MLM - Earnings call transcript Q1 2024 | Martin Marietta Materials, Inc.

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Operator

Welcome to Martin Marietta's First Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, today's call is being recorded and will be available for replay on the company's website. I will now turn the call over to your host, Ms. Jacklyn Rooker, Martin Marietta's Director of Investor Relations. Jacklyn, you may begin.

Jacklyn Rooker

Good morning, and thank you for joining Martin Marietta's First Quarter 2024 Earnings Call. as Ward Executive and Financial with Vice may forward-looking are and Executive Officer. Today's future today States include Nickolas, United results Jim President statements performance. events, me future Nye, in or Chief Chair Officer; discussion securities operating With laws by financial connection defined and Chief could results to differ Like other subject is actual Marietta to risks cause businesses, Martin and uncertainties that materially. resulting any from as legally information, required publicly forward-looking We statements, otherwise. Please no the revise whether today's earnings or legal obligation, except developments public release undertake the and on available Securities own disclaimers new both are in update future and to Exchange to and other website. or refer which our filings, contained Commission's

available section this the that during supplemental information on and of our website, made financial and Investors summarizes webcast We results trends. our have

results all operations. reminder, and financial a continuing As today operating are for discussed

reconciled to participation our are call Nickolas as addition, information discussion and the question-and-answer and session well I directly appendix our a review the brief filings on are our and quarter non-GAAP SEC X A remarks. which, today's begin will follow. comparable and measures of some with in completed with and to also In to the concluding well allocation. our first question. trends. the Ward Jim as will available measure most operating website. Ward limit defined as earnings supplemental After our results recently GAAP will capital as performance transactions Q&A your then market financial will Please provide

Ward. to over call the turn now will I

C. Nye

results adherence our Marietta's you execution operating for our to continued proven and store industry-leading and performance you, Thank growth today's joining thank plan. disciplined or everyone, teleconference. review welcome, and analysis strategic of and Jacklyn, Martin demonstrate and and

our position is Marietta XXXX dynamics meaningfully product value construction the to confident industry's favorable outperformance continued With demand supporting commercial the for we and that the underway, excellence portfolio ongoing and strategy, quarter Martin steady concluded operational continued season transactions in adherence nadir, undertakings first will over beyond. remain volume always XXXX that optimizing in

earnings $X.XX the full year to to well benefits realization $X.XX raised As XXXX billion billion detailed billion a Water we realized adjusted This Blue year's actions. guidance pricing or that to as range increase $X.XX reflects strong operations from at in today's recently EBITDA be midpoint. will the as of this the acquired our release,

revised offsetting annualized dates. guidance Denver exposure year, we've expand billion all the closing the EBITDA of again As XXXX annual our of is respective while and acquired with downstream XX, of These initiatives, tons generate business. These operations concrete footprint XX $XXX Cement $X.X in are April add us ability shipments new high-growth their at from EBITDA, our margins. and Florida. platform the More Blue our completed area. And and aggregates February consistently than in the January on the our reducing Tennessee South & executed and cyclical of proceeds redeploying higher leading customary, this aggregates transactions expected improve company's transactions more a portfolio-enhancing a we'll strengthening X, SOAR approximately X XX million aggregates to to transactions Industries platform providing to Albert X Water we in aggregates Texas divestiture we reflected of related our producer acquisition revisit specifically, as growth midyear. Consistent Frei Colorado, pure-play EBITDA in of generate aggregate from are guidance million the adjusted on our Sons, metropolitan approximately

chronic demand in construction sales in largely per over or by attractive, XX.X% and margin shipments long-lived the office adjusted weather offset retail year basis, partially Central value shipment commitment valuable line of cold due and and volume impacted mix performance. our pricing gross on to advantages Aggregate XX% our underscoring Aggregates warehouse, start XX basis fundamentals softening weather operating consideration appropriate for organic our and the divisions and West and to declined more to favorable XX.X% and increasing by East the commercial company's increased the in notwithstanding product divisions. remain relative to now expanded receiving the unwavering XX.X% Turning Aggregates our reserves. decline. well strength team's commercial ton our quarter and strategy, profit Southwest an gross first points

X Works, aggregates secular we intensive we ahead, end future. in long-term Looking and pricing enthusiastic these geographies growth Public across for believe uses construction. market our primary and chosen drive fundamentals specifically, favorable markets residential foreseeable and Martin the trends nonresidential trends about remain will of attractive Marietta's Martin Marietta's More

