First-Quarter Aggregates Gross Profit Per Ton Increased 14 Percent to
Magnesia Specialties Achieved Record Quarterly Gross Profit
Quarter Highlights Include Significant Portfolio Enhancements
Full-Year 2024 Guidance Raised to
First-Quarter Highlights
(Financial highlights are for continuing operations)
Quarter Ended | ||||||||||
(In millions, except per share) | 2024 | 2023 | % Change | |||||||
Total revenues1 | $ | 1,251 | $ | 1,354 | (8)% | |||||
Gross profit | $ | 272 | $ | 303 | (10)% | |||||
Earnings from operations2 | $ | 1,421 | $ | 196 | 625% | |||||
Net earnings from continuing operations attributable to Martin Marietta2 | $ | 1,045 | $ | 134 | 680% | |||||
Adjusted EBITDA3 | $ | 291 | $ | 324 | (10)% | |||||
Earnings per diluted share from continuing operations2 | $ | 16.87 | $ | 2.16 | 681% |
- Total revenues include the sales of products and services to customers (net of any discounts or allowances) and freight revenues.
- Quarter ended
March 31, 2024 earnings from operations and net earnings from continuing operations attributable to Martin Marietta and earnings per diluted share from continuing operations include$1.3 billion ,$0.9 billion and$14.94 per diluted share, respectively, for a nonrecurring gain on a divestiture partially offset by acquisition, divestiture and integration expenses and a noncash asset and portfolio rationalization charge. - Earnings from continuing operations before interest; income taxes; depreciation, depletion and amortization expense; the earnings/loss from nonconsolidated equity affiliates; acquisition, divestiture and integration expenses and the impact of selling acquired inventory after its markup to fair value as part of acquisition accounting (refer to the "Non-GAAP Financial Measures" section of the Appendix for Company-defined parameters); nonrecurring gain on divestiture and noncash asset and portfolio rationalization charge, or Adjusted EBITDA, is a non-GAAP financial measure. See Appendix to this earnings release for a reconciliation to net earnings from continuing operations attributable to Martin Marietta.
"Our positive outlook also reflects continued pricing momentum together with the product demand we expect from record federal- and state-level infrastructure investments, large-scale heavy industrial activity, data centers, and energy projects, which should counterbalance softer residential and warehouse construction demand, as well as an anticipated moderation in light nonresidential activity. Despite near-term interest rate uncertainty, single-family housing remains historically under built, particularly in key Martin Marietta markets with notable population growth. As such, we expect Martin Marietta will disproportionately benefit from new single-family home construction once interest rates moderate and affordability headwinds recede.
"Consistent with our SOAR 2025 priorities, we have continued to strengthen our portfolio by reducing cyclical downstream exposure, while expanding our aggregates footprint through the additions of the Albert Frei &
First-Quarter Financial and Operating Results
(All financial and operating results are for continuing operations and comparisons are versus the prior-year first quarter, unless otherwise noted)
Building Materials Business
The
Aggregates
First-quarter aggregates shipments decreased 12.3 percent to 36.6 million tons due largely to a more weather-impacted start to the year in the Company's East and Southwest Divisions coupled with softening demand in warehouse, office and retail construction, partially offset by more favorable weather and relative strength in the Company's Central and West Divisions. Average selling price (ASP) increased 12.2 percent to
Aggregates gross profit increased modestly to
Cement and Downstream Businesses
Cement and ready mixed concrete revenues decreased 22 percent to
Asphalt and paving revenues increased one percent to a first-quarter record of
Magnesia Specialties Business
Magnesia Specialties achieved record first-quarter gross profit of
Portfolio Optimization
Acquisitions
On
Divestitures
On
Cash Generation, Capital Allocation and Liquidity
Cash provided by operating activities for the three months ended
Cash paid for property, plant and equipment additions for the three months ended
During the three months ended
The Company had
Revised Full-Year 2024 Guidance
The Company’s 2024 guidance table below reflects the AFS and BWI Southeast acquisitions and the
2024 GUIDANCE | ||||||||
(Dollars in Millions) | Low * | High * | ||||||
Consolidated | ||||||||
Total revenues1 | $ | 6,900 | $ | 7,300 | ||||
Interest expense, net of interest income | $ | 105 | $ | 115 | ||||
Estimated tax rate2 | 22.5 | % | 23.5 | % | ||||
Net earnings from continuing operations attributable to Martin Marietta3 | $ | 2,210 | $ | 2,300 | ||||
Adjusted EBITDA4 | $ | 2,300 | $ | 2,440 | ||||
Capital expenditures | $ | 675 | $ | 725 | ||||
Building Materials Business | ||||||||
Aggregates | ||||||||
Volume % change5 | 2.0 | % | 6.0 | % | ||||
ASP % change6 | 11.0 | % | 13.0 | % | ||||
Gross profit7 | $ | 1,710 | $ | 1,790 | ||||
Cement, | ||||||||
Gross profit | $ | 405 | $ | 445 | ||||
Magnesia Specialties Business | ||||||||
Gross profit | $ | 100 | $ | 110 |
* Guidance range represents the low end and high end of the respective line items provided above.
