The Rock Products Interview: Andy Arnold

Rock Products Editor Mark Kuhar Reached out to BMC Enterprises’ Chief Operating Officer/Managing Director Andy Arnold to Discuss Breedon’s Move into the U.S. Market.

Andy, can you give us a little background on yourself and BMC?
I started my career in 1989 with what was at the time Redland, a UK-based construction material company later acquired by Lafarge. I worked for Lafarge in various capacities prior to joining BMC in 2006.

You have a significant history with the company.
I am one of the longest tenured outside of a few others. BMC Enterprises will celebrate 100 years in 2025.

Regarding your background with Redland North America then with Lafarge, was that both in cement and aggregate or across cement, aggregates and ready mixed?
Not in cement, but aggregates, ready mixed and asphalt. I originally started in the Mid-Atlantic area around Baltimore. I got to know prior BMC owner Nathan McKean when I was based in Kansas City and running the operations for Missouri and Kansas for Lafarge. Ultimately I went to Paris headquarters from 2004 to 2006 and then joined BMC.

Can you give us a little bit of detail about how the Breedon deal came to pass?
Breedon approached us almost two years ago when they originally wanted to grow in the United States. We had some conversations but were unable to reach agreement. Then last year after we had completed three acquisitions, Breedon reached back out and said “We’d like to talk to you guys again.” We started talking last summer and in November signed a letter of intent.

Now that the deal is done, what is the integration process into Breedon going to look like? Is there going to be a name change? How will the executive hierarchy look? Will staff levels remain the same?
As I make the rounds to all of our operations, I’m getting all those same questions. We have tried to address them with many of our business leaders so they could answer them more immediately. We really have three goals: We’re going to continue to focus on safety and increase our safety focus; we’re going to make sure we reach our numbers both in volumes and profit; and then both Breedon CEO Rob Wood and CFO James Brotherton made it clear that we want to continue to grow, but at an even faster pace than what we had been doing under BMC. So while there will be some integration efforts going on to make sure our systems and our expectations and Breedon’s expectations are aligned, there will be some integration things that take place. Nathan McKean, the former owner of BMC, is now on an Advisory Board that has been put together that will review potential acquisitions. He will have input into those and he will also be working on the governmental affairs side. Nathan also is the chairman of NRMCA for this coming year, he’s been highly involved in that organization for many years as have I, but to answer your question there’s no name change. Really everything stays the same. There will continue to be changes as things develop and as our organization develops but I’m here to run the business as I had previously as chief operating officer.

If I’m hearing you right there’s some additional acquisition activity in play up the road?
Very much so. Breedon wanted a platform in the United States; to not just have one state where we operate. We do operate a little bit in Illinois and in Arkansas but primarily in Missouri. Breedon didn’t come to Missouri just to maintain that business base. Certainly it will be a platform for additional growth as we move forward. It’s an exciting time. Actually it is exactly what we were doing under BMC, but now we’ll be able to do it faster than we had previously. With a corporate parent like Breedon behind you it accelerates the pace.

Is there any talk about looking at existing operations now, adding new equipment, upgrading and doing some things that maybe you didn’t think about doing before?
I’m sure there’ll be discussions about those things as other experts may have ideas as to how we can be more efficient and make improvements to our operations. We already have some ideas in mind as we try to ramp up and be in a position to take on the additional work that’s coming in Missouri between the Infrastructure Investment and Jobs Act and work that the state has done in its general budget to improve I-70. We’re excited about how those enhancements to some of our operations will help us to be able to supply a portion of those projects.

Can you reflect a little bit on the success of your integration model with the 20 or so deals that have been closed in the past 10 years?
We try to keep management in place where possible and out in the field we have a real strong group of people. They know how to run their business day to day; we don’t need to tell them how to do their job. We do bring some things to new companies that maybe they hadn’t seen before concerning how they operate; some ideas on how to improve their safety focus. Those things are cultural, they take some time. Some of the remote markets are not doing a lot of things that we do in some other areas, but the managers have been willing to accept those things and see the advantage to adding them into the way they operate. BMC has a strong culture, we’re never sitting still. We’re trying to not only improve the operations but we’re always looking for continuous improvement from our newly acquired companies.

Do you see Breedon as being more keen to develop the aggregate side of the business or the ready mix side of the business?
I think it would depend on the situation. Certainly our idea at BMC was to grow on the aggregate side first, but there are situations where it makes sense to grow not only in ready mix but also in concrete products. A few years ago we added a concrete products business in southwest Missouri called Stewart Concrete Products. We’ve added another operation in northwest Arkansas. Whether it be ready mix or concrete products or aggregates – and they’re all important – we’re going to continue to grow all of those businesses.

Is Breedon interested in the North American cement market?
We haven’t had any discussions about that with them at all. Cement has not come up. Obviously they have it over in the UK and Ireland but it has not been a discussion that we’ve had relative to the United States.

Is there interest in North America as a whole in terms of aggregates or ready mixed, whether it be Canada or Mexico?
We’ve not had any discussions around that. Although I don’t see any reason why there would be resistance to going on to other parts of North America.

Any final thoughts?
Breedon is looking forward to growth and success in the U.S. market. I am pleased to be part of it.