funds batement Road sustained highway, We expect ARPA, demand energy the major warehouse, softness expected recovery, increase with demand near-term market $XXX Transportation and largest XXXX additional the in provided Act value according supply challenges product construction continues XXXX manufacturing spending the critical center grew ending street increase in and nonresidential manufacturing annual positively for the investments. The continue chains, will to housing February projects local state supported of of activity continue a driving awards, $XXX and compared in in contract the indicator fully Notably, as public remains the to nation's the Transportation a phase. market provides our of for of local in DOT and said, or future our once period peak. in by billion and $XXX to expect projects highway, trends federal manufacturing, February XXXX early single-family billion a government multiyear supported generational U.S.-based be infrastructure to backlogs, moderated Equally, we rate demand and drive expect February of reshoring match from by product value XXXX. spending and or federal, Builders to certainty and ceasing to Jobs billion from American in demand billion. which advance XX% demand long-term infrastructure, from $XXX tunnel leading to this is countercyclical for by center our the record XXXX to in and Investment robust with XX-month a construction, as and Department in end outlook provide XX, Construction XX% often sector with their bridge This intensive budgets, services as residential in domestic the growth state data will secular market, to data Association State subside XX% multiyear for $XXX That markets. intelligence heavy had public offset post-COVID robust. Infrastructure partially Infrastructure we IIJA projects adjusted artificial trend investment cloud-based actions DOTs annual grow state markets construction to nonresidential steady in aggregate expected as projects towards particularly affordability renewed construction, ongoing market. Shifting XXXX or is advance to key light billion, the

Google As $X uniquely an City intelligence example, Kansas underground its announced March, in data to operations. our nearly of artificial positioned drive a center new aggregates efforts, help billion XXX,XXX requires from in tons which

the X vacancy higher XXXX nonresidential rates light interest demand high from last of be longer office at years residential construction expect lag we for single-family Looking and given challenged the the declines. natural rates, market, will

increase XXXX, a which above starts the November March trough. year million a have we're residential by in encouraged for ago. Notably, X leading single-family XXXX housing from the aggregates starts, a demand, of As nearly mortgage positive XXXX, since despite been trends around were indicator market, rates, of near-term in units single-family or million a from recovery XX% at units housing X indicative uncertainty

our in now Jim benefit key turn interest more structural once mortgage well-publicized the metropolitan over disproportionately new Marietta discuss the deficit expect payments housing rates areas, Martin call home affordable. I'll we company's monthly Jim? results. and Given quarter our moderate financial become first to to from construction to

James Nickolas

and Ward, good morning, Thanks, everyone.

our XXXX earnings quarter the our to portion million XXXX due guidance the $X.XX both compared and release, our of EBIT lower guidance due mentioned Ward the weather by midpoint. at divestiture adjusted prior year impacted shipments midpoint guidance conditions. As at the our Texas to gross South profit includes metrics tougher indicated the cement the The gross of our full and Aggregates billion effect profit to and $XX shipment full this on a raised for the billion year $X.XX basis profit smaller we aggregates of commercial increased impact volumes, is updated Despite profit the billion, points in growing which value efficacy modestly favorable can in year's weather decrease of to decrease Aggregates our the was much decline majority of XX%. Building a drives of margin the of business. vast expected $XXX The acquisition. The A to decline benefit control of purchase unseasonably ready-mix $XXX gross focus what fair and of and quarter X% nonrecurring noncash related gross profits gross inventory reflect to second of million, without our cost $X.X Blue accounting Water and million, a Materials revenues in generated to specifically the the flexible write-up to of volumes. market higher XX XX%. structure, These we discipline results increased team's business

Turning cement targeted downstream to businesses. and our Texas

decreased related profit the in secondarily by South wet to Texas weather of and concrete million to divestiture plant and and decreased $XXX $XX revenues operations gross Concrete XX% its primarily and million, cement Cement driven Our our by XX% Texas.

operational approximately cement Consistent Midlothian XXX,XXX North operational a of all-time cost markets. Colorado-based Texas, profit of finish the seasonal improved million quarter loss during more despite and Specialties incremental $XX production gross as facilities new is quarter tailwinds asphalt due in high-margin third end will strong our mill $XX asphalt the the geographies, headwinds winter in business than plant in capacity first our tons are to track offset in with and Additionally, typical the $XX still operations million pricing, posted million trends which as achieved of gross add metal a Minnesota-based maintenance shutdowns revenues relevant and paving X% experienced our annual conditions. Magnesia in to energy decrease continued be an mining unfavorable winter on record to at quarterly control inactive XXXX.

our priorities In on organic growing we responsibly allocation acquisitions, investment to first of capital capital the disciplined all long-standing capital shareholders, maintaining capital invested business. quarter, the investment-grade million rating Our value-enhancing our and focused prudent credit of return through $XXX profile. into our business consistent while remain

$XXX announcement $X.X with XXXX, over million repurchase February shareholders repurchases. a We quarter average million our we and repurchase $XXX shares total the of also during through returned of dividends shareholders XXX,XXX have to used $XXX.XX. Since to share price that returned of at billion to in an almost authorization both

was Our as X.Xx of March debt-to-EBITDA XX. ratio net

back of no to sheet over balance to With Assuming capitalize net year-end targeted call that, be activity, pipeline. to will range by X.X a a our on to leverage below acquisition strong Ward. further providing expect turn X.Xx M&A we I X.Xx the robust

C. Nye

much. Jim, coast-to-coast product To favorable will Martin commercial expect so thanks providing and across dynamics of positioned our We're another XXXX benefit footprint. significant from achievement for infrastructure to year Marietta. be steady conclude, we well tailwinds, demand

Over the continue Marietta proven has safety, the instructions, to past we'll XX turn with years, the excellence so operator on strategic the commitment operational public Thank the resilient an unwavering platform has built and of that questions. provide Martin commercial and a to durable successful will our execution aggregates-led build attention business. our an your priorities. If required to now foundation addressing you. We'll and since disciplined company, the

Operator

question of [Operator next proceed comes Instructions] with Thompson Research right. Stephens. the line the from comes of the line question first Group. All to from Trey Thompson going from next And And question. We're Grooms your from your Kathryn

Trey Grooms

Yes.

