A Little First Quarter Perspective

The publicly traded aggregates companies released their first-quarter reports, and several items beg for a little perspective.

Vulcan Materials came out of the gates strong with a 7 percent increase in its Aggregates segment gross profit to $148 million. This despite higher energy costs and shipment delays due to unusually cold and wet weather in certain markets.

Other hurdles included a 26 percent increase in the unit cost for diesel fuel, the planned shutdown of three large facilities for repairs ahead of the construction season and above normal distribution costs due to lingering storm-related ship and what it called barge movement inefficiencies.

Speaking of barge movements, check out our story on Vulcan’s new ship The Ireland, in this issue.

Martin Marietta Materials saw its first quarter numbers decline against last year. But not to worry. The company is also citing weather-related issues. Its first-quarter operating results compare unfavorably to the first quarters of 2017 and 2016 when the company benefitted from back-to-back years during which oddly favorable weather conditions in its markets allowed it to exceed expectations.

The company concluded its acquisition of Bluegrass Materials, which is good news for them. Ward Nye, chairman, president and CEO of Martin Marietta believes the United States is in the midst of a steady, multi-year construction recovery, which is good news for everyone.

Summit Materials saw its first quarter net revenue increase, but that increase is primarily due to recent acquisitions. In addition to several ready mixed plants, Summit added Stoner Sand in Missouri and Midwest Minerals in Kansas to its stable of operations.

It is interesting to note that Summit’s diesel fuel forward-purchase program has helped to mitigate the impact of that commodity’s maddening price fluctuations. It is astounding to note that Summit’s operating companies consume 30 million gallons of fuel each year.

Elsewhere, LafargeHolcim noted that further market growth is anticipated in North America driven by residential and non-residential demand; Eagle Materials touted a recent cement plant acquisition as adding to its bottom line; and Cemex saw its gray cement, ready-mixed and aggregates volumes in the United States increase by 4 percent, 8 percent and 5 percent, respectively.

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