EXP - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the fourth quarter 2020 Eagle Materials earnings conference call. At this time, all participants’ lines are in a listen-only mode. After the speakers’ presentation, there will be a question and answer session. To ask a question during this session, you’ll need to press star, one on your telephone. Please be advised that today’s conference is being recorded.

further star, any require you assistance, zero. press If

hand over Haack, to would and now speaker conference to like Michael I your the today, CEO. President Mr.

You sir. may begin,

Michael Haack

for to Thank morning. fiscal Eagle our XXXX. full Materials’ quarter you. of year Welcome conference Good fourth and call

glad could you are with us We today. be

our are and and Communications. Financial Bob Strategy, Stewart, Joining me Chief of Development today Executive Corporate Craig Kesler, Officer, Vice President

in and connection please There on with call. will presentation be the it, www.eaglematerials.com a To to go link made to click slide the access the webcast.

covers those note uncertainties While and cautionary you discussed during slides, made statements the forward-looking are These during from risks to that regarding the accessing call. could that are please the the subject call. cause first slide results disclosure statements differ our to

please disclosure, release. also further which our end refer the For this is of to at included press information,

remarking me reporting more earnings than let the start morning, This two by even are matters important today. are that we on on

health, of and the First wellbeing our is safety employees.

is The communities business. being in we the good in which neighbors do second citizens and responsible

be it not these to closely related. COVID-XX, two could relates As more

and action Regarding health processes an protocols our partners. safety that the remain all have response and COVID-XX, essential has early open business enabled customers to proactive us and in business protect employees, This to our been in locations. safety establishing of we as safely

sell been operate allowing the chain, local operate heartland to in U.S. supply deemed has we serve situation, importantly and own and fully in products. and inputs material us everywhere raw our this that and and most essential, we make states, We control are have construction our fortunate and virtually domestic sunbelt a

demand strong terms our record fourth for this We should our entered quarterly Posting quarter. to reason. experience no the revenue fiscal much of quarter me for momentum with our We in this quarter markets. interruption not did brings our be markets. business earnings in across surprise Which

being trying than as times, feedback emphasis in contact unpredictable, matters. they local to COVID-XX, of intimate our In of involves rather case this these is geography the our on This environment. predict with In rapid unprecedented in deployment the navigate loops. operations

business are quickly changes react We market occur. as in and local can they to many ways a any

some severe track an have navigated record very We cycles money in regard. successfully we deepest in and before our the navigated claim. longest and every have U.S. which would made this say can space We year, unrivalled construction recession few in history and through

non-essential balance to of now, quarter strengthen prepared announced We our a well emphasize respond and curtailing I our arise. other plan prudent is suspended suspending measures. of environment. preparedness through also be our the are already issues sheet. plan part entails strong want strategy share of cash and part of host repurchases, we controlling as cash was during Out expenditures, comprehensive and dividend. an Right inventory levels, clear to that dividend conserve This the to that very this of a abundance managing we capital quickly caution, of

shaping. portfolio some where assets and exceeded of us. assets and value timely we of a for ownership non-core the ready-mix announced The standpoint We effort our that It is from is result that long-term strategy quarter these in coincidental of operating of have value cash California. made progress sale sale this emerge the a in program aggregates alternative

to distribution We during for business we sell quarter alternatives business. also the remaining to were sand explore frac continue the able and sand our frac

over economies that the its fully time. be on We effects relieved and will COVID-XX expect around uncertainties the

opportunities prepared materials well to We in arise will capitalize in these that uncertain times. are construction the of on wake

decade than ago. were cement a the of business we three side are We on times larger the

as an cement network heartland. latest Kosmos plant the The began in U.S plant recently We the addition in of was Eagle have operating and March. acquired built strategic plants a that terminals we

of has we March, to prominence completed the wallboard the equipment Our capacity production business installation In expand for [indiscernible] satisfaction. customer Paper. Republic unrivaled and attained

the all through we capacity. installation this finalize seeing but will new of aspects We of the benefits added when travel over summer equipment already are the reopens,

to may is We the sheet back. are time strong, our healthy, and and In that underestimate regard, the again. balance led we way recovery the many will way power we cycles our to well the businesses. this are that monetary not for from emerge create is it stimulus Construction think this I prior poised already announced fiscal has at government and winds so uncertain with our important lead

another. make way that homes building pace be remain reasons matches bridges the are Low replacement and needs affordable more and There or formation term. Our well in infrastructure will and repaired. chronicled at the many built are to household and U.S. needs. we not about long constructive Roads rates one interest are

businesses still two the for to updates We look timing forward currently separation but that transaction. of the have on no

remarks. introductory me for all That’s far as as

the me to results for quarter. through turn let over financial to Craig it go Now the

