue. Within this, the majority of public projects are maintenance-related, which historically provides a relatively stable portion of the business.

The other customer groups contribute to the remaining portion of the $2.812 billion in fiscal 2025 revenue. You see steady workflow from commercial projects, which fall under the private sector grouping, and the company also supports other contractors.

• Private Sector projects include paving and sitework for commercial sites and residential developments.
• Federal Government work is captured within the public funding category, specifically mentioning airport runways and interstate highways.
• Third-party sales involve supplying other construction companies with essential materials like Hot Mix Asphalt (HMA) and aggregates, supported by Construction Partners, Inc.'s aggregate facilities and hot-mix asphalt plants.

The company's strategy focuses on scaling operations in high-growth local markets throughout the Sunbelt, capitalizing on strong infrastructure demand and population migration.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Construction Partners, Inc.'s operations, which is crucial for understanding their profitability, especially given their aggressive acquisition strategy. The cost structure is heavily weighted toward the direct costs of building and maintaining roads.

The largest component here is the Cost of Revenues, covering the raw materials like asphalt and aggregate, direct labor for the crews, and the operational costs of running heavy equipment. For fiscal year 2025, this figure stood at approximately $2.373 billion.

To support that massive operational scale, significant investment is needed to keep the fleet running and expand capacity. This shows up in Capital Expenditures for equipment and plant maintenance, which were reported at $137.9 million in FY2025. This is a non-negotiable cost in heavy construction; you can't pave without pavers.

Here's a quick look at some of the key cost metrics you need to track:

The company's growth through acquisition means debt management is a constant focus. The resulting leverage is reflected in the interest expense, which is substantial due to acquisition-driven debt. The debt/EBITDA ratio was sitting at 3.1x, showing the level of leverage used to fund their Sunbelt expansion.

General and Administrative (G&A) expenses are the overhead costs of running the corporate structure, sales, and support functions. For FY2025, the management of these costs was tight, with G&A expenses decreasing to 7.1% of total revenue. That efficiency helps protect the gross margin.

Finally, the human capital required to execute these projects is a major cost driver. Construction Partners, Inc. supports its operations with a large workforce, employing over 6,800 employees across its markets. Managing labor relations and retaining key personnel are critical operational risks tied directly to this cost base.

You should watch the relationship between the Cost of Revenues and the reported revenue of $2.812 billion for FY2025 to gauge gross margin performance. Finance: draft 13-week cash view by Friday.

Construction Partners, Inc. (ROAD) - Canvas Business Model: Revenue Streams

You're looking at the core ways Construction Partners, Inc. (ROAD) brings in cash as of late 2025. Honestly, it's a straightforward model built on infrastructure spending, which is great when the public sector is funding big projects.

The primary sources of revenue for Construction Partners, Inc. (ROAD) are tied directly to the physical work they perform and the materials they produce. This revenue is generally split between government-backed work and private development.

• Public Sector Infrastructure construction and maintenance fees.
• Private Sector site development and paving contract payments.
• Sales of Hot Mix Asphalt (HMA) and aggregates to third parties.

The company's growth in these areas has been significant, driven by both winning new contracts and buying up other local construction businesses and materials plants. For instance, the significant topline growth in fiscal 2025 was driven by both strategic acquisitions and sustained organic growth of 8.4 percent compared to the prior year.

Here's the quick math on the final results for the fiscal year ending September 30, 2025:

The revenue streams are supported by a strategy that sees roughly half of the annual growth coming from acquisitions, with the other half coming from organic growth, which includes about 4% price growth and 3% to 6% targeted real organic growth. This mix helps smooth out the lumpy nature of large government bids.

Specifically regarding the streams:

• Public Sector Infrastructure construction and maintenance fees are fueled by the continued focus on infrastructure development across the Sunbelt.
• Private Sector site development and paving contract payments come from commercial projects and the expanding addressable markets for roadway repair.
• Sales of Hot Mix Asphalt (HMA) and aggregates to third parties benefit from vertical integration, like the recent acquisition of eight Houston hot-mix asphalt plants, which expanded capacity and market share in Texas.

The overall financial performance shows the success of executing this multi-faceted revenue strategy. Total revenue for fiscal year 2025 was $2.812 billion, representing a 54 percent increase compared to fiscal 2024. Net Income for fiscal year 2025 was $101.8 million, up 48 percent from $68.9 million in fiscal 2024. That's a strong showing for a capital-intensive business.

Finance: draft 13-week cash view by Friday.