0001718227FALSE290 Healthwest Drive, Suite 2DothanAlabama3630300017182272024-11-212024-11-21

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): November 21, 2024 
CONSTRUCTION PARTNERS, INC.
(Exact name of registrant as specified in its charter) 
 
Delaware 001-38479 26-0758017
(State or other jurisdiction
of incorporation)
 (Commission
File Number)
 (I.R.S. Employer
Identification Number)
 
290 Healthwest Drive, Suite 2
Dothan, Alabama 36303
(Address of principal executive offices) (ZIP Code)
(334) 673-9763
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbol(s) Name of each exchange
on which registered
Class A common stock, $0.001 par value ROAD The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).        Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.                                  ☐






Item 2.02.     Results of Operations and Financial Condition.
On November 21, 2024, Construction Partners, Inc. issued a press release announcing its financial results for the fiscal quarter and year ended September 30, 2024. A copy of the press release is furnished as Exhibit 99.1 hereto, and the information contained in Exhibit 99.1 is incorporated herein by reference.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
Item 9.01.    Financial Statements and Exhibits.
(d)    Exhibits.
Exhibit No.Description
99.1**
104*Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.
** Furnished herewith.




SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CONSTRUCTION PARTNERS, INC.
Date: November 21, 2024By:/s/ Gregory A. Hoffman
Gregory A. Hoffman
Senior Vice President and Chief Financial Officer




Exhibit 99.1
capturea03.jpg
NEWS RELEASE
Construction Partners, Inc. Announces Fiscal 2024
Fourth Quarter and Full Year Results

Revenue Up 17% Compared to FY23
Net Income Up 41% Compared to FY23
Adjusted EBITDA Up 28% Compared to FY23
Record Backlog of $1.96 Billion

DOTHAN, AL, November 21, 2024 – Construction Partners, Inc. (NASDAQ: ROAD) (“CPI” or the “Company”), a vertically integrated civil infrastructure company specializing in the construction and maintenance of roadways in local markets throughout the Sunbelt, today reported financial and operating results for the fiscal quarter and year ended September 30, 2024.
Fred J. (Jule) Smith, III, the Company’s President and Chief Executive Officer, said, “We are pleased to report significant growth in fiscal year 2024, led by the strong operational performance of our family of companies throughout the Sunbelt. We are proud of the contributions from our more than 5,000 employees that helped deliver a record fiscal year and generated revenue growth of 17%, net income growth of 41%, and Adjusted EBITDA(1) growth of 28% compared to fiscal 2023, including Adjusted EBITDA Margin(1) of 12.1% for fiscal 2024. In addition, we completed eight acquisitions in fiscal 2024 that expanded our geographic footprint into new growth markets and enhanced CPI’s relative market share across our Sunbelt states.”
Fiscal 2024 revenues were $1.82 billion, an increase of 17% compared to $1.56 billion in fiscal 2023. Fourth quarter revenues were $538.2 million, an increase of 13% compared to $475.0 million in the fourth quarter last year.
Gross profit was $258.3 million in fiscal 2024, an increase of 32% compared to $196.4 million in fiscal 2023. Gross profit for the fourth quarter was $84.1 million, an increase of 11% compared to $75.5 million in the fourth quarter last year.
General and administrative expenses were $151.5 million for fiscal 2024, or 8.3% of total revenue, compared to $126.9 million, or 8.1% of total revenue, in fiscal 2023. Fourth quarter general and administrative expenses were $39.8 million, compared to $33.0 million in the fourth quarter last year, and as a percentage of total revenue, 7.4% and 6.9%, respectively.
Net income was $68.9 million for fiscal 2024, an increase of 41% compared to net income of $49.0 million in fiscal 2023. Fourth quarter net income was $29.3 million, a decrease of 5.2% compared to net income of $30.9 million in the fourth quarter last year.
Adjusted EBITDA(1) for fiscal 2024 was $220.6 million, an increase of 28% compared to $172.6 million in fiscal 2023. Adjusted EBITDA Margin(1) in fiscal 2024 was 12.1%, compared to 11.0% in fiscal 2023. Fourth quarter Adjusted EBITDA(1) was $77.0 million, an increase of 11.8% compared to $68.9 million in the fourth quarter last year. Adjusted EBITDA Margin(1) in the fourth quarter was 14.3%, compared to 14.5% in the fourth quarter last year.
Project backlog was $1.96 billion at September 30, 2024, compared to $1.60 billion at September 30, 2023 and $1.86 billion at June 30, 2024.
Smith added, “Earlier this month, we acquired Lone Star Paving, our new platform company in Texas. Lone Star is an excellent company with an outstanding management team operating in three of the fastest growth metro areas in the country. We are pleased to welcome Lone Star into the CPI family of companies. They uniquely fit our culture with a shared commitment to safety, operational excellence, employee advancement and smart vertical integration initiatives.
(1) Adjusted EBITDA and Adjusted EBITDA Margin are financial measures not presented in accordance with generally accepted accounting principles (“GAAP”). Please see “Reconciliation of Non-GAAP Financial Measures” at the end of this press release.


