Martin Marietta established records for revenues and profits in the third quarter of 2019, and it exhibited widespread shipment and pricing strength across the majority of its building materials business.
Aggregate shipments were up 12 percent and pricing jumped 5 percent in the quarter, Martin Marietta reports.
“Building on our strong momentum in the first half of the year, we once again delivered exceptional performance, establishing new quarterly records for revenues, gross profit, adjusted EBITDA (earnings before interest, tax, depreciation and amortization) and earnings per diluted share,” says Ward Nye, chairman, president and CEO at Martin Marietta. “These record-setting third-quarter results, driven by broad-based improvements in shipments, pricing and profitability across the majority of our building materials business, reflect the disciplined execution of our strategic plan and our team’s unrelenting commitment to operational excellence.
“Based on recent trends and our solid performance to date, we are raising our outlook for the remainder of 2019,” Nye adds.
Aggregate
Third-quarter aggregate shipments and pricing at Martin Marietta improved 12.4 percent and 5.3 percent, respectively.
Shipments for Martin Marietta’s Mid-America Group operations increased 14 percent, reflecting attractive market fundamentals that have bolstered continued infrastructure and commercial construction activity. Pricing improved 3.5 percent.
Shipments for Southeast Group operations increased 0.8 percent following double-digit growth in the prior-year quarter. Volume growth was muted by the impact of Hurricane Dorian, as well as the delayed timing of projects in the region, Martin Marietta says. Pricing improved 5.7 percent, reflecting the strength of the north Georgia and Florida markets.
West Group shipments at Martin Marietta increased 14.8 percent, driven by energy-related projects along the Gulf Coast, increasing commercial activity in Colorado, and improved weather that allowed customers to advance weather-deferred projects. Pricing growth of 9.2 percent reflected favorable geographic and product mix.
“We have carefully positioned our business, geographically and otherwise, to capitalize on attractive market fundamentals that support sustainable and long-term construction growth, including employment gains, positive demographic trends and superior state fiscal health,” Nye says. “Our third-quarter performance, including double-digit growth in both aggregates and cement shipments, as well as solid volume growth in our downstream products, demonstrates Martin Marietta’s ability to take advantage of robust underlying demand and the meaningful acceleration of infrastructure construction projects in our key states.
“These favorable dynamics, combined with the benefits of our locally-driven pricing strategy, underscore the comparative strength of our markets and bode well for continued construction gains,” Nye adds. “With increased infrastructure activity as a result of state and local transportation funding initiatives, and continued private-sector strength, we are confident that construction activity in our top 10 states will continue growing and outpacing the nation as a whole.”
2020 look ahead
In releasing its third-quarter 2019 performance figures, Martin Marietta also offered a glimpse at the coming year and its expectations for it. Martin Marietta expects the current construction cycle will continue for the foreseeable future and expand at a steady pace in 2020 for each of its three primary construction end-use markets.
For more 2020 details from Martin Marietta, click here.
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