Gross Margin Expansion Across All Product
Lines
First Half Execution Supports Increase in
Full Year Outlook
BIRMINGHAM, Ala., Aug. 3, 2023
/PRNewswire/ -- Vulcan Materials Company (NYSE: VMC), the nation's
largest producer of construction aggregates, today announced
results for the quarter ended June 30,
2023.
Financial Highlights Include:
|
Second Quarter
|
|
Year-to-Date
|
|
Trailing-Twelve Months
|
Amounts in millions,
except per unit data
|
2023
|
2022
|
|
2023
|
2022
|
|
2023
|
2022
|
Total
revenues
|
$ 2,113
|
$ 1,954
|
|
$ 3,762
|
$ 3,495
|
|
$ 7,582
|
$ 6,618
|
Gross profit
|
$
583
|
$
446
|
|
$
885
|
$
715
|
|
$ 1,728
|
$ 1,461
|
Selling, Administrative
and General (SAG)
|
$
139
|
$
134
|
|
$
256
|
$
253
|
|
$
518
|
$
482
|
As % of Total
revenues
|
6.6 %
|
6.9 %
|
|
6.8 %
|
7.3 %
|
|
6.8 %
|
7.3 %
|
Net earnings
attributable to Vulcan
|
$
309
|
$
187
|
|
$
429
|
$
279
|
|
$
726
|
$
594
|
Adjusted
EBITDA
|
$
595
|
$
450
|
|
$
933
|
$
744
|
|
$ 1,814
|
$ 1,545
|
Earnings attributable
to Vulcan from
continuing operations per diluted
share
|
$ 2.33
|
$ 1.50
|
|
$ 3.25
|
$ 2.20
|
|
$ 5.49
|
$ 4.56
|
Adjusted earnings
attributable to Vulcan from
continuing operations per diluted
share
|
$ 2.29
|
$ 1.53
|
|
$ 3.25
|
$ 2.25
|
|
$ 6.11
|
$ 5.04
|
Aggregates
segment
|
|
|
|
|
|
|
|
|
Shipments
(tons)
|
63.4
|
63.8
|
|
115.1
|
116.8
|
|
234.6
|
234.7
|
Freight-adjusted sales
price per ton
|
$ 18.69
|
$ 16.25
|
|
$ 18.68
|
$ 15.91
|
|
$ 17.76
|
$ 15.41
|
Gross profit
|
$
499
|
$
402
|
|
$
801
|
$
645
|
|
$ 1,565
|
$ 1,343
|
Gross profit per
ton
|
$ 7.87
|
$ 6.31
|
|
$ 6.96
|
$ 5.52
|
|
$ 6.67
|
$ 5.72
|
Cash gross
profit
|
$
618
|
$
510
|
|
$ 1,033
|
$
856
|
|
$ 2,027
|
$ 1,750
|
Cash gross profit per
ton
|
$ 9.76
|
$ 7.99
|
|
$ 8.98
|
$ 7.33
|
|
$ 8.64
|
$ 7.45
|
Tom Hill, Vulcan Materials'
Chairman and Chief Executive Officer, said, "Our earnings growth
through the first half of 2023 reflects the compounding benefits of
the consistent execution of our strategic disciplines and the
strength of our aggregates-led business. Aggregates gross profit
margin has expanded 230 basis points, and cash gross profit per ton
has improved 23 percent to $8.98 per
ton. Strong sales and operating momentum across our business is
expected to carry through the rest of the year. Shipments have
benefited from large industrial projects, and residential
construction activity has been better than expected. As a result,
we now expect to deliver full-year Adjusted EBITDA of $1.9 to $2.0
billion, an increase of $150
million compared to our initial expectations communicated in
February."
Segment Results
Aggregates
In the second
quarter, segment gross profit increased 24 percent to $499 million ($7.87
per ton), and gross profit margin expanded 290 basis points. This
improvement resulted from strong pricing growth and improving
efficiencies from our operating disciplines. Earnings improvement
was widespread across the Company's footprint.
Aggregates shipments decreased 1 percent with variations across
geographies. Shipment activity in California was particularly strong, following
the weather-impacted first quarter. Certain markets in the
Southeast benefited from healthy shipment activity to industrial
projects.
The pricing environment remains positive across the Company's
footprint. Freight-adjusted selling prices increased 15 percent, or
$2.44 per ton, as compared to the
prior year, with all markets realizing year-over-year
improvement.
Consistent with expectations, freight-adjusted unit cash cost of
sales increased 8 percent, or $0.67
per ton, over the prior year. Persistent inflationary pressures for
parts and supplies offset the benefit of lower diesel prices.
Pricing momentum and solid operational execution drove a 22
percent improvement in cash gross profit per ton to $9.76 per ton in the second quarter. The Company
remains focused on compounding improvements in unit profitability
throughout the cycle through fixed cost leverage, price growth and
operating efficiencies.
Asphalt, Concrete and Calcium
Asphalt segment gross
profit was $57 million, an increase
of $43 million over the prior year's
second quarter, and gross profit margin continued to expand. Cash
gross profit was $66 million versus
$22 million in the prior year. The
year-over-year improvement in earnings was driven by a combination
of strong shipment growth, continued pricing momentum and lower
liquid asphalt cost. Shipments increased 16 percent, benefiting
from solid growth in Arizona and
California, the Company's largest
asphalt markets. Pricing increased 9 percent, or $6.10 per ton, with improvements across all
markets.
Concrete segment gross profit was $27
million, and cash gross profit was $47 million in the second quarter. Unit gross
profit improved 22 percent, or $2.35
per cubic yard, despite lower shipments. Second quarter shipments
were impacted by the prior year divestiture of the Company's
operations in New York,
New Jersey and Pennsylvania and the slowdown in residential
construction activity.
