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Vulcan Materials (VMC) Misses on Earnings & Revenues in Q3
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Vulcan Materials Company’s (VMC - Free Report) third-quarter 2016 adjusted earnings of $1.01 per share missed the Zacks Consensus Estimate of $1.12 by 9.8%. However, the bottom line increased 9.8% from the prior-year quarter on the back of robust margins.
Total revenue of $1,008 million also missed the Zacks Consensus Estimate of $1,109 million by 9.1%. Sales also decreased 3% from the prior-year quarter.
Third-quarter 2016 results were hurt by slower-than-expected large project starts and the impact of extremely wet weather conditions on shipments in several key markets.
Adjusted gross margin of 35.2% increased 200 basis points (bps). Adjusted EBITDA increased 6.1% year over year to $300.97 million as gross profit margins improved at the Aggregates and Asphalt segments.
Revenues declined 1% year over year to $822 million. Freight-adjusted revenues jumped 2% year over year to $641 million.
A noticeable slowdown in the trailing twelve month construction starts in March, the timing of certain large projects, and unfavorable weather patterns led to highly variable third-quarter shipment results across Vulcan-served markets.
Aggregates shipments (volumes) decreased 4% owing to gradual recovery in private and public demand across end-markets.
Freight-adjusted average sales price climbed 8%.
Adjusted gross profit margin of 40.8% increased 90 bps compared to the prior-year quarter.
Non-Aggregates
Total revenue in the Concrete segment was $91.1 million, up 3.6% year over year. Concrete segment gross profit was $9 million in the quarter compared with $10 million in the prior-year quarter. Sales volumes were flat with the prior-year quarter level as higher volumes in Arizona and Georgia helped offset lower volumes in Maryland, Texas and Virginia.
Revenues at the Asphalt Mix segment were $157.4 million, down 11.9% owing to a decrease in volume. Asphalt segment gross profit was $33 million versus $30 million a year ago. Volumes decreased 11%. However, solid sales and operating disciplines as well as effective materials margin management made up for the volume decline.
Total revenue at the Calcium segment (formerly Cement) was $2.4 million, compared with $2.2 million in the prior-year quarter. The Calcium segment reported gross profit of $0.8 million, in line with the prior-year quarter figure
Guidance
Although the company did not issue any firm guidance, it expects to see broad-based volume and pricing growth accompanied by continued margin expansion in 2017.
Vulcan Materials carries a Zacks Rank #5 (Strong Sell).
Upcoming Releases
Here are some companies in the construction sector that are scheduled to report third-quarter results soon.
Summit Materials, Inc. (SUM - Free Report) is slated to report third-quarter 2016 results on Nov 2. Third-quarter earnings are expected to grow 2.44%.
Quanta Services, Inc. (PWR - Free Report) is expected to report third-quarter 2016 results on Nov 3. Earnings are expected to grow 87.83%
D.R.Horton, Inc.’s (DHI - Free Report) third-quarter earnings is expected to increase 20.4%. The company is scheduled to release results on Nov 8.
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Vulcan Materials (VMC) Misses on Earnings & Revenues in Q3
Vulcan Materials Company’s (VMC - Free Report) third-quarter 2016 adjusted earnings of $1.01 per share missed the Zacks Consensus Estimate of $1.12 by 9.8%. However, the bottom line increased 9.8% from the prior-year quarter on the back of robust margins.
Total revenue of $1,008 million also missed the Zacks Consensus Estimate of $1,109 million by 9.1%. Sales also decreased 3% from the prior-year quarter.
Third-quarter 2016 results were hurt by slower-than-expected large project starts and the impact of extremely wet weather conditions on shipments in several key markets.
Adjusted gross margin of 35.2% increased 200 basis points (bps). Adjusted EBITDA increased 6.1% year over year to $300.97 million as gross profit margins improved at the Aggregates and Asphalt segments.
VULCAN MATLS CO Price, Consensus and EPS Surprise
VULCAN MATLS CO Price, Consensus and EPS Surprise | VULCAN MATLS CO Quote
Segment Details
Aggregates
Revenues declined 1% year over year to $822 million. Freight-adjusted revenues jumped 2% year over year to $641 million.
A noticeable slowdown in the trailing twelve month construction starts in March, the timing of certain large projects, and unfavorable weather patterns led to highly variable third-quarter shipment results across Vulcan-served markets.
Aggregates shipments (volumes) decreased 4% owing to gradual recovery in private and public demand across end-markets.
Freight-adjusted average sales price climbed 8%.
Adjusted gross profit margin of 40.8% increased 90 bps compared to the prior-year quarter.
Non-Aggregates
Total revenue in the Concrete segment was $91.1 million, up 3.6% year over year. Concrete segment gross profit was $9 million in the quarter compared with $10 million in the prior-year quarter. Sales volumes were flat with the prior-year quarter level as higher volumes in Arizona and Georgia helped offset lower volumes in Maryland, Texas and Virginia.
Revenues at the Asphalt Mix segment were $157.4 million, down 11.9% owing to a decrease in volume. Asphalt segment gross profit was $33 million versus $30 million a year ago. Volumes decreased 11%. However, solid sales and operating disciplines as well as effective materials margin management made up for the volume decline.
Total revenue at the Calcium segment (formerly Cement) was $2.4 million, compared with $2.2 million in the prior-year quarter. The Calcium segment reported gross profit of $0.8 million, in line with the prior-year quarter figure
Guidance
Although the company did not issue any firm guidance, it expects to see broad-based volume and pricing growth accompanied by continued margin expansion in 2017.
Vulcan Materials carries a Zacks Rank #5 (Strong Sell).
Upcoming Releases
Here are some companies in the construction sector that are scheduled to report third-quarter results soon.
Summit Materials, Inc. (SUM - Free Report) is slated to report third-quarter 2016 results on Nov 2. Third-quarter earnings are expected to grow 2.44%.
Quanta Services, Inc. (PWR - Free Report) is expected to report third-quarter 2016 results on Nov 3. Earnings are expected to grow 87.83%
D.R.Horton, Inc.’s (DHI - Free Report) third-quarter earnings is expected to increase 20.4%. The company is scheduled to release results on Nov 8.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>