Why Martin Marietta is optimistic about the months to come

By |  February 13, 2018

Martin Marietta, which released its fourth-quarter and full-year 2017 results Tuesday, remains optimistic about its near-term and long-term outlook.

According to Martin Marietta, the fundamental drivers for its expected growth remain intact as the current recovery continues on a steady and extended basis.

“Looking ahead to 2018, the fundamental drivers for broad-based construction activity support our optimism that we will continue to benefit from a steady, multi-year cyclical recovery across our geographic footprint,” says Ward Nye, chairman, president and CEO of Martin Marietta. “Our leading positions in many of the nation’s most attractive and vibrant markets should allow us to capitalize on anticipated increased demand for infrastructure projects and private-sector construction activity in 2018 and beyond.”


In 2018, Martin Marietta expects infrastructure construction activity to see benefits from funding provided by the FAST Act as state Departments of Transportation and contractors address labor constraints and further regulatory reform emerges.

Additionally, state and local initiatives that support infrastructure funding, including gas tax increases and other ballot initiatives passed over the last 24 months, continue to gain overwhelming voter support and will play an expanded role in public-sector activity.

Third-party forecasts support increased infrastructure spending in 2018, as well, particularly spending for highways and streets, the company adds.

Martin Marietta expects nonresidential construction to modestly increase in both the heavy industrial and commercial sectors for the next several years as supported by third-party forecasts. Also, the company’s management expects new energy-related projects will bid in 2018 with construction activity in 2019 and beyond as permitting and final investment decisions are made and approved.

The company also expects residential construction to continue to grow, particularly in its key markets. Employment gains, historically low levels of construction activity over the previous years, low mortgage rates and higher lot development will drive the growth.

“While employment expansion has led to continued strength in private residential and nonresidential construction, we have yet to see meaningful and consistent growth in public heavy construction activity,” Nye says. “Infrastructure projects have been hindered by project delays and uncertainty concerning regulatory and other related reform.”

Martin Marietta is, however, encouraged by the recent passing of the Tax Cuts & Jobs Act.

“Passage of this legislation provides positive momentum in Washington, D.C. to address the shortfall in sustainable funding commensurate with the nation’s need for infrastructure investment,” Nye says.

The recent release of President Trump’s $1.5 trillion plan to rebuild the nation’s infrastructure is yet another sign Martin Marietta welcomes.

“[This] provides additional momentum, increasing the likelihood that both infrastructure funding will be increased and regulatory burdens will be lightened,” Nye says. “While state Departments of Transportation and contractors are slowly addressing their labor constraints, we believe that were an enhanced infrastructure bill enacted, those efforts would be more rapidly addressed.

“However, even in the absence of such an enhanced infrastructure bill, strong customer confidence and improving sentiment lead us to believe that infrastructure activity for 2018 and beyond should benefit from the FAST Act, the 2017 Tax Act, and state and local infrastructure initiatives,” Nye adds.

Kevin Yanik

About the Author:

Kevin Yanik is editor-in-chief of Pit & Quarry. He can be reached at 216-706-3724 or kyanik@northcoastmedia.net.

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