Vulcan’s profitability increases despite fewer shipments

Vulcan Materials Co. released its fourth-quarter statement Thursday, highlighting fourth-quarter earnings of $90 million before interest, taxes, depreciation and amortization (EBITDA), as well as a gross profit increase of $5 million. Including gains on the sale of real estate and businesses, restructuring charges and exchange offer costs, Vulcan’s fourth-quarter EBITDA was $137 million.

The company’s aggregates segment gross profit increase $2 million from the prior year’s fourth quarter, and gross profit margin expanded partly due to a 4 percent increase in pricing and despite a 3 percent decline in aggregates shipments. According to Vulcan, aggregates shipments in Arizona, Florida, North Carolina and Texas showed strength, as each increased more than 10 percent versus the prior year. Shipments in California, Georgia and the Midwest were lower, the company says, due in part to fewer large projects than the previous year.

“Demand for aggregates in our markets is expected to grow by mid-single digits in 2013,” says Don James, Vulcan chairman and CEO. “Aggregates demand from residential construction is expected to increase double-digits while demand from private non-residential buildings is expected to increase high single-digits versus 2012.”

For the year, Vulcan’s EBITDA increased $59 million on flat revenues, and its gross profit increased by $50 million. Aggregates shipments declined 1 percent and pricing increased 2 percent.

“Despite slightly weaker aggregates shipments, we achieved a 17 percent increase in adjusted EBITDA, reflecting aggressive actions to reduce costs and to take advantage of pricing opportunities across the markets we serve,” James says.