Provision-related cash outflows (shown as “non-cash items and other” of -€152 million), reflecting payments tied to restructuring provisions set up in the prior year, as well as bonuses and certain litigation-related payments.Higher capital expenditures (up €80 million), including spending in Q4 related to the Padeswood carbon capture project in the U.K.Free cash flow came in at €2.1 billion , down about €60 million year over year. Aldach attributed the decline primarily to:Aldach added that some of these m ...

Market Overview - The S&P 500 experienced a decline of approximately 0.6%, primarily driven by a drop in big tech stocks, which fell about 0.7% [1][2] - The VIX index is trading with a 20 handle, indicating increased market volatility [1] - The 10-year Treasury yield is currently at 4.07% [2] Geopolitical and Economic Factors - U.S. military buildup in the Middle East has raised speculation about a potential attack on Iran, dampening market sentiment [2][3] - The trade deficit in the U.S. has reached its widest level in modern history, with tariffs failing to narrow it or boost domestic manufacturing [4][36] Company-Specific Insights - Blue Owl, an asset manager, has faced investor withdrawals from one of its private credit funds, negatively impacting its stock and those of peers like Apollo, Blackstone, and KKR [3] - CRH, a building materials giant, reported adjusted revenue in line with estimates and is actively involved in over 100 data center projects across the U.S., indicating strong demand in this sector [19][21] Investment Strategies and Trends - There is a focus on diversifying within the AI theme, with an emphasis on AI infrastructure as a key area for growth [10][11] - Emerging markets (E.M.) are being considered as a source of diversification and earnings growth, with significant inflows noted [11][12] - Companies are advised to invest in defensive AI sectors, such as semiconductors and hardware, to mitigate risks in the current market environment [15][16] Economic Outlook - The upcoming GDP report is expected to show strong growth, with significant investment in the economy contributing to this outlook [36][40] - Wage growth has been broad-based, particularly in manufacturing, indicating a positive economic trajectory [44][50] Corporate Actions and Market Reactions - Bank of America plans to commit $25 billion to private credit deals, reflecting a strategic shift in its investment approach [34] - Walmart's shares have seen a decline despite strong performance, attributed to cautious earnings forecasts amid a challenging economic backdrop [67][70]

Vulcan Materials Company (VMC), headquartered in Birmingham, Alabama, produces and supplies construction aggregates. Valued at $43.7 billion by market cap, the company’s principal product lines are aggregates, asphalt mix, concrete, and cement. Shares of the largest producer of construction aggregates have underperformed the broader market over the past year. VMC has gained 11.7% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 11.9%. In 2026, however, VMC stock is up 6%, su ...

Vulcan's Earnings Are Dragging Down Construction Materials Stocks. - Barron'sSkip to Main ContentThis copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.# Vulcan's Earnings Are Dragging Down Construction Materials StocksBy [Al Root]ShareResize---ReprintsIn this article[VMC][SPX][ ...

In aggregates, shipments totaled approximately 227 million tons , an increase of 3% for the full year, driven by prior-year acquisitions. Same-store aggregate shipments were “slightly lower” than the prior year. Aggregates mix-adjusted price improved 6% for the full year and 5% in the fourth quarter, while aggregates cash gross profit per ton improved 7% for the year, according to management.The company also generated over $1.8 billion of operating cash flow , which management said was up 29% year over year ...

Core Insights - Knife River entered 2026 with a record backlog of approximately $1 billion, up 38% from the previous year, with about 90% tied to public work [2] - The company reported a strong fourth quarter in 2025, achieving a 47% increase in adjusted EBITDA and a gross margin of nearly 19%, driven by cost controls and favorable weather [4][6] - Management emphasized a favorable infrastructure environment, with healthy DOT budgets and significant IIJA funding remaining to be disbursed [3] Backlog and Project Focus - The backlog consists mainly of lower-risk public paving projects with contract values under $5 million, while private opportunities are emerging in data centers and manufacturing facilities [2] - The geographic mix of backlog has shifted towards the Mountain and Central regions, with Oregon experiencing softness [1] Segment Performance - In the West, profitability was driven by legacy Pacific operations despite a softer economy in Oregon, with significant projects in California and Hawaii [7] - The Mountain segment saw a nearly 20% increase in construction revenue year-over-year, with improved asphalt and ready-mix margins [8] - The Central segment was pivotal in 2025, with successful acquisitions and major contracting projects, including a $112 million project in Texas [9] - The Energy Services segment remains margin accretive, focusing on operational improvements and higher-margin products [10] Financial Performance and Guidance - Knife River's adjusted EBITDA grew 7% to $497 million in 2025, marking a company record [5] - For 2026, management guided consolidated revenue of $3.3 billion to $3.5 billion and adjusted EBITDA of $520 million to $560 million, implying an adjusted EBITDA margin of about 16% [15] - The company invested $789 million in growth initiatives in 2025, with expectations for maintenance and improvement capex to remain between 5% and 7% of revenue in 2026 [13][14] Pricing and Cost Management - Dynamic pricing strategies led to a 9% improvement in aggregates pricing in 2025, with expectations to continue optimizing pricing in 2026 [11] - The company anticipates mid-single-digit volume growth and pricing increases in aggregates for 2026, along with margin expansion [18]