Calcium segment gross profit was $1.1
million compared to $0.2
million in the prior year's second quarter.
Selling, Administrative and General (SAG)
SAG expense
in the quarter was $139 million, or
6.6 percent of total revenues, a 30 basis points improvement versus
the prior year. Trailing-twelve-months SAG expense was 6.8 percent
of total revenues. The Company remains focused on further
leveraging its overhead cost structure.
Financial Position, Liquidity and Capital
Allocation
Through the first half of the year, cash provided
by operating activities was $508
million, a 56 percent increase from the comparable prior
year period. Capital expenditures in the second quarter were
$157 million, including both
maintenance and growth projects. Through the first half of 2023,
capital expenditures were $270
million. As planned, the Company expects to spend
$600 to $650
million for maintenance and growth projects in 2023.
Additionally, the Company now expects to spend approximately
$200 million on opportunistic land
purchases for strategic reserves in California, North
Carolina and Texas. During
the quarter, the Company returned $57
million to shareholders through dividends, an 8 percent
increase versus the prior year, and $50
million to shareholders through repurchases of common
stock.
On June 30, 2023, the ratio of
total debt to trailing-twelve-months Adjusted EBITDA was 2.1 times
(2.0 times on a net debt basis).
On a trailing-twelve-months basis, return on average invested
capital was 14.7 percent, a 110 basis points improvement over the
prior year. The Company is focused on continuing to drive
improvement through solid operating earnings growth coupled with
disciplined capital management.
Outlook
Regarding the Company's full-year outlook for
2023, Mr. Hill stated, "We are increasing our full-year earnings
expectations to reflect aggregates shipment trends and the earnings
momentum in our Asphalt segment. Through the first half of the
year, shipments have been in line with the upper end of our
original expectations. Private non-residential construction
activity has remained healthy and should partially offset declines
in residential activity which have been more moderate than
anticipated. As a result, we are updating our aggregates volume
outlook to reflect shipment levels through the first half. As
always, we remain focused on the things we can control, and we are
well positioned to navigate shifts in demand and deliver attractive
earnings growth in 2023."
Management expectations for 2023 include the following
updates:
- Aggregates shipments down 1 to 4 percent (236.3 million tons in
2022)
- Total Asphalt, Concrete and Calcium segment cash gross profit
of approximately $295 million
-
- Asphalt expected to contribute 50 to 55 percent of
non-aggregates cash gross profit with mid-single digit growth in
both volume and price
- Concrete expected to contribute 45 to 50 percent of
non-aggregates cash gross profit reflecting the impact of the
weather-challenged first quarter
- Net earnings attributable to Vulcan of between $855 and $935
million
- Adjusted EBITDA of between $1.9
and $2.0 billion
All other aspects of the Company's expectations for 2023 remain
unchanged.
Conference Call
Vulcan will host a conference call at
10:00 a.m. CT on August 3, 2023. A webcast will be available via
the Company's website at www.vulcanmaterials.com. Investors and
other interested parties may access the teleconference live by
calling 800-343-4849, or 203-518-9814 if outside the U.S. The
conference ID is 8433578. The conference call will be recorded and
available for replay at the Company's website approximately two
hours after the call.
About Vulcan Materials Company
Vulcan Materials
Company, a member of the S&P 500 Index with headquarters in
Birmingham, Alabama, is the
nation's largest supplier of construction aggregates – primarily
crushed stone, sand and gravel – and a major producer of
aggregates-based construction materials, including asphalt and
ready-mixed concrete. For additional information about Vulcan, go
to www.vulcanmaterials.com.
Non-GAAP Financial Measures
Because GAAP financial
measures on a forward-looking basis are not accessible, and
reconciling information is not available without unreasonable
effort, we have not provided reconciliations for forward-looking
non-GAAP measures, other than the reconciliation of Projected
EBITDA as included in Appendix 2 hereto. For the same reasons, we
are unable to address the probable significance of the unavailable
information, which could be material to future results.
FORWARD-LOOKING STATEMENT DISCLAIMER
This document
contains forward-looking statements. Statements that are not
historical fact, including statements about Vulcan's beliefs and
expectations, are forward-looking statements. Generally, these
statements relate to future financial performance, results of
operations, business plans or strategies, projected or anticipated
revenues, expenses, earnings (including EBITDA and other measures),
dividend policy, shipment volumes, pricing, levels of capital
expenditures, intended cost reductions and cost savings,
anticipated profit improvements and/or planned divestitures and
asset sales. These forward-looking statements are sometimes
identified by the use of terms and phrases such as "believe,"
"should," "would," "expect," "project," "estimate," "anticipate,"
"intend," "plan," "will," "can," "may" or similar expressions
elsewhere in this document. These statements are subject to
numerous risks, uncertainties, and assumptions, including but not
limited to general business conditions, competitive factors,
pricing, energy costs, and other risks and uncertainties discussed
in the reports Vulcan periodically files with the SEC.
