Strong Revenue Growth
Consolidated net sales increased 20.3% year-over-year for the quarter; trailing 12-month net sales grew 11.5%.
Astec
· ASTE
May 6th, 2026
Summary
- Earnings Call Date:
- 2026-05-06
- Change Since:
- +15.49%
- Next Earnings Date:
- 2026-08-05
Earnings Call Sentiment
PositiveThe call presents a generally positive operational and top-line story: strong revenue growth (+20.3% YoY), expanding backlog (+36% YoY), significant Materials Solutions momentum, healthy free cash flow ($32.6M) and successful acquisition integrations. Offsetting these positives are near-term profitability pressures driven by tariffs, freight/duty inflation, elevated trade-show costs, mix/timing effects and a notable quarter-on-quarter margin decline (310 bps) that reduced adjusted EPS materially. Management maintained full-year adjusted EBITDA guidance and emphasized backlog and pricing actions to mitigate cost pressures, signaling confidence in recovery later in the year.
Company Guidance
Management maintained full‑year 2026 guidance for adjusted EBITDA of $170–$190 million and an effective tax rate of 25–28%, with capital expenditures of $40–$50 million, depreciation & amortization of $55–$65 million, quarterly adjusted SG&A of $70–$80 million and interest expense of approximately $7 million. At quarter‑end liquidity totaled $73.4 million in cash and $194.1 million in available credit (total $267.5 million), net debt to adjusted EBITDA was ~2.3x (within the 1.5–2.5x target) after a roughly $70 million draw for the CWMF acquisition, and management expects year‑end leverage near ~1.7x at the guidance midpoint. Management said it is keeping guidance despite Q1 headwinds (Q1 adjusted EBITDA $30.3M, 7.6% margin; free cash flow $32.6M; adjusted EPS $0.54) citing strong backlog ($549M, +36% YoY), implied orders of $397M (+27% YoY) and book‑to‑bill ratios >100% in both segments as support.
Robust Backlog and Order Activity
Backlog grew to $549 million from $403 million, an increase of $146 million or 36% year-over-year; implied orders were $397 million, up $85 million or 27.2% YoY, and book-to-bill in each segment exceeded 100%.
Materials Solutions Outperformance
Materials Solutions net sales rose $65.9 million or 70.6% YoY (trailing 12-month +36.3%); segment operating adjusted EBITDA increased 71.2% to $8.9 million for the quarter and up 59.6% on a trailing 12-month basis; trailing 12-month margin expanded 140 basis points to 9.6%.
Adjusted EBITDA and Trailing Performance
First quarter adjusted EBITDA was $30.3 million with an adjusted EBITDA margin of 7.6%; trailing 12-month adjusted EBITDA was $136 million with a 9.2% margin.
Strong Free Cash Flow and Liquidity
Generated $32.6 million of free cash flow in Q1; ended the quarter with $73.4 million cash and $194.1 million available credit for total liquidity of $267.5 million; net debt-to-adjusted EBITDA ~2.3x (within 1.5x–2.5x target).
Parts & Service Growth and Mix
Parts and service sales increased $24 million or 19.7% YoY and remained approximately 37% of net sales, supporting recurring revenue objectives and aftermarket expansion.
Successful Acquisitions and Integration Progress
TerraSource (July 2025) and CWMF (Jan 2026) integrations progressing well (payroll, finance, sales alignment); CWMF synergies realizing faster than prior deals and cross-selling/procurement opportunities identified.
Reaffirmed Full-Year Guidance
Management maintained full-year 2026 adjusted EBITDA guidance of $170 million to $190 million and reiterated capacity to invest (capex $40M–$50M; D&A $55M–$65M).
Favorable Industry Tailwinds
Stable federal infrastructure funding and record state/local transportation awards (2025 value $152.2B vs $132.2B in 2024) support multiyear demand for Astec products.
Operator
Hello, and welcome to the Astec Industries First Quarter 2026 Earnings Call. As a reminder, this conference call is being recorded. It is my pleasure to introduce your host, Steve Anderson, Senior Vice President of Administration and Investor Relations. Mr. Anderson, you may begin.
Stephen C. Anderson
Thank you, and good morning. Joining me on today's call are Jaco van der Merwe, our Chief Executive Officer; and Brian Harris, our Chief Financial Officer. In just a moment, I'll turn the call over to Jaco to provide his comments, then Brian will summarize our financial results. For your convenience, a copy of our press release and presentation have been posted on our website under the Investor Relations tab at www.astecindustries.com. Turning to Slide 2. I'll remind you that our discussion this morning may contain forward-looking statements that relate to the future performance of the company, and these statements are intended to qualify for the safe harbor liability established by the Private Securities Litigation Reform Act. Factors that can influence our results are highlighted in today's financial news release and others are contained in our filings with the U.S. Securities and Exchange Commission.
We also refer to various U.S. GAAP and non-GAAP financial measures, which management believes provide useful information to investors. These non-GAAP measures have no standardized meaning prescribed by U.S. GAAP and are, therefore, unlikely to be comparable to the calculation of similar measures of other companies. We do not intend these items to be considered in isolation or as a substitute to th...
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