- Total revenues include the sales of products and services to customers (net of any discounts or allowances) and freight revenues.
- Estimated tax rate includes the tax impact of a nonrecurring gain on a divestiture.
- Net earnings from continuing operations attributable to Martin Marietta include
$1.2 billion for a nonrecurring gain on a divestiture partially offset by acquisition, divestiture and integration expenses, impact of selling acquired inventory after its markup to fair value as part of acquisition accounting and a noncash asset and portfolio rationalization charge. - Adjusted EBITDA is a non-GAAP financial measure. See Appendix to this earnings release for a reconciliation to net earnings from continuing operations attributable to Martin Marietta.
- Volume change is for aggregates shipments net of acquisitions and divestitures, inclusive of internal tons, and is in comparison to 2023 shipments of 198.8 million tons.
- ASP change is for aggregates average selling price and is in comparison to 2023 ASP of
$19.84 per ton. - Aggregates gross profit includes an estimated
$30 million impact of selling acquired inventory after its markup to fair value as part of acquisition accounting.
Non-GAAP Financial Information
This earnings release contains financial measures that have not been prepared in accordance with generally accepted accounting principles in
Conference Call Information
The Company will discuss its first-quarter 2024 earnings results on a conference call and an online webcast today (
About Martin Marietta
Martin Marietta, a member of the S&P 500 Index, is an American-based company and a leading supplier of building materials, including aggregates, cement, ready mixed concrete and asphalt. Through a network of operations spanning 28 states,
Investor Contacts:
Director, Investor Relations
+1 (919) 510-4736
Jacklyn.Rooker@martinmarietta.com
MLM-E.
If you are interested in Martin Marietta stock, management recommends that, at a minimum, you read the Company’s current annual report and Forms 10-K, 10-Q and 8-K reports to the
Investors are cautioned that all statements in this release that relate to the future involve risks and uncertainties and are based on assumptions that the Company believes in good faith are reasonable, but which may be materially different from actual results. These statements, which are forward-looking statements under the Private Securities Litigation Reform Act of 1995, provide the investor with the Company’s expectations or forecasts of future events. You can identify these statements by the fact that they do not relate only to historical or current facts. They may use words such as “guidance”, “anticipate”, “may”, “expect”, “should”, “believe”, “will”, and other words of similar meaning in connection with future events or future operating or financial performance. Any or all of the Company’s forward-looking statements here and in other publications may turn out to be wrong.
