Vulcan Materials Co. announced results for the quarter and year ended Dec. 31, 2022. In the fourth quarter 2022, the company reported total revenues of $1.732 billion versus $1.606 billion in the fourth quarter of 2021. For full-year 2022, the company reported total revenues of $7.315 billion versus $5.552 billion for full-year 2021, more than a 30% increase.
Aggregates segment gross profit increased in the fourth quarter despite lower shipments due mostly to unfavorable weather. Fourth quarter gross profit increased to $327 million, or $6.04 per ton; shipments declined 6%.
In early October, the lingering effects of Hurricane Ian slowed shipments in certain southeastern markets while significant rainfall and extreme winter temperatures impacted November and December construction activity across many markets. The prior year’s fourth quarter weather was unusually mild, amplifying this year’s weather impact.
Quarterly shipments were also impacted by the absence of tons available from the company’s Mexico operations, which were unexpectedly and arbitrarily shut down by the Mexican government in May 2022.
Fourth quarter freight-adjusted selling prices increased 14%, or $2.05 per ton, and increases were widespread across the company’s footprint. Freight-adjusted pricing for the full year was $16.40 per ton, an increase of $1.53 per ton, or 10%, over the prior year. Adjusting for mix impacts, average selling prices increased 15% in the fourth quarter and 11% for the full year.
Notwithstanding the challenging weather conditions in the fourth quarter, solid operational execution helped offset continued energy cost headwinds and inflationary pressures for many parts and supplies. Freight-adjusted unit cash cost of sales increased 17%, or $1.27 per ton, as compared to the prior year’s fourth quarter. The average unit price of diesel fuel in the fourth quarter increased 61% from the prior year. Excluding the impact of higher diesel fuel costs, freight-adjusted cash cost of sales increased 11%.
Unit profitability expansion accelerated throughout the year with fourth quarter gross profit per ton increasing 7% and cash gross profit per ton increasing 11%. For the full year, cash gross profit per ton improved 5% to $7.83 per ton.
- For the full year, asphalt gross profit improved $36 million with robust pricing gains overcoming a 36% increase in the unit cost of liquid asphalt.
- For the full year, concrete gross profit improved $35 million, benefiting from the earnings contribution of acquisitions. Cash gross profit for the full year was $172 million.
- Full year Calcium segment gross profit was $2.6 million compared to $2.2 million in the prior year.
Tom Hill, Vulcan Materials’ chairman and chief executive officer, said, “Our aggregates-led business delivered solid results in 2022 as our teams executed well in a challenging macro-environment. We continued to improve our aggregates unit profitability and demonstrate the resiliency of our business. Our relentless focus on our operating disciplines, coupled with nimble pricing actions to overcome inflationary pressures, led to a 12% increase in our full-year Adjusted EBITDA. Fourth quarter results were negatively impacted by abnormally wet and cold weather that disrupted construction activity and materials shipments, in addition to some softening in single-family residential demand. Despite these disruptions, our industry-leading aggregates cash gross profit per ton increased 11% in the fourth quarter. We carry solid pricing momentum into 2023 and are focused on our operating disciplines to manage costs and improve efficiencies. By controlling what we can control, we expect to deliver another year of earnings growth.”