Financial Data and Key Metrics Changes - In 2025, the company achieved a record Adjusted EBITDA of $497 million, representing a 7% increase year-over-year [4] - The fourth quarter saw a 47% increase in Adjusted EBITDA and a 340 basis point improvement in Adjusted EBITDA margin [18] - Gross profit for the fourth quarter increased by 27%, achieving a record gross margin of nearly 19% [18] Business Line Data and Key Metrics Changes - Aggregates volumes increased by 17% in the fourth quarter, with pricing up by 8% [18] - Ready Mix volumes rose by 20% in the fourth quarter, with gross margin lifting by 230 basis points [20] - Contracting services revenue grew by 15%, with the Mountain region experiencing nearly 20% growth [22] Market Data and Key Metrics Changes - The company entered 2026 with a record backlog of $1 billion, a 38% increase from the previous year [11] - Approximately 46% of IIJA funding remains to be disbursed across the company's 14 states, indicating strong public budgets [11] - The company anticipates continued growth in states with higher infrastructure spending, particularly in California, Alaska, and Hawaii [12] Company Strategy and Development Direction - The company focuses on four growth components: market positioning, vertical integration, self-help initiatives, and a strong corporate culture [6] - The acquisition program ramped up in 2025, with five deals completed and expectations for continued activity in 2026 [4][7] - The company aims to enhance margins through continuous improvement and operational excellence initiatives [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position for growth, citing favorable market conditions and strong infrastructure funding [5][11] - The company expects consolidated revenue for 2026 to be between $3.3 billion and $3.5 billion, with Adjusted EBITDA between $520 million and $560 million [26] - Management highlighted the importance of cost control and dynamic pricing strategies to drive future profitability [38] Other Important Information - The company invested $789 million in growth initiatives in 2025, including acquisitions and organic projects [23] - Maintenance capital expenditures were in line with expectations at 6% of revenue [24] - The company ended the year with nearly $75 million in unrestricted cash and a net leverage position of 2.2 times [25] Q&A Session Summary Question: Opportunities to build on backlog in the West region - Management acknowledged a geographic shift in backlog but expressed confidence in funding and opportunities in California, Hawaii, and Alaska [32][33] Question: Potential levers to outperform aggregate pricing expectations - Management noted strong pricing performance in 2025 and highlighted the implementation of dynamic pricing strategies as a key lever for future pricing [34][38] Question: Margin outlook for 2026 - Management indicated expectations for modest margin improvement, driven by dynamic pricing and operational efficiencies [42][44] Question: Return to year-over-year growth in Oregon - Management expects Oregon's performance in 2026 to be in line with 2025 results, contingent on public funding clarity [46][48] Question: Contribution of acquisitions to 2026 growth - Management stated that the contributions from acquisitions would offset seasonal losses and emphasized organic growth in guidance [88][90] Question: Data centers and backlog conversion - Management reported significant opportunities in data centers, primarily in material supply, with a strong pipeline of pending work [78][80]

