Martin Marietta Materials, Inc. (NYSE:MLM) today reported its results
for the fourth quarter and year ended December 31, 2013.
Ward Nye, President and CEO of Martin Marietta Materials, stated: “We
are pleased to finish a successful 2013 with a solid fourth quarter.
Strong performance by our Aggregates and Specialty Products businesses
contributed to quarterly earnings per diluted share of $0.77, a 67%
increase over the prior-year quarter. Our nonresidential and residential
aggregates product line shipments experienced double-digit volume growth
as a result of focused execution and our efforts to position the Company
to benefit from the continued recovery in private-sector construction.
The Aggregates business also achieved pricing growth in each reportable
segment. When coupled with disciplined management of our cost profile
and record performance by our Specialty Products business, this led to
an incremental consolidated gross margin (excluding freight and delivery
revenues) for the quarter of 69%. Notably, our consolidated gross margin
(excluding freight and delivery revenues) expanded 380 basis points.
“The Aggregates business reported a 3.4% quarterly increase in
aggregates product line pricing and notable growth in both pricing and
volume in the ready mixed concrete product line, which led to a 7%
increase in net sales and a 250-basis-point improvement in gross margin
(excluding freight and delivery revenues). Aggregates product line
shipments were down slightly compared with the prior-year quarter, as
volume growth in the private-sector was offset by decreased shipments to
the public-sector. Net sales for the Specialty Products business
increased 15%, reflecting the Woodville, Ohio kiln expansion in the
dolomitic lime business, marketing initiatives in the chemicals business
and sound pricing gains in key product lines.
“As we begin 2014, we are encouraged by numerous macro-economic
indicators, including employment growth, which suggest increased
construction activity going forward. We expect private-sector
construction to benefit from significant shale energy projects,
improvements in general nonresidential construction and further recovery
in the housing market. Additionally, we also foresee some modest growth
in public sector projects. Following years of underinvestment at the
federal level, growth in state-level infrastructure funding initiatives
should stimulate public-sector activity. In summary, we believe we are
well positioned to capture these opportunities across our markets and
build on the momentum created throughout 2013,” Nye said.
NOTABLE ITEMS FOR THE QUARTER (ALL COMPARISONS ARE VERSUS THE
PRIOR-YEAR FOURTH QUARTER)
-
Earnings per diluted share of $0.77 compared with $0.46
-
Consolidated net sales of $491.4 million compared with $456.0 million
-
Aggregates product line pricing increase of 3.4%; volume decline of
0.4%
-
Specialty Products record net sales of $58.1 million and record
earnings from operations of $20.4 million
-
Consolidated gross margin (excluding freight and delivery revenues) of
20.6%, up 380 basis points
-
Consolidated selling, general and administrative expenses (SG&A)
decreased 70 basis points as a percentage of net sales
-
Consolidated earnings from operations of $62.8 million compared with
$40.2 million
NOTABLE ITEMS FOR THE YEAR (ALL COMPARISONS ARE VERSUS 2012)
-
Earnings per diluted share of $2.61 compared with $1.83 (2012 includes
business development expenses of $0.46 per diluted share)
-
Net sales of $1.943 billion compared with $1.833 billion
-
Aggregates product line pricing up 3.0%; volume flat
-
Specialty Products record net sales of $225.6 million and record
earnings from operations of $73.5 million
-
Consolidated gross margin (excluding freight and delivery revenues) of
18.7%, up 90 basis points
-
Consolidated SG&A up 10 basis points as a percentage of net sales
-
Consolidated earnings from operations of $218.0 million compared with
$156.2 million
MANAGEMENT COMMENTARY (ALL COMPARISONS, UNLESS NOTED, ARE VERSUS THE
PRIOR-YEAR FOURTH QUARTER)
Nye continued, “The private sector continues to drive construction
growth. Looking closely at our fourth-quarter results, the
nonresidential market, which comprised 33% of fourth-quarter aggregates
product line shipments and increased 11%, was a major contributor. We
saw notable growth in both commercial construction and the energy sector
as we continue to benefit from the investment in shale energy. Looking
forward, we anticipate additional opportunities as developmental
activity moves into downstream projects.