Craig Kesler

XX% during businesses year. a very to year. to volume end Acquirable and Thank XXXX you revenue our two increased $XXX revenue X% improved the record of the year, contributed acquired the year. billion, from Revenue for fourth a approximately addition cement Michael. $X.X pricing, reflecting wallboard of up and the sales prior paperboard businesses and quarter strong was the million, million $XX during year fiscal Fiscal sales improved volume, reflecting

diluted earnings share Annual improved XX% per $X.XX. to

in several asset gas press proppants most impact impairment highlighted of to release, years oil and non-routine business. the the notably we both include an items, the related charge As

is to the mill. CARES related fiscal of For diluted tax effect share an Act. of expansion outage of to earnings includes the the the expenses linked XXXX, effect per benefit and This related our paper development significant a

The primarily and recover rates than non-routine CARES today. at per Act back tax paid carry improved enables annual acquisition asset XX%. share in earnings years to to items, taxes the pay these it by use us higher Kosmos prior Excluding the we’d generated tax

by QX per each would share of affected is by share increased The have these also same XX%. for consistently Adjusting comparison items. many fourth earnings quarter year, non-routine earnings them per

in Turning and increased revenue concrete aggregate includes now performance, cement in concrete materials improved the XX% concrete, we the segment both the aggregate Annual of sales Operating cement an driven slide sector earnings improvement our to shows sector, heavy in volume business and XX% by primarily pricing the our XXXX. results XX%, August segments. this reflecting acquired cement, sales and in and next and results pricing. the volume, our in improvement which increased in again

light at was sales materials net $X.X light paper of million, earnings Annual equipment. offset results on to prices. operating sales annual also X% higher materials results XX% an the materials by reflect side, declined partially next volume by prices reflecting in lower on our offset and sales wallboard annual declined the to $XXX paperboard Moving sales tie improved impact in X% wallboard sector extended revenue The outages the two light was in sector as new approximately The to mill of million. our the impact the volume. annual outage decline

the was late adjust and and costs. lower to we hydraulic drilling March, business mining the XX% $XX business. of sector, continue proppant to loss operating explore an operations annual as distribution sector fracturing continued business for our operating and we and the had pressure reduced to we under recent In price revenue alternatives activity sold gas In and the we remaining minimize months down oil in increasing oil This has further proppant of come million.

our fiscal XX% Total through purchase early during term $XXX acquisition declined syndicated cash March, Kosmos a loan the million. group. Operating increased $XXX we the cement to the flow XXXX business, million. through existing spending to capital completed In of funding bank

dividends. During we suspended million, fiscal million In Michael previously capital fiscal announced returned as and nearly we spending XXXX, repurchases of XX% to $XX to million $XXX and repurchases to $XX highlighted, expect we XXXX, Eagle through share to dividends. and a decline future and have share range approximately shareholders

cap Finally net a XX, on capital $XXX was and our our had cash at we to million March At of ratio XX% XXXX, hand. structure. look debt

to net liquidity no quarter end at nearly the leverage $XXX maturities. X.X million term Our Total of ratio debt we debt the and near was have EBITDA was times.

for and improves business liquidity going the proceeds million. tax stemming cash in announced northern NOL further we California forward. operating the April, concrete our our with and refund sale position our from These of carry-back aggregates flow $XX.X In combined

call. Thank you attending for today’s

move the and question session. answer to Catherine? We will now

Operator

[Operator instructions]

comes with Grooms Trey from question Stephens. first Our

line is open. Your

Trey Grooms

and thank taking my Hey, you good for morning, questions.

to trending both bit since seeing the First know, to business trends demand you into guys you’re you of off, in I Also, your cement solid, in little volume volume, maybe and sense on of about from talk quarter. but sides give of wallboard comp this prior - guess how can especially was you COVID-XX, the further into us also very pandemic? on a a this what strong are quarter April very the your May, things end the was much impact difficult organic the had. given Understandably

Michael Haack

Michael. Yes that. Trey, this I’d is on a things mention few

that highlight the situation. things One I to this does matter of in was wanted geography