Financial Data and Key Metrics Changes - In 2025, the company achieved a record Adjusted EBITDA of $497 million, representing a 7% increase year-over-year [4] - The fourth quarter saw a 47% increase in Adjusted EBITDA and a 340 basis point improvement in Adjusted EBITDA margin [18] - Gross profit for the fourth quarter increased by 27%, achieving a record gross margin of nearly 19% [18] Business Line Data and Key Metrics Changes - Aggregates volumes increased by 17% in the fourth quarter, with pricing up by 8% [18] - Ready-mix volumes rose by 20% in the fourth quarter, with gross margin lifting by 230 basis points [20] - Contracting services revenue grew by 15%, with the Mountain region experiencing nearly 20% growth [22] Market Data and Key Metrics Changes - The company entered 2026 with a record backlog of $1 billion, a 38% increase from the previous year [11] - Approximately 46% of IIJA funding remains to be disbursed across the company's 14 states, indicating strong public budgets [11] - The company is seeing increased private opportunities, including data centers and distribution facilities [11] Company Strategy and Development Direction - The company focuses on four growth components: markets, vertical integration, self-help initiatives, and a strong corporate culture [6] - The acquisition program ramped up in 2025 with five completed deals, and the company expects another busy year in 2026 [4][7] - The strategy emphasizes being an aggregates-based, end-to-end provider to enhance value and improve margins [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence entering 2026, citing strong momentum and favorable market conditions [5] - The company anticipates continued growth driven by infrastructure investments and a disciplined focus on cost control and pricing optimization [10][25] - Management expects consolidated revenue for 2026 to be between $3.3 billion and $3.5 billion, with Adjusted EBITDA between $520 million and $560 million [26] Other Important Information - The company invested $789 million in growth initiatives in 2025, including acquisitions and organic projects [23] - Maintenance capital expenditures were $170 million, or 6% of revenue, consistent with previous guidance [24] - The company ended the year with nearly $75 million in unrestricted cash and a net leverage position of 2.2x [25] Q&A Session Summary Question: Opportunities to build on backlog in the West region - Management acknowledged a geographic shift in backlog but expressed confidence in California, Hawaii, and Alaska's funding [32] Question: Potential levers to outperform aggregate pricing expectations - Management highlighted the success of dynamic pricing strategies and ongoing training to optimize pricing [38] Question: Margin outlook for 2026 - Management indicated expected margin improvements across all product lines, driven by dynamic pricing and operational excellence initiatives [44] Question: Return to year-over-year growth in Oregon - Management expects Oregon's performance in 2026 to be broadly in line with 2025 results, pending clarity on public funding [48] Question: Contribution of acquisitions to 2026 growth - Management stated that the full-year contribution from TexCrete would offset seasonal losses from Strata, indicating strong organic growth [90]

Financial Data and Key Metrics Changes - In 2025, the company achieved a record Adjusted EBITDA of $497 million, representing a 7% increase year-over-year [4] - The fourth quarter of 2025 saw a 47% increase in Adjusted EBITDA and a 340 basis point improvement in Adjusted EBITDA margin [16] - Gross profit for the fourth quarter increased by 27%, achieving a record gross margin of nearly 19% [16] Business Line Data and Key Metrics Changes - Aggregates volume increased by 17% in the fourth quarter, with pricing up by 8% [16] - Ready-mix volumes rose by 20% in the fourth quarter, with gross margin improving by 230 basis points [18] - Contracting services revenue grew by 15%, with the Mountain region experiencing nearly 20% growth [20] Market Data and Key Metrics Changes - The company entered 2026 with a record backlog of $1 billion, a 38% increase from the previous year [10] - Approximately 46% of IIJA funding remains to be disbursed across the company's 14 states, indicating strong public budgets for infrastructure [10] - The company anticipates continued growth in states with higher growth forecasts, particularly in the Mountain and Central regions [6] Company Strategy and Development Direction - The company focuses on four growth components: market positioning, vertical integration, self-help initiatives, and a strong corporate culture [5] - The acquisition program is ramping up, with five deals completed in 2025 and more expected in 2026 [4][6] - The company aims to enhance margins through continuous improvement and operational efficiencies [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position for growth in 2026, citing strong market conditions and a favorable infrastructure funding backdrop [5][10] - The company expects to maintain a disciplined focus on cost control and pricing optimization to drive EBITDA growth [8][24] - Management highlighted the importance of a stable budget in Oregon for future growth, with expectations for performance to align with 2025 results [43] Other Important Information - The company invested $789 million in growth initiatives in 2025, including acquisitions and organic projects [21] - Capital expenditures for maintenance and improvement are expected to remain between 5% and 7% of revenue in 2026 [22] - The company ended 2025 with $75 million in unrestricted cash and a net leverage position of 2.2 times, below the long-term target of 2.5 times [23] Q&A Session Summary Question: Opportunities to build on backlog in the West region - Management acknowledged a geographic shift in backlog but expressed confidence in the funding and opportunities in California, Hawaii, and Alaska [30] Question: Potential levers to outperform aggregate pricing expectations - Management discussed the success of dynamic pricing strategies and ongoing training to optimize pricing [35] Question: Margin outlook for 2026 - Management indicated expectations for margin improvements across all product lines, driven by dynamic pricing and operational efficiencies [40] Question: Return to year-over-year growth in Oregon - Management expects Oregon's performance in 2026 to be in line with 2025 results, contingent on public funding clarity [44] Question: Impact of acquisitions on 2026 outlook - Management stated that the contributions from acquisitions would offset seasonal losses and that organic growth is expected to be strong [86]

4Q and Full-Year 2025 Results Presentation February 17, 2026 Forward-Looking Statements The information in this presentation highlights the key growth strategies, projections and certain assumptions for the company and its subsidiaries, including with respect to the benefits of acquisitions. Many of these highlighted statements and other statements not historical in nature are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Although the comp ...