“The residential market achieved volume growth of 21% and accounted for
15% of our quarterly shipments, in line with historical levels. Housing
permits and starts, key indicators for residential construction
activity, continue to meaningfully improve on a year-over-year basis.
Housing starts for the year were up 18% over 2012, and the rate of
starts significantly exceeded completions. The ChemRock/Rail market,
which represented 10% of aggregates volumes, decreased 12%, partially as
a result of a reduction in agricultural lime shipments due to wetter and
colder weather and lower ballast volumes. Shipments to the
infrastructure end-use market, which represented the remaining 42% of
our aggregates product line, decreased 10%, driven by the completion of
several large road projects in Indiana and Iowa and poor weather in
Texas.
“The Federal government shutdown in October, as well as questions
concerning future government spending policy negatively affected
public-sector demand. There is continued uncertainty in long-term
funding beyond the September 2014 expiration of the Moving Ahead for
Progress in the 21st Century Act, or
MAP-21. However, we remain encouraged by the anticipated impact of the Transportation
Infrastructure Finance and Innovation Act (TIFIA) component of
MAP-21 which has the ability to leverage up to $50 billion in financing
for transportation projects of either national or regional significance.
While awards continue to move at a slower pace versus earlier
expectations, we still expect TIFIA to benefit several of our major
markets – namely Texas, North Carolina and Florida – in 2014 and likely
more notably in 2015.
“Not surprisingly, we are seeing growth in state-level funding
initiatives as states and municipalities are taking actions to address
their infrastructure needs in this period of federal funding
uncertainty. For example, Texas, in addition to filing applications for
nearly $7 billion in funding assistance under TIFIA, has a November
ballot initiative that, if passed, would provide an additional $1
billion in funding for highway projects. Additionally, San Antonio
recently announced an $825 million highway initiative that will include
the area’s first toll-road project. Colorado passed legislation to
allocate $450 million for emergency road repairs following flood damage
incurred in September, of which $110 million will be provided by the
U.S. Department of Transportation. In Georgia, three regions within the
state are collecting a special-purpose local option sales tax earmarked
for transportation improvements. We expect projects funded by this tax
to accelerate during 2014. Anecdotally, these examples demonstrate why
we believe infrastructure spending on local levels will continue to grow.
“We were successful in extending our pricing momentum in the Aggregates
business with each of our reportable segments reporting growth. Pricing
improvement was strongest in the Mid-America Group, where a 5.2%
increase was led by our North Carolina operations. Importantly, for each
quarter of 2013, all reportable segments achieved aggregates product
line pricing improvement, enabling us to achieve an overall annual
increase of 3.0%. For the quarter, the ready mixed concrete business
achieved pricing growth of 9.8% while the asphalt product line reported
a decrease of 4.8%.
“SG&A expenses were 7.6% of net sales, a decrease of 70-basis-points. On
an absolute basis, SG&A expenses declined $0.5 million. Consolidated
earnings from operations were $62.8 million, an improvement of 56%.
“Specialty Products continued its strong performance and generated
record fourth-quarter net sales of $58.1 million. We controlled
production costs and increased the business’ gross margin (excluding
freight and delivery revenues) by 360 basis points. Fourth-quarter
earnings from operations were a record $20.4 million, an increase of 29%.
LIQUIDITY AND CAPITAL RESOURCES
“Cash provided by operating activities for full-year 2013 was $309.0
million compared with $222.7 million in 2012. The improvement is
attributable to earnings growth, due in part to the absence of
significant business development costs incurred during 2012.
“During the quarter, we renegotiated our revolving line of credit and
term loan and extended the expiration of these facilities to 2018.