“In fiscal 2025, we continue to project growth and enhanced profitability, supported by eleven months of Lone Star’s contribution in our fiscal year. The addition of Lone Star positions CPI to accelerate our ROAD-Map 2027 strategy and to deliver long-term value to our investors and other stakeholders.”
Fiscal 2025 Outlook
As previously announced, CPI’s outlook for fiscal 2025 with regard to revenue, net income, Adjusted EBITDA and Adjusted EBITDA Margin is as follows:
Revenue in the range of $2.48 billion to $2.58 billion
Net income in the range of $97 million to $113 million
Adjusted EBITDA(1) in the range of $347 million to $377 million
Adjusted EBITDA Margin(1) in the range of 14.0% to 14.6%
Ned N. Fleming, III, the Company’s Executive Chairman, stated, “We are excited to enter Texas with an outstanding company like Lone Star. This transformational acquisition exemplifies the CPI growth strategy of partnering with experienced local operators who know how to build and operate great companies that we can further support within our larger organization. Moving forward, we will continue to benefit from opportunities afforded by a generational investment in infrastructure, the fast-growing economies in the Sunbelt, and numerous organic and acquisitive growth opportunities to scale our organization and deliver value to our stockholders.”
Conference Call
The Company will conduct a conference call today at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) to discuss financial and operating results for the fiscal quarter and year ended September 30, 2024. To access the call live by phone, dial (412) 902-0003 and ask for the Construction Partners call at least 10 minutes prior to the start time. A telephonic replay will be available through November 28, 2024 by calling (201) 612-7415 and using passcode ID: 13748361#. A webcast of the call will also be available live and for later replay on the Company’s Investor Relations website at www.constructionpartners.net.
About Construction Partners, Inc.
Construction Partners, Inc. is a vertically integrated civil infrastructure company operating in local markets throughout the Sunbelt in Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee and Texas. Supported by its hot-mix asphalt plants, aggregate facilities and liquid asphalt terminals, CPI focuses on the construction, repair and maintenance of surface infrastructure. Publicly funded projects make up the majority of its business and include local and state roadways, interstate highways, airport runways and bridges. The company also performs private sector projects that include paving and sitework for office and industrial parks, shopping centers, local businesses and residential developments. To learn more, visit www.constructionpartners.net.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained herein that are not statements of historical or current fact constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. These statements may be identified by the use of words such as “may,” “will,” “expect,” “should,” “anticipate,” “intend,” “project,” “outlook,” “believe” and “plan.” The forward-looking statements contained in this press release include, without limitation, statements related to financial projections, future events, business strategy, future performance, future operations, backlog, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management. These and other forward-looking statements are based on management’s current views and assumptions and involve risks and uncertainties that could significantly affect expected results. Important factors could cause actual results to differ materially from those expressed in the forward-looking statements, including, among others: our ability to successfully manage and integrate acquisitions; failure to realize the expected economic benefits of acquisitions, including future levels of revenues being lower than expected and costs being higher than expected; failure or inability to implement growth strategies in a timely manner; declines in public infrastructure construction and reductions in government funding, including the funding by transportation authorities and other state and local agencies; risks related to our operating strategy; competition for projects in our local markets; risks associated with our capital-intensive business; government requirements and initiatives, including those related to funding for public or



infrastructure construction, land usage and environmental, health and safety matters; unfavorable economic conditions and restrictive financing markets; our ability to obtain sufficient bonding capacity to undertake certain projects; our ability to accurately estimate the overall risks, requirements or costs when we bid on or negotiate contracts that are ultimately awarded to us; the cancellation of a significant number of contracts or our disqualification from bidding for new contracts; risks related to adverse weather conditions; our substantial indebtedness and the restrictions imposed on us by the terms thereof; our ability to maintain favorable relationships with third parties that supply us with equipment and essential supplies; our ability to retain key personnel and maintain satisfactory labor relations; property damage, results of litigation and other claims and insurance coverage issues; risks related to our information technology systems and infrastructure; our ability to maintain effective internal control over financial reporting; and the risks, uncertainties and factors set forth under “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and its subsequently filed Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date they are made. The Company assumes no obligation to update forward-looking statements to reflect actual results, subsequent events, or circumstances or other changes affecting such statements except to the extent required by applicable law.
Contacts:
Rick Black / Ken Dennard
Dennard Lascar Investor Relations
ROAD@DennardLascar.com
(713) 529-6600
- Financial Statements Follow -



