EXP - Earnings call transcript Q3 2025

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Operator

Good day, everyone, and welcome to Eagle Materials' Fourth Quarter and Fiscal 2024 Earnings Conference Call. This call is being recorded. At this time, I would like to turn the call over to Eagle's President and Chief Executive Officer, Mr. Michael Haack. Mr. sir. ahead, go please Haack,

Michael Haack

Good morning. third Michael call our Materials to of fiscal Eagle quarter is conference year for Welcome XXXX. Haack. This

Officer; to in Vice go click today our There Strategy it, will me Craig please slide and to the this Development. Financial Alex on presentation call. a made access Joining and Corporate and Haddock, with the of President are Senior webcast. be Investor connection link Relations, eaglematerials.com Chief Kesler, To

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

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

to our This joining operational to again, enabled once discuss FY for third In of some cycles. a 'XX those the deliver color results. ensure strategic results you our long execute remain us start to focus to Materials. third team throughout the strategic our Eagle producer investing on off initiatives approach on quarter These term Thank several and with morning, initiatives across of priorities. for quarter, positive us performance strategic we several and today the to low-cost economic I'd like demonstrate

the Let me we things many do of just highlight business. to examples X areas our few of are particular importance. a strengthen core These

indicator. began safety. focus rate lagging lowest In incident we happy is total regard, this our we at the tracking TRIR report primary with ended Eagle since or First, year our that this to calendar I'm recordable

on this is plan stopping there. an While we achievement, don't

we for safety out our culture, and and safety people safe. necessary keeping protocols continue the procedures all standardized We build tackle policies our company-wide to ensure

zero. controls engineering the continue our towards of journey to place putting through will our focus use leading on indicators in continue We

product. getting while business, that have Second, meaningful initiatives. completed In Cement we intensity cement sustainability are Mountain progress lowering blended us our our reduce cement modernization costs. XXX% projects, goal and overall make manufacturing our our of closer our our like we construction-grade continue These manufactured to COX expansion our to investments on for

making are by our Paperboard water use and reduce of increase water Republic the should which facility, on at treatment our also usage We XX% recycled completing headway plant the water.

expands serve for and our its pure-play The within footprint. overall a alignment and initiative fundamentals regional growth third our rare spending Stone us materials Bullskin a strategic customers. our Lime advantages with is market fits that to was The levels. in of DOT acquisition asset healthy ability including with Pennsylvania, acquisition and combination nicely provides presence recent growth our This current and to strategy. our opportunity Bullskin acquire aggregate solid strategic Western also heavy our a present

such Acquisitions growth squarely as fits strategy. broader in our Bullskin

will to is employees We welcome criteria seek closed financial strengthen as footprint integration underway. Bullskin to investments and our growth to and in The the our early continue January, that strategic excited Eagle. and Bullskin does. I'm acquisition well meet

reached and quarter third of give rainfall some our despite record in generated areas. business being on Now markets, operating past views volumes this more our because some near-record X% We averages. broadly. key let cement me down details of revenue In on performance conditions historical rainfall quarter XXX%

challenging Our impressively conditions. amidst these people and plants our executed

The both discussed Tulsa was our cement undertook Texas plan locations. last completed timely we As at work at plants. and quarter, Lehigh both major maintenance

term, investments both and costs, which past reliability maintenance increased enabled ensuring normal the to a to were plants of The increased quarter long this us for us maintenance get affect cycle. did smart back

concrete and and position the well Denver Kansas portfolio those City at customer feel we our and future. businesses our realign to continue also sites for can aggregate We both

markets cement dollars projects program increase federal letters our consumption price of solid. cement, environments, In tilt half the our regards operations the through higher. private of remain IIJA manufacturing pricing, should nonresidential XXXX. fundamentals for have With are operating these wallboard we the Despite products cement flow just for majority demand tougher in to for infrastructure our through out first starting and the to

market Regarding just ago. wallboard the lower path knock-on for and the demand, XX discussed outlook next today is buying today's The rates it businesses, housing States. in interest continue on we'll homebuyers consumption. benefit more lack we effects we're the cloudier most construction challenges and focused demand widely feel rates Single-family home drastic months. change the housing, for being positive the for worse underlying wallboard increased a by demand end our The mortgage to thus, are will quarter of for the important wallboard the facing for than of potential affordability over need United was to in homes the residential to XX rates be from made the and

amount Regardless continue flow to how invest focus we on cash of the free demand we and cash our over significant cycles. of short-term to generate a best picture,