Sorry Kathryn. about that for

BWI. of with information you us just that, might even stand-alone have up so environment acquisitions overall the a bit, ASP integration talk early I and relative view could adjusting kind the very going EBITDA know days, you've your past, portfolio see then of maybe that's busy of optimization. but opportunities And the it's to maybe far, all the taking about in How clearly the I the you little maybe and you where if guide given You a and with be demand AFS And been think but there? bit.

you that? could do First that out right? have maybe off, us help with And I

C. Nye

have thanks try questions. with do to all I'll do it parts. the You X right. for And

So up Frei. perspective, from seen. a question transactions what this well. Number and is we've that's our let's about close a signs, we two, Friday, on typically they're It and our open one. Marietta talk the Water. networks, closed our And done a The and on we Martin nice it's good it on well. has look, first Blue lot it done And our has operation. you've we went closed teams exactly one, integration, and on on We thing have done morning your Monday our and tickets, and a --

blocking, to based complete, integration on you the the expect and it our the is tackling would it's and history. people where again, exactly So be

couple looking we commercial and excellence views at able relatively the mean, from one, I Now announce customers. And of in least at fact Water that. to excellence given a closed XX commercial notice perspective, to we the a that of on those operational integration number excellence, were on If of we're people with provide markets effective generally our to we XX. July quickly, all midyears ought days Blue

we're CapEx, particular, looking any got that again, more the of up opportunistic land typically to going look, spend and just be that carve-out. upgrades. We're like advantage at term, you'll in operational in seeing on contracts purchases wins. and is quick things later. One fleet suppliers. our within takes things So thing was that several what we be for plant modernization. keep that some see I Longer to worked a favorable things of because the CapEx to look Blue at regard that's And are guidance for looking a one think we early like CapEx to And is incremental of looking Water feel component. worth modestly, We're modestly without relative that mind up some in addition actually, that could first We're time, in that closing BWI it's the to excellence, typically obviously that. happens the respect. With in noting, days looking XX we're to

So corporate with that came business. SG&A no

So it that from basically already synergized was perspective.

gone So of again, has Trey. actually that nicely, very all

The One, What the said of tons minus the X. came year, of we're we of transactions we you're X%. volume, now if mentioned, bit look thought longer, taking this was X by really you than at into parse remember a out we days million about in other the we're that not a let's that, Midpoint But and interest the about of at is then about we start QX, of of about in there That's that X/X were that at weather-impacted plus if were last piece if it is noting. overall less that volume. right probably tons account, mean worth X we seeing fact on if million when these looking really, quarter looking at several X% year. things call itself. shipping about to was because a X/X to there year. And couple X we're is which over was slower tons private, and that balance, value quite Trey. X/X I weather, million of down you

that And or into components So the probably we're at and call takes let's in we're acquisitions seeing heritage when again, volume, effect the down it the X%, those into looking think down new what lower account. account, we you're we're organic to of guide, closer taking guide, end X%. original but then

wanted, Trey. that bridge the you gives you that hopefully, So

try of there piece volume respond and I So deal a not components then the to your yet? bridge. I'll integration Was did it question go also with of through to the

Trey Grooms

Do moving here. a kind information just the I EBITDA like Ward, particular, up there's one based was just, Yes. that guide given a of thing in some us that you've bit. in just past again, the pieces seems of the of right? But about on you're maybe it in stand-alone BWI lot have

C. Nye

No, we are.

EBITDA midpoint, now So it's if look at you the overall billion. $X.XX

XX% last Now were where over that's year. we

take we're only that worth to in of account year's X months. Blue give Water you into basically, a So going that

to But way in thing it. also one seeing state as other we're Heritage improvement well. that's to important is business think the the So of that's

benefit be We're by think getting business going Water, raised which the way, we getting at to you things, come. Heritage We're of other XX% Blue among a the to we're midpoint. pricing X we to the aggregate more seeing in there. So see, there's for also improvement the the can

pricing actually in this was at we looking And difficulty Marietta at mind pricing is at So pricing year. we're again, of midyear degree Martin include Water, if below that's was going keeping pricing. of their the and Frei was some some Blue have Heritage that to that that

seeing new have the So from that the headwind that that you're in, and the despite businesses Trey. the you're are actually pricing that we seeing overall changes brought we

relative hope EBITDA we're pricing well. the as I helps and doing that So what to to range relative

Trey Grooms

color, Very Ward. rest Very Yes. for year. helpful good the encouraging, and luck of the

Operator

taking Research we'll be again the Thompson And next Kathryn from question Thompson from Group.