We’re have volumes stable. the heartland heartland remained not pretty been the our demand impacted coast as producer. as a east much has coast, U.S. west The so or

Trey Grooms

business, and wallboard? Okay, and that’s cement sides both on of the

Michael Haack

correct. That’s

Trey Grooms

that. great. Okay, Thank you for

a the slate markets cement until, Just update sounds your and looking How June. I lot a on pricing an I it cement delayed timing was have of the are think, for be price, might markets there? April. It it like from know

Michael Haack

market June our general pricing delay time that that’s at you that and that then if a what cement the There’s Yes, accurate. timeframe it’s a said fit plan. is now, re-evaluate Right and time. of at we’ll that determine to

Trey Grooms

that in geographic was Okay, in? you’re your and markets all of

Michael Haack

of were were for of but few correct. increases XXX% that. some--the the the totally enacted, to There that markets a that’s get markets, Not price was able majority

Trey Grooms

kind what got one wallboard of sand during is downturn here why, the here, with it lot hit more medium the to changed business different wallboard be business hard, enter a picture, industry standpoint - were last for or about pretty and how know, outlook in and changes your on was that in me, has pricing how the the if from pricing Last you’ve downturn to near for we’ve you term. big you seen could this talk Okay. Can for uncertainty the a we a any there business? or of

Craig Kesler

months this through ourselves scenarios. two or It’s good and a challenging question, is alternative Craig. Trey, and we the over three thinking are last

the was long demand were the XXXX, demand fall on and starts things - if come to housing back so think on we you a million side, do housing the of you about had first pushing the One side. industry XXXX to, way X where in we

levels cycle. starting momentum and but of levels of good February, We haven’t building. so we’re home peak those approached some this far near to housing certainly nowhere see January even starts We were

that. below well We’re

capacity of think supply one-two not the side, forget XXXX, opposite Recession. talked remember remember square and all to more XX% was significant capacity entering into materials, demand uncertainty and, The It we people we that in feet, added you rising, just being X to punch is billion other harder issue. find, over and a any demand lot, expensive this a of frankly, enter XXXX some find. also about the to XX% capacity Great down the the billion years this have a We the harder got thing, and amount added as don’t I frankly, with are and a period if with, lot new you’ve least we were and we’ve to to new of X raw becoming at

the that are business position etc., there where we years we different then So ago, addition we found as terms we go our so are so in this--and better, plant, and a positioned Georgetown, things ourselves lot Carolina that than forward capacity of were our XX in we also structural other - here. business have consolidation, in part changes are of South of enter different a very

Trey Grooms

Best thanks right, All stay you. of for Thank the and safe. well detail. luck,

Operator

Thank you.

with comes Our next Brent question Davidson. from DA Thielman

Your line is open.

Brent Thielman

relatively Trey’s you, a think morning. and have end so I other quarter? like good side. be know well national question hit. a Thank you just markets, good Have markets wallboard and influenced the here great. It up has this demand Maybe pricing in sometimes at level far your I held been sounds seen on pretty stability follow-up Hey, some can on pricing

Craig Kesler

really would and see year. tell since results, price, you our in almost flat our can Yes last it this quarterly has Brent, been I you time

recent most the this in the about as that saw the average. exited quarter We same quarter. You

Brent Thielman

ability new Kosmos, I’ve about delays it’s Kentucky to in Okay, a that? because relatively Can asset’s Can of on by or to question us. some offset public that’s projects. you new some some that on from great. into Then other markets? others navigate heard that all surrounding that of talk shipping just you

Michael Haack

we when of facility. asset into what make we the sure was Yes, owned only at We since kind the that asset March directly outage X, took over saw we’ve went we in asset. now had itself, an to that

came that remember different with If that asset so pretty distribution. substantial know correctly distribution too, you span facilities do you several for a have we network, states

Our sales with pretty has the past been team team. consistent

in put the business the vice of Eagle’s of the from it. side have too existing some We fantastic really sales out time. management taking utilizing for at that of finance team president and culture in everything, the manufacturing network where there it we Eagle that to and the and has with job, team are the get done of a there the this and product moving sales But have

market was to we and been reallocate Pennsylvania said, do at around move little beginning, product bit. As able a and that that trying the they’ve have and distribution in a

for time, will as job. now, color it I so in our just with fantastic a or can we’re we the give months it more the quarter couple after we a own doing quarter that, they’re you get after think under More next time more some I it in come belts.