upgrade to a condition. to work Over has repairing reliability a buybacks. capital competitive X high our for share investments is strategic material include Eagle. replacing improve These Materials Eagle our projects last close investments material new to of the paper as strategic operational that equipment our Investments returns of of growth, mill over plans. results raw have we and or to on a through organic as combination like across keep This critical billion including multi-decades $X high-return to advantage the years, footprint plants, initiative reserves put and ensure to in Republic in our of our an plants well capital

sites. including shares share maintaining several investments made cement acquisition reducing several inorganic position, and XX% and We've terminals multiple strengthen organic our investments to through of low-cost also and repurchase aggregate the Kosmos program. a made profile inorganic our those leverage by strategic Cement, outstanding our healthy We while

years. Our many through for high-return firm initiatives commitment to executing has cycle as remains similar the it

to it go results. over turn me Craig financial our let through to Now

D. Kesler

Thank you, Michael.

The volume and downtick year. by pricing. cement prior million, wallboard Third volume concrete driven lower sales was paperboard partially higher from decline aggregate by the a and offset and and was sales slight quarter revenue $XXX

was quarter $X.XX. per our EPS a fully reflects to X% buyback due offset by reduction lower Third earnings, program. in share quarterly share diluted earnings shares The

As expense quarter. development on activities. transaction-related we item during we in million had release, and business highlighted was nonroutine costs the with the $X.X It press of associated

X%, Turning and by In our now of volume, implemented revenue to slide. this on because cement Aggregates cement which increases sales sector, primarily segments, segment Concrete partially the earlier we next year. heavy includes performance highlighted offset our declined price Cement lower sales materials and

higher the quarter our markets cement in XX% volume November. cement third of costs. exceptionally affected in Midwest addition lower the Great Operating Plains weather and sales Our was volume wet were during down earnings by because maintenance to sales significantly primarily

As had maintenance maintenance $X costs at of by work we both The increased the major approximately our we quarter, previewed of plants cement has projects which improving quarter, been reliability. two million. during long-term completed, plants third last the plant's

we cement nearly have markets calendar As our part announced increases of for of first Michael all in 'XX. the price mentioned,

sales prices. Moving recycled to higher slide. volume the wallboard next up increased X% recycled paperboard Light and volume Materials and sales sector was sector on and X% sales X%. increased volume wallboard and this Revenue paperboard the reflecting in

by recycled paperboard were volume Operating the and paperboard terms in the increased wallboard paperboard wallboard and X% and earnings sales of sales XX% recycled sector up In higher wallboard higher also million to XX%. prices. prices, and driven $XX

now flow. Looking cash at our

We to capital flow continue line strategic priorities cash criteria. rigorous generate our and allocate and with in return healthy financial

million, cement to $XXX Laramie, During $XXX Capital flow Wyoming cash months primarily because expansion of and our modernization plant. was the the spending million. project first X increased year, of the operating at

also small We aggregates business aggregates acquired existing acquired quarter, our complementary for $XX the is million to Kentucky. operation in business a last

of for million quarterly XXX,XXX in dividends of addition we common our shareholders the year. a during $XXX stock the finally, million And returning to our $XXX of X nearly first to total repurchased shares paying months

remaining have current repurchase X.X our million shares authorization. We approximately under

meaningful liquidity hand, debt the bringing total committed end And the at and million. debt-to-cap flexibility. ratio XXXX, ended XX% to continues our structure, the at which no December $XX of X.Xx. approximately of quarter significant was debt-to-EBITDA XX, cash leverage our At have million finally, near-term quarter $XXX was net provide our And a net we We to financial look us with maturities. ratio on capital

subsequent we and we As on acquisition hand borrowings and previously our of which Bullskin facility. through the quarter mentioned, Lime Stone announced completed under of credit cash Michael bank to combination end, funded a

for you today's attending move Dave? the question-and-answer session. Thank call. to We'll now

Operator

[Operator Instructions] Grooms Our with Trey from first question Stephens. comes

Trey Grooms

in is Pennsylvania more how other that it that and in we opportunities The fits market? on color more are aggregates Bullskin tuck-in. one-off there -- kind they Maybe on geographically, the maybe a the is any -- one of kind Or pure-play if off, are a there in this Pennsylvania First could market? touch of acquisitions. other

M&A. thinking of has be place bigger But deploy about And and we a part then on active kind Is in have asset to we overall the than all aggregates a little aggregates been maybe that recently again, portfolio. been Eagle picture, a could smaller approach more bigger should way a maybe historically capital you more aggregates Or your the have you historically? there? how where you of

