Vulcan(VMC) - 2025 Q2 - Quarterly Results

VULCAN Q2 2025 Earnings Release Financial Highlights Vulcan Materials reported strong Q2 2025 results with earnings growth and margin expansion driven by pricing and cost management Q2 2025 Key Financial Metrics (YoY) | Metric | Q2 2025 | Q2 2024 | Change | Year-to-Date 2025 | Year-to-Date 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $2,102M | $2,014M | +4.4% | $3,737M | $3,560M | +5.0% | | Gross Profit | $625M | $592M | +5.6% | $991M | $897M | +10.5% | | Net Earnings | $321M | $308M | +4.2% | $450M | $411M | +9.5% | | Adjusted EBITDA | $660M | $603M | +9.5% | $1,070M | $927M | +15.4% | | Adjusted EBITDA Margin | 31.4% | 29.9% | +150 bps | 28.6% | 26.0% | +260 bps | | Diluted EPS (Continuing Ops) | $2.43 | $2.33 | +4.3% | $3.41 | $3.11 | +9.6% | - CEO Tom Hill highlighted that strong execution led to a 13% increase in aggregates cash gross profit per ton and a 16% improvement in Adjusted EBITDA through the first half of the year[2] Second Quarter Segment Results The Aggregates segment drove earnings growth through strong pricing and execution, offsetting a weather-related shipment decline Aggregates The segment's gross profit grew due to a 5% increase in selling prices, which offset a 1% weather-related shipment decrease Aggregates Segment Performance - Q2 2025 | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Gross Profit | $560M | $528.5M (implied) | +6.0% | | Gross Profit per Ton | $9.44 | $8.79 | +7.4% | | Cash Gross Profit per Ton | $11.88 | $10.92 | +8.8% | | Shipments (million tons) | 59.3 | 60.1 | -1.3% | | Freight-Adjusted Selling Price | $22.11 | $21.00 | +5.3% | - Freight-adjusted unit cash cost of sales saw a modest increase of only 1% ($0.15 per ton), demonstrating continued operating cost discipline[4] - On a trailing-twelve months basis, cash gross profit per ton increased 13%, marking the tenth consecutive quarter of double-digit improvement in unit profitability[3] Asphalt and Concrete Both segments improved unit profitability, with the Concrete segment's growth notably driven by contributions from recent acquisitions - Asphalt segment gross profit was $57 million, with unit cash gross profit improving by 5%[5] - Concrete segment gross profit was $8 million, with unit cash gross profit increasing by 30%, mainly due to acquired operations[5] Operating Expenses Selling, Administrative and General (SAG) expenses were 6.9% of total revenues, showing improved cost management on a TTM basis SAG Expense Analysis | Period | SAG Expense | As % of Total Revenues | | :--- | :--- | :--- | | Q2 2025 | $144M | 6.9% | | TTM Ended Q2 2025 | $550M | 7.2% | Financial Position and Capital Allocation The company maintained a strong balance sheet with debt within its target range while investing in capex and increasing dividends - The ratio of total debt to TTM Adjusted EBITDA was 2.2 times (2.1 times on a net debt basis), within the company's target range of 2.0 to 2.5 times[8] - Capital expenditures for maintenance and growth projects totaled $102 million in Q2[7] - The company returned $65 million to shareholders via dividends, representing a 6% increase compared to the prior year[7] - Return on average invested capital was 15.9% on a TTM basis[8] Business Outlook The company reaffirmed its full-year 2025 Adjusted EBITDA guidance, supported by strong first-half performance and highway demand - The company reaffirmed its full-year outlook to deliver $2.35 to $2.55 billion of Adjusted EBITDA[9] - The positive outlook is supported by strong first-half performance and an acceleration in new highway construction activity in its markets[9] Consolidated Financial Statements This section presents the unaudited consolidated Statements of Earnings, Balance Sheets, and Cash Flows for the period Consolidated Statements of Earnings Total revenues grew to $2.10 billion, and net earnings increased to $320.9 million, resulting in a diluted EPS of $2.43 Q2 2025 Statement of Earnings Highlights (in millions) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenues | $2,102.4 | $2,014.4 | | Gross Profit | $625.2 | $592.2 | | Operating Earnings | $471.0 | $453.6 | | Net Earnings Attributable to Vulcan | $320.9 | $308.0 | Consolidated Balance Sheets As of June 30, 2025, total assets stood at $16.97 billion, with total equity growing