Kathryn Thompson

was a question very guidance. your helpful Just prior from answer, which cleanup around

guidance should pricing how account into acquired if just finally, opportunities given clarification, with the from Magnesia mix one a I the And then we could a any do with Specialties. account that of midyear much into and factors for also change pricing other acquisitions? And pricing take Just takes in those actions? follow-on

portion segment's small of a from we on can contribution, While a through outperformance? broader good read had macro a quarter, what very perspective EBITDA you business this

C. Nye

Thank you, Kathryn.

if So One, have answer. pricing some see. a looking we're doesn't given got to here's the I mid rest we've direct we're that everything things. mean years. It's believe at the couple the of the of for we year, guide going that It

what It going means those So get they're that now that indicated to that Blue we've customers, mean? we does already bought midyears. to Water,

in. So we've that built

were year, we worked in had going on. As in had to you already midyears, not our guidance. to get indicated may that coming We has put had into we it indicated California recall, that the that customers been they

specific been midyears there been have worked very So see. numbers you the into have that some that

direct fact reflect that midyears, think in. still the that numbers more we're to realization the some put the very of midyear. very going But see you're X we increases nice mid-years So is, we seeing things: year at beginning some

more expect during reporting that should you the looks what like. us to color is you back tells we're on summertime. that with what when So come

about to that. I way would the that's ask So think you

one, several Number Specialties, still markets would Now chemical say the I very markets. Mag relative globally difficult things. are to

Now said, Mag that its had just ever. quarter best

of say steel well. relatively are doors off? Number I'd is. So is couple worth It Is that. doing a It's on through one blowing the not. things reading it

So business it well. tells quite performing actually us is that

at is So steel utilization XX%. about

I'm overall at we're if that is looking going, actually So business with the way it. pleased very

a is think be I at read-through may you this. looking that

of One manufacturing TPO we nicely that at that new see us we're roofing. to that renaissance we're of look the as looking roofing a TPO others. begin we're is things lot degrees and plants battery United for manufacturing And to these and lot across of that now is States seeing data recover going and a in centers can that what of tells these the

So typically, industrial we're looking But seeing through, we're TPO watching for that if Kathryn, -- those through. into that's a uses. larger read products I don't think go read you're bad roofing when recover,

Kathryn Thompson

Very helpful. of luck. best And

Operator

next of Stanley comes Stifel. the Your line from question from Elliott

Stanley Elliott

And a can little volume year. of well. standpoint end had talk some of rest happening across technical the some from seeing if of market apologize a about color on others. through we're the of give some moving some covered kind what's was as what love the kind Ward, bit into you I But mentioned as difficulties on I've kind kind from of You some building you're about to of of would an this the end market. perspective?

C. Nye

start so. Look, bipartisan digits up that's thank our One, with to a for single that going way even the largest into to Stanley, we several think get use coming year question. this larger. is this more infrastructure going the for see look, Build be 'XX you've use to you in, got law in which we I high infrastructure, to meaningful meaningfully. that do end end year. single nicely mid-single is reasons. an Happy and let's mean,

and those year-over-year. healthy other what's fashion. those budgets the pretty we're tunnel working and states, period. happening prior were a billion XX% XX%. I that in those awards, $X are I approved keep we've budgets billion local saw in my at XX geographies. If the our last significant this highway, too, of in initiatives And up levels what chosen got $XXX comments the relative multi-year And around top we're $XXX think in our bridge that prepared year, see looking we year about marketplace people ballot were last very we at thing year. in mentioned DOTs see to transportation way very attractive. the mind, mind, at funding is Keep during that looking we'll forget versus billion So in XXXX That's last a up that months in XX were in if

same. and we again, we're infrastructure bit XX% non-res. that's is that the probably way, So is about that of is We think XX% break the non-res of looking a by the little perhaps more. mind, of it looks. Around at our non-res. down think non-res, in portion is that's we view good and light like Keep mid-single of business digits, pretty our the looks attractive. If a still heavy think it And we way largely

flowing seeing through that's we're warehousing. specifically demand the But will we distribution domestic continues energy really of side if we CHIPS moderation those Act that the we're And there's that years. Inflation $XX billion heavy, next thinking resilient. put think and supplemental and for slides over is in about be degrees about Reduction things worth Act worth in be of That money keeping manufacturing. Now in what billion and several several money One, offsetting to that fact mind. of the heavy more sectors $XXX

this shoots, Now AI is green some and in where we important, I and is in seeing data centers. are think

actually Omaha. a disproportionate due in significant Des it have of wind it's for interest. I Midwest. there. it be not Kansas new beneficiary in We're we're very Moines. So a seeing where in to in Google we to building take land mentioned And it going those just that across of We're facility but power a XXX,XXX example, is seeing the we're states I about the City. tons and to mean, availability going It's seeing

commentary with was going what with think for in having organic our Trey be relative by fact, to term to see rates that impacted longer to in that view, we light high And back near volume. on interest I office rates. and I partly Now the going the is, non-res goes vacancy

we that's will modestly single We continue that. see it. resi, piece we mortgage impacting period affordability. call maybe down, And of as than certainly let's of that there rates higher So it, this digits, persist higher a navigating low think that's softness

thinking think been the increase, mortgage at reality a going XX% mean are November, are of I higher the think states February. part again, starts And of if are it. But think single-family Texas, Martin like the mean encouraging with that cetera. remain to in Carolina, Florida, that's in And if I Georgia, with I today take rates states and trends. the about X million met think know looking Marietta that's clearly, trends they North the units, is going about demand et and since to have last nearly because new population than I year-over-year people a big have at we're inflows at and would I to these be do recent we recent housing thought starts have you look construction.

