Vulcan Materials pushed up its first quarter sales from $996 million in 2019 to $1.05 billion this year with a strong performance in its aggregates division.
According to Vulcan chairman and chief executive officer Tom Hill: "Our first quarter earnings improved across all segments and were in line with our expectations, despite wet weather in certain key markets in the Southeast and Southwest.
"These results demonstrated the strong long-term fundamental position of our aggregates-led businesses and our commitment to leading the industry in pricing and unit profitability.
The company, which describes itself as "the largest producer of construction aggregates in the United States - primarily crushed stone, sand and gravel - and a major producer of aggregates-based construction materials, including asphalt and ready-mixed concrete," says it "experienced minimal financial impact from the COVID-19 pandemic in the first quarter."
However, says Vulcan boss Hill: "From a position of strength, we are proactively planning for the potential impacts of the pandemic on construction activity.
"Our strengths are derived from the flexibility provided by our aggregates-focused business, our diverse geographic footprint, our balance sheet structure and recently enhanced liquidity, and our operational capabilities.
"Our leading market positions, built over more than 60 years, and our proven track record of strong operations also position us well. That said, we have undertaken a comprehensive review of our operating plans and have contingency plans in place to respond as efficiently as possible to demand shifts.
"Aggregates is far more adaptable to these demand shifts than any other construction materials, a characteristic that should serve us well during this period of disruption. As a result, we will be well-equipped to manage our business effectively and serve our customers reliably through these unprecedented times."
In a statement out this week, Vulcan broke down its aggregates results: "First quarter segment sales increased 4 percent, and gross profit increased 5 percent to $194 million, or $4.31 per
ton.
"These improvements resulted from growth in shipments in certain key markets and wide-spread growth in pricing.
"First quarter aggregates shipments were 1 percent lower than the prior year's strong first quarter, when aggregates shipments increased 13 percent as a result of delayed shipments from the fourth quarter of 2018.
"Many markets in the US Southeast and the Southwest were negatively impacted by wet weather while shipments in California, Florida, Illinois and Virginia realized solid growth.
"On a mix-adjusted basis, all of the Company's key markets reported year-over-year price growth. For the quarter, freight-adjusted average sales price increased 4.5 percent (4.8 percent on mix-adjusted basis) versus the prior year's quarter.
"As anticipated, first quarter cost of sales were negatively impacted by higher repairs, maintenance and stripping costs, which were incurred early in the quarter to take advantage of the seasonally low production volume.
"Wet weather inefficiencies also affected costs in certain markets. These were partially offset by the modestly lower unit cost of diesel fuel in the quarter. Cash gross profit per ton increased 6 percent from the prior year's first quarter to $6.02 per ton.
