Martin Marietta Materials Inc. reported results for the fourth quarter and year ended Dec. 31, 2023. For the fourth quarter, total revenues were $1.608 billion versus $1.477. billon for the fourth quarter of 2022, an 8.9% increase. For full year 2023, the company is reporting total revenues of $6.777 billion versus $6.161 billion in 2022, a 10% improvement.
The Building Materials business achieved record fourth-quarter revenues and gross profit. Revenues of $1.53 billion increased 8.9% and gross profit of $461.3 million increased 39.2%.
Fourth-quarter aggregates shipments decreased 2.1%, reflective of the company’s value-over-volume strategy and moderating demand resulting from the affordability-driven residential slowdown and a softening in warehouse and data center construction. Pricing increased 15%, or 14.3% on a mix-adjusted basis, due to the cumulative effect of Jan. 1, 2023, and mid-year 2023 pricing actions.
Aggregates gross profit increased 36.8% to $328.6 million and gross margin increased 650 basis points to 32.2%, both fourth-quarter records.
Texas cement fourth-quarter shipments decreased 8.1% to 0.9 million tons, primarily due to wet weather. Pricing increased 16.6%, aided by favorable supply/demand dynamics in the Dallas-Fort Worth Metroplex.
Notwithstanding the shipment decline, cement gross profit increased 46.0% to $84.5 million and gross margin expanded by 1,450 basis points to 52.8%, both fourth-quarter records, as energy and maintenance costs moderated on a comparative basis.
Ready mixed concrete revenues improved 12.1% to $232.8 million, while gross profit increased 38.3% to $21.3 million.
Asphalt and paving revenues increased 13.3% to $228.4 million. Gross profit increased 49.8% to $26.9 million as lower natural gas and liquid asphalt, or bitumen, costs augmented pricing growth.
Ward Nye, chair and CEO of Martin Marietta, stated, “A strong fourth quarter capped the best year in our company’s history. In fact, 2023 was extraordinary in nearly every respect for Martin Marietta. We achieved the safest and most profitable year ever while enhancing the durability of our business through enterprise excellence together with undertaking non-core asset divestitures.
“The team’s disciplined execution of our proven value-over-volume commercial strategy drove an organic improvement of 33.0% and 46.4% in full-year Adjusted EBITDA and aggregates unit profitability, respectively. These accomplishments, notwithstanding a macroeconomic backdrop that was highlighted by restrictive monetary policy, a housing slowdown and rising geopolitical tensions, demonstrate the resiliency of our aggregates-led business model and position us well for continued success in 2024 and beyond.
“Looking at the year ahead, we expect aggregates demand for infrastructure, large-scale energy and domestic manufacturing projects will be strong, largely offsetting weaker residential demand and anticipated softening in light nonresidential activity. That said, as mortgage rates stabilize and affordability headwinds recede, we fully expect single-family residential construction to recover, as demand still far exceeds supply particularly in our key markets.”
Nye concluded, “The advantaged nationwide presence of our business, built over decades, and further complemented with our recently-announced acquisitions, uniquely positions us to capitalize on favorable population migration trends in the near-, medium- and long-term. Together with this foundation and our unyielding commitment to execute our proven strategic plan, we fully expect to continue driving sustainable growth and shareholder returns through dynamic macroeconomic cycles.”