Forward-looking statements are not guarantees of future
performance and actual results, developments, and business
decisions may vary significantly from those expressed in or implied
by the forward-looking statements. The following risks related to
Vulcan's business, among others, could cause actual results to
differ materially from those described in the forward-looking
statements: general economic and business conditions; a pandemic,
epidemic or other public health emergency, such as the COVID-19
outbreak; Vulcan's dependence on the construction industry, which
is subject to economic cycles; the timing and amount of federal,
state and local funding for infrastructure; changes in the level of
spending for private residential and private nonresidential
construction; changes in Vulcan's effective tax rate; the
increasing reliance on information technology infrastructure,
including the risks that the infrastructure does not work as
intended, experiences technical difficulties or is subjected to
cyber-attacks; the impact of the state of the global economy on
Vulcan's businesses and financial condition and access to capital
markets; international business operations and relationships,
including recent actions taken by the Mexican government with
respect to Vulcan's property and operations in that country; the
highly competitive nature of the construction industry; the impact
of future regulatory or legislative actions, including those
relating to climate change, biodiversity, land use, wetlands,
greenhouse gas emissions, the definition of minerals, tax policy
and domestic and international trade; the outcome of pending legal
proceedings; pricing of Vulcan's products; weather and other
natural phenomena, including the impact of climate change and
availability of water; availability and cost of trucks, railcars,
barges and ships as well as their licensed operators for transport
of Vulcan's materials; energy costs; costs of hydrocarbon-based raw
materials; healthcare costs; labor relations, shortages and
constraints; the amount of long-term debt and interest expense
incurred by Vulcan; changes in interest rates; volatility in
pension plan asset values and liabilities, which may require cash
contributions to the pension plans; the impact of environmental
cleanup costs and other liabilities relating to existing and/or
divested businesses; Vulcan's ability to secure and permit
aggregates reserves in strategically located areas; Vulcan's
ability to manage and successfully integrate acquisitions; the
effect of changes in tax laws, guidance and interpretations;
significant downturn in the construction industry may result in the
impairment of goodwill or long-lived assets; changes in
technologies, which could disrupt the way Vulcan does business and
how Vulcan's products are distributed; the risks of open pit and
underground mining; expectations relating to environmental, social
and governance considerations; claims that our products do not meet
regulatory requirements or contractual specifications; and other
assumptions, risks and uncertainties detailed from time to time in
the reports filed by Vulcan with the SEC. All forward-looking
statements in this communication are qualified in their entirety by
this cautionary statement. Vulcan disclaims and does not undertake
any obligation to update or revise any forward-looking statement in
this document except as required by law.
Investor Contact: Mark Warren
(205) 298-3220
Media Contact: Janet Kavinoky (205) 298-3220
|
|
|
|
|
|
|
|
|
|
Table A
|
Vulcan Materials Company
|
and Subsidiary Companies
|
|
|
|
|
|
|
(in millions, except
per share data)
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
Consolidated Statements of
Earnings
|
|
|
|
June 30
|
|
|
|
June 30
|
(Condensed and
unaudited)
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
|
$2,112.9
|
|
$1,954.3
|
|
$3,761.8
|
|
$3,495.0
|
Cost of
revenues
|
|
(1,529.6)
|
|
(1,508.1)
|
|
(2,876.5)
|
|
(2,780.1)
|
Gross
profit
|
|
583.3
|
|
446.2
|
|
885.3
|
|
714.9
|
Selling, administrative
and general expenses
|
|
(139.1)
|
|
(134.4)
|
|
(256.5)
|
|
(253.4)
|
Gain on sale of
property, plant & equipment
|
|
|
|
|
|
|
|
|
and
businesses
|
|
16.7
|
|
2.0
|
|
18.5
|
|
4.6
|
Other operating
expense, net
|
|
(9.8)
|
|
(6.2)
|
|
(9.0)
|
|
(11.6)
|
Operating
earnings
|
|
451.1
|
|
307.6
|
|
638.3
|
|
454.5
|
Other nonoperating
income (expense), net
|
|
(0.1)
|
|
(4.7)
|
|
1.3
|
|
(3.0)
|