Brent Thielman

that. we looks helped the appreciate that like [indiscernible]? so get of value apples-to-apples just kind the that within can you the it segment, this Do an of Wildcat profitability--profit quarter. have Okay, comparison proppant Then sale, sale

Craig Kesler

in sold Brent, business in the very sale profitability. January Yes you and February Like into from Wildcat wasn’t that really catch-up changed a the business, Frankly, I improvement very were strong and and again as slow prices winter. was the a earlier, were times dramatically, quarter, we volumes minor. fall lot tell so said Wildcat of March proceeds there oil end improvement the the very has in April fell really the early of in that the so would I at

but As wanted the to performance sale business we there, we driving the a during that quarter. most alternatives think sense and wasn’t and the made said, exit the about for

Brent Thielman

I last what you the going process, that can done talk are you’ve now lot’s guys in guess for advance is on just but right process about to you to just know I my about question timing, to be can already from to on this. Great. you extent talk separation the markets, date? the guys looking everything a going

Craig Kesler

Brent, to before, not that. think now Michael Yes, over and as said time confidence out next an in months is I where in pointed right you XX we’ve we’re the and visibility uncertain want have the as XX,

high can regular and to strong the and remained some recognize they’re early While place, our happen want what to together. in do support very uncertain of markets until they certainly of them are keep long manner. our businesses can have volumes term, because businesses times, you also have action course put degree so the we the in and in together stronger here May, other these right in immediate confidence where the we in we a certainty best to would have there, is these those Until during each a April way things term capital getting and markets trading

Brent Thielman

Okay, Thank guys. you it. appreciate

Operator

you. Thank

with comes next Anthony Citi. Pettinari Our question from

open. is line Your

Anthony Pettinari

morning. Good

impact on cement the seen the of given gas and of in states if on projects that had tax public you just any the general you reduced markets demand, parts if that on cancellations heartland the or you’ve of up comments operate, other held the could have better Just push-backs you, following revenues. health any than wondering obviously just thoughts country, understanding up wondering budgets

Michael Haack

on No. been us Right delayed? strong. a and Has good it’s that. to at there may we question, hear of demand Yes. time’s or has this that here impactful going really tell our Do to been projects it time? Yes, now, be

we’ll what’s is don’t we’re happen what demand happens now, now that on if right to like right Really, impacted hard focus near What predict what We in and too more the markets. side. to that longer anything. and term, the is in over experiencing on the I it’s going strong just to being see see term,

Anthony Pettinari

costs spike in looks come with Okay, this Maybe bit to discontinued a on that’s few delayed. sharp that’s the It little like the last OCC or it’s back weeks. shifting helpful. Maybe light seen side, we’ve being some collections. just

on you extent fiber and seeing spike Just had those to you’re strategy in your for recycled it. costs passing the wondering that thoughts through, any if

Craig Kesler

prices April and we’ve OCC - right go You’re seen here May. in up

to a the from been of with. the OCC we dealing you’d has snap generation lot expect to that really as the I of think down, improve pricing economy, what declined, so shut just It as economy generation that moderate stems restart likely see a reaction going forward. and such we’ve was

so etc., lessen closing, mills containerboard seen pressure OCC. should some also on of that You’ve the

on mechanism to generally the through. do As pass have our those lag, pricing ability the paper way recall, the quarter through It’s we costs. but have pass within you may a side paper we incremental on those ability mill the works, to the

out side, that wallboard that the a because, aren’t as quarter be On quarterly it’s this lag, to we again, but we so would feel next start we would look something with dealing see develop quarter, closely we’ll prices, into next December, and may something be the It’s those could but moderate. things months. September also over they and weeks as higher watching we OCC

Anthony Pettinari

helpful. that’s turn I’ll it Okay, over.

