NOA Boosts Backlog With New Heavy Civil Infrastructure Project

Core Viewpoint - North American Construction Group Ltd. (NOA) has secured a significant heavy civil construction contract in partnership with Mikisew North American Limited Partnership, which is expected to generate approximately $125 million in revenue over a two-year period [1][4]. Company Overview - North American Construction provides a range of services including equipment maintenance, mining, and heavy construction across Canada, the United States, and Australia [5]. - The company recently acquired MacKellar Group for an expected total consideration of$395 million, which is anticipated to enhance its growth prospects [5]. Contract Details - The awarded project is located at a leading mine in the Fort McMurray region and involves constructing large diversion ditches to manage water flow away from mining areas [3]. - The project is set to commence in January 2025 and conclude in October 2026 [4]. Financial Performance - The contract win contributes to NOA's pro forma backlog, which has increased to $3.1 billion, reflecting a$300 million rise from the previous quarter [7]. - The company expects its year-end backlog to exceed $3 billion, indicating a trend of increasing geographic and resource diversification [7]. Market Opportunities - There is a growing demand for heavy equipment in Australia, particularly in Queensland and New South Wales, with opportunities in various mining sectors including copper, gold, silver, and iron ore [6]. - Despite a 3.3% increase in NOA's shares over the past three months, the company has underperformed compared to the Zacks Building Products - Heavy Construction industry's 29.7% growth [9].