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Shares of The Monarch Cement Company (MCEM - Free Report) have declined 1% since reporting results for the first quarter of 2026. This compares with the S&P 500 index’s 0.7% return over the same time frame. Over the past month, the stock has gained 13.2% compared with the S&P 500’s 6.1% return.
The company reported significantly improved first-quarter 2026 results, driven by higher cement and ready-mixed concrete volumes. Consolidated net sales rose 27.5% to $49.4 million from $38.7 million in the prior-year quarter.
Net income climbed to $11.3 million, or $3.03 per share, from $2.7 million, or 72 cents per share, a year earlier. Gross profit increased to $18.1 million from $11.7 million, while the gross profit margin expanded to 36.6% from 30.2% in the first quarter of 2025.
The Monarch Cement Co. Price, Consensus and EPS Surprise
The company’s Cement Business remained the primary growth driver in the quarter. Cement segment sales increased by $7.3 million year over year, aided largely by a 27.1% increase in the sales volume, while pricing contributed an additional $0.5 million. The Ready-Mixed Concrete Business posted a $3.4-million increase in sales, supported by a 28.1% rise in cubic yards sold, partly offset by modest pricing declines.
The Cement segment’s gross profit margins improved sharply to 51.9% from 44.3% a year earlier. The Ready-Mixed Concrete segment also showed improvement, with gross profit margins rising to 8.9% from 5.8%. Segmental operating income in the Cement Business increased to $11.9 million from $6.2 million in the prior-year period, while the Ready-Mixed Concrete Business reduced its operating loss to $302,430 from $1.1 million.
The company also benefited from stronger performance in brick, block and sundry product sales, which increased by $0.6 million during the quarter.
Factors Influencing Quarterly Results
Management attributed the quarter’s performance largely to stronger shipment volumes across both operating segments. Higher cement and ready-mixed concrete demand significantly outweighed modest pricing pressures in ready-mixed concrete operations.
Cost trends also contributed to margin expansion. Cement production costs declined by $2.1 million despite increased shipment volumes, while material costs in the Ready-Mixed Concrete Business decreased by $0.2 million. Overall consolidated cost of sales increased 12.7% year over year to $31.3 million, a slower pace than revenue growth, supporting profitability gains.
The company additionally recorded a substantial increase in unrealized gains on equity investments. Unrealized gains totaled $6.2 million in the quarter against an unrealized loss of $7.1 million in the prior-year period. However, gains on sales of equity investments declined to $1 million from $10.5 million a year earlier. Selling, general and administrative expenses remained relatively stable year over year at $6.5 million.
Management also noted the seasonal nature of the business, emphasizing that construction activity typically weakens during winter months due to cold temperatures, snow and heavy rainfall. Sales generally peak during the second and third quarters when construction conditions improve.
Liquidity & Capital Spending
Monarch Cement ended the quarter with working capital of $161.7 million, up from $158.6 million at the end of 2025. Cash, cash equivalents and restricted cash totaled $33 million as of March 31, 2026, compared with $50.7 million a year earlier.
Net cash provided by operating activities increased to $10.6 million from $7.7 million in the prior-year quarter. Meanwhile, net cash used for investing activities declined significantly to $13.8 million from $35.1 million a year ago.
The capital expenditure totaled $11.1 million in the quarter, including $7.1 million related primarily to cement production facilities and $4 million for routine ready-mixed concrete equipment purchases. Management said that the company plans to invest $35.2 million in property, plant and equipment in 2026.
Other Developments
During the quarter, RMCMO Holdings LLC issued a dividend to Monarch Cement. In lieu of receiving cash, the company received and retired 1,817 shares of Monarch Cement’s capital stock. Monarch continues to hold a 49% ownership stake in RMCMO following the joint venture transaction completed in late 2024.
