United States Lime & Minerals(US:USLM)2021-02-26 21:03Financial Performance - Revenues increased by 1.5% in 2020 compared to 2019, with Lime and Limestone Operations revenues rising by 1.7% primarily due to the addition of limestone sales from the Carthage acquisition[144]. - Gross profit increased by 14.2% in 2020 compared to 2019, driven by higher average selling prices for lime and limestone products and lower fuel costs[145]. - Net income rose by $2.2 million, or 8.3%, in 2020, with net income per fully diluted share increasing to $5.00 from $4.64 in 2019[147]. - Revenues for 2020 increased to $160.7 million, up $2.4 million or 1.5% from $158.3 million in 2019, driven by a 1.7% increase in Lime and Limestone Operations revenues[180]. - Gross profit for 2020 rose to $47.6 million, an increase of $5.9 million or 14.2% compared to $41.7 million in 2019, primarily due to higher selling prices and lower fuel costs[181]. - Net income for 2020 was $28.2 million, or $5.00 per share diluted, reflecting an increase of $2.2 million or 8.3% from $26.1 million in 2019[187]. - Net cash provided by operating activities was $58.6 million in 2020, compared to $47.0 million in 2019, an increase of $11.6 million, or 24.6%[199]. Acquisitions and Investments - The Carthage acquisition contributed $4.6 million to revenues in 2020, enhancing the company's geographic footprint[140]. - Cash flows from operations enabled $17.1 million in capital investments, including the Carthage acquisition, and increased cash balances to $83.6 million as of December 31, 2020[147]. - The company expects to spend approximately $14.0 million per year in Lime and Limestone Operations for capital and re-equipping projects[198]. - Net cash used in investing activities was $25.2 million for 2020, compared to $26.5 million for 2019, including $8.4 million for the acquisition of Carthage[200]. Operational Efficiency - The company has modernized and expanded its facilities, resulting in lower production costs and greater operating efficiencies, particularly with the new fuel-efficient kiln at the St. Clair facility[155]. - Selling, general and administrative expenses (SG&A) increased to $12.2 million in 2020, up $0.7 million or 5.8% from $11.5 million in 2019, with SG&A as a percentage of revenues at 7.6%[182]. Market Demand and Challenges - Demand for lime and limestone products from construction customers increased in 2020, while demand from oil and gas services, environmental, and steel customers decreased due to economic conditions[151]. - The ongoing impact of the COVID-19 pandemic has created uncertainty and economic disruption, affecting demand and pricing for lime and limestone products[153]. - The company faces challenges from volatile energy costs and must maintain or increase product prices to offset increased costs amid competitive pressures[159]. Tax and Financial Obligations - The effective income tax rate for 2020 was 17.2%, up from 15.7% in 2019, primarily due to increased income before taxes[186]. - Total contractual obligations as of December 31, 2020, amounted to $14.7 million, with significant future lease payments due[209]. - The company plans to maintain compliance with credit agreement provisions to pay dividends and repurchase shares, contingent on the Cash Flow Leverage Ratio[206]. Debt and Credit Facilities - The credit agreement provides for a $75 million revolving credit facility, with an additional $50 million accordion feature, maturing on May 2, 2024[202]. - The company had no debt outstanding as of December 31, 2020 or 2019, with $0.4 million of letters of credit issued under the Revolving Facility[207].