For the third consecutive quarter, Martin Marietta experienced decreased total revenue, gross profit and aggregate shipments.
Total revenue was down 6 percent in the third quarter to $1.8 billion, and gross profit was down 9 percent to $588 million. Third-quarter aggregates shipments declined 3.9 percent to 53.7 million tons, due, in large part, to what Martin Marietta calls historically wet weather in the company’s east division. Softening warehouse and residential demand across the company’s footprint also played a factor.
Martin Marietta’s aggregate gross profit also decreased slightly in the third quarter, falling 0.68 percent to $438 million. The company says this decrease was primarily driven by lower operating leverage from reduced shipments and weather-driven inefficiencies, which were largely offset by acquisition contributions.
Aggregate pricing and gross profit per ton were both up in the third quarter, according to Martin Marietta. Pricing was up 7.7 percent to $21.52 per ton, and gross profit increased 3 percent to a third-quarter record of $8.16 per ton.
“In the third quarter, our team achieved record quarterly aggregates gross profit per ton, record third-quarter cash flows from operations, record third-quarter revenues and gross profit in our magnesia specialties business and the best year-to-date safety performance in our company’s history,” says Ward Nye, chairman and CEO of Martin Marietta. “While these achievements demonstrate our continued success managing those factors we can control, well-chronicled weather-related events had major impacts on our third-quarter business results. Significant July precipitation, together with Tropical Storm Debby in North Carolina, Hurricane Beryl in Texas and Hurricane Helene across much of our Southeast footprint, all occurred during the quarter.
“Although these events are short-term and temporary, they nonetheless adversely impacted our third-quarter product shipments, geographic mix and financial results and, as a result, we revised our full-year 2024 Adjusted EBITDA guidance to $2.1 billion at the midpoint,” Nye adds.
Despite some of these setbacks, Nye is optimistic about what the new year has in store for the company.
“Looking ahead to 2025 and beyond, we expect to benefit from record levels of federal and state investments in highways, streets and bridges,” he says. “Additionally, reshoring and the build-out of artificial intelligence infrastructure should provide steady growth in these aggregates-intensive end markets for years to come. Further, although higher interest rates continue to affect residential construction activity, we are encouraged by recent Federal Reserve policy actions and the likelihood of more interest rate cuts later this year, which should support a recovery in housing and, subsequently, light nonresidential construction activity.”