Construction Partners, Inc.
Consolidated Statements of Comprehensive Income
(in thousands, except share and per share data)

For the Three Months Ended
September 30,
For the Fiscal Year Ended
September 30,
2024202320242023
Revenues$538,163 $475,026 $1,823,889 $1,563,548 
Cost of revenues454,082 399,489 1,565,635 1,367,163 
Gross profit84,081 75,537 258,254 196,385 
General and administrative expenses(39,836)(33,002)(151,497)(126,947)
Gain on sale of property, plant and equipment1,523 2,223 4,483 7,048 
Gain on facility exchange— — — 5,389 
Operating income45,768 44,758 111,240 81,875 
Interest expense, net(6,084)(3,545)(19,071)(17,346)
Other (expense) income (117)(50)(70)875 
Income before provision for income taxes and earnings from investment in joint venture39,567 41,163 92,099 65,404 
Provision for income taxes10,256 10,250 23,161 16,403 
Loss from investment in joint venture(3)— (3)— 
Net income$29,308 $30,913 $68,935 $49,001 
Other comprehensive (loss) income, net of tax
Unrealized (loss) gain on interest rate swap contract, net(6,722)1,922 (11,889)1,297 
Unrealized gain (loss) on restricted investments, net418 (211)697 (223)
Other comprehensive (loss) income, net(6,304)1,711 (11,192)1,074 
Comprehensive income$23,004 $32,624 $57,743 $50,075 
Net income per share attributable to common stockholders:
Basic$0.57 $0.60 $1.33 $0.95 
Diluted$0.56 $0.59 $1.31 $0.94 
Weighted average number of common shares outstanding:
Basic51,792,183 51,828,257 51,883,760 51,827,001 
Diluted52,590,344 52,406,501 52,574,503 52,260,206 



Construction Partners, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)

September 30,
20242023
ASSETS
Current assets:
Cash and cash equivalents$74,686 $48,243 
Restricted cash1,998 837 
Contracts receivable including retainage, net350,811 303,704 
Costs and estimated earnings in excess of billings on uncompleted contracts25,966 27,296 
Inventories106,704 84,038 
Prepaid expenses and other current assets24,841 9,306 
Total current assets585,006 473,424 
Property, plant and equipment, net629,924 505,095 
Operating lease right-of-use assets38,932 14,485 
Goodwill231,656 159,270 
Intangible assets, net20,549 19,520 
Investment in joint venture84 87 
Restricted investments18,020 15,079 
Other assets17,964 32,705 
Total assets$1,542,135 $1,219,665 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$182,572 $151,406 
Billings in excess of costs and estimated earnings on uncompleted contracts120,065 78,905 
Current portion of operating lease liabilities9,065 2,338 
Current maturities of long-term debt26,563 15,000 
Accrued expenses and other current liabilities42,189 31,534 
Total current liabilities380,454 279,183 
Long-term liabilities:
Long-term debt, net of current maturities and deferred debt issuance costs486,961 360,740 
Operating lease liabilities, net of current portion30,661 12,649 
Deferred income taxes, net53,852 37,121 
Other long-term liabilities16,467 13,398 
Total long-term liabilities587,941 423,908 
Total liabilities968,395 703,091 
Commitments and contingencies
Stockholders’ Equity:
Preferred stock, par value $0.001; 10,000,000 shares authorized at September 30, 2024 and September 30, 2023 and no shares issued and outstanding
— — 
Class A common stock, par value $0.001; 400,000,000 shares authorized, 44,062,830 shares issued and 43,819,102 shares outstanding at September 30, 2024, and 43,760,546 shares issued and 43,727,680 shares outstanding at September 30, 2023
44 44 
Class B common stock, par value $0.001; 100,000,000 shares authorized, 11,784,650 shares issued and 8,861,698 shares outstanding at September 30, 2024, and 11,921,463 shares issued and 8,998,511 shares outstanding at September 30, 2023
12 12 
Additional paid-in capital278,065 267,330 
Treasury stock, Class A common stock, par value $0.001, at cost, 243,728 shares at September 30, 2024, and 32,866 shares at September 30, 2023
(11,490)(178)
Treasury stock, Class B common stock, par value $0.001, at cost, 2,922,952 shares at September 30, 2024 and 2023
(15,603)(15,603)
Accumulated other comprehensive income, net7,502 18,694 
Retained earnings315,210 246,275 
Total stockholders’ equity573,740 516,574 
Total liabilities and stockholders’ equity$1,542,135 $1,219,665 