“At December 31, 2013, our ratio of consolidated debt to consolidated
EBITDA, as defined in our senior credit facility, for the trailing
twelve months was 2.67 times, in compliance with our covenant.
2014 OUTLOOK
“We are encouraged by various positive trends in our business and
markets – especially in employment and private-sector construction.
Nonresidential construction is expected to grow in both the heavy
industrial and commercial sectors. Shale development and related
follow-on public and private construction activities are anticipated to
remain strong. Further, the commercial building sector is expected to
benefit from improved market fundamentals, such as higher occupancies
and rents, strengthened property values and increased real estate
lending. Based on these factors, we anticipate that the nonresidential
end-use market will increase in the mid-to-high single digits.
Residential construction should continue to grow, driven by historically
low mortgage rates, rising housing prices and total annual housing
starts, which are expected to exceed one million units for the first
time since 2007. We believe these trends will lead to double-digit
volume growth in residential end-use shipments. For the public sector,
authorized highway funding from MAP-21 should increase slightly compared
with 2013. Additionally, state initiatives to finance infrastructure
projects are expected to grow and continue to play a more critical role
in public-sector activity. Based on these trends and expectations, we
expect aggregates shipments to the infrastructure end-use market to
increase slightly. Finally, our ChemRock/Rail end-use market is expected
to have low single-digit growth compared with 2013.
“Cumulatively, we anticipate aggregates product line shipments will be
up 4% to 5% compared with 2013 levels. We currently expect aggregates
product line pricing will increase 3% to 5% for the year compared with
2013. A variety of factors beyond our direct control may continue to
exert pressure on our volumes, and our forecasted pricing increase will
not be uniform across the company. We expect aggregates product line
direct production cost per ton will decrease slightly compared with 2013.
“We expect our vertically integrated businesses to generate between $385
million and $405 million of net sales and $40 million to $45 million of
gross profit.
“SG&A expenses as a percentage of net sales are expected to decline
compared with 2013, driven in part by $7.9 million of nonrecurring costs
related primarily to the 2013 completion of our information systems
upgrade, as well as, lower pension costs.
“Net sales for the Specialty Products segment are expected to be between
$225 million and $235 million, generating $85 million to $90 million of
gross profit. Steel utilization and natural gas prices are two key
factors for this segment.
“Interest expense is expected to remain relatively flat compared with
2013. Our effective tax rate is expected to approximate 29%, excluding
discrete events. Capital expenditures are forecast at $155 million.”
RISKS TO OUTLOOK
The 2014 outlook include management’s assessment of the likelihood of
certain risk factors that will affect performance. The most significant
risks to the Corporation’s 2014 performance will be Congress’ actions
and timing surrounding the expiration of MAP-21 in September and
uncertainty over the funding mechanism for the Highway Trust Fund.
Further, additional government shutdown(s) and the impact of The
Patient Protection and Affordable Care Act may further erode
consumer confidence, which may negatively impact investment in
construction projects. While both MAP-21 and TIFIA credit assistance are
excluded from the federal budget sequester and the U.S. debt ceiling
limit, the ultimate resolution of these issues may have a significant
impact on the economy and, consequently, construction activity. Other
risks related to the Corporation’s future performance include, but are
not limited to, both price and volume and include a recurrence of
widespread decline in aggregates volume negatively affecting aggregates
price; the termination, capping and/or reduction of the federal and/or
state gasoline tax(es) or other revenue related to infrastructure
construction; a significant change in the funding patterns for
traditional federal, state and/or local infrastructure projects; a
reduction in defense spending, and the subsequent impact on construction
activity on or near military bases; a decline in nonresidential
construction, a decline in energy-related drilling activity resulting
from certain regulatory or economic factors, a slowdown in the
residential construction recovery, or some combination thereof; and a
reduction in ChemRock/Rail shipments resulting from the uncertainty as
to the timing and funding levels of the domestic farm bill and declining
coal traffic on the railroads. Further, increased highway construction
funding pressures resulting from either federal or state issues can
affect profitability. If these negatively affect transportation budgets
more than in the past, construction spending could be reduced. North
Carolina, a state that disproportionately affects the Corporation’s
revenue and profitability, is among the states experiencing these fiscal
pressures, although recent statistics indicate that transportation and
tax revenues are increasing. The Specialty Products business essentially
runs at capacity; therefore any unplanned changes in costs or
realignment of customers introduce volatility to the earnings of this
segment.
