ConDig (1-Aug-17).  Profit at Sterling Construction Co surged in the second quarter as the Texas-based civil contractor reported a 30% rise in revenue.

The Woodlands, Texas-based company booked net income of $3.7 million in the quarter ended June 30 compared with $2 million in the same period last year.

It comes as revenue shot up to $246.4 million from $189.6 million in the second quarter last year, while gross margins improved to 10.2% from 8.2%.

Higher second revenue was primarily driven by a $42.5 million incremental contribution from the company’s acquisition of Denton, Texas-based concrete outfit Tealstone Construction for about $85 million in April.

Revenue in the civil division grew 7.3% to $209.1 million, due principally to the ramp up in a new construction joint venture project by Sterling’s Utah subsidiary, while operating income was $3.1 million.

Revenue in the company’s residential division in the second quarter was $37.2 million and operating income reported as $5.2 million.

Sterling Construction expects full-year revenue in the range of $850 million to $880 million and net income attributable to Sterling common stock holders to be between $9 million and $11 million.

“Our acquisition of Tealstone at the beginning of the quarter was an important step in the transformation of our business and was immediately accretive. This business has provided us with a higher margin revenue stream with minimal integration challenges,” said Joe Cutillo, Sterling Construction’s chief executive officer.

“Beyond the near-term benefits, Tealstone gives us a strong market position in residential and commercial concrete construction in a rapidly growing market, and a pathway for meaningful expansion into adjacent markets.”