First-quarter results and trends described in this release may not necessarily be indicative of the Company’s future performance. The Company’s outlook is subject to various risks and uncertainties and is based on assumptions that the Company believes in good faith are reasonable, but which may be materially different from actual results. Factors that the Company currently believes could cause actual results to differ materially from the forward-looking statements in this release (including revised 2024 Guidance) include, but are not limited to: the ability of the Company to face challenges, including shipment declines resulting from economic and weather events beyond the Company’s control; a widespread decline in aggregates pricing, including a decline in aggregates shipment volume negatively affecting aggregates price; the history of both cement and ready mixed concrete being subject to significant changes in supply, demand and price fluctuations; the termination, capping and/or reduction or suspension of the federal and/or state fuel tax(es) or other revenue related to public construction; the level and timing of federal, state or local transportation or infrastructure or public projects funding and any issues arising from such federal and state budgets, most particularly in
You should consider these forward-looking statements in light of risk factors discussed in Martin Marietta’s Annual Report on Form 10-K for the year ended
Appendix
Unaudited Statements of Earnings | ||||||||
Three Months Ended | ||||||||
2024 | 2023 | |||||||
(In Millions, Except Per Share Data) | ||||||||
Total Revenues | $ | 1,251 | $ | 1,354 | ||||
Total cost of revenues | 979 | 1,051 | ||||||
Gross Profit | 272 | 303 | ||||||
Selling, general and administrative expenses | 118 | 104 | ||||||
Acquisition, divestiture and integration expenses | 20 | 1 | ||||||
Other operating (income) expense, net | (1,287 | ) | 2 | |||||
Earnings from Operations | 1,421 | 196 | ||||||
Interest expense | 40 | 42 | ||||||
Other nonoperating income, net | (33 | ) | (17 | ) | ||||
Earnings from continuing operations before income tax expense | 1,414 | 171 | ||||||
Income tax expense | 368 | 36 | ||||||
Earnings from continuing operations | 1,046 | 135 | ||||||
Loss from discontinued operations, net of income tax benefit | — | (13 | ) | |||||
Consolidated net earnings | 1,046 | 122 | ||||||
Less: Net earnings attributable to noncontrolling interests | 1 | 1 | ||||||
Net Earnings Attributable to Martin Marietta | $ | 1,045 | $ | 121 | ||||
Net Earnings (Loss) Attributable to Martin Marietta | ||||||||
Per Common Share: | ||||||||
Basic from continuing operations | $ | 16.92 | $ | 2.17 | ||||
Basic from discontinued operations | — | (0.21 | ) | |||||
$ | 16.92 | $ | 1.96 | |||||
Diluted from continuing operations | $ | 16.87 | $ | 2.16 | ||||
Diluted from discontinued operations | — | (0.21 | ) | |||||
$ | 16.87 | $ | 1.95 | |||||
Weighted-Average Common Shares Outstanding: | ||||||||
Basic | 61.8 | 62.1 | ||||||
Diluted | 62.0 | 62.2 | ||||||
Unaudited Operating Segment Financial Highlights | ||||||||
Three Months Ended | ||||||||
2024 | 2023 | |||||||
(Dollars in Millions) | ||||||||
Total revenues: | ||||||||
East Group | $ | 526 | $ | 530 | ||||
644 | 741 | |||||||
Total | 1,170 | 1,271 | ||||||
Magnesia Specialties | 81 | 83 | ||||||
Total | $ | 1,251 | $ | 1,354 | ||||
Earnings (Loss) from operations: | ||||||||
East Group | $ | 128 | $ | 109 | ||||
1,299 | 95 | |||||||
Total | 1,427 | 204 | ||||||
Magnesia Specialties | 24 | 20 | ||||||
Total reportable segments | 1,451 | 224 | ||||||
Corporate | (30 | ) | (28 | ) | ||||
Consolidated earnings from operations | $ | 1,421 | $ | 196 | ||||
Interest expense | 40 | 42 | ||||||
Other nonoperating income, net | (33 | ) | (17 | ) | ||||