The Corporation’s principal business serves customers in
aggregates-related construction markets. This concentration could
increase the risk of potential losses on customer receivables; however,
payment bonds normally posted on public projects, together with lien
rights on private projects, help to mitigate the risk of uncollectible
receivables. The level of aggregates demand in the Corporation’s end-use
markets, production levels and the management of production costs will
affect the operating leverage of the Aggregates business and, therefore,
profitability. Production costs in the Aggregates business are also
sensitive to energy and raw material prices, both directly and
indirectly. Diesel fuel and other consumables change production costs
directly through consumption or indirectly by increased energy-related
input costs, such as steel, explosives, tires and conveyor belts.
Fluctuating diesel fuel pricing also affects transportation costs,
primarily through fuel surcharges in the Corporation’s long-haul
distribution network. The Specialty Products business is sensitive to
changes in domestic steel capacity utilization and the absolute price
and fluctuations in the cost of natural gas.
Transportation in the Corporation’s long-haul network, particularly the
supply of rail cars and locomotive power to move trains, affects our
ability to efficiently transport material into certain markets, most
notably Texas, Florida and the Gulf Coast. The availability of trucks
and drivers to transport our product, particularly in markets
experiencing increased demand due to energy-sector activity, is also a
risk. The Aggregates business is also subject to weather-related risks
that can significantly affect production schedules and profitability.
The first and fourth quarters are most adversely affected by winter
weather. Hurricane activity in the Atlantic Ocean and Gulf Coast
generally is most active during the third and fourth quarters.
Risks to the outlook include shipment declines as a result of economic
events beyond the Corporation’s control. In addition to the impact on
nonresidential and residential construction, the Corporation is exposed
to risk in its estimated outlook from credit markets and the
availability of and interest cost related to its debt.
The Corporation’s future performance is also exposed to risks from tax
reform at the federal and state levels.
CONFERENCE CALL INFORMATION
The Company will discuss its fourth-quarter 2013 earnings results on a
conference call and online web simulcast today (January 28, 2014). The
live broadcast of the Martin Marietta Materials, Inc. conference call
will begin at 8:30 a.m. Eastern Time today. An online replay will be
available approximately two hours following the conclusion of the live
broadcast. A link to these events will be available at the Corporation’s
website.
For those investors without online web access, the conference call may
also be accessed by calling (866) 610-1072, confirmation number
51412630. For international participants, the call can be accessed by
calling (973) 935-2840 and using the same confirmation number.
Martin Marietta Materials, Inc. is the nation’s second largest producer
of construction aggregates and a producer of magnesia-based chemicals
and dolomitic lime. For more information about Martin Marietta
Materials, Inc., refer to the Corporation’s website at www.martinmarietta.com.
If you are interested in Martin Marietta Materials, Inc. stock,
management recommends that, at a minimum, you read the Corporation’s
current annual report and Forms 10-K, 10-Q and 8-K reports to the
Securities and Exchange Commission (SEC) over the past year. The
Corporation’s recent proxy statement for the annual meeting of
shareholders also contains important information. These and other
materials that have been filed with the SEC are accessible through the
Corporation’s website at www.martinmarietta.com
and are also available at the SEC’s website at www.sec.gov.
You may also write or call the Corporation’s Corporate Secretary, who
will provide copies of such reports.