Michael Haack

assets more When we that you. and One it's answer you already aggregate here as a market at is we the that have tuck-in, I'll that the we Trey, Yes, in that incurred look the actually our for said, recently. secures and flexibility large one from a of we things. for a bit procured quarry gives just different cement down The little us manufacturing. was a right couple road

gives in Let's needed. cement and plant supply there to was aggregate if also the us locally, it market it ever our secondary us participate a

just We have our criteria but for quarry, plenty strategic reserves fit of several at existing us.

not resource. that excited the Up Eagle Bullskin pure-play Pennsylvania, in to a find team. aggregates the common join as team very have just asset, to We're it's

facilities, of cement into we build this our that very out fits provide market. up As We one network well.

line it over so network strategy network with that growth to to secure that it's make right and time. And in have is our stronger

to To consider aggregates and fan the We of question business. we've second deploying a that been always capital heavy aggregates, aggregates. of side the of your

side grow Our that we strategy quality we interested come of if been our aggregates are heavy price, those business, available right return at the And meet as criteria into to see assets the a that fit and primarily. continuously has good the assets. great in

Trey Grooms

Got bit wallboard. helpful. gears one, a second it. on to switching guess, little That's maybe I

mentioned. fair in a we to significant medium front? kind this in move helpful. think the continues more see range Or the to bump along expected? on steady, be term some remains Any expectations kind of more . there sit would volume environment held high-level certain, there But demand you us give volume more have than wallboard could we for And as rate expected. overall Is you any better of we wallboard the obviously, for which maybe kind So here today? directional now would of that it rate the is significant changes wallboard of in until kind maybe is thoughts

D. Kesler

think Trey, head. nail I the you hit on actually the

If time over calendar look last it at demand plus or the you that to has each frame. were minus X-year over been X years, year X% wallboard

housing XX.X we've billion feet, been I pretty consistent. has wallboard that. look, been consumption in that an 'XX think environment calendar we around where has mediocre, We're finished pretty and So going -- number been to reflects square and tepid,

you XX prior And billion look U.S. of square been feet so of forward, north we've well the as cycles, in consumption

still low of consumption. at So total we're pretty levels

you at healthy We've U.S., of out, activity this demand. least a in of for low and good now, just affordability lack got rate level lock-in decade, the got, are many years interest and Michael inventory. that. wages healthy as issue, very But employment of a construction there's There's part a rates the also certainly, the just pointed underlying here

start the the see to consumption see we and affordability increase. in to expect . would just see We to improve as affordability total So improvement. got we housing

Operator

Brent with from Davidson. And comes the Thielman next D.A. question

Brent Thielman

there? . still I you XXXX. going I'm to Craig, temperature delay price any in or kind taking market just update you're be curious, going that. mean wallboard for slated first you talked Michael I part the of know around previously to to of increase the the comments November, now? about that right of Are any

D. Kesler

announced got here for increase we we've Brent, February. a that early Yes, price

shortly frankly. after this call, So

do in forward we with a the So have to exact move we and that. market, on speculate and going to price realization but try we're not increase whatnot,

Brent Thielman

or the Got weather. a I year-on-year when then on don't like look know that there's costs in extra Craig, it. I wondering from costs out mean, just segment volume, to the in obviously, at a margin pinch related was to we any if else cement, perspective. there? that which other And flush guess, I in I here are maintenance extraordinary anything

D. Kesler

Tulsa, down Oklahoma here. one in replacement programs Yes, Brent, of and in X Texas equipment and projects highlighted nontypical the talked those. of to facility and maintenance last about quarter then that pieces certainly, we it and at We it the had large of our were maintenance facility, very XX-year-old related

headwind an this So quarter. million $X in that was

this say programs. unique a would I those from yes, So cost had quarter impact

of mentioned, Michael those of improving about did . both with facilities As job team long-term reliability good those really the and projects. a the

Brent Thielman

Got it.

last we're only I of time month it this Just done the these in not what news. some anyway, have one. can know a but gets doesn't conditions seem lot I see like from the in, a of abated year weather

Just can if you a quarter we we about the wondering that bit talk ought that sit to how little current approaching and here be in today. as

D. Kesler

the going of always different tough during country the most of that. trend frankly, lots a January across January U.S. I've entirety it's no than winter. even draw weather is Yes. February to said Look, the is certainly and activity as of through This

types different. this of and has So issues, be yes, those . will always no year January

Operator

question from the next with Pettinari And Anthony comes Citigroup.