Interest expense,
net
|
|
(46.7)
|
|
(38.7)
|
|
(95.7)
|
|
(74.7)
|
Earnings from
continuing operations
|
|
|
|
|
|
|
|
|
before income
taxes
|
|
404.3
|
|
264.2
|
|
543.9
|
|
376.8
|
Income tax
expense
|
|
(92.0)
|
|
(63.7)
|
|
(108.6)
|
|
(82.4)
|
Earnings from
continuing operations
|
|
312.3
|
|
200.5
|
|
435.3
|
|
294.4
|
Loss on discontinued
operations, net of tax
|
|
(3.7)
|
|
(13.1)
|
|
(5.8)
|
|
(14.9)
|
Net earnings
|
|
|
|
308.6
|
|
187.4
|
|
429.5
|
|
279.5
|
Earnings attributable
to noncontrolling interest
|
|
0.0
|
|
(0.1)
|
|
(0.2)
|
|
(0.4)
|
Net earnings
attributable to Vulcan
|
|
$308.6
|
|
$187.3
|
|
$429.3
|
|
$279.1
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share attributable to Vulcan
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$2.34
|
|
$1.51
|
|
$3.27
|
|
$2.21
|
Discontinued
operations
|
|
($0.02)
|
|
($0.10)
|
|
($0.05)
|
|
($0.11)
|
Net
earnings
|
|
$2.32
|
|
$1.41
|
|
$3.22
|
|
$2.10
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss)
per share attributable to Vulcan
|
|
|
|
|
|
|
Continuing
operations
|
|
$2.33
|
|
$1.50
|
|
$3.25
|
|
$2.20
|
Discontinued
operations
|
|
($0.02)
|
|
($0.10)
|
|
($0.04)
|
|
($0.11)
|
Net
earnings
|
|
$2.31
|
|
$1.40
|
|
$3.21
|
|
$2.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding
|
|
|
|
|
|
|
|
|
Basic
|
|
133.2
|
|
133.0
|
|
133.2
|
|
133.0
|
Assuming
dilution
|
|
133.8
|
|
133.5
|
|
133.7
|
|
133.6
|
Effective tax rate from
continuing operations
|
|
22.8 %
|
|
24.1 %
|
|
20.0 %
|
|
21.9 %
|
Table B
|
Vulcan Materials Company
|
and Subsidiary Companies
|
|
|
|
|
|
|
|
|
(in
millions)
|
Consolidated Balance Sheets
|
|
June 30
|
|
December 31
|
|
June 30
|
(Condensed and
unaudited)
|
|
2023
|
|
2022
|
|
2022
|
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$166.0
|
|
$161.4
|
|
$120.7
|
Restricted
cash
|
|
2.2
|
|
0.1
|
|
3.0
|
Accounts and notes
receivable
|
|
|
|
|
|
|
Accounts and notes
receivable, gross
|
|
1,174.6
|
|
1,056.2
|
|
1,121.6
|
Allowance for credit
losses
|
|
(14.2)
|
|
(10.9)
|
|
(10.0)
|
Accounts and notes
receivable, net
|
|
1,160.4
|
|
1,045.3
|
|
1,111.6
|
Inventories
|
|
|
|
|
|
|
Finished
products
|
|
455.3
|
|
439.3
|
|
405.2
|
Raw
materials
|
|
69.1
|
|
63.4
|
|
63.5
|
Products in
process
|
|
7.2
|
|
6.0
|
|
4.8
|
Operating supplies and
other
|
|
63.0
|
|
70.6
|
|
50.7
|
Inventories
|
|
594.6
|
|
579.3
|
|
524.2
|
Other current
assets
|
|
120.5
|
|
115.9
|
|
140.0
|
Total current
assets
|
|
2,043.7
|
|
1,902.0
|
|
1,899.5
|
Investments and
long-term receivables
|
|
31.2
|
|
31.8
|
|
33.1
|
Property, plant &
equipment
|
|
|
|
|
|
|
Property, plant &
equipment, cost
|
|
11,561.5
|
|
11,306.4
|
|
10,831.1
|
Allowances for
depreciation, depletion & amortization
|
|
(5,455.7)
|
|
(5,255.1)
|
|
(5,087.9)
|
Property, plant &
equipment, net
|
|
6,105.8
|
|
6,051.3
|
|
5,743.2
|
Operating lease
right-of-use assets, net
|
|
558.4
|
|
572.6
|
|
692.6
|
Goodwill
|
|
3,689.5
|
|
3,689.6
|
|
3,742.4
|
Other intangible
assets, net
|
|
1,653.1
|
|
1,702.1
|
|
1,776.0
|
Other noncurrent
assets
|
|
251.9
|
|
285.2
|
|
294.7
|
Total assets
|
|
$14,333.6
|
|
$14,234.6
|
|
$14,181.5
|
Liabilities
|
|
|
|
|
|
|
Current maturities of
long-term debt
|
|
0.5
|
|
0.5
|
|
0.5
|
Short-term
debt
|
|
0.0
|
|
100.0
|
|
176.0
|
Trade payables and
accruals
|
|
402.1
|
|
454.5
|
|
441.0
|
Other current
liabilities
|
|
390.7
|
|
401.6
|
|
411.8
|
Total current
liabilities
|
|
793.3
|
|
956.6
|
|
1,029.3
|
Long-term
debt
|
|
3,873.2
|
|
3,875.2
|
|
3,873.7
|
Deferred income taxes,
net
|
|
1,069.8
|
|
1,072.8
|
|
1,036.1
|
Deferred
revenue
|
|
149.9
|
|
159.8
|
|
163.9
|
Noncurrent operating
lease liabilities
|
|
537.5
|
|
548.4
|
|
645.1
|
Other noncurrent
liabilities
|
|
683.5
|
|
669.6
|
|
689.2
|
Total
liabilities
|
|
$7,107.2
|
|
$7,282.4
|
|
$7,437.3
|
Equity
|
|
|
|
|
|
|
Common stock, $1 par
value
|
|
132.9
|
|
132.9
|
|
132.9
|
Capital in excess of
par value
|
|
2,845.4
|
|
2,839.0
|
|
2,817.3
|
Retained
earnings
|
|
4,375.7
|
|
4,111.4
|
|
3,921.4
|
Accumulated other
comprehensive loss
|
|
(151.4)
|
|
(154.7)
|
|
(150.5)
|
Total shareholder's
equity
|
|
7,202.6
|
|
6,928.6
|
|
6,721.1
|
Noncontrolling
interest
|
|
23.8
|
|
23.6
|
|
23.1
|
Total equity
|
|
$7,226.4
|
|
$6,952.2
|
|
$6,744.2
|
Total liabilities and
equity
|
|
$14,333.6
|
|
$14,234.6
|
|
$14,181.5
|
|
|
|
|
|
|
|
Table C
|
Vulcan Materials Company
|
and Subsidiary Companies
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