Construction Partners, Inc.
Consolidated Statements of Cash Flows
(in thousands)
For the Fiscal Year Ended September 30,
20242023
Cash flows from operating activities:
Net income$68,935 $49,001 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, accretion and amortization 92,920 79,100 
Amortization of deferred debt issuance costs362 299 
Unrealized loss (gain) on derivative instruments184 342 
Provision (recovery) for bad debt491 456 
Gain on sale of property, plant and equipment(4,483)(7,048)
Gain on facility exchange— (5,389)
Realized losses on restricted investments53 30 
Share-based compensation expense14,412 10,759 
Loss (earnings) from investment in joint venture— 
Deferred income taxes22,681 11,165 
  Other non-cash adjustments(300)(263)
Changes in operating assets and liabilities:
Contracts receivable including retainage(6,627)(25,961)
Costs and estimated earnings in excess of billings on uncompleted contracts5,531 2,573 
Inventories(15,480)(7,320)
Prepaid expenses and other current assets(13,015)3,650 
Other assets(522)(129)
Accounts payable13,433 17,220 
Billings in excess of costs and estimated earnings on uncompleted contracts24,869 24,099 
Accrued expenses and other current liabilities4,828 2,340 
Other long-term liabilities804 2,233 
Net cash provided by operating activities, net of acquisitions209,079 157,157 
Cash flows from investing activities:
Purchases of property, plant and equipment(87,930)(97,810)
Proceeds from sale of property, plant and equipment14,059 17,698 
Proceeds from facility exchange— 36,987 
Business acquisitions, net of cash acquired(231,777)(91,787)
Proceeds from the sale of restricted investments3,553 2,900 
Purchases of restricted investments(5,490)(11,360)
Net cash used in investing activities(307,585)(143,372)
Cash flows from financing activities:
Proceeds from issuance of long-term debt, net of debt issuance costs210,235 103,000 
Principal payments of long-term debt(72,813)(103,125)
Purchase of treasury stock(11,312)(139)
Net cash provided by (used in) financing activities126,110 (264)
Net change in cash, cash equivalents and restricted cash27,604 13,521 
Cash, cash equivalents and restricted cash:
Beginning of year49,080 35,559 
End of year$76,684 $49,080 
Supplemental cash flow information:
Cash paid for interest$21,680 $19,157 
Cash paid for income taxes$5,447 $1,009 
Cash paid for operating lease liabilities$6,874 $3,029 
Non-cash items:
Operating lease right-of-use assets obtained in exchange for operating lease liabilities$29,097 $3,109 
Property, plant and equipment financed with accounts payable$7,227 $2,459 
Amounts (receivable) payable to sellers in business combinations$(153)$— 