Operator

you. Thank

comes Sachs. Revich Our with Jerry next Goldman from question

line open. is Your

Jerry Revich

Yes, morning the advantage others pipeline obviously spoke Craig, like able were deploy strong your Good willingness, and take could the de-leveraging. time sheet an about folks been capital, your now overall to M&A at opportunity talk of that hi. I’m the if about to uncertainty everyone. have in when looks you given comes if you what all call? up, on we wondering your balance a past

Craig Kesler

acquisition highlight of that’s something working Jerry, are process and through. plant, we that of cement just so the in and the integrating we I completed million would a $XXX

our de-lever improving continuing on think I sheet our to as have here. highlighted, I from balance and focus is Michael and

focus company. the of balance on because some We the sheet the health unique is so the certainly of opportunities have Eagle, and

come fit right M&A value that are of we early there’s terms very but focused now. of of are point, of this. But de-leveraging quality something lot eyes too in opportunities maybe keep requirements to it’s and that, our project your and again need on be we’ll there To that Way out open. there a to asset, the some

Jerry Revich

other As to make, that this last Any there’s mentioned in markets? you in a ago, observations current How the call, folks to do cement earlier was your cement substantially the would expect decade plays. your it pricing larger been out you cycle and than on play the is you footprint compared particularly in recession recession? consolidation

Michael Haack

network, and where I happy when have acquisitions I’m sit our at where know, You look we really our been.

The heartland as We’re synergies and us of the higher that our served well us everything a [indiscernible] cost across served share well some capacity, cases. could more and cost time the maximize increased else, if past. a footprint U.S. supplier, in the it has and to. have and versus we We just of volatility I maximize cement of and see plants us. during look When for some a I we’re our output in this markets many of in stable at plants lower benefit

stable now there to is market it our and has do the if now, willfully respond so we to been don’t that comfortable happen demand see for something and were where uncertainty, but located. of Right prepared but right we’re markets, across our is prepared where we’re the right stand. now network we we’re majority with recognize to those, that We in very just uncertainty

Jerry Revich

given you’re from with the feedback pushing environment? industry’s about focus what standpoint from from pricing customer you in nice can conversations uncertainty, are uncertain June, getting Obviously the on customers, but of customers it’s the terms on to like got a your that? we those what considering April kind the pushback June, of In talk

Michael Haack

the good price is a The going to question. market what It’s is. determine

plan the implementation that price, to a in to in stated, customers be market first months with see coming we’ll conversation more that we We’re and got to frame. timing We’ve our and they’ll of going know is, that. what as the time June is that. with with have the constant so But color our for the determine

Jerry Revich

Okay.

what based cement the of made implementing any in short Eagle’s call in otherwise you terms folks been, you benefits time of has acquisitions or Can a application see that owned as best street and on have you’d when practices. that think set past, the two-way you I Lastly, out? the versa, vice for of about, talk practices you’ve Kosmos, opportunity opportunities network there

Michael Haack

Sure.

start with we I’ll talent First, off the and acquired. people the

We’re very happy itself, with people. the plant the

some and with synergies only came on to got do owned a realization and the transaction, the we’ve first all said, that foremost, it extremely still months, we’re people some you with. we’ve couple happy so synergies. those As work the of quantification of and But

level they that the able from get earlier into some also some directly the plan and integrating Eagle of fits those what exploring to we opportunities plant and put of we a else. stage This from for We in at culture best on across management that side and top bought side to our were network learn our network. on practices everything have

most have It’s plant. of the this their we opportunities to wonderful and time the in efficient and seeing, be frame. a It’s some going that, side we’re those we we’re over know plant reports and from exploring mining opportunities second the coming U.S. around

look support I’m being and happy [indiscernible] I about Sugar provides more everything. transaction, Cement and all integrated Illinois and when stability even extremely It able with transaction, having network. plant across to that and into to more the Overall to Fairborn our and Creek do that the at that connect

a just to coming since it about conversation quarters, get you’ll see in so that little owned and of there. more time in from need but the only us, a Over beginning we’ve we dig there the lot March,

little restrictive and in As get travel’s been know, these see more items. you of some there a to lately

Jerry Revich

a long you. drive. would it Thank Yes, be

Operator

Thank you.

Stanley from comes with question next Stifel. Elliott Our

Your line open. is

Stanley Elliott

you that Hey, be see you. the coming seeing with first, shut for points maybe curious markets are are breaking the question. has bucket quick for how question the that of big the it’s you data some We see residential economy good Thank see that morning in all right? residential to the bottom hit touch. typically down, the I’d looking markets Are when down being customers? all been everybody. get like to and starting off taking drop the A you conversations - a