Six Months Ended
|
Consolidated Statements of Cash
Flows
|
|
June 30
|
(Condensed and
unaudited)
|
|
2023
|
|
2022
|
Operating Activities
|
|
|
|
|
Net earnings
|
|
|
|
$429.5
|
|
$279.5
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities
|
|
|
Depreciation,
depletion, accretion and amortization
|
|
303.3
|
|
284.0
|
Noncash operating
lease expense
|
|
27.3
|
|
31.3
|
Net gain on sale of
property, plant & equipment and businesses
|
|
(18.5)
|
|
(4.6)
|
Contributions to
pension plans
|
|
(3.8)
|
|
(3.9)
|
Share-based
compensation expense
|
|
24.3
|
|
18.2
|
Deferred tax provision
(benefit)
|
|
(4.7)
|
|
6.6
|
Changes in assets and
liabilities before initial
|
|
|
|
|
effects of business
acquisitions and dispositions
|
|
(256.9)
|
|
(289.2)
|
Other, net
|
|
|
|
|
7.0
|
|
3.6
|
Net cash provided by
operating activities
|
|
$507.5
|
|
$325.5
|
Investing Activities
|
|
|
|
|
Purchases of property,
plant & equipment
|
|
(354.6)
|
|
(290.6)
|
Proceeds from sale of
property, plant & equipment
|
|
20.5
|
|
10.2
|
Proceeds from sale of
businesses
|
|
130.0
|
|
0.0
|
Payment for businesses
acquired, net of acquired cash and adjustments
|
|
0.9
|
|
(188.1)
|
Other, net
|
|
|
|
|
0.0
|
|
(0.2)
|
Net cash used for
investing activities
|
|
($203.2)
|
|
($468.7)
|
Financing Activities
|
|
|
|
|
Proceeds from
short-term debt
|
|
75.0
|
|
559.8
|
Payment of short-term
debt
|
|
(175.0)
|
|
(383.8)
|
Payment of current
maturities and long-term debt
|
|
(550.4)
|
|
(7.6)
|
Proceeds from issuance
of long-term debt
|
|
550.0
|
|
0.0
|
Debt issuance and
exchange costs
|
|
(3.4)
|
|
(0.7)
|
Payment of finance
leases
|
|
(11.6)
|
|
(18.8)
|
Purchases of common
stock
|
|
(49.9)
|
|
0.0
|
Dividends
paid
|
|
|
|
(114.4)
|
|
(106.3)
|
Share-based
compensation, shares withheld for taxes
|
|
(17.8)
|
|
(17.2)
|
Other, net
|
|
|
|
|
(0.1)
|
|
0.0
|
Net cash provided by
(used for) financing activities
|
|
($297.6)
|
|
$25.4
|
Net increase (decrease)
in cash and cash equivalents and restricted cash
|
|
6.7
|
|
(117.8)
|
Cash and cash
equivalents and restricted cash at beginning of year
|
|
161.5
|
|
241.5
|
Cash and cash
equivalents and restricted cash at end of period
|
|
$168.2
|
|
$123.7
|
|
|
|
|
|
|
|
|
|
|
|
Table D
|
Segment Financial Data and Unit
Shipments
|
|
|
|
|
|
|
|
|
|
(in millions, except
per unit data)
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
|
|
June 30
|
|
June 30
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Total Revenues
|
|
|
|
|
|
|
|
|
Aggregates
1
|
|
$1,578.4
|
|
$1,401.8
|
|
$2,872.8
|
|
$2,523.0
|
Asphalt
2
|
|
337.4
|
|
274.8
|
|
507.1
|
|
442.0
|
Concrete
|
|
343.5
|
|
422.3
|
|
628.7
|
|
782.8
|
Calcium
|
|
2.4
|
|
1.4
|
|
4.6
|
|
3.3
|
Segment
sales
|
|
$2,261.7
|
|
$2,100.3
|
|
$4,013.2
|
|
$3,751.1
|
Aggregates intersegment
sales
|
|
(148.8)
|
|
(146.0)
|
|
(251.4)
|
|
(256.1)
|
Total
revenues
|
|
$2,112.9
|
|
$1,954.3
|
|
$3,761.8
|
|
$3,495.0
|
Gross Profit
|
|
|
|
|
|
|
|
|
Aggregates
|
|
$498.6
|
|
$402.4
|
|
$801.3
|
|
$645.2
|
Asphalt
|
|
|
56.6
|
|
13.6
|
|
57.4
|
|
10.7
|
Concrete
|
|
27.0
|
|
30.0
|
|
24.7
|
|
58.2
|
Calcium
|
|
|
|
|
1.1
|
|
0.2
|
|
1.9
|
|
0.8
|
Total
|
|
|
|
$583.3
|
|
$446.2
|
|
$885.3
|
|
$714.9
|
Depreciation, Depletion, Accretion and
Amortization
|
|
|
|
|
Aggregates
|
|
$119.6
|
|
$107.3
|
|
$231.9
|
|
$210.9
|
Asphalt
|
|
|
8.9
|
|
8.5
|
|
17.8
|
|
17.1
|
Concrete
|
|
19.5
|
|
20.7
|
|
39.9
|
|
41.8
|
Calcium
|
|
0.0
|
|
0.1
|
|
0.1
|
|
0.1
|
Other
|
|
|
|
6.9
|
|
6.4
|
|
13.6
|
|
14.1
|
Total
|
|
|
|
$154.9
|
|
$143.0
|
|
$303.3
|
|
$284.0
|
Average Unit Sales Price and Unit
Shipments
|
|
|
|
|
|
Aggregates
|
|
|
|
|
|
|
|
|
Freight-adjusted
revenues 3
|
|
$1,184.4
|
|
$1,036.6
|
|
$2,150.3
|
|
$1,859.3
|
Aggregates -
tons
|
|
63.4
|
|
63.8
|
|
115.1
|
|
116.8
|
Freight-adjusted sales
price 4
|
|
$18.69
|
|
$16.25
|
|
$18.68
|
|
$15.91
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Products
|
|
|
|
|
|
|
|
|
Asphalt Mix -
tons
|
|
4.0
|
|
3.4
|
|
6.1
|
|
5.7
|
Asphalt Mix - sales
price 5
|
|
$75.52
|
|
$69.42
|
|
$74.80
|
|
$67.25
|
|
|
|
|
|
|
|
|
|
|
|
|
Ready-mixed concrete -
cubic yards
|
|
2.1
|
|
2.8
|
|
3.9
|
|
5.3
|
Ready-mixed concrete -
sales price 5
|
|
$163.82
|
|
$148.75
|
|
$162.64
|
|
$146.43
|
|
1 Includes product sales (crushed stone,
sand and gravel, sand, and other aggregates), as well as freight
& delivery
|
costs that we pass along to our customers, and service revenues
related to aggregates.