housing is long we it's single-family think far to headwind, very be to think be attractive. going near-term modest going term, we So a really

going likely about that's at behind to view And we at build to we to our look build nonres be that's heavy that's think think we is to at side how come multiyear, X-month going the that So and going most to res we very of X- the lag. to continue non-res, light resilient. multiyear with is about look think look infrastructure how going res, if think

that So hope Stanley, I helps.

Stanley Elliott

and of Ward, luck. color, best Great

Operator

of from comes Your Pettinari next Citi. from line question Anthony the

Anthony Pettinari

could XXs raise it my your I'm role the continue kind aggregates you cement profit. envision kind assets you through aggregates mix remaining understanding you'll and from With and long-term looks of the broader is gross target Mag you'll a to talk portfolio? And moves, terms like organically that of there acquisitions. see question the of percentage and is, wondering about there in high if in just portfolio the you grow high XXs to playing

C. Nye

we made Number one, us you are we moves several And have that. people and that's told expect the an are be. to we've totally I'd that consistent should say aggregates-led things. company, always what with

integrated, significant concrete, that us. where keep businesses the interdicted yes. Equally vertically will relatively we've by ready-mix we've talk we'll cement of remember, you is QX. we be should see and XXX,XXX because criticality this business, one the of So worth that answer you X number about question be where leader in be of I And of said a pivot other market meaningfully Anthony, think things is is to we're go cement. aggregates up strategic businesses? is a and expect aggregates to it buying means the spoke meaning cement that what largely if long significant the strategic we've that cannot is on got we the think pure the naturally where to an have I Midlothian you portion though, aggregates downstream takes fact where precisely that the water. And at And annual in coming mind, Midlothian tons will that of capacity year spoken up,

to business business that look we mind about a million keep business being that and in we have business if that's Specialties to worth business. And Dallas-Fort because million year. in invest $XXX business, and frankly, the $XXX that of you Magnesia in a That's going business, So a very earned in that attractive margin much continue a we we hugely investment a like if that's like that's they've because that we Worth. Equally, in. ways over business perspective, from it's grow make to can it, responsibly a at that right find

number profits. And Are it, revenues meaning, those driving cement; upstream in three, looking and businesses the businesses, you number think aggregates bet. it at the upstream led, two, yes, that one, particular the So of is of number we is big X our we aggregates; Mag way specialties. vast majority

And will XX%. And today your gross yes, was were you that mean number we ago, we're up. about a profit aggregates yes, where we go sub-XX%, from was at looking sitting right. it if see I to at XX%. year aggregates look So here to percentage somewhere closer

cement number business expect we way the and to Specialties about also I've business you our hope Magnesia very think up going in very a that So but keep good that important I as well. to outlined Worth high-performing Dallas-Fort and

Operator

question of next from from your Goldman the Sachs. Revich And line Jerry comes

Jatin Khanna

Jatin Good Revich. driven the for And pipeline? standpoint, M&A morning, for This industry? range feasible additional further refinement that's is Jerry deal what a has everyone. opportunities the significant Khanna behalf you? asset From of on portfolio on What's of a your there based scope for is

C. Nye

for we question. and say I we would in grow. you the One, looked markets, markets that importantly, in want the things. Thank we in the most to can which several grow have

things balance several that have our sheet. we So of is. advantage the condition Number one,

those look balance which in businesses our annum. we in a math, sheet, if we say and you XXX done, to we markets at that position we've Number you grow and at that on annum look in per have tons I basis, prudent at our by buy we the two, we if businesses to we that we can per you'll that to done the want produce can and wise at look about transactions and we aggregates So of that smartly. think continue found fashion. If transactions grow a want a enter, in are look million sell

time that there the there's to to another out we believe that. buy. Martin way Here's ability Marietta capture Basically, that's we over have the

like? we uniquely tell you from but publicly through clinical I And geographically, you I No, I of in that sit other perspective and world and are the Martin that company economically, can tell Now in are. a can course, good linear lenses, what held we a are. do regulatorily believe also believe look that's better than of we United to to view, can't. But at view look the any my otherwise States. where positioned exactly believe, that's going here I that, I I that I Marietta

Our you heard of the at at the We're We're team what as phase like synergy And we're contracting is and our at good phase M&A. businesses. well. comments, our it. good good identifying that. shareholders we as And at very during from it do earlier integration of good