Consolidated earnings from continuing operations before income tax expense | $ | 1,414 | $ | 171 | ||||
Unaudited Product Line Financial Highlights | ||||||||||||
Three Months Ended | ||||||||||||
2024 | 2023 | |||||||||||
Amount | % of Revenues | Amount | % of Revenues | |||||||||
(Dollars in Millions) | ||||||||||||
Total revenues: | ||||||||||||
Building Materials: | ||||||||||||
Aggregates | $ | 885 | $ | 912 | ||||||||
Cement and ready mixed concrete | 265 | 340 | ||||||||||
Asphalt and paving | 59 | 58 | ||||||||||
Less: Interproduct sales | (39 | ) | (39 | ) | ||||||||
Total | 1,170 | 1,271 | ||||||||||
Magnesia Specialties | 81 | 83 | ||||||||||
Consolidated total revenues | $ | 1,251 | $ | 1,354 | ||||||||
Gross profit (loss): | ||||||||||||
Building Materials: | ||||||||||||
Aggregates | $ | 239 | 27% | $ | 238 | 26% | ||||||
Cement and ready mixed concrete | 31 | 12% | 58 | 17% | ||||||||
Asphalt and paving | (22 | ) | (36)% | (20 | ) | (35)% | ||||||
Total | 248 | 21% | 276 | 22% | ||||||||
Magnesia Specialties | 29 | 36% | 25 | 30% | ||||||||
Corporate | (5 | ) | NM | 2 | NM | |||||||
Consolidated gross profit | $ | 272 | 22% | $ | 303 | 22% | ||||||
Balance Sheet Data | ||||||||
2024 | 2023 | |||||||
Unaudited | Audited | |||||||
(In millions) | ||||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 2,648 | $ | 1,272 | ||||
Restricted cash | 2 | 10 | ||||||
Accounts receivable, net | 703 | 753 | ||||||
Inventories, net | 1,077 | 989 | ||||||
Current assets held for sale | 18 | 807 | ||||||
Other current assets | 70 | 88 | ||||||
Property, plant and equipment, net | 6,600 | 6,186 | ||||||
Intangible assets, net | 4,181 | 4,087 | ||||||
Operating lease right-of-use assets, net | 382 | 372 | ||||||
Other noncurrent assets | 559 | 561 | ||||||
Total assets | $ | 16,240 | $ | 15,125 | ||||
LIABILITIES AND EQUITY | ||||||||
Current maturities of long-term debt | $ | 400 | $ | 400 | ||||
Current liabilities held for sale | — | 18 | ||||||
Other current liabilities | 1,029 | 752 | ||||||
Long-term debt (excluding current maturities) | 3,947 | 3,946 | ||||||
Other noncurrent liabilities | 1,987 | 1,973 | ||||||
Total equity | 8,877 | 8,036 | ||||||
Total liabilities and equity | $ | 16,240 | $ | 15,125 | ||||
Unaudited Statements of Cash Flows | ||||||||
Three Months Ended | ||||||||
2024 | 2023 | |||||||
(Dollars in Millions) | ||||||||
Cash Flows from Operating Activities: | ||||||||
Consolidated net earnings | $ | 1,046 | $ | 122 | ||||
Adjustments to reconcile consolidated net earnings to net cash provided by operating activities: | ||||||||
Depreciation, depletion and amortization | 130 | 124 | ||||||
Stock-based compensation expense | 15 | 14 | ||||||
Gain on divestitures and sales of assets | (1,333 | ) | (1 | ) | ||||
Deferred income taxes, net | (95 | ) | 6 | |||||
Noncash asset and portfolio rationalization charge | 49 | — | ||||||
Other items, net | (2 | ) | (2 | ) | ||||
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures: | ||||||||
Accounts receivable, net | 55 | (14 | ) | |||||
Inventories, net | (85 | ) | (82 | ) | ||||
Accounts payable | 15 | 18 | ||||||
Other assets and liabilities, net | 377 | (24 | ) | |||||
Net Cash Provided by Operating Activities | 172 | 161 | ||||||
Cash Flows from Investing Activities: | ||||||||
Additions to property, plant and equipment | (200 | ) | (174 | ) | ||||
Acquisitions, net of cash acquired | (488 | ) | — | |||||
Proceeds from divestitures and sales of assets | 2,107 | 22 | ||||||
Investments in life insurance contracts, net | 6 | 4 | ||||||
Other investing activities, net | — | (4 | ) | |||||
Net Cash Provided by (Used for) Investing Activities | 1,425 | (152 | ) | |||||
Cash Flows from Financing Activities: | ||||||||
Payments on finance lease obligations | (5 | ) | (4 | ) | ||||
Dividends paid | (46 | ) | (42 | ) | ||||