|
2 Includes product sales, as well as
service revenues from our asphalt construction paving
business.
|
3 Freight-adjusted revenues are
Aggregates segment sales excluding freight & delivery revenues
and
|
other revenues related to services, such as landfill tipping fees,
that are derived from our aggregates business.
|
4 Freight-adjusted sales price is
calculated as freight-adjusted revenues divided by aggregates unit
shipments.
|
5 Sales price is calculated by dividing
revenues generated from the shipment of product (excluding service
revenues
|
generated by the segments) by total units of the product
shipped.
|
|
|
|
|
|
|
|
|
|
|
Appendix 1
|
1. Reconciliation of Non-GAAP
Measures
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates segment
freight-adjusted revenues is not a Generally Accepted Accounting
Principle (GAAP) measure and should not be considered as an
alternative to metrics defined by GAAP. We present this metric as
it is consistent with the basis by which we review our operating
results. We believe that this presentation is consistent with our
competitors and meaningful to our investors as it excludes revenues
associated with freight & delivery, which are pass-through
activities. It also excludes other revenues related to services,
such as landfill tipping fees, that are derived from our aggregates
business. Additionally, we use this metric as the basis for
calculating the average sales price of our aggregates products.
Reconciliation of this metric to its nearest GAAP measure is
presented below:
|
Aggregates Segment Freight-Adjusted
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except
per ton data)
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Trailing Twelve Months
Ended
|
|
|
|
|
|
June 30
|
|
June 30
|
|
June 30
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Aggregates segment
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
sales
|
|
$1,578.4
|
|
$1,401.8
|
|
$2,872.8
|
|
$2,523.0
|
|
$5,622.5
|
|
$4,847.7
|
Less:
|
|
Freight & delivery
revenues 1
|
|
364.7
|
|
336.0
|
|
674.5
|
|
608.3
|
|
1,357.3
|
|
1,128.2
|
|
|
|
Other
revenues
|
|
29.3
|
|
29.2
|
|
48.0
|
|
55.4
|
|
99.0
|
|
101.3
|
Freight-adjusted
revenues
|
|
$1,184.4
|
|
$1,036.6
|
|
$2,150.3
|
|
$1,859.3
|
|
$4,166.2
|
|
$3,618.2
|
Unit shipments -
tons
|
|
63.4
|
|
63.8
|
|
115.1
|
|
116.8
|
|
234.6
|
|
234.7
|
Freight-adjusted sales
price
|
|
$18.69
|
|
$16.25
|
|
$18.68
|
|
$15.91
|
|
$17.76
|
|
$15.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 At the segment level, freight &
delivery revenues include intersegment freight & delivery
(which are eliminated at the consolidated level) and freight to
remote
distribution sites.
|
GAAP does not define
"Cash gross profit," and it should not be considered as an
alternative to earnings measures defined by GAAP. We and the
investment community use this metric to assess the operating
performance of our business. Additionally, we present this metric
as we believe that it closely
correlates to long-term shareholder value. We do not use this
metric as a measure to allocate resources. Aggregates segment cash
gross profit per ton is computed by dividing Aggregates segment
cash gross profit by tons shipped. Reconciliation of this
metric to its nearest GAAP measure is
presented below:
|
Cash Gross Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except
per ton data)
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Trailing Twelve Months
Ended
|
|
|
|
|
|
June 30
|
|
June 30
|
|
June 30
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Aggregates segment
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$498.6
|
|
$402.4
|
|
$801.3
|
|
$645.2
|
|
$1,564.6
|
|
$1,343.4
|
Depreciation,
depletion, accretion and amortization
|
|
119.6
|
|
107.3
|
|
231.9
|
|
210.9
|
|
462.1
|
|
406.2
|
|
Aggregates segment cash
gross profit
|
|
$618.2
|
|
$509.7
|
|
$1,033.2
|
|
$856.1
|
|
$2,026.7
|
|
$1,749.6
|
Unit shipments -
tons
|
|
63.4
|
|
63.8
|
|
115.1
|
|
116.8
|
|
234.6
|
|
234.7
|
Aggregates segment
gross profit per ton
|
|
$7.87
|
|
$6.31
|
|
$6.96
|
|
$5.52
|
|
$6.67
|
|
$5.72
|
Aggregates segment cash
gross profit per ton
|
|
$9.76
|
|
$7.99
|
|
$8.98
|
|
$7.33
|
|
$8.64
|
|
$7.45
|
Asphalt segment
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$56.6
|
|
$13.6
|
|
$57.4
|
|
$10.7
|
|
$104.0
|
|
$21.4
|
Depreciation,
depletion, accretion and amortization
|
|
8.9
|
|
8.5
|
|
17.8
|
|
17.1
|
|
35.9
|
|
34.9
|
|
Asphalt segment cash
gross profit
|
|
$65.5
|
|
$22.1
|
|
$75.2
|
|
$27.8
|
|
$139.9
|
|
$56.3
|
Concrete segment
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
$27.0
|
|
$30.0
|
|
$24.7
|
|
$58.2
|
|
$55.7
|
|
$94.5
|
Depreciation,
depletion, accretion and amortization
|
|
19.5
|
|
20.7
|
|
39.9
|
|
41.8
|
|
81.2
|
|
75.3
|
|
Concrete segment cash
gross profit
|
|
$46.5
|
|
$50.7
|
|
$64.6
|
|
$100.0
|
|
$136.9
|
|
$169.8
|
|
|
|
|
|
|
|
|
|
|
Appendix 2
|
Reconciliation of Non-GAAP Measures
(Continued)
|
|
|
|
|
|
|
|
|
|
|
|
GAAP does not define
"Earnings Before Interest, Taxes, Depreciation and Amortization"
