Granite Construction has recently released its 10-K report, providing insights into the company's operations and financial performance. Granite Construction Incorporated operates as an infrastructure contractor and a construction materials producer in the United States. The company operates through two segments, Construction and Materials segments. The Construction segment engages in the construction and rehabilitation of roads, pavement preservation, bridges, rail lines, airports, marine ports, dams, reservoirs, aqueducts, infrastructure, and site development for use by the public. The Materials segment is involved in the production of aggregates and asphalt for internal use, as well as for sale to third parties.
Liquidity and Capital Resources: Cash, cash equivalents, and marketable securities as of December 31, 2023, increased $93.6 million to $453.5 million from the prior year end. The company believes its primary sources of liquidity will be sufficient to meet expected working capital needs, capital expenditures, financial commitments, cash dividend payments, and other liquidity requirements associated with existing operations for the next twelve months.
Capital Expenditures: Major capital expenditures for aggregate and asphalt production facilities, aggregate reserves, construction equipment, buildings, and leasehold improvements, and investments in information technology systems were $140.4 million during the year ended December 31, 2023, compared to $121.6 million during 2022, an increase of $18.8 million. The increase year over year is primarily due to acquisitions of materials reserves in 2023.
Cash Flows: Net cash provided by operating activities was $183.7 million during 2023, representing a $128.1 million increase compared to 2022. Cash used in investing activities was $359.3 million during 2023, a $348.3 million increase compared to 2022. Cash provided by financing activities was $299.3 million during 2023, representing a $463.6 million increase compared to 2022.
Derivatives: The company recognizes derivative instruments as either assets or liabilities in the consolidated balance sheets at fair value using Level 2 inputs.
Surety Bonds and Real Estate Mortgages: Granite Construction is required to provide various types of surety bonds that provide additional security for its performance under certain public and private sector contracts. At December 31, 2023, approximately $3.2 billion of the company's $5.5 billion CAP was bonded. The company's investments in real estate affiliates are subject to mortgage indebtedness.
Covenants and Events of Default: The company's Credit Agreement requires compliance with various affirmative, restrictive, and financial covenants. As of December 31, 2023, Granite Construction was in compliance with the covenants in the Credit Agreement.
Share Purchase Program: The Board of Directors authorized the purchase of up to $300.0 million of the company's common stock at management’s discretion. As of December 31, 2023, $231.5 million of the authorization remained available.
Today the company's shares have moved -3.1% to a price of $49.77. For more information, read the company's full 10-K submission here.