So is the continue will capital, got right be deal? if first we've to it call it will. answer our The on

a through share sustainable repurchases those be a and business So our our is the #X. in The for deal shareholders and same. #X, is guess capital meaningful investing and priorities remain is, quite priorities remains my returning to And will right while. #X, responsibly through cash the dividend

responsive to I again, So hope your question. that's

Operator

Your Stanley. comes Morgan Angel of line next from from the question Castillo

Angel Castillo Malpica

curious, just at Ward, terms or the last it several capital nothing like changing to as priorities. is But in off in comment kind you done that the there, allocation M&A to here. as opportunities last of build of have the do sounds multiples things perhaps there quarters And really attractive

ability to Just one, I greenfields as valuation, kind a pipeline is your terms shorter evolving X you the years. how of in time the talked think of it about opportunities? And period of curious some do in think have peers is their of about two,

are, puts as So any greenfields just how help us as understand, of are I kind just they where M&A. well valuations guess, evolving takes where terms in they of rates, opportunities around that's the maybe with with there and

C. Nye

we've so safer, that we synergize on Blue on Yes. making look the can attractive Thank go would by a to and we can perspectives able done you have, now at, operations type and you for been at like one, precisely the our time question. that and Albert with look that feel of more for might shareholders what sure it, process that look a it we like market. take from high at what the it those a is doing works multiple. that's And that's Water, I through model. to can a what And our is I ability through making to to The business through relatively at it very at at we're products bring and and customers efficient otherwise look a the what go important, right operations making Number look more perspective that's say from what do we and synergy bring do Frei. a we're transaction and we when multiple

Our view going continue the our we're that way growing to is that's business.

going you heady And land I reason feel good going is a greenfield ongoing to We're a perspective. to pretty more will We're think permitting. operation. that adjacent zoning, frankly, we're a special through to planning going about and got Now from one at time look, think use perspective, greenfield good way. X that, we're than of frame from that operations I But a years Look, too. going you're use see through to identifying at the property.

more in think flow, a we today a business in to time think think that's to realistic do greenfielding, about a probably meaningful I as difference And is cash the getting profit to if buying X frame XX we way years. a constructive opposed more it.

The away other anywhere is business. we're thing near an peak awfully our from to volumes being keep way in mind in long

XX reserves that rates. current today in are extraction at years at nearly ground looking the we're So

not to locations and greenfield is So our put need high. out go in terribly

that's like But purchases. reasonable, in will some some to position in adjacent I but that existing to expect to we not a land through us so be heard it's ago business number go and us multiples looks think greenfielding be years we're in in a adding that's heritage earlier in way sensible to you need looking I within in at up Colorado California, and to bulking M&A, CapEx you, and longer. did XX-year I speak quite something do I to buying look more us properties, instances, what locations. We our do to Our in and going opportunistic would very to lot land would believe for example, California what purchase. And for a us, reserve our much would do focused expect look reserves me to

Operator

Capital from And Markets. the Garik of question Shmois your next Loop comes line from

Garik Shmois

assumptions despite the changed performance any quarter has anything updated seeing what to cost Obviously, was had the speak speak since volumes, in you beginning in could on could cost hoping margin if weaker if you're wondering good you just if of year? the to aggregates the I side. you the

James Nickolas

Garik, Yes. here. Jim

about X% I inflation. call think quarter's the COGS at per I ton indicated last

accurate in I would the of that a for the rate half but year. year, inflation full will lower that's higher average back and I the be of blended of think say the X%. in year the still half first

that's think have year number. in fade still right on. But goes as did the it's still consistent. X% I I QX think to tailwinds going think I So some We is diesel on an the basis, overall

Operator

from comes Truist. the question Hughes next from Keith of Your line

Keith Hughes

I whether shortfall highway just given some the pushed If a expectation you money of comments, go little gets gets organic just the big? usually at I'm more And unit is for year. that that weather to with your non-res talk pushed, coming offset to forward. little the back in, surprised a could want this the that. about

C. Nye

we're think what on. the I is offset private more overall focused

I attractive, of think heavy we non-res side believe will continue Keith. to the be

in see year momentum going with into the I build continued think year. going throughout to we're that believe we public next a

of if course, more like softness, going than the to aggregates-intensive seeing degrees it's think to we I res. is. the is and are, we're be multifamily non-res single-family of res and in And about Xx X

share So frankly, I higher at of our think longer, we're philosophy. just it to looking lenses interest with we're given and value-over-volume And have properly up giving with respect through degrees those rates. as that up

I leads think I've relative together, volume as looking organic overall offered to to aggregates. we're the things at conclusion that the that those to you us on

Operator

Your comes of next Jefferies. from question line from Ng the Phil

Philip Ng

Cement for now Texas the smaller little Appreciating a divestiture.

year. to wet the While little start it obviously was a

Cement. business? increase Have risk locked Texas ramping view, is And in how up up coming guys guys the midyear perhaps puts are on Texas potentially capacity Midlothian. the I of you your to market, Any along? situated? from does are where pricing that like some obviously So just support you for demand the in a curious, back half? it April You grinding see