(EBITDA), and it should not be considered as an alternative to
earnings measures defined by GAAP. We use this metric to assess the
operating performance of our business and as a basis for strategic
planning and forecasting as we believe that it closely correlates
to long-term shareholder value. We do not use this metric as a
measure to allocate resources. We adjust EBITDA for certain items
to provide a more consistent comparison of earnings performance
from period to period. Reconciliation of this metric to its nearest
GAAP measure is presented below (numbers may not foot due to
rounding):
|
EBITDA and Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Trailing Twelve Months
Ended
|
|
|
|
|
|
June 30
|
|
June 30
|
|
June 30
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net earnings
attributable to Vulcan
|
|
$308.6
|
|
$187.3
|
|
$429.3
|
|
$279.1
|
|
$725.7
|
|
$594.0
|
Income tax
expense
|
|
90.8
|
|
59.2
|
|
106.6
|
|
77.2
|
|
215.8
|
|
159.2
|
Interest expense,
net
|
|
46.7
|
|
38.7
|
|
95.7
|
|
74.7
|
|
189.3
|
|
147.6
|
Depreciation,
depletion, accretion and amortization
|
|
154.9
|
|
143.0
|
|
303.3
|
|
284.0
|
|
606.8
|
|
543.5
|
EBITDA
|
|
|
$601.0
|
|
$428.2
|
|
$934.8
|
|
$715.0
|
|
$1,737.7
|
|
$1,444.2
|
|
Loss on discontinued
operations
|
|
$4.9
|
|
$17.6
|
|
$7.9
|
|
$20.0
|
|
$13.0
|
|
$21.2
|
|
Gain on sale of real
estate and businesses, net
|
|
(15.2)
|
|
0.0
|
|
(15.2)
|
|
0.0
|
|
(21.3)
|
|
0.0
|
|
Charges associated with
divested operations
|
|
4.3
|
|
0.4
|
|
4.7
|
|
0.7
|
|
7.8
|
|
1.5
|
|
Acquisition related
charges 1
|
|
0.3
|
|
4.0
|
|
0.8
|
|
8.4
|
|
9.5
|
|
56.4
|
|
COVID-19 direct
incremental costs
|
|
0.0
|
|
0.0
|
|
0.0
|
|
0.0
|
|
0.0
|
|
9.6
|
|
Pension settlement
charge
|
|
0.0
|
|
0.0
|
|
0.0
|
|
0.0
|
|
0.0
|
|
12.1
|
|
Loss on
impairments
|
|
0.0
|
|
0.0
|
|
0.0
|
|
0.0
|
|
67.8
|
|
0.0
|
Adjusted
EBITDA
|
|
$595.3
|
|
$450.2
|
|
$932.9
|
|
$744.1
|
|
$1,814.5
|
|
$1,545.1
|
1 Represents charges associated with
acquisitions requiring clearance under federal antitrust laws. Cost
for trailing-twelve months ended June 30, 2022 include U.S.
Concrete acqusition related expenses of $21.8 million, the cost
impact of purchase accounting inventory valuations of $14.8
million and change in control severance and retention charges of
$16.0 million.
|
Similar to our
presentation of Adjusted EBITDA, we present Adjusted diluted
earnings per share (EPS) attributable to Vulcan from continuing
operations to provide a more consistent comparison of earnings
performance from period to period. This metric is not defined by
GAAP and should not be considered as an alternative to earnings
measures defined by GAAP. Reconciliation of this metric to its
nearest GAAP measure is presented below:
|
Adjusted Diluted EPS attributable to Vulcan from
Continuing Operations (Adjusted Diluted EPS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Trailing Twelve Months
Ended
|
|
|
|
|
|
June 30
|
|
June 30
|
|
June 30
|
|
|
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net earnings
attributable to Vulcan
|
|
$2.31
|
|
$1.40
|
|
$3.21
|
|
$2.09
|
|
$5.43
|
|
$4.44
|
Less:
|
Discontinued
operations
|
|
(0.02)
|
|
(0.10)
|
|
(0.04)
|
|
(0.11)
|
|
(0.06)
|
|
(0.12)
|
Diluted EPS
attributable to Vulcan from continuing operations
|
$2.33
|
|
$1.50
|
|
$3.25
|
|
$2.20
|
|
$5.49
|
|
$4.56
|
Items included in
Adjusted EBITDA above, net of tax
|
|
(0.06)
|
|
0.03
|
|
(0.05)
|
|
0.05
|
|
0.46
|
|
0.48
|
NOL carryforward
valuation allowance
|
|
0.02
|
|
0.00
|
|
0.05
|
|
0.00
|
|
0.16
|
|
0.00
|
Adjusted diluted EPS
attributable to Vulcan from
|
|
|
|
|
|
|
|
|
|
|
|
|
|
continuing
operations
|
|
$2.29
|
|
$1.53
|
|
$3.25
|
|
$2.25
|
|
$6.11
|
|
$5.04
|
The following
reconciliation to the mid-point of the range of 2023 Projected
EBITDA excludes adjustments (as noted in Adjusted EBITDA above) as
they are difficult to forecast (timing or amount). Due to the
difficulty in forecasting such adjustments, we are unable to
estimate their significance. This metric is not defined by GAAP and
should not be considered as an alternative to earnings measures
defined by GAAP. Reconciliation of this metric to its nearest GAAP
measure is presented below:
|
2023 Projected EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mid-point
|
Net earnings
attributable to Vulcan
|
|
|
|
|
|
|
|
|
|
|
|
$895
|
Income tax
expense
|
|
|
|
|
|
|
|
|
|
|
|
250
|
Interest expense, net
of interest income
|
|
|
|
|
|
|
|
|
|
|
|
195
|
Depreciation,
depletion, accretion and amortization
|
|
|
|
|
|
|
|
|
|
|
|
610
|
Projected
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
$1,950
|
Because GAAP financial
measures on a forward-looking basis are not accessible, and
reconciling information is not available without unreasonable
effort, we have not provided reconciliations for
forward-looking non-GAAP measures, other than the reconciliation of
Projected EBITDA as noted above. For the same reasons, we are
unable to address the probable significance of the unavailable
information, which could be material to future results.
