Vulcan Materials (VMC) Up On Q2 Earnings & Revenue Beat
Zacks Investment Research | Jul 24, 2019 11:33PM ET
Vulcan Materials Company’s (NYSE:VMC) shares gained 2.1%, following solid second-quarter 2019 results, wherein the top and bottom lines surpassed the respective Zacks Consensus Estimate. Also, earnings and revenues improved year over year, given shipment growth, price improvements and operating efficiencies in the aggregates business. Also, robust growth in public construction demand and continued improvement in private demand added to the positives.
The company — which is one of the largest producers of construction aggregates — reported adjusted earnings of $1.48 per share, surpassing the consensus mark of $1.45 by 2.1%. Total revenues of $1,327.7 million outpaced the consensus mark of $1,306 million by 1.7%.
On a year-over-year basis, its earnings and revenues grew 20.4% and 10.6%, respectively, in the quarter.
Segments in Detail
Aggregates
Revenues from the segment increased 11% year over year to $1,062.1 million. Freight-adjusted revenues also rose 10.4% from the prior-year quarter to $806.4 million. The upside was mainly driven by shipment growth, higher pricing, and solid execution of operating disciplines and efficiencies.
Aggregate shipments (volumes) were up 4% year over year, reflecting solid underlying demand, mainly arising from public funding for highways, and employment and population growth, particularly in Southeast and Mid-Atlantic regions. Yet, adverse weather delayed shipments across Illinois, Tennessee and Texas.
Gross profit of $329 million was up 16% year over year. Also, gross margin (as a percentage of segment sales) expanded 140 basis points (bps) to 31% on the back of solid growth in shipments and price improvements.
Asphalt, Concrete and Calcium
Revenues from the Asphalt Mix segment were $247.2 million, up 16.7% year over year. The segment recorded a gross profit of $27.6 million versus $25.8 million a year ago due to lower material margins. Asphalt mix selling prices increased 8% or $4.34 per ton and shipments grew 8% from the prior-year quarter.
Unit cost of liquid asphalt, which recorded a 16% year-over-year increase in the second quarter, was relatively stable throughout the first half of 2019.
Total revenues from the Concrete segment were $103.8 million, down 2.8% year over year. Moreover, gross profit totaled $12.9 million, down 2.3% year over year. Same-store shipments were down 11.1% year over year but average selling prices grew 5%.
Total revenues from the Calcium segment were down 12.2% from the prior-year figure to $2 million. The segment reported gross profit of $0.8 million versus $0.7 million in the prior-year quarter.
Vulcan Materials Company Price, Consensus and EPS Surprise
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