Craig Kesler

I you a think data of already reaction, quick before see their see started this a seen you’re you’re are There’s lot has a so a number to activities. starting and you going Yes been to to Anecdotally, to can bottom have start a to kind and it. over going really reopen little data. put a and it. of to improve what be going lot some come, to just were look their that think have many Stanley, going more this of I bit, We’ve weeks data out such you’re states months people through trend interesting saying, normal things back and to doing to of to routine see these economies, macroeconomic

still benefit have do but think the fundamentally, both term immediate rates want is distance, from family interest may I reaction, actually this some single that very for even businesses. you longer will Longer think probably I it’s thing. be attractive there do You - environment where term low construction an good social to so

Stanley Elliott

I’m The for that just guys that including XX%. a number? Kosmos me, last at within capital for thing of about that capex clarification, down maintenance is requirements least you talked being assuming point

Craig Kesler

Yes, absolutely.

for modern into baked opportunities but the the think for Michael some It’s facility. that spending next pointed facility we’ve estimates our is Kosmos well. We maintained in certainly a year. been I out see capital very improvement,

basis. annual talked these is annual significant. past, need upfront. sustaining on are the businesses in significant The we’ve investment capital not in our real As The sustaining is an needs not

Stanley Elliott

time. the for thanks Perfect,

Operator

you. Thank

from question comes Ng Jefferies. next Phil with Our

Your open. line is

Phil Ng

Congrats on Hey a strong guys, good quarter. morning.

volume cement, the cost Given good process continuous you and profile business is there how the a are think manufacturing a incrementals manage way going in of to the to of a about that from perspective? downturn,

Michael Haack

want it, We have us less planning year, back continuous were a rein our get investments to want what’s the how if something in the your we is side. several, demand the we process. several has to that’s to back some we kind it different past, pull capital current enabled respond. to even would of We’ve is When at are we To this been to question, it, cash over look do and done with have in lever but happen, I the markets and capital the spend in strong. when manufacturing

Some clinker versus really investments of capacity. grinding looking production been the have the at those capital capacity

We have several storage extra clinker so that clinker can at to that’s an we of if take different that may to the can capacity we it, have in have then to of market future facilities grinding continue turn. run, so one where we with we example do look and thing were

has several two kiln line In We lines. we’re that of lines now, run. others. demand just one that instead run have not multiple of we any kilns multiple There’s can we but now have kiln of alternatives, locations, Right right enacting profile as seeing us we any kind those that.

Phil Ng

little Any think that from these states any perspective, and markets press key that that’s be a Got Texas, better weaker budgeting it, and you how of a some states in of helpful. DOTs any water. on There’s substantially obviously like perspective shape, you? lot noise under a for been a are of your are

Michael Haack

gold locations. There items, are now, like for overall weak. some into with that in near with said, across highlight demand stable not there’s are term example all as so impacts micro different market prices provide we been As a significantly it, has but out this market right I’d up,

gas a We small and of it’s the of movement in the percentage that’s market some oil but that’s not that Oklahoma with such our happened are anymore sales significant. of watching some it,

happens, on a see of what the X% overall side been less anymore. so anymore, just sell it’s product cement that a meaningful as but what than we it’s think we’ve number market consistent. to pretty But just not I we watching are

pretty been stable. a that’s area heartland We’re in

Phil Ng

Okay, great.

Just again across one light the last stable it’s or side one once pretty board, your things. from heavy business material me. whether Appreciate of your is

of by up how remind commitments? long-term bringing savings us like from lot. already. Thanks capacity just are sounds standpoint, It is cost locked much for you some Can that You some paperboard. business seeing a on you’re a

Michael Haack

that the with follow the to a it as project then capacity. turn I I’ll in it. and did mentioned paper mill quick give on do to that project, Craig more and I’ll as side, is over up we was expand first you know, to us comment What

and in the to seeing of little implement into We’ve able the been we equipment, early all machine speed notice a capacity up faster, to there so run let are that in may running we equipment, were translated and You stages the that a tons. little some that’s equipment us bit. able bit the some early, additional

we us from going help [indiscernible] a person need of part do and machine have also open in be production come out a seeing final that some there. company that’s when right we improved to to now, a everything. of We and happening, overseas be secondary equipment with need are from installed, the and that and But already but of over bans that everything, will summer travel the that we that’s the

it and see publicly that we’ll ton running addition summer XX,XXX-plus stated we’ve and think I and that and we some are to a going up finally more was today, currently to full get seeing the able equipment capacity. we’re of to that be comes as

Operator

you. Thank

James. Our comes next from Josh question with Raymond Wilson

Your open. line is

Josh Wilson

are and good Craig and well. Mike, morning your Thanks, Bob. you families Hope

Craig Kesler

You too.