C. Nye

the question. Well, for thanks

at it looking at up on X.X%. like ASP, looking One, if things. several it was we're So mix adjusted, really

number, So number good I one, lot in April. that's a account of pretty happened things into taking mean a

increase that as tell goes you September thing have on the we up well. in price a prospect I other will not is The given the of

continue Texas we very see being no, to healthy. North So

internal mind, business environment well. in We in we've we good. continue as customer treat to see customers treat there our And own marketplace. And we the of just keep pricing like very our own other big there, got that a

we going pretty again, feel to like So attractive. that's be

The is I together, I it, as we versus mean, what prior we're at other piece ASPs the quarter. that ready in saying Equally, up and it at year we X% look were if of fits they think this mix, look

it And that Southwest, significant nicer weather quarter, I nicely through if headwinds look Phil, we as again, quarter-over-quarter, that's in for at happening because So in Arizona. of had think ready ready-mix again, weather weather or we despite what's that the had the fact And gross actually the mix for good you, a was indicator well. the I cement we actually business, for the profit up. overall in read nice

Operator

Brent Thielman Davidson. next question And D.A. line from your of comes from the

Brent Thielman

the business particular you're or think a sort similar for the And respect could strategy. I'm Heidelberg or around do with in like assets, the you legacy and AFS line implement you plan inning however in pricing what Ward, you'd in describe California thinking quarter infer optimization BWI? essentially what to just of to we time to

C. Nye

in question. price, the below mean I corporate say that average I that's several it's One, business at our look Brent, relatively selling things. thank California. you early for the overall in I still we're innings average. a would if think we still

that many say can't in You California. about things

So I piece that's of a it. think

focused that will do That And state. as continue that more we're the on that, is other I thing that think business business to business continuing think profitable. will become I to in mature. aggregates grow in our we

does look Our business perspective the team like a that will like of -- from look Marietta. profit Martin become of from rest of more looks seasoned. the a lot it of like it And percentage what

Brent. businesses innings I rate way So we we and would also markets guess I markets will run That Frei to are businesses, would below the they about Those pace markets are that I would it, the yes California. of in and obviously business the average. there. If us. a know about my Marietta more ahead. We're for look, But think be Water think modestly and mean what they're likely we're compared is those look those well. about Blue parallel, mid-years the I'm mean, the -- Southeastern home like transactions. Martin early sure talking in not already think maybe clearly will I in relatively Water Blue that's

Operator

Michael comes Dudas Your Research. the from line from Vertical next of question

Michael Dudas

that just participate? of just be little want are in cautious. little a there's as presentation fact I well, your needs of want data other data seems the to large so reflection to comment just bit where of you heavy get much the standpoint it lumpiness more I the the come Is out kind to be there? non-res It's going power vendor to a stage areas back these being a early siting on of more some a Relative it. centers. markets to of a centers your is that issues, a demand just a just in from opportunity? bit sense the this It in to -- sorting of res, in

C. Nye

Yes, good in multifold. And had they're part particularly piece in we degree available is I reason the data is talking centers in the good we energy. roadblocks about how would getting of have that them degrees is land. to think say several what a days presence of of about I was about United feel that central and really there things One in mean I prolific about the what's States. these about the be and one will to talking Street ago, it. the Wall some Journal one, XX Number a we've

are for mean as markets So us. I really Western Eastern centers important -- today, data and Iowa. and in under actually construction there I'm sitting today those Nebraska that are here X

to cetera, in more Yes. water, very the they we're and where long-term land to the as And we e-commerce, more bit AI where but in will a going 'XX. that, a land meaning importantly, a again, in significant we're in here? Yes. where early States part bit complicated et use secular think, Texas today, at of and looking term, complicated? think presence be Yes. United again, have on So we people, get that Is have 'XX, business, Will more the I that's attractive more the Central Southeast? Southwest? a Marietta we Yes. trends are Martin need to cloud, near the I looking of the be advantage as going because use very But

our it. that's we'll think see I I And where to think going that's be differentiator.

Operator

next of Your the Davis. comes from Thalhimer Adam Thompson, from question line

Adam Thalhimer

Ward, And any can is dealing with on of why Kind us here? issue? you that color with that comment strategy? on sticking the over volume additional value we're why

C. Nye

margin And without of important. products down I cost it, would have we're X% there's and underpriced been why a back. heavy one I up for good this over that for side our ASPs volume important, is a our takes guess happen, here's have getting a the thing product. quarter to And of say show frankly, building X road. no there those time. of activity was volume think has impressive. I product that And what the when value project. you that lot a looking We're building long expansion takes is XX%, you And going revealed to really ever right? XX%. But quarter place value you're if we're looking at really mining I XX% on and just what ended, it things and at is, and been mean and the sure non-res putting is that's we're from to well come the our going The but home look at of over stick a that the volume if building some of also to is is those quite between X that the do safely. do numbers so a on you're you something And I cost skill making know. ground part it pricing perspective, a

we that through the of degree getting have and overall business, look product put the So work if the go on of we our the ground difficulties doing a at difficulties overall our business safely. to specification quality into of to

value into we've seen teams their an perspective as well. important those tends talking I have work time it to work a bid, they to customer is what us have. largely relatively perspective, And enough to about to think their for if numbers from conversation well from is our

something in I was that it we're So said X look, gone or our we've pricing in as has going we're a the at forward, if before, at X way think here looking ago, years world looked company thinking stockpile. and the period wrong that economic a of in a believe I way ground and cycle the we're different our different in a point. just in different of about value time, of product I at --

Operator

the Longbow question David And from comes line of Research. your from MacGregor next

David S. MacGregor

portfolio very Ward, management, on congratulations on the the all progress impressive.