Asher Sohnen

Sohnen Asher is Anthony. for on This

cement can provide on maybe January you customers seeing then the early sense you just for any the be midyear might some it? you color realization had conversations might side, that on around or hikes? bracing Just have be And the on initial

D. Kesler

speculate little increase. cement on round early to Probably of too second a a a price

it's got As January, that of increases well. most of through get first fourth certainly, of with the seen as Michael results. how go sporadic But part . price in markets 'XX, what all the weather part we'll And throughout not spring we've as realized as the we we throughout time. earlier, January, into for first -- kind time of spring our we've the mentioned, said the I those and some about the talk of quarter we calendar into

Asher Sohnen

the given strip is headwinds. And quarter, costs for Got maintenance out looks Got volume maybe like it. were which it. year-over-year, encouraging then margins the I flat I roughly just if think cement the increased it

potentially how the -- should up? for headwind we more opportunity just the over margin weather about no next maintenance think of I and with So couple maybe cement quarters easing

D. Kesler

optimistic we're spring. Again, the about going into Yes.

of as maintenance about been about 'XX As we're but side go It's that as reasons think optimistic, down to certainly funds not that will to weather in said, the way repeatable that spending through down well volumes you highlighted -- we coming we . the Again, for the of not been this activity some trickle year improvement activity there's pretty out of and months. those X next has start lot X%, lot A a of year. necessarily 'XX. the throughout system, a been bidding long infrastructure will be as as just on We're and X%. unique construction again, and of 'XX, volumes calendar the and to has 'XX and see. lack be this down IIJA margin well. calendar And

Operator

The Jerry next from question with Goldman comes Revich Sachs.

Jerry Revich

the what's the we on wallboard a margins it, key the mid-cycle give performance would in to, the structure love XXXX on time the question I different this cycle people during outstanding similar data sustainability pricing margin asking of Craig, points, about frame level are and margin saw the the resi of given compared environment, is continuing you Michael, call that that pricing uneven in wallboard back thoughts an if really pause, and soft mind? your resi have don't and comfort current where folks

D. Kesler

Yes.

gypsum ago not, the about the the it been you're side, And closures, certainly, time, has at it pretty low U.S. here coal been about And we've on Look, plant quite had to demand therefore, talking wallboard quite earlier, seen Jerry. we've relates raw . But believe stuck for used. that years pretty been XXXX, one dramatically. is a frankly. XX question, industry inventory we've of synthetic on quite levels, or when that's as talked it good the in The has material issue, ground and consumption in gypsum changed as I So some the point. synthetic neutral the And homebuilding been consistent mentioned flip bit. as side some now. has

find And away, has further change maintenance now significant difficult material in as and to has become cost which so structure raw more you've a transportation the seen that costs. increased

American unique supply around primary gypsum the -- was synthetic Eagle that when that raw to are you material of in But have raw going have a material, relying and industry that the as on we materials. Again, unique cost and Gypsum our had roughly surety structure. of on its shift from away half is their impact

and of moons margins for structural these positioned. because many we advantage ago were a made us. that So everybody enjoy that Not is it's well decisions

Jerry Revich

the the cost any heavy the business? Craig, strictly high for on base, on is And focus you deployment strategic given of emerging that Or side competitor position opportunities the here for of capital some our on note, side? wallboard . still folks

D. Kesler

to have work. we balance at our ways of As flow our Michael And wallboard and our free we the cash advantage across always has to look continue said, to that network. position put sheet take

we those of facilities western of things on gypsum. with worth we are cost continue and part and that that the explore, do in do our materials that we decades take the we facilities the are those to have. country improve opportunities that raw look to So continue at sit advantage position Those how of

Jerry Revich

shift about And and talk can we cement. gears

in the you were normally, maintenance, pretty shipments were XX% the good thought quarter, sequentially, shipments given are your I sequentially. down your down So just XX%

in very the looks on comp to of just in seasonality versus March views in for June. feels expectations demand second up one, quarter, As the quarter seasonality stacks easy like how of think calendar quite a like 'XX, comp your still we you the your that easy love in then normal comparison and volumes cadence tough the math get first tough it normal quarter would and have terms applying into about volumes the for but in

D. Kesler

year. see are is off beginning when ready months normal The today, and to really hardest out sitting certainly . pretty difficult But it winter June that's as of get season here January so have this and just the quarter, the January get Yes. yes, you'd here the get and construction expect March seasonality. there. to always season, optimism and Sitting which September, kick here you is that into a given of particularly quarter construction starts to the today, February, that proved X/X into around

Operator

the And Thompson question with Davis. comes from Thalhimer next Adam

Adam Thalhimer

more in those through there On push for are Or cement prices, were April? any January?