Reconciliation of Non-GAAP Financial Measures

Adjusted EBITDA represents net income before, as applicable from time to time, (i) interest expense, net, (ii) provision (benefit) for income taxes, (iii) depreciation, depletion, accretion and amortization, (iv) share-based compensation expense, (v) loss on the extinguishment of debt, and (vi) expenses associated with non-routine acquisitions. Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of revenues for each period. These metrics are supplemental measures of our operating performance that are neither required by, nor presented in accordance with, GAAP. These measures have limitations as analytical tools and should not be considered in isolation or as an alternative to net income or any other performance measure derived in accordance with GAAP as an indicator of our operating performance. We present Adjusted EBITDA and Adjusted EBITDA Margin because management uses these measures as key performance indicators, and we believe that securities analysts, investors and others use these measures to evaluate companies in our industry. Our calculation of Adjusted EBITDA and Adjusted EBITDA Margin may not be comparable to similarly named measures reported by other companies. Potential differences may include differences in capital structures, tax positions and the age and book depreciation of intangible and tangible assets.
The following tables present a reconciliation of net income, the most directly comparable measure calculated in accordance with GAAP, to Adjusted EBITDA and the calculation of Adjusted EBITDA Margin for the applicable periods.
Construction Partners, Inc.
Net Income to Adjusted EBITDA Reconciliation
Fiscal Years Ended September 30, 2024 and 2023
(in thousands, except percentages)
For the Fiscal Year
Ended September 30,
2024
2023 (2)
Net income$68,935 $49,001 
Interest expense, net19,071 17,346 
Provision for income taxes23,161 16,403 
Depreciation, depletion, accretion and amortization 92,920 79,100 
Share-based compensation expense15,031 10,759 
Acquisition-related expenses (1)
1,455 — 
Adjusted EBITDA$220,573 $172,609 
Revenues$1,823,889 $1,563,548 
Adjusted EBITDA Margin12.1 %11.0 %
(1)Reflects expenses associated with the acquisition of Lone Star Paving, which management views as a non-routine acquisition.
(2)In periods commencing prior to September 30, 2023, the Company historically included within the definition of Adjusted EBITDA an adjustment for management fees and expenses related to the Company’s management services agreement with an affiliate of SunTx Capital Partners, a member of the Company’s control group. Effective October 1, 2023, the term of the management services agreement was extended to October 1, 2028. As a result of the term extension, the Company no longer views the management fees and expenses paid under the management services agreement as a non-recurring expense. Accordingly, periods commencing subsequent to September 30, 2023 do not include an adjustment for management fees and expenses, and the Company has recast comparative Adjusted EBITDA and Adjusted EBITDA Margin for the quarter and fiscal year ended September 30, 2023 to conform to the current definition.




Construction Partners, Inc.
Net Income to Adjusted EBITDA Reconciliation
Three Months Ended September 30, 2024 and 2023
(in thousands, except percentages)
For the Three Months
Ended September 30,
2024
2023 (2)
Net income$29,308 $30,913 
Interest expense, net6,084 3,545 
Provision for income taxes10,256 10,250 
Depreciation, depletion, accretion and amortization 25,452 21,331 
Share-based compensation expense4,445 2,850 
Acquisition expenses(1)
1,455 — 
Adjusted EBITDA$77,000 $68,889 
Revenues$538,163 $475,026 
Adjusted EBITDA Margin14.3 %14.5 %
(1)Reflects expenses associated with the acquisition of Lone Star Paving, which management views as a non-routine acquisition.
(2)In periods commencing prior to September 30, 2023, the Company historically included within the definition of Adjusted EBITDA an adjustment for management fees and expenses related to the Company’s management services agreement with an affiliate of SunTx Capital Partners, a member of the Company’s control group. Effective October 1, 2023, the term of the management services agreement was extended to October 1, 2028. As a result of the term extension, the Company no longer views the management fees and expenses paid under the management services agreement as a non-recurring expense. Accordingly, periods commencing subsequent to September 30, 2023 do not include an adjustment for management fees and expenses, and the Company has recast comparative Adjusted EBITDA and Adjusted EBITDA Margin for the quarter and fiscal year ended September 30, 2023 to conform to the current definition.


Construction Partners, Inc.
Net Income to Adjusted EBITDA Reconciliation
Fiscal Year 2025 Outlook
(unaudited, in thousands, except percentages)

For the Fiscal Year Ending September 30, 2025
LowHigh
Net income$97,000 $113,000 
Interest expense, net64,072 62,715 
Provision for income taxes32,471 38,432 
Depreciation, depletion, accretion and amortization128,957 138,353 
Share-based compensation expense21,500 21,500 
Acquisition expenses3,000 3,000 
Adjusted EBITDA$347,000 $377,000 
Revenues$2,480,000 $2,580,000 
Adjusted EBITDA Margin14.0 %14.6 %




v3.24.3
Cover Page
Nov. 21, 2024
Cover [Abstract]  
Entity Tax Identification Number 26-0758017
Entity File Number 001-38479
Entity Incorporation, State or Country Code DE
Entity Registrant Name CONSTRUCTION PARTNERS, INC.
Document Period End Date Nov. 21, 2024
Document Type 8-K
Amendment Flag false
Entity Central Index Key 0001718227
Entity Emerging Growth Company false
Security Exchange Name NASDAQ
Trading Symbol ROAD
Title of 12(b) Security Class A common stock, $0.001 par value
Pre-commencement Issuer Tender Offer false
Pre-commencement Tender Offer false
Soliciting Material false
Local Phone Number (334) 673-9763(Registrant’s telephone number, including area code)
City Area Code (334) 673-9763(Registrant’s telephone number, including area code)
Written Communications false
Entity Address, Postal Zip Code 36303
Entity Address, State or Province AL
Entity Address, City or Town Dothan
Entity Address, Address Line One 290 Healthwest Drive, Suite 2

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