Investors are cautioned that all statements in this press release
that relate to the future involve risks and uncertainties, and are based
on assumptions that the Corporation believes in good faith are
reasonable but which may be materially different from actual results.
Forward-looking statements give the investor our expectations or
forecasts of future events. You can identify these statements by
the fact that they do not relate only to historical or current facts.
They may use words such as "anticipate," "expect," "should be,"
"believe," “will”, and other words of similar meaning in connection with
future events or future operating or financial performance. Any
or all of our forward-looking statements here and in other publications
may turn out to be wrong.
Factors that the Corporation currently believes could cause actual
results to differ materially from the forward-looking statements in this
press release include, but are not limited to, Congress’ actions
and timing surrounding the expiration of MAP-21 in September and
uncertainty over the funding mechanism for the Highway Trust Fund; the
performance of the United States economy and the resolution and impact
of the debt ceiling and sequestration issues; widespread decline in
aggregates pricing; the termination, capping and/or reduction of the
federal and/or state gasoline tax(es) or other revenue related to
infrastructure construction; the level and timing of federal and state
transportation funding, most particularly in North Carolina, one of the
Corporation’s largest and most profitable states, and Texas, Iowa,
Colorado and Georgia; the ability of states and/or other entities to
finance approved projects either with tax revenues or alternative
financing structures; levels of construction spending in the markets the
Corporation serves; a reduction in defense spending, and the subsequent
impact on construction activity on or near military bases; a decline in
the commercial component of the nonresidential construction market,
notably office and retail space; a slowdown in energy-related drilling
activity; a slowdown in residential construction recovery; a reduction
in shipments due to a decline in funding under the domestic farm bill;
unfavorable weather conditions, particularly Atlantic Ocean hurricane
activity, the late start to spring or the early onset of winter and the
impact of a drought or excessive rainfall in the markets served by the
Corporation; the volatility of fuel costs, particularly diesel fuel, and
the impact on the cost of other consumables, namely steel, explosives,
tires and conveyor belts, and with respect to the Specialty Products
business, natural gas; continued increases in the cost of other repair
and supply parts; transportation availability, notably the availability
of railcars and locomotive power to move trains to supply the
Corporation’s Texas, Florida and Gulf Coast markets; increased
transportation costs, including increases from higher passed-through
energy and other costs to comply with tightening regulations as well as
higher volumes of rail and water shipments; availability and cost of
construction equipment in the United States; weakening in the steel
industry markets served by the Corporation’s dolomitic lime products;
inflation and its effect on both production and interest costs; ability
to successfully integrate acquisitions quickly and in a cost-effective
manner and achieve anticipated profitability to maintain compliance with
the Corporation’s leverage ratio debt covenant; changes in tax laws, the
interpretation of such laws and/or administrative practices that would
increase the Corporation’s tax rate; violation of the
Corporation’s debt covenant if price and/or volumes return to previous
levels of instability; downward pressure on the Corporation’s common
stock price and its impact on goodwill impairment evaluations; reduction
of the Corporation’s credit rating to non-investment grade resulting
from strategic acquisitions; and other risk factors listed from time to
time found in the Corporation’s filings with the SEC. Other
factors besides those listed here may also adversely affect the
Corporation, and may be material to the Corporation. The
Corporation assumes no obligation to update any such forward-looking
statements.
