Rock Products

AUG 2017

Rock Products is the aggregates industry's leading source for market analysis and technology solutions, delivering critical content focusing on aggregates-processing equipment; operational efficiencies; management best practices; comprehensive market

Issue link:

Contents of this Issue


Page 123 of 131

122 • ROCK products • August 2017 Aggregates Industry Almanac Publicly Traded Companies Additionally, the pre-construction pipeline of projects contin- ues to grow across the company's footprint. State and local governments have continued to pass funding measures to increase public infrastructure investment significantly, and more projects supported by federal FAST Act funding have moved further toward the active construction stage. Broad pricing momentum continued across the compa- ny's footprint with substantially all markets realizing price growth in the second quarter. For the quarter, same-store freight-adjusted average sales price for aggregates increased 5 percent versus the prior year, or $0.59 per ton, despite a negative mix impact. The overall pricing climate remains favorable as visibility to a sustained recovery improves and as construction mate- rials producers stay focused on earning adequate returns on capital. California and Georgia each realized high-single digit price growth, again supported by clear and improving visibility to sustained growth in demand. Second quarter Aggregates segment gross profit was $253 million, or $5.27 per ton. Segment results in the quarter were negatively impacted by product shipment mix, acquisition-re- lated integration costs, a 15 percent increase in the unit cost of diesel fuel and costs related to the transition to two new, more efficient ships to transport aggregates from a quarry in Mexico. In total, these items negatively impacted segment gross profit by $16 million in comparison to the prior year. Martin Marietta Scores Record Second Quarter Results Martin Marietta Materials Inc. reported record results for the second-quarter ended June 30, 2017, including consolidated net sales of $996.3 million, an increase of 8.8 percent com- pared with $915.4 million in the second quarter of 2016. The company also reported: •  Building Materials net sales of $931.7 million compared with $856.6 million, an increase of 8.8 percent, and Mag- nesia Specialties net sales of $64.6 million compared with $58.8 million, an increase of 9.7 percent. •  Consolidated gross profit of $274.1 million compared with $247.4 million, an increase of 10.8 percent. •  Consolidated earnings from operations of $212.9 mil- lion compared with $190.8 million, an increase of 11.5 percent. • Earnings per diluted share of $2.25 compared with $1.90, an increase of 18.4 percent. • EBITDA of $292.3 million compared with $266.5 million, an increase of 9.7 percent. In the second quarter of 2017, net sales for the com- pany's Building Materials business, which includes the aggregates, cement, ready mixed concrete, and asphalt and paving product lines, were $931.7 million, an increase of 8.8 percent from $856.6 million, driven by pricing and volume gains in all product lines. The aggregates product line average selling price improve- ment of 3.8 percent was led by a 10.6 percent increase in the Southeast group. The West and Mid-America groups reported increases of 3.4 percent and 2.4 percent, respectively. The cement product line had pricing growth of 5.2 percent, further reinforcing the underlying positive market fundamentals in Texas. Ready mixed concrete and asphalt pricing increased 1.4 percent and 11.1 percent, respectively. Aggregates product line shipments increased 2.0 percent compared with the second quarter of 2016. Volume growth was led by the West's increase of 3.6 percent followed by 2.0 percent growth in the Mid-America group. Volume growth in Mid-America was negatively impacted by heavy precipita- tion. In addition, the Southeast's shipments were particularly affected by wet weather in Georgia throughout the majority of the second quarter and decreased 3.2 percent compared with the second quarter of 2016. Total cement shipments increased 8.0 percent. Ready mixed concrete shipments, including volumes from acquired busi- nesses, increased 11.5 percent. Asphalt volumes increased 16.5 percent compared with the second quarter of 2016, benefitting from robust demand in Colorado. Gross margin (excluding freight and delivery revenues) for the Building Materials business was 26.8 percent, an increase of 30 basis points, driven by the Southeast group's nearly 250-basis-point improvement. Further growth was hindered by poor, weather-impacted operating conditions. The Build- ing Materials business results reflect cement kiln maintenance costs of $3.5 million for the quarter compared with $5.7 mil- lion. Remaining planned kiln maintenance costs for the year are $10.6 million, with nearly all to occur in the fourth quar- ter. Total kiln maintenance costs for the full year 2017 are expected to be $18.3 million compared with $20.9 million in the prior year. Ward Nye, chairman, president and CEO of Martin Mar- ietta, stated, "Our record second-quarter results reflect improved sales, gross profit and earnings from operations in each reportable group, underscoring the breadth of our business and our ability to capitalize on the ongoing recovery in construction activity. Positive residential and nonresidential activity drove results, along with pricing improvements across our aggregates product line, led by the Southeast group's 10.6 percent increase. We overcame challenging operating conditions in several key states, as near-record levels of precipitation in North Carolina, South Carolina, Georgia and Florida negatively impacted aggre- gates shipments and operating efficiencies in our historically most profitable geographic areas. Looking ahead, we are

Articles in this issue

Links on this page

Archives of this issue

view archives of Rock Products - AUG 2017