D. Kesler

It's our a combination networks. our across across plants

in are markets Some January.

in in markets Some some between. going and April are

of board the the So market across you're it's upon depending kind that . in.

Adam Thalhimer

then should much Bullskin, And is Okay. And their Craig, to how for pricing kind . of tonnage? corporate your add we aggregates average? for similar

D. Kesler

pricing Good question, don't a with Look, from you, I average consistent -- markets. of our the Adam. perspective, would tell I across kind

. In for update a it on so the time you terms more a business. we'll we give little here, volumes month with we've owned as have volume, of better a can than less

Adam Thalhimer

Okay. and that lastly, I'm average on QX. a the And pricing was that in quite paperboard the then new that $XXX. the kind of norm bit reverse? jumped will Or is curious, over price, up mechanical

D. Kesler

mechanical supply the No, in agreements within adjustments business. that that dealing is price the with

we pricing mechanisms that contracts. that in ton. having in improvement the a pricing $XXX quarter, into October, Again, dip see the is as back in here not March actually below down December and price year, the change. So long-term and a prices function so It's OCC function the a of a market just it's you'll probably go prices of came OCC higher been November earlier

Operator

from Ng next with . Phil question And comes Jefferies. the

Philip Ng

if a IIJA Eagle in been it's been a this headlines lot IRA is your seen since on any implemented And impacts that back cement, for Have tariffs view? separately, are funding potentially being this situation. And noticeable you you activity There's projects? Appreciating Trump there the has super paused, House What's of any clear bad? all positive business being office. do fluid how with or think means? what then actually whether or

D. Kesler

there. in question, Eagle, lot we a but Again, things construction that going Eagle road always it infrastructure in matter things of transition, a and look, Yes, recently. through or of certainly in as there's they're But the other to expect the administration some we as bumps see your different, that speed don't this here Phil, relates first no much activity that lot to continue. on of think an has is bumps to continue change noise noise, would issue and mattered a

to impact U.S., In TBD, it terms imports, directly. imported cost to necessarily course, higher us into the it on But cement cost a the ton. the of indirectly, of would dramatic a supply be of tariffs certainly product not cause but impact would marginal

Philip Ng

it down seen know doesn't in like of seen Super. the but mean thus a I side slow year, much the lot months getting any that done there's in not public you front. to far? But pause you've projects activity I sound on haven't winter the on

D. Kesler

No, no.

Philip Ng

out because I sure in commercial, the again, well but want steady. Okay. kind quarter seems I was of softening this seeing of some but And the way you pretty pretty just about Is Super. steady, of kind on order muted well do pretty there . the of the front impressive. but on this. pretty to And about was have message once then Demand way you've thoughtful characterize make as growth, single-family the wallboard we're as environment, as resilient. side you're the distributors things, what think that being talked demand

D. Kesler

generate hard an whether the is shipments within any trend it's wallboard January. though even other lot we haven't But Again, indoor seen or to way swings wallboard sport, one activity, orders, in always business. it's dramatic a Yes. of the

Operator

Securities. question . next Jonathan Truist from the comes Bettenhausen with And

Jonathan Bettenhausen

Just morning. like this again. Keith wallboard manufacturer . helpful. color that? Is gains there it for more would this the What any some on I'm wallboard, looks shipment are of be the once going a focus? drivers like main the on? here outperformed Or On regional industry are volumes share number of

D. Kesler

would right on I the Look, margin. say No.

we're X.X% and the think down up was industry I or so, slightly.

line in that. with being to close very So

the we activity more there share the regional where activities robust. last Our southern our country part changed of just from, in footprint years. the in is that construction certainly much X hasn't generally are benefit given

it's that. more of think I So

Operator

the over Mr. like to I closing This back remarks. concludes turn would Haack any session. for to question-and-answer conference our

Michael Haack

Dave. you, Thank

for our to the had today. year operational everyone end also strategic the the on marks and always, who focus joined call on then, priorities on we year, our excellent quarter Thanks we and execution while look for and Next capitalizing of we as the opportunities Until our out fiscal year to reflecting ahead. businesses. forward will laying

Operator

concluded. conference for now you The has Thank presentation. today's attending

You may now disconnect.

Eagle Materials (EXP) 29 Jan 252025 Q3 Earnings call transcript