Infrastructure Company D.A. DAVIDSON DIVERSIFIED INDUSTRIALS & - PowerPoint PPT Presentation

Granite is America’s Infrastructure Company D.A. DAVIDSON DIVERSIFIED INDUSTRIALS & SERVICES CONFERENCE S EPTEMBER 19, 2019

S AFE H ARBOR Any statements contained in this presentation that are not based on historical facts, including statements regarding future events, occurrences, circumstances, activities, performance, growth, demand, strategic plans, outcomes, guidance, backlog, Committed and Awarded Projects (CAP), and results, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements are identified by words such as “future,” “outlook,” “assumes,” “believes,” “expects,” “estimates,” “anticipates,” “intends,” “plans,” “appears,” “may,” “will,” “should,” “could,” “would,” “continue,” and the negatives thereof or other comparable terminology or by the context in which they are made. These forward - looking statements are estimates reflecting the best judgment of senior management and reflect our current expectations regarding future events, occurrences, circumstances, activities, performance, growth, demand, strategic plans, outcomes, guidance, backlog, CAP, and results. These expectations may or may not be realized. Some of these expectations may be based on beliefs, assumptions or estimates that may prove to be incorrect. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our business, financial condition, results of operations, cash flows and liquidity. Such risks and uncertainties include, but are not limited to, those described in greater detail in our filings with the Securities and Exchange Commission, particularly those specifically described in our Annual Report on Form 10-K and quarterly reports on Form 10-Q. Due to the inherent risks and uncertainties associated with our forward-looking statements, the reader is cautioned not to place undue reliance on them. The reader is also cautioned that the forward-looking statements contained herein speak only as of the date of this presentation and, except as required by law; we undertake no obligation to revise or update any forward-looking statements for any reason.

James Roberts, CEO

G RANITE I S A MERICA ’ S I NFRASTRUCTURE C OMPANY TM Granite is in the business of delivering Infrastructure Solutions for public and private clients in the Americas Infrastructure Solutions are the consistent delivery of ideas, innovations, products and services to power today’s mobile society and improve the everyday life of our clients

“ Boldly contending for that which is right… CONSECUTIVE YEARS …and firmly Forbes rejecting that Most Trustworthy Companies America’s Best Mid -Size Employers which is wrong. ” CONSECUTIVE YEARS

S TRATEGIC P LAN F OCUS : 2023 Business Growth & Sustainability Increase the size, diversity, and profitability of our business through acquisition and organic growth GVA Excellence in Execution S TAKEHOLDER Consistently and safely provide infrastructure V ALUE solutions that exceed stakeholder C REATION expectations and create value for Granite Focus on our People Our employees pursue excellence, know what is expected of them, have proper resources, and are accountable for results

ENR #1 Highways ENR #5 Bridges ENR #6 Transportation Contractor DIVERSE CAPABILITIES Broad opportunities ENR #9 Transmission/Distribution ENR #1 Mining ENR #2 Sanitary Storm Sewers across geographies & ENR #2 Water Transmission Line ENR #5 Sewerage & Solid Waste end-markets

DIVERSIFICATION: LAYNE, LIQUIFORCE ACQUISITIONS FUEL GROWTH OPPORTUNITIES Granite 2018 Granite acquired businesses 2018 Granite-acquired affiliates

>650 Million Tons of Construction Materials Permitted Reserves* & Asphalt 54 Quarries Our expert teams go above and beyond to provide high-quality, technical, logistics, and scheduling solutions to 49 Asphalt our internal and external construction Plants materials customers. Granite is a proud recipient of the Diamond Achievement award for Quality, Paving and Sustainability at more than 90% of our plant and aggregate sites, year-over-year. *Includes owned and leased reserves as of 12/31/2018

F IRST H ALF 2019 O VERVIEW • Weather impacts Granite locations across U.S. through May; strong June acceleration • Impact from non-cash charges related to four legacy, unconsolidated Heavy Civil joint venture projects • End-market diversification balances growth and risk • Strong demand, bidding discipline bolster profit growth expectations On pace for record second half results 10

