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IN THE KNOW Vulcan Reports Second Quarter Results Vulcan Materials Co. announced that aggregates seg‐ ment gross profit improved $9 million, or 9 percent, in the second quarter, reflecting lower unit cost of sales due to improved productivity and cost reduction initia‐ tives. All key labor and energy efficiency metrics for ag‐ gregates improved for the quarter. On a same‐store basis, aggregates shipments increased slightly from the prior year period, notwithstanding the pull‐forward effect of seasonally favorable weather conditions during the first quarter and the effects of Tropical Storm Debby in Florida in June. Overall, ship‐ ments decreased 1 percent due to the sale of operations in Indiana in 2011. Gross profit improved $9 mil- lion, or 9 percent, in the sec- ond quarter, reflecting lower unit cost of sales due to im- proved productivity and cost reduction initiatives. Aggregates pricing increased slightly, offsetting some of the earnings effect of a less favorable geographic mix. Chairman and Chief Executive Officer Don James stated, "The improvement in our second quarter operating re‐ sults demonstrates the continuing benefits of our ongo‐ ing focus on reducing overhead costs and maximizing operating efficiency across the organization. Despite weaker volumes in several of our most profitable mar‐ kets, aggregates segment gross profit margin improved by 220 basis points. Cash earnings per ton of aggregates increased to $4.57 per ton. Both of these improvements demonstrate our cost reduction efforts and the earnings potential of our aggregates business, particularly as vol‐ ume across our geographic markets recovers." Trends in both the private and public sector construc‐ tion markets remain positive, according to James. "In particular, we are encouraged by the passage of the new multi‐year highway bill by Congress in late June, which should provide state departments of trans‐ portation with funding certainty they need to move forward on infrastructure programs," he said. "We re‐ main focused on executing our initiatives and aggres‐ sively managing other items under our control. This will enable us to continue to generate higher levels of earnings and cash flow, further improve our operating leverage, reduce overhead costs and strengthen our credit profile." Canadian Parliament Approves Budgetary Reforms On June 29, the Canadian Senate passed the 2012 Om‐ nibus Budget Act (C‐38), approximately two weeks after the House of Commons sent the measure to the upper chamber, according to the Associated Equipment Distrib‐ utors. Immediately after passage the measure received royal assent, giving it the force of law and making several controversial changes to Canadian policy. The budget pursues major overhauls of tax, retirement and regulatory policies. C‐38 also rewrites the Canadian Environmental Protection Act and creates the Canadian Environmental Assessment Act to judge whether proj‐ ects are likely to have adverse environmental effects. The new process would allow for the recognition of as‐ sessments by other jurisdictions and mandates opportu‐ nities for public participation. On the energy and infrastructure front, the budget es‐ tablishes that pipelines may not necessarily be deemed to be obstructions to navigation routes of endangered species. Under the change, Cabinet officials will now have direct roles in environmental reviews. The omnibus budget bill was both contentious and contro‐ 14 ROCKproducts • AUGUST 2012 versial with members of parliament due to the lack of specifics regarding its sweeping changes to a number of long‐standing programs. Prime Minster Stephen Harper's Conservative government has said the cuts are necessary to restore the nation's fiscal health, but has refused re‐ peated requests to reveal details about the measure's im‐ pact. Other controversial provisions lay out the process for raising the retirement age from 60 to 65 and for in‐ creasing the portion of pension funds due from employees to 50 percent. Legislative flurry creates the Canadian Environmental As- sessment Act to judge whether projects are likely to have ad- verse environmental effects. C‐38 was the first of two budget measures that Parlia‐ ment must approve. Canada's second implementing budget resolution will be introduced by Conservative Party leaders this fall, with significant reforms to labor and tax laws promised. www.rockproducts.com CANADIAN NEWS FAST FACT PRODUCER NEWS FAST FACT