Cautionary Statements Regarding Forward-Looking Statements
Certain statements in this communication regarding the proposed
acquisition of TXI by Martin Marietta, the expected timetable for
completing the transaction, benefits and synergies of the transaction,
future opportunities for the combined company and products and any other
statements regarding Martin Marietta’s and TXI’s future expectations,
beliefs, plans, objectives, financial conditions, assumptions or future
events or performance that are not historical facts are
“forward-looking” statements made within the meaning of Section 21E of
the Securities Exchange Act of 1934. These statements are often, but not
always, made through the use of words or phrases such as “may”,
“believe,” “anticipate,” “could”, “should,” “intend,” “plan,” “will,”
“expect(s),” “estimate(s),” “project(s),” “forecast(s)”, “positioned,”
“strategy,” “outlook” and similar expressions. All such forward-looking
statements involve estimates and assumptions that are subject to risks,
uncertainties and other factors that could cause actual results to
differ materially from the results expressed in the statements. Among
the key factors that could cause actual results to differ materially
from those projected in the forward-looking statements are the
following: the parties’ ability to consummate the transaction; the
conditions to the completion of the transaction, including the receipt
of approval of both Martin Marietta’s shareholders and TXI’s
stockholders; the regulatory approvals required for the transaction not
being obtained on the terms expected or on the anticipated schedule; the
parties’ ability to meet expectations regarding the timing, completion
and accounting and tax treatments of the transaction; the possibility
that the parties may be unable to achieve expected synergies and
operating efficiencies in connection with the transaction within the
expected time-frames or at all and to successfully integrate TXI’s
operations into those of Martin Marietta; the integration of TXI’s
operations into those of Martin Marietta being more difficult,
time-consuming or costly than expected; operating costs, customer loss
and business disruption (including, without limitation, difficulties in
maintaining relationships with employees, customers, clients or
suppliers) being greater than expected following the transaction; the
retention of certain key employees of TXI being difficult; Martin
Marietta’s and TXI’s ability to adapt its services to changes in
technology or the marketplace; Martin Marietta’s and TXI’s ability to
maintain and grow its relationship with its customers; levels of
construction spending in the markets; a decline in defense spending and
the commercial component of the nonresidential construction market and
the subsequent impact on construction activity; a slowdown in
residential construction recovery; unfavorable weather conditions; a
widespread decline in aggregates pricing; changes in the cost of raw
materials, fuel and energy and the availability and cost of construction
equipment in the United States; the timing and amount of federal, state
and local transportation and infrastructure funding; the ability of
states and/or other entities to finance approved projects either with
tax revenues or alternative financing structures; and changes to and the
impact of the laws, rules and regulations (including environmental laws,
rules and regulations) that regulate Martin Marietta’s and TXI’s
operations. Additional information concerning these and other factors
can be found in Martin Marietta’s and TXI’s filings with the Securities
and Exchange Commission, including Martin Marietta’s and TXI’s most
recent Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K. Martin Marietta and TXI assume no
obligation to update or revise publicly the information in this
communication, whether as a result of new information, future events or
otherwise, except as otherwise required by law. Readers are cautioned
not to place undue reliance on these forward-looking statements that
speak only as of the date hereof.
Additional Information and Where to Find It
In connection with the proposed transaction between Martin Marietta and
TXI, Martin Marietta and TXI intend to file relevant materials with the
Securities and Exchange Commission, including a Martin Marietta
registration statement on Form S-4 that will include a joint proxy
statement of Martin Marietta and TXI that also constitutes a prospectus
of Martin Marietta. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE
JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT MARTIN MARIETTA, TXI AND THE PROPOSED TRANSACTION. The joint proxy
statement/prospectus and other documents relating to the proposed
transaction (when they are available) can be obtained free of charge
from the SEC’s website at www.sec.gov. These documents (when they are
available) can also be obtained free of charge from Martin Marietta upon
written request to the Corporate Secretary at Martin Marietta Materials,
Inc., 2710 Wycliff Road, Raleigh, NC 27607, telephone number (919)
783-4540 or from Martin Marietta’s website, http://ir.martinmarietta.com
or from TXI upon written request to TXI at Investor Relations, Texas
Industries, Inc., 1503 LBJ Freeway, Suite 400, Dallas, Texas 75234,
telephone number (972) 647-6700 or from TXI’s website,
http://investorrelations.txi.com.