C OMMITTED AND A WARDED P ROJECTS * Mega $4.9 Specialty projects $4.4 $0.6 $0.3 Water $1.1 $3.7 $0.3 $0.7 Q2’19 $3.8 $3.7 $3.7 Other Q2'18 Q4'18 Q2'19 Transportation $3.7 ALTERNATIVE PROCUREMENT WORK CONTRACT BACKLOG * Committed and Awarded Projects includes contract backlog (unearned revenue and other awards) and certain alternative procurement projects. $ in billions 11

C URRENT P ROJECT P ORTFOLIO Focus on Lower Risk, Higher Margin Projects # of Jobs Average Project Size 4,000 – 4,500 ~$2M Execution of Diversified Strategy 97% of Jobs* <$20M Operating in 44 States * Open jobs as of June 30, 2019 12

H EAVY C IVIL P ORTFOLIO S HARE 1H 2018 1H 2019 37% % of Total CAP 48% 52% 63% 20% 28% % of Total Revenue 72% 80% Heavy Civil Other 13

R EITERATING Q2 2019 G UIDANCE • Core earnings power strong • High-single-digit consolidated revenue growth • Adjusted EBITDA margin* of 4.0% to 5.0% (double- digit in 2H’19) • Guidance revisions include impact of charges • Revised guidance continues to reflect strong market conditions *Adjusted EBITDA margin is a non-GAAP measure. Please refer to the description of non-GAAP measures in the attached tables. 14

S TRATEGIC & M ARKET O VERVIEW • Improving State, Local, Municipal funding • Broad, steady private-sector opportunity set • Federal foundational element, future catalyst (FY 2021+) 15

F IRST H ALF 2019 P ROJECT B IDDING * $4.6B+ Project Bidding (Size >$150M) $4.2B+ 27% Mid- 20’s 1H’19 High-teens $4.6B+ 26.7% 21.3% Project Bidding 1H 18 1H 19 (Size <$150M) 73% Bid Amount (Project Size <$150M) Hit Rate** *Excluding projects <$5K; Bid Results are not a guarantee that a project will be awarded. Lag between bid day and project start can vary 30-120 days. ** Hit rate calculated as the total value of bids won divided by the total value of bids participated in. 16

S ECOND H ALF 2019 AND B EYOND • Record backlog providing for strong growth • Strong Construction Materials committed volumes • WMS Group fully integrated; Focusing on growing top- and bottom-line • Proactively refining Heavy Civil Group strategy • Continuing robust bidding environment 17

Q&A T HANK Y OU

Building Investor Value Together Contact Investor Contact: Corporate Office: Lisa Curtis 585 West Beach St. Vice President, Investor Relations Watsonville, CA 95076 (831) 728-7532 (831) 724-1011 www.graniteconstruction.com Lisa.curtis@gcinc.com

APPENDIX Non-GAAP Financial Information The tables below contain financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Specifically, management believes that non -GAAP financial measures such as EBITDA and EBITDA margin are useful in evaluating operating performance and are regularly used by securities analysts, institutional investors and other interested parties, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. We are also providing additional non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA margin, adjusted net income attributable to Granite Construction Incorporated and adjusted diluted earnings per share to indicate the impact of non-recurring acquisition, integration, acquired intangible amortization expenses and synergy costs related to the acquisition of Layne Christensen Company and LiquiForce. Management believes that these additional non-GAAP financial measures facilitate comparisons between securities analysts, institutional investors and other interested parties. However, the reader is cautioned that any non-GAAP financial measures provided by the Company are provided in addition to, and not as alternatives for, the Company's reported results prepared in accordance with GAAP. Items that may have a significant impact on the Company's financial position, results of operations and cash flows must be considered when assessing the Company's actual financial condition and performance regardless of whether these items are included in non-GAAP financial measures. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non- GAAP financial measures provided by the Company may not be comparable to similar measures provided by other companies.