Summit Materials reported strong growth in the third quarter, with net revenue increasing 49.9 percent ($369.9 million) to $1.11 billion.
For Summit, the third quarter represents another period of nearly 50 percent revenue growth. The company reported a 58.1 percent growth in the second quarter. In the first quarter of 2024, Summit’s revenue increased 89.9 percent following its merger with Argos USA.
According to Summit, $403.4 million of its third-quarter revenue was due to acquisitions, primarily its Argos merger. This outpaced the company’s $43.6 million in net revenue decreases related to divestitures. Organic prices increased across all business lines, the company adds.
Summit’s operating income increased 52.1 percent in the third quarter to $194.7 million, largely due to the Argos USA merger.
The company’s adjusted EBIDTA increased 50.9 percent ($106.2 million) to $314.7 million, reflecting the contribution from the Argos USA assets, continued pricing gains and operational improvements across the enterprise – including integration synergies.
“Our materials-led portfolio delivered another resilient quarter of financial results, even amid significant rainfall and severe weather events that impacted many of our key markets,” says Anne Noonan, president and CEO of Summit Materials. “I’m incredibly proud of our teams that responded safely and with agility to produce an Elevate-era record for EBITDA margins and take valuable steps towards achieving our strategic agenda.
“Today, due to volumes below prior expectations and including valuable self-help offsets, we are refining the midpoint of our full-year guide to $985 million,” Noonan adds. “Concurrently and thanks to strong execution, we are increasing our adjusted EBITDA margin expectations to at least 24 percent in 2024. Without question, our Summit team has successfully navigated a dynamic environment to strengthen our business, improve our commercial and operational capabilities and, critically, build momentum as we focus on the fourth quarter and our path forward in 2025.”
How Summit fared in aggregates
Summit’s aggregate business also saw increases in the third quarter.
According to Summit, aggregate net revenue increased by $12.5 million to $192.3 million in the third quarter.
Organic aggregate sales volumes increased 0.7 percent, primarily driven by Utah, British Columbia and the Carolinas. Average selling prices for aggregates increased 7.4 percent, with organic pricing growing 6.9 percent. Pricing growth was strong throughout Summit’s footprint, led by the East segment, which increased 8.3 percent versus the prior-year period.
Despite these increases, several areas of Summit’s aggregate business declined in the third quarter.
Adjusted cash gross profit margin related to aggregates decreased to 58.5 percent in the third quarter, compared to 59 percent in the prior-year period. Aggregate sales volumes decreased 1.8 percent in the third quarter as a result of divestitures, the company says.
