Rock Products

AUG 2019

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

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62 • ROCK products • August 2019 Eagle does not intend to disclose developments regarding this process if and until an action is announced, or the pro- cess is otherwise concluded. Upon completion of the separation, each company will have its own management team and an independent board of directors that will include members of the current Eagle board. Full management teams and boards for both compa- nies will be named in the months leading up to the formal separation. ACG Acquisition Drives Arcosa's First Quarter 2019 Results Arcosa Inc. announced results for the first quarter ended March 31, 2019. The company is reporting that reve- nues increased 16% to $410.9 million. Net income increased 25% to $27.7 million; while adjusted net income increased 30% to $28.8 million, excluding non-routine items related to the ACG Materials acquisition. Construction Products revenues increased 51% to $106.0 million in the first quarter, benefitting from a full quarter of operating results from the December 2018 acquisition of ACG Materials. Operating profit for the first quarter was $11.3 million compared to $12.4 million in the same period in 2018. Adjusting for the write-up of acquired ACG Materials inventory, first quarter Adjusted Segment EBITDA was $21.5 million, $4.0 million higher than a year ago. The increase was driven by the ACG acquisition. "Arcosa's first quarter results were better than our expecta- tions," said Antonio Carrillo, president and chief executive officer. "This strong start to 2019 supports our confidence in our full-year guidance. We achieved year-over-year rev- enue growth in each of our business segments, benefitting from organic initiatives and the addition of ACG Materials into our Construction Products Group. ACG's first quarter results were in line with our expectations, and we continue to consider bolt-on acquisitions in the aggregates and specialty materials markets. "We continued to execute effectively on our stage one prior- ities: growing Construction Products, improving margins in Energy Equipment, expanding our Transportation Products business as markets continue to recover, and operating a lean corporate structure," Carrillo continued. "Our strong start to the year and confidence in current busi- ness trends support our expectations for substantial growth in 2019. We reaffirm our full-year revenue and adjusted EBITDA guidance ranges of $1.70 billion to $1.80 billion and $215 million to $225 million, respectively. The mid-point represents 18% year-over-year adjusted EBITDA growth in 2019, after absorbing additional standalone company costs and initial pricing on a long-term components contract," Car- rillo noted. MDU Resources Materials Group Takes First-Quarter Loss MDU Resources Group Inc. reported first quarter earnings of $40.9 million, or 21 cents per share, compared to first quarter 2018 earnings of $42.4 million, or 22 cents per share. The construction materials business experienced a seasonal loss in the first quarter, with a loss of $34.4 million this year compared to $23.5 million in 2018. Acquisitions that the com- pany made in 2018 added to operations that are impacted by winter weather conditions, and the company experienced lower margins as a result of less-favorable weather condi- tions in certain regions. The construction materials backlog of work at March 31 was a record $943 million, compared to $692 million in 2018. The construction services business in the first quarter had record revenues, up about 26% over last year, and record earnings. Earnings were $20.0 million, approximately 33% higher than the $15.1 million earned in first quarter 2018. The company performed a higher volume of work for the hospitality and high-tech industries, as well as for other util- ity companies, during the quarter. It also saw an increase in sales and rentals of the utility construction equipment it manufactures. Its backlog of work at March 31 was a record $1.02 billion, compared to $675 million at the same time last year. "Our construction services business had record results in the first quarter, including record revenues, which has led us to increase our 2019 revenue guidance by $50 million for this business. Our utility and pipeline businesses also performed very well," said David L. Goodin, president and CEO of MDU Resources. "Our construction materials busi- ness experienced a larger first quarter loss compared to last year, which was anticipated as we added operations through acquisitions in 2018 in areas where construction activity is impacted by winter. "Our construction businesses have combined record back- log of nearly $2 billion at March 31, giving us confidence as we enter the peak of the 2019 construction season," Goodin said. "Our natural gas pipeline business has begun construc- tion on two expansion projects that we expect to be finished and in-service later this year. Our utility business recently announced that we plan to retire our wholly owned coal-fired electric generation units, and we continue to move forward with that effort while ensuring we are providing affordable, safe and reliable electricity to our customers." Aggregates Industry Almanac Publicly Traded Companies

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