Josh Wilson

acquisition the what First and ready-mix you housekeeping in was contribution Could quarter? quantify aggregates of a the sales item. the

Craig Kesler

side? revenue the On

Josh Wilson

Yes.

Craig Kesler

a was minimal Yes, pretty number. it

the for it I when the concrete and you two. was the Kosmos almost at quarter, evenly both between entire it was million $XX split and for think look acquisition, quarter around the

Josh Wilson

could but maybe of down of was see blocks still profits that business through Then for contribution good business, it. outlook building what going volume that there, you forward? some cost sand given were, year-on-year walk frac us cuts, the terms and some what cost of the regarding Got in is the fixed to

Craig Kesler

charges nothing, some in you as Josh, significant to that XX, it taken months, release, and considerably. XX see the last down obviously impairment where written earnings business and down next in to so over has we’ve the we’ve to depreciation gone the amortization

business on So volume March then in in we be volume and seen mentioned, it while did change April. quarter. and a this February, actually as the fixed I earlier, what of as into January driving the business improvement a But improve another I and bit goes a may little was in so saw during we obviously long also that’s cost see way, like down have year-over-year, we highlighted earnings that

Josh Wilson

the me, Then continuing? markets particularly volume, trends and growth any states how or last in cement the terms the of are to organic from that one contributed strong those end

Craig Kesler

very during and for we back really was if quarter, we different. entire broad I’d to it. network seen quarter very September but December it quarter, the really momentum as inventories saw the based. I the highlight winter, saw fourth we across that go The quarter, it the was improvement We good coming think and out volume no as even saw of was had you are good low, were the you we really

Josh Wilson

Okay. next Good luck with the quarter.

Craig Kesler

Thanks.

Operator

you. Thank

Our next with Robert question Berenberg. comes Muir from

Your line is open.

Robert Muir

Thanks question. for very taking Thanks much. the

that. on there any about any Thank color you if year? this talked bit, you--is tax sheet update I acquisition there benefit around federal $XXX you. earlier tax with wondered the million I that the balance think a Kosmos quite can I was the Firstly, income associated just the moved receivable saw and on

Craig Kesler

accelerate cement depreciation. Yes, absolutely. to plant, we were Kosmos the able When acquired we the

For recover operating tax we net to to is expensed, receivable. taxable went previously the CARES price position the that that Uniquely paid certainly taxes, and was of from income that backwards loss. so what’s purposes, so a and driving income carry we a Act, able and because immediately purchase tax were XX% of

this million-plus another refund, our next over benefit $XX of return coming and actually so mentioned could paying be also XX% tax years generated meant that you versus receivable What in I’d the back what filed rate carry should during we also press that and quarter, we’ve That the was we that seeking at release, the to are NOL highlight couple were taxes months. that of for that XX%. of current and we’ve

Robert Muir

normally do Notwithstanding access I shipway you Great, likely from maybe repair. just any had being supply? year supplied the to any be the then you the seeing that it, is How it’s in you is Chicago the think still virus, obviously evolve? Mississippi, by Are second on the players think market. market that was I the Are in question this how Illinois the that seeing etc.? to other closed changes market--I changes think from for but effects going

Michael Haack

We’re positioned in market. that well

for this everything, that our seen facility in see them satisfy federal shift repairs market. don’t to appropriately. We customers in significant Illinois time. anything with and anything customers down some waterways right changes our or run at have market during we grinding everything, pretty run like We’ve conversation there been haven’t the I and comfortable and and will that our shut to our do on and but have also we’re with it Skyway, that be supplying notable capacity going anything cement everything we That plant, that. much that We plant at that and impact are summer. we

Robert Muir

that I efficient in that in please? final I margin Is the mentioned The XX%, out, you X-K I for was EBITDA put Kosmos a most wrong. second that look me, great. think think the Then as Okay, but U.S. looks your could at is be clarify was portfolio you that be whole? or question just plant. to you about when the Could that

Michael Haack

look at plant, said thermal I at looking we the plants, when efficiency, thermally when we we efficient. the so Yes, that were at efficiency them look of

I missed part? the second

Craig Kesler

related. think they’re I

On results it Cemex X-K. were was them, think in X-K, the XXXX ran and the is calendar I and as what’s included XXXX those

Robert Muir

much. Thanks Okay, great. that’s very questions. the for Thanks

Operator

you. Thank

question SunTrust. with next from Keith Our comes Hughes

is line Your open.

