Summit Materials net revenue up in second quarter of 2017

Summit Materials Inc. increased its net revenue by 15.9 percent to $478.4 million in the second quarter of 2017 compared with $412.6 reported in the prior year period.

The company attributes the improvement in net revenue to acquisition-related contributions, increased organic sales volumes across all lines of business and improved organic average selling prices in cement and ready-mix concrete, Summit Materials says.

“We delivered exceptional growth in net revenue, operating income and net income during the second quarter, driven by a combination of strong seasonal demand across all lines of business, together with contributions from recently completed acquisitions,” says Tom Hill, CEO of Summit Materials.

Aggregate net revenue increased 15.3 percent to $84.2 million in the second quarter of 2017 when compared with the prior-year period, the company says. Aggregate adjusted cash gross profit margin increased 68.3 percent in the second quarter of 2017 versus 63.3 percent in the prior year period.

According to Summit Materials, organic aggregate sales volumes increased 6.1 percent in the second quarter of 2017 primarily owing to increased demand in Texas, Utah, Virginia and Vancouver, Canada. Average selling prices of organic aggregate declined 1.7 percent in the second quarter because of an unfavorable sales mix in the Vancouver and Austin markets. Excluding those two markets, average selling prices of organic aggregate increased 3.5 percent on a year-over-year basis.

Adjusted EBITDA increased 17.9 percent year-over-year to $135.2 million compared with $114.7 million in the prior year period. Adjusted EBITDA margin increased 50 basis points to 28.3 percent in the second quarter of 2017 when compared with the prior year period.

Summit Materials has completed 10 acquisitions on a year-to-date basis, including four transactions that have closed since May 2017, the company adds. The four acquisitions included Glasscock Co. in South Carolina, Great Southern Ready Mix in Texas, Ready-Mix Concrete of Somerset in Kentucky and Northwest Ready Mix in Colorado.

“We have closed on four acquisitions since our last quarterly update in May 2017,” Hill says. “Together, these bolt-on transactions expand and enhance our vertically-integrated materials-based businesses in Texas, Kentucky, Colorado and South Carolina. Our acquisition pipeline remains very active, with more than 20 transactions currently under review.

“Given continued strength in organic volume growth, record levels of available liquidity and multiple near-term acquisitions on the horizon, Summit is well positioned as we transition into the second half of the year,” Hill says.