|
|
|
|
|
|
|
|
|
|
|
Appendix 3
|
Reconciliation of Non-GAAP Measures
(Continued)
|
|
|
|
|
|
|
|
|
|
|
|
Net debt to Adjusted
EBITDA is not a GAAP measure and should not be considered as an
alternative to metrics defined by GAAP. We, the investment
community and credit rating agencies use this metric to assess our
leverage. Net debt subtracts cash and cash equivalents and
restricted cash from total debt. Reconciliation of this metric to
its nearest GAAP measure is presented below:
|
Net Debt to Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
June 30
|
|
|
|
|
|
|
|
|
|
|
|
2023
|
|
2022
|
Debt
|
|
|
|
|
|
|
|
|
|
|
|
|
Current maturities of
long-term debt
|
|
|
|
|
|
|
|
$0.5
|
|
$0.5
|
Short-term
debt
|
|
|
|
|
|
|
|
0.0
|
|
176.0
|
Long-term
debt
|
|
|
|
|
|
|
|
3,873.2
|
|
3,873.7
|
Total debt
|
|
|
|
|
|
|
|
$3,873.7
|
|
$4,050.2
|
Less: Cash and cash
equivalents and restricted cash
|
|
|
|
|
|
|
|
168.2
|
|
123.7
|
Net debt
|
|
|
|
|
|
|
|
$3,705.5
|
|
$3,926.5
|
Trailing-Twelve Months
(TTM) Adjusted EBITDA
|
|
|
|
|
|
|
|
$1,814.5
|
|
$1,545.1
|
Total debt to TTM
Adjusted EBITDA
|
|
|
|
|
|
|
|
2.1x
|
|
2.6x
|
Net debt to TTM
Adjusted EBITDA
|
|
|
|
|
|
|
|
2.0x
|
|
2.5x
|
We define "Return on
Invested Capital" (ROIC) as Adjusted EBITDA for the trailing-twelve
months divided by average invested capital (as illustrated below)
during the trailing 5-quarters. Our calculation of ROIC is
considered a non-GAAP financial measure because we calculate ROIC
using the non-GAAP metric EBITDA. We believe that our ROIC metric
is meaningful because it helps investors assess how effectively we
are deploying our assets. Although ROIC is a standard financial
metric, numerous methods exist for calculating a company's ROIC. As
a result, the method we use to calculate our ROIC may differ from
the methods used by other companies. This metric is not defined by
GAAP and should not be considered as an alternative to earnings
measures defined by GAAP. Reconciliation of this metric to its
nearest GAAP measure is presented below (numbers may not foot due
to rounding):
|
Return on Invested Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollars in
millions)
|
|
|
|
|
|
|
|
|
|
|
Trailing Twelve Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
June 30
|
|
June 30
|
|
|
|
|
|
|
|
|
|
|
|
2023
|
|
2022
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
$1,814.5
|
|
$1,545.1
|
Average invested
capital
|
|
|
|
|
|
|
|
|
|
|
|
Property, plant &
equipment, net
|
|
|
|
|
|
|
|
$5,986.1
|
|
$5,385.6
|
|
Goodwill
|
|
|
|
|
|
|
|
3,703.1
|
|
3,599.0
|
|
Other intangible
assets
|
|
|
|
|
|
|
|
1,703.7
|
|
1,640.0
|
|
Fixed and intangible
assets
|
|
|
|
|
|
|
|
$11,392.9
|
|
$10,624.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
$1,994.5
|
|
$1,835.5
|
|
Less: Cash and cash
equivalents
|
|
|
|
|
|
|
|
148.1
|
|
320.6
|
|
Less: Current
tax
|
|
|
|
|
|
|
|
52.6
|
|
46.2
|
|
Adjusted current
assets
|
|
|
|
|
|
|
|
1,793.8
|
|
1,468.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
980.0
|
|
833.5
|
|
Less: Current
maturities of long-term debt
|
|
|
|
|
|
|
|
0.5
|
|
7.5
|
|
Less: Short-term
debt
|
|
|
|
|
|
|
|
117.6
|
|
55.2
|
|
Adjusted current
liabilities
|
|
|
|
|
|
|
|
861.9
|
|
770.8
|
|
Adjusted net working
capital
|
|
|
|
|
|
|
|
$931.9
|
|
$697.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average invested
capital
|
|
|
|
|
|
|
|
$12,324.8
|
|
$11,322.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on invested
capital
|
|
|
|
|
|
|
|
14.7 %
|
|
13.6 %
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/vulcan-reports-second-quarter-2023-results-301892122.html
SOURCE Vulcan Materials Company