Keith Hughes

Thank you.

more May, on things, positive of this than positive any and positive for lot a more call said heard season. virtually You I’ve conference earnings April

gauge sort you are up and looks of in slightly? us or what Just just this bottom volumes line, your any like? down over give April year Can year May, on

Craig Kesler

on any haven’t have here much volumes to wallboard trying volume--you across I a we’re well consider, down, includes change to That of remained the and think we but as Keith, year-over-year seen cement businesses. May. strong have forward and being Yes guidance communicate and that is what in trying give to up not really or April in just comparisons the volumes always business,

Look, we going fully just seen us it in and there’s changes. on We yet. impact haven’t what’s understand economy the

Keith Hughes

run that the do changes? time Okay, demand to note, unless you and on schedules that pattern wallboard, particularly for on normal production being, expect

Craig Kesler

front facilities do. meet run always us, will that’s absolutely to in We of what the the and demand levels you that are

really have matching it with can’t wallboard the you us. always time, supply You you’re over so outside, inventory of for store it pretty will demand. That’s - don’t to ability typical store deteriorate

Keith Hughes

Okay, thank you.

Operator

you. Thank

from question comes Paul with Roger Exane BNP Our Paribas. next

Your line is open.

Rob Whitworth

questions. Hi, Rob Paul you there do balance the for ask, Whitworth Thanks taking there’s are your still concerns, planning, my I you state an of this just say the U sheet? any recovery? on scenario or actually liquidity is when L-shaped Are confident if have wanted situations would Roger. to about a for where you

Craig Kesler

existing $XX.X driven was the April non-strategic some extension among as we and asset - on here gave current certainly the had of that that situation wasn’t earlier, by in dates, made and was some to We’ve it mentioned Yes. a modifications facilities us things, but other maturity the timely I a million. sale

the NOL near have for filed refund term. receive the we and have should that We general in

recession we last cash these the what in and flow assets, What are we they a about found significant was generator. know

do continue so if our moderated Our of be as half feel this we be, quickly position we said, Wallboard roughly liquidity basis is and capital very generate further. we trim are necessary, spending at can point we these about are this a significant, plants need a not depreciation assets lot an at extent the annual point, needs, from amortization of can to what and where good cash. to on and so

Rob Whitworth

thank Brilliant, you.

know expectation government is in follow-up, Thank from state your around federal you’ve stimulus already, on a the spending you. infrastructure touched just expectations this I’d expiring as post are your obviously September. Just what falling already FAST what year, like to Act the

Michael Haack

midterm we of any it, get us or and be the in this it’s stimulus at any to through right comes going what’s see to time is with to uncertainties front hitting to now materialize of don’t or in I take we’re that then system. it, now, to looking impact year. the look a going as so at the we and of the into kind it, in term us mid frame in later time pipeline, to Yes, going But it’d take work term stimulus right some longer some time short the of it’s anything, understand

Rob Whitworth

you. thank Okay,

Operator

Thank you.

with JP We have Adrian from Morgan. a question Huerta

open. is line Your

Adrian Huerta

Thank you. everyone. morning good Hi,

You have already we over mentioned last the that quarters. strong three volumes seen the

the you’ve markets. can volumes. was of it now tougher year-on-year cement across gained we that comps a also Do I’m start market think in basis? three you say about on kind quarters, coming the said getting and will talking quarters during share You these that

Michael Haack

customer I market for on more It’s just of quite us and market see gaining we markets question, it. been share have share now market don’t on with base we’ve You know, both a pretty really. it while participate the our consistent so we the on business, share on sides the in our

I’m focused plans we’re on for the focused the future, before, really but As business stands as we on said it today. had in more things happening running

We we’re right do as have at just a future, run cases seeing dictates we’re if we’d where our potential there’s and what but downsize plants run the stable now going in to this demand time. market the

Adrian Huerta

thank you. Excellent,

Operator

like have any turn the remarks. closing the to today. call questions Thank for management all you. to we for I’d That’s

Michael Haack

into much. calling summer. The much talking our I very very say the call, want will Thank to again you you for you is only thing in be thank to conference we and

Operator

concludes this call. conference participating. and gentlemen, for Ladies today’s you Thank

Everyone disconnect. have now may day. a great You

Eagle Materials (EXP) 19 May 202020 Q4 Earnings call transcript