Repurchases of common stock | (150 | ) | (75 | ) | ||||
Distributions to owners of noncontrolling interest | (1 | ) | — | |||||
Shares withheld for employees’ income tax obligations | (27 | ) | (17 | ) | ||||
(229 | ) | (138 | ) | |||||
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash | 1,368 | (129 | ) | |||||
Cash, Cash Equivalents and Restricted Cash, beginning of period | 1,282 | 359 | ||||||
Cash, Cash Equivalents and Restricted Cash, end of period | $ | 2,650 | $ | 230 | ||||
Unaudited Operational Highlights | ||||||||||||
Three Months Ended | ||||||||||||
2024 | 2023 | % Change | ||||||||||
Total Shipments (in millions) | ||||||||||||
Aggregates tons | 36.6 | 41.7 | (12.3 | )% | ||||||||
Cement tons | 0.6 | 1.0 | (37.1 | )% | ||||||||
Ready mixed concrete cubic yards | 1.2 | 1.5 | (21.2 | )% | ||||||||
Asphalt tons | 0.5 | 0.5 | 0.2 | % | ||||||||
Non-GAAP Financial Measures
Earnings from continuing operations before interest; income taxes; depreciation, depletion and amortization expense; the earnings/loss from nonconsolidated equity affiliates; effective
Reconciliation of Net Earnings from Continuing Operations Attributable to Martin Marietta to Adjusted EBITDA
Three Months Ended | ||||||||
2024 | 2023 | |||||||
(Dollars in Millions) | ||||||||
Net earnings from continuing operations attributable to Martin Marietta | $ | 1,045 | $ | 134 | ||||
Add back (Deduct): | ||||||||
Interest expense, net of interest income | 14 | 32 | ||||||
Income tax expense for controlling interests | 368 | 35 | ||||||
Depreciation, depletion and amortization expense and earnings/loss from nonconsolidated equity affiliates | 128 | 122 | ||||||
Acquisition, divestiture and integration expenses | 18 | 1 | ||||||
Nonrecurring gain on divestiture | (1,331 | ) | — | |||||
Noncash asset and portfolio rationalization charge | 49 | — | ||||||
Adjusted EBITDA | $ | 291 | $ | 324 | ||||
Reconciliation of the GAAP Measure to the 2024 Adjusted EBITDA Guidance
(Dollars in Millions) | ||||
Net earnings from continuing operations attributable to Martin Marietta | $ | 2,255 | ||
Add back (Deduct): | ||||
Interest expense, net of interest income | 110 | |||
Income tax expense for controlling interests | 675 | |||
Depreciation, depletion and amortization expense and earnings/loss from nonconsolidated equity affiliates | 560 | |||
Acquisition, divestiture and integration expenses | 22 | |||
Impact of selling acquired inventory after its markup to fair value as part of acquisition accounting | 30 | |||
Nonrecurring gain on divestiture | (1,331 | ) | ||
Noncash asset and portfolio rationalization charge | 49 | |||
Adjusted EBITDA | $ | 2,370 | ||
Non-GAAP Financial Measures
Mix-adjusted average selling price (mix-adjusted ASP) is a non-GAAP measure that excludes the impact of period-over-period product, geographic and other mix on the average selling price. Mix-adjusted ASP is calculated by comparing current-period shipments to like-for-like shipments in the comparable prior period. Management uses this metric to evaluate the realization of pricing increases and believes this information is useful to investors. The following reconciles reported average selling price to mix-adjusted ASP and corresponding variances.
Three Months Ended | ||||||||
2024 | 2023 | |||||||
Aggregates: | ||||||||
Reported average selling price | $ | 22.26 | $ | 19.83 | ||||
Adjustment for impact of acquisitions | 0.05 | — | ||||||
Organic average selling price | $ | 22.31 | $ | 19.83 | ||||
Adjustment for impact of product, geographic and other mix | 0.03 | |||||||
Organic mix-adjusted ASP | $ | 22.34 | ||||||
Reported average selling price variance | 12.2 | % | ||||||
Organic average selling price variance | 12.5 | % | ||||||
Organic mix-adjusted ASP variance | 12.7 | % | ||||||
Source:
2024 GlobeNewswire, Inc., source