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Monarch Cement Q1 Earnings Jump Y/Y on Strong Cement Demand Trends
Shares of The Monarch Cement Company (MCEM - Free Report) have declined 1% since reporting results for the first quarter of 2026. This compares with the S&P 500 index’s 0.7% return over the same time frame. Over the past month, the stock has gained 13.2% compared with the S&P 500’s 6.1% return.
The company reported significantly improved first-quarter 2026 results, driven by higher cement and ready-mixed concrete volumes. Consolidated net sales rose 27.5% to $49.4 million from $38.7 million in the prior-year quarter.
Net income climbed to $11.3 million, or $3.03 per share, from $2.7 million, or 72 cents per share, a year earlier. Gross profit increased to $18.1 million from $11.7 million, while the gross profit margin expanded to 36.6% from 30.2% in the first quarter of 2025.
The Monarch Cement Co. Price, Consensus and EPS Surprise
The Monarch Cement Co. price-consensus-eps-surprise-chart | The Monarch Cement Co. Quote
Segmental Performance & Operating Metrics
The company’s Cement Business remained the primary growth driver in the quarter. Cement segment sales increased by $7.3 million year over year, aided largely by a 27.1% increase in the sales volume, while pricing contributed an additional $0.5 million. The Ready-Mixed Concrete Business posted a $3.4-million increase in sales, supported by a 28.1% rise in cubic yards sold, partly offset by modest pricing declines.
The Cement segment’s gross profit margins improved sharply to 51.9% from 44.3% a year earlier. The Ready-Mixed Concrete segment also showed improvement, with gross profit margins rising to 8.9% from 5.8%. Segmental operating income in the Cement Business increased to $11.9 million from $6.2 million in the prior-year period, while the Ready-Mixed Concrete Business reduced its operating loss to $302,430 from $1.1 million.
The company also benefited from stronger performance in brick, block and sundry product sales, which increased by $0.6 million during the quarter.
Factors Influencing Quarterly Results
Management attributed the quarter’s performance largely to stronger shipment volumes across both operating segments. Higher cement and ready-mixed concrete demand significantly outweighed modest pricing pressures in ready-mixed concrete operations.
Cost trends also contributed to margin expansion. Cement production costs declined by $2.1 million despite increased shipment volumes, while material costs in the Ready-Mixed Concrete Business decreased by $0.2 million. Overall consolidated cost of sales increased 12.7% year over year to $31.3 million, a slower pace than revenue growth, supporting profitability gains.
The company additionally recorded a substantial increase in unrealized gains on equity investments. Unrealized gains totaled $6.2 million in the quarter against an unrealized loss of $7.1 million in the prior-year period. However, gains on sales of equity investments declined to $1 million from $10.5 million a year earlier. Selling, general and administrative expenses remained relatively stable year over year at $6.5 million.
Management also noted the seasonal nature of the business, emphasizing that construction activity typically weakens during winter months due to cold temperatures, snow and heavy rainfall. Sales generally peak during the second and third quarters when construction conditions improve.
Liquidity & Capital Spending
Monarch Cement ended the quarter with working capital of $161.7 million, up from $158.6 million at the end of 2025. Cash, cash equivalents and restricted cash totaled $33 million as of March 31, 2026, compared with $50.7 million a year earlier.
Net cash provided by operating activities increased to $10.6 million from $7.7 million in the prior-year quarter. Meanwhile, net cash used for investing activities declined significantly to $13.8 million from $35.1 million a year ago.
The capital expenditure totaled $11.1 million in the quarter, including $7.1 million related primarily to cement production facilities and $4 million for routine ready-mixed concrete equipment purchases. Management said that the company plans to invest $35.2 million in property, plant and equipment in 2026.
Other Developments
During the quarter, RMCMO Holdings LLC issued a dividend to Monarch Cement. In lieu of receiving cash, the company received and retired 1,817 shares of Monarch Cement’s capital stock. Monarch continues to hold a 49% ownership stake in RMCMO following the joint venture transaction completed in late 2024.