to $8.43 billion year-over-year Balance Sheet Highlights (in millions) | Account | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Current Assets | $2,243.5 | $1,976.5 | | Total Assets | $16,974.7 | $14,216.4 | | Total Current Liabilities | $1,341.9 | $796.8 | | Long-term Debt | $4,359.2 | $3,331.7 | | Total Equity | $8,429.7 | $7,730.4 | Consolidated Statements of Cash Flows Net cash from operating activities for the first six months increased significantly to $593.2 million from $374.5 million YoY Six-Month Cash Flow Summary (in millions) | Activity | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $593.2 | $374.5 | | Net Cash used for Investing Activities | $(236.9) | $(533.8) | | Net Cash used for Financing Activities | $(606.1) | $(678.3) | | Net Decrease in Cash | $(249.8) | $(837.6) | Segment and Product Data This section provides detailed financial and operational metrics for each business segment, led by the Aggregates segment Q2 2025 Segment Gross Profit (in millions) | Segment | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Aggregates | $559.5 | $528.5 | | Asphalt | $57.2 | $59.0 | | Concrete | $8.5 | $4.7 | Q2 2025 Unit Shipments & Sales Price | Product | Unit Shipments | Avg. Sales Price | | :--- | :--- | :--- | | Aggregates | 59.3M tons | $22.11/ton (Freight-adj.) | | Asphalt Mix | 3.9M tons | $81.29/ton | | Ready-mixed concrete | 1.2M cubic yards | $186.60/cubic yard | Reconciliation of Non-GAAP Measures This section provides reconciliations for key non-GAAP metrics like Adjusted EBITDA and Net Debt to their closest GAAP counterparts Aggregates Segment Freight-Adjusted Revenues The reconciliation shows freight-adjusted revenues, which exclude freight costs, increased to $1.31 billion in Q2 2025 Q2 Aggregates Revenue Reconciliation (in millions) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Segment Sales | $1,649.6 | $1,613.5 | | Less: Freight & Delivery | $(310.9) | $(324.5) | | Less: Other Revenues | $(28.8) | $(26.4) | | Freight-Adjusted Revenues | $1,310.1 | $1,262.6 | Cash Gross Profit Cash gross profit for the Aggregates segment was $703.8 million, resulting in a cash gross profit per ton of $11.88 Q2 2025 Cash Gross Profit (in millions) | Segment | Gross Profit | DDAA | Cash Gross Profit | | :--- | :--- | :--- | :--- | | Aggregates | $559.5 | $144.3 | $703.8 | | Asphalt | $57.2 | $14.0 | $71.2 | | Concrete | $8.5 | $19.0 | $27.5 | EBITDA and Adjusted EBITDA Adjusted EBITDA increased to $659.5 million in Q2 2025, with the corresponding margin expanding to 31.4% Q2 Adjusted EBITDA Reconciliation (in millions) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Earnings Attributable to Vulcan | $320.9 | $308.0 | | Interest, Taxes, DDAA | +$335.3 | +$290.7 | | EBITDA | $656.1 | $598.7 | | Adjustments | +$3.4 | +$4.5 | | Adjusted EBITDA | $659.5 | $603.1 | Adjusted Diluted EPS Adjusted Diluted EPS from continuing operations for Q2 2025 increased to $2.45 from $2.35 in the prior-year quarter Adjusted Diluted EPS Reconciliation | Period | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Earnings per Share | $2.42 | $2.31 | | Adjustments (net of tax) | +$0.03 | +$0.04 | | Adjusted Diluted EPS | $2.45 | $2.35 | Net Debt to Adjusted EBITDA The company's leverage ratios remained healthy, with a net debt to TTM Adjusted EBITDA ratio of 2.1x as of June 30, 2025 Leverage Ratios as of June 30, 2025 | Metric | Value | | :--- | :--- | | Total Debt | $4,909.7M | | Net Debt | $4,558.7M | | TTM Adjusted EBITDA | $2,201.1M | | Total Debt to TTM Adj. EBITDA | 2.2x | | Net Debt to TTM Adj. EBITDA | 2.1x | Return on Invested Capital (ROIC) The company's Return on Invested Capital was 15.9% for the trailing-twelve months ending June 30, 2025 - The company's Return on Invested Capital (ROIC) for the trailing-twelve months ended June 30, 2025, was 15.9%[32] Legal Disclaimers This section contains a forward-looking statement disclaimer and notes that reconciliations for forward-looking non-GAAP measures are not provided - The report contains forward-looking statements concerning future financial performance and business plans, which are subject to numerous risks and uncertainties[13][15] - Reconciliations for forward-looking non-GAAP financial measures are not provided because the necessary information is not accessible without unreasonable effort[12]