C. Nye

David, thank much. so you

it long a time. You've watched

to see So able you've been it.

David S. MacGregor

pricing. kind I beginning going. your know of touched to still response I like weather on MSA on how variance MSA traction weather a to it kind that but I in angle. maybe at given from price this to you previous come complicated of Can year this may on you ask you it's question, temporarily and first Well, have slightly the at in and sounds different to just wanted a price a go. the to you may more about Yes. want impact just that getting XQ is does It has you're actions still realizations to out the footprint? in your this talk those standpoint, also an some in of maybe of across leave this bit, some ASP seeing looking at able pressure XQ that get you're footing about pushed price basis increase? And a in greater terms little it on beyond? the of before quarter

C. Nye

David, thanks would for question. several the things. say I

was in degrees particular. of much because bit see We was it of And so of the would and say else don't was relative part January cement beyond midyears to I having think earlier already anything XQ Texas in even it was different I what, last in in a that considerably deferrals from than rain did of I know conversation issue think see year-over-year. to You the the X. relative guide Southwest we puts to April degree some more What degrees we've into now. right And what built pressure of the it that. of part question to first, again, to your going we're places there that Texas a X a really so was weather, on

that April a do mind, of pricing. the country circumstance X weather the accustomed of So to a was unique in seeing a lot role. But in played I again, keep think bit

to January with notion we've over this pushing something months let's to months everything our call base XX So last, here the that really XX customer of anyway. X was introduced it,

So at affected think whether, it I was think if that I'm I how looking it. pricing,

in January. was does reasons, degree little because be quarter the I we'll or the prospect was for here on it don't think that cement slower one again, some do it looking any I And increases second we're of of think at relatively out at least the pressure in to see of in the what undue it's of balance gate discrete coming it year. bit think help? that I going David, the of price a the September puts

David S. MacGregor

does. it Yes,

Operator

Research. And your from of line Timna next from the Tanners question comes Wolfe

Timna Tanners

the wanted to for Is that footprint regard data I've we comparison center center? with ask the about I one there. And compare because warehouse the with you normal a that data commentary XXX,XXX heard of how Or also tons. some that that, to Google do is a mentioned? particular

size-wise, against an question your about caution one something more they but there like how wondering you're is compare I there, in maybe another. on. it cautious earlier And presentation your Just was think is

sure want just to make understand So that. I we

C. Nye

commercial that large a outside what in of Yes. a you'd Good space. think question, of on fairway being on that look of project at and that Timna. Look, I type don't that as type anywhere of normal expect

work typically although to large I anything concrete the earlier, large then conversation In I through, that walls. pull point, walls. And saying measure, going an In are be It's they're some to build And roofing of the you'll too, So think do read-through several there concrete this think going they're could is in the of be back be an At things to aesthetics. the in of good that's example that other see will typically these these. not on take doing I not keep there's Mag, this in degrees Timna, question had a Oftentimes, base. goes that's think some beauty in that. words, it One, it not think the putting And are on other tilt-up relative exercise going because to At they're some TPO it's with is pretty floors be site painted I referenced Yes, last I large normal it, measure, of would it, In for probably dealer consistent other you to piece a happening. the isn't if was walls. that I'm to warehousing? beauty. not going about concrete. mind, brick. things in point,

there States, what XXX,XXX I respects, Two, in in no, the us, fairway. miner of the So think And that when centers middle mine location. is part underground locations able at isn't we looks of I the as in open in to about the if United like know, almost in all actually we underground closer you the tons typical States. one than And point our one market the for was aggregates in in us. And many Three, means to build particular, the these. And it's particular, would to is it's we were what we're in unusual. of somebody United referencing pit largest about talking for the that central able above literally that get we're be this, that use mining to locations. is be about we're

well. from works actually very proximity perspective, So that a Timna,

Timna Tanners

like helpful That's I the in beauty color. concrete.

Operator

would Nye Ward back And our to like remarks. closing I for for it to portion today's that call. concludes Q&A turn

C. Nye

results strategic summary, business operational safest, XXXX and in our and most to look to durable compelling today's business driving joining maintain aggregates-led differentiated believe safety, Thank opportunities, foreseeable shareholder all Martin a and value our superior well to well-defined and future. provide and to you sharing quarter public plan we and continue call. the to teams, excellence company. We Thanks as summer. unrivaled for Marietta position world-class forward sustainable practices we our results us the build the best-performing positioned for world's model, conference sustainable second In growth earnings growth commercial commitment best-in-class is

any support and continued Martin follow-up for available time we're of questions. always, you Marietta. your Thank As for again

Operator

Thank for this today's you conference concludes participating. ladies call. And you, gentlemen, presenters. and Thank

You may disconnect. now

Martin Marietta Materials (MLM) 30 Apr 242024 Q1 Earnings call transcript