North American Construction Group NYSE: NOA raised its 2026 combined revenue outlook after reporting stronger-than-expected first-half performance, supported by growth in Australia, the contribution from its IMC acquisition and improved operating activity across its markets.
The company said second-quarter combined revenue reached C$456 million, an increase of C$86 million from the prior-year period. IMC, which was acquired during the year, contributed C$91 million in quarterly revenue. Excluding IMC, Australian revenue grew organically by 15%, driven by commissioned growth assets and execution, Chief Financial Officer Jason Veenstra said.
North American Construction Group reported C$93 million of EBITDA for the quarter and adjusted earnings per share of C$0.32. EBITDA and EBIT rose meaningfully from the prior-year quarter, reflecting the IMC acquisition and what Veenstra described as a more typical quarter from the Fargo joint ventures.
“Our first half performance was stronger than expected entering the year and gives us the confidence to raise our full year revenue outlook,” President and CEO Barry Palmer said.
Revenue Outlook Raised, EBITDA Guidance Maintained
The company increased its 2026 combined revenue guidance to a range of C$1.6 billion to C$1.8 billion, with a midpoint of C$1.7 billion. That midpoint is C$100 million above the prior outlook midpoint and would represent approximately 14% growth from the company’s 2025 result, according to management.
North American Construction Group maintained its adjusted EBITDA outlook of C$380 million to C$420 million and its free-cash-flow outlook of C$110 million to C$130 million. At the midpoints, the guidance calls for C$400 million in adjusted EBITDA and C$120 million in free cash flow.
During the question-and-answer session, Palmer said the higher revenue forecast primarily reflects the strength of first-half revenue, while EBITDA was consistent with management’s prior expectations. He also said diesel-cost changes are largely passed through in most of the company’s operations and are not expected to affect either revenue or EBITDA guidance.
The company reported C$78 million in operating cash flow before working capital during the quarter and C$23 million in free cash flow after a C$13 million positive working-capital change. Net debt rose by C$191 million to C$1.1 billion, reflecting the IMC acquisition and growth capital equipment purchases. Reported trailing-12-month net-debt leverage was 2.9 times, while Veenstra said the business was operating at a second-half run-rate leverage ratio of 2.6 times.
Australia Remains Primary Growth Engine
Palmer said Australia remains the company’s primary growth engine. Revenue in the region increased at an approximately 31% compound annual rate from the first half of 2024 through the first half of 2026, while first-half 2026 revenue was 14% above the second half of 2025.
The MacKellar and IMC businesses have expanded the company’s national presence in Australia and its ability to pursue larger project scopes, management said. IMC’s new eight-bay workshop in Muchea is expected to increase maintenance capacity and support equipment rebuilds as well as larger projects.
Management said IMC adds exposure to lower-capital-intensity unit-rate work and broadens the company’s mineral exposure across gold, lithium, iron ore, nickel and other critical minerals. Palmer said IMC’s margins are not as high as those of the equipment-rental business in Queensland because much of its work is conducted under unit-rate contracts. However, he said the format offers potential margin improvement when performance exceeds expectations.
As of June 30, the Australian operations had about C$3.4 billion in contractual backlog and a further C$3.9 billion bid pipeline, the company said.
Oil Sands and Northern Infrastructure Opportunities
In Canada’s oil sands, North American Construction Group has identified 260 multi-life heavy equipment assets as its target fleet. Management is focused on improving mechanical availability, with a medium-term target above 70%.
Palmer said customer demand is increasing as haul distances lengthen and operating requirements expand. The company plans to invest about C$50 million in 2026 in the prioritized fleet to replace components and improve reliability. Management said incremental investments will target internal rates of return above 40% and a path toward gross profit margins of roughly 15%.
Veenstra said total capital spending for the year is expected to be slightly above C$200 million, compared with an earlier expectation below that level. The increase is tied primarily to the company’s oil sands fleet-efficiency strategy, while Australia is tracking in line with operating plans established late last year.
In northern Canada, the company said Nuna is adding equipment in Nunavut during the third quarter. The expansion is expected to increase site-level revenue by about 20%. Nuna also has secured a Yukon infrastructure award and three initial Ontario projects, which management said establish footholds for potential follow-on work.
North American Construction Group’s total bid pipeline exceeded C$12 billion as of June 30, including approximately C$3.6 billion in active tender and procurement. The active pipeline was split evenly between Australia and North America and consisted of 54% mining services and 46% infrastructure opportunities.
Backlog and Leadership Update
Record contractual backlog of approximately C$3.8 billion underpins the company’s outlook, management said. The second-half plan includes dry-season conditions supporting MacKellar in Queensland, continued IMC activity ramping in Western Australia, improved oil sands utilization after spring breakup and a fourth-quarter contribution from the Nunavut fleet expansion.
Management also discussed a recently won fuel-services contract, which Veenstra said is included in the C$3.8 billion backlog. The contract requires approximately C$5 million of capital spending and carries about C$135 million of backlog, according to comments during the call. Palmer said the award could create opportunities for additional contracts as existing agreements in the market approach expiration.
Finally, Palmer said Chairman Martin Ferron had indicated that the company’s CEO search was progressing well and that North American Construction Group expects to announce a new CEO in the coming weeks.
About North American Construction Group (NYSE:NOA)
North American Construction Group Ltd NYSE: NOA is a Canadian industrial company headquartered in Edmonton, Alberta, that specializes in providing integrated heavy construction equipment solutions. Through its two core segments—Sales and Rentals—the company offers a comprehensive portfolio of new and used off-highway trucks, wheel loaders, hydraulic excavators, dozers and motor graders, along with aftermarket parts and maintenance services.
In its Sales division, North American Construction Group partners with leading global equipment manufacturers to distribute and support a broad range of heavy machinery across multiple industries.
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