Participants in Solicitation
This communication is not a solicitation of a proxy from any investor or
securityholder. However, Martin Marietta, TXI and certain of their
respective directors and executive officers may be deemed to be
participants in the solicitation of proxies in connection with the
proposed transaction under the rules of the SEC. Information regarding
Martin Marietta’s directors and executive officers may be found in its
Annual Report for the year ended December 31, 2012 on Form 10-K filed
with the SEC on February 2, 2013 and the definitive proxy statement
relating to its 2013 Annual Meeting of Shareholders filed with the SEC
on April 16, 2013. Information regarding TXI’s directors and executive
officers may be found in its Annual Report for the year ended May 31,
2013 on Form 10-K filed with the SEC on July 22, 2013 and the definitive
proxy statement relating to its 2013 Annual Meeting of Shareholders
filed with the SEC on August 23, 2013. These documents can be obtained
free of charge from the sources indicated above. Additional information
regarding the interests of these participants will also be included in
the joint proxy statement/prospectus when it becomes available.
Non-Solicitation
This communication shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to buy
any securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any
such jurisdiction. No offer of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended.
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MARTIN MARIETTA MATERIALS, INC.
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Unaudited Statements of Earnings
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(In millions, except per share amounts)
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Three Months Ended
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Year Ended
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December 31,
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December 31,
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2013
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2012
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2013
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2012
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Net sales
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$
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491.4
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$
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456.0
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$
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1,943.2
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$
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1,833.0
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Freight and delivery revenues
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53.6
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46.2
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212.3
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198.9
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Total revenues
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545.0
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502.2
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2,155.5
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2,031.9
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Cost of sales
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390.4
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379.3
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1,579.2
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1,505.9
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Freight and delivery costs
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53.6
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46.2
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212.3
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198.9
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Total cost of revenues
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444.0
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425.5
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1,791.5
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1,704.8
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Gross profit
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101.0
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76.7
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364.0
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327.1
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Selling, general and administrative expenses
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37.5
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38.0
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150.1
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138.4
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Business development costs
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-
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-
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0.7
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35.1
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Other operating income, net
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0.7
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(1.5
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(4.8
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(2.6
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)
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Earnings from operations
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62.8
|
|
|
|
40.2
|
|
|
|
218.0
|
|
|
|
156.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
|
|
12.8
|
|
|
|
13.4
|
|
|
|
53.5
|
|
|
|
53.3
|
|
|
Other nonoperating expenses and (income), net
|
|
|
|
|
0.1
|
|
|
|
(0.1
|
)
|
|
|
0.3
|
|
|
|
(1.2
|
)
|
|
Earnings from continuing operations before taxes on income
|
|
|
|
|
49.9
|
|
|
|
26.9
|
|
|
|
164.2
|
|
|
|
104.1
|
|
|
Income tax expense
|
|
|
|
|
14.4
|
|
|
|
5.0
|
|
|
|
44.0
|
|
|
|
17.4
|
|
|
Earnings from continuing operations
|
|
|
|
|
35.5
|
|
|
|
21.9
|
|
|
|
120.2
|
|
|
|
86.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on discontinued operations, net of related tax benefit
|
|
|
|
|
|
|
|
|
|
|
|
of $0.2, $0.3, $0.4 and $0.8, respectively
|
|
|
|
|
(0.3
|
)
|
|
|
(0.2
|
)
|
|
|
(0.8
|
)
|
|
|
(1.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated net earnings
|
|
|
|
|
35.2
|
|
|
|
21.7
|
|
|
|
119.4
|
|
|
|
85.5
|
|
|
Less: Net (loss) earnings attributable to noncontrolling interests
|
|
|
|
|
(0.8
|
)
|
|
|
0.2
|
|
|
|
(1.9
|
)
|
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to Martin Marietta Materials, Inc.
|
|
|
|
$
|
36.0
|
|
|
$
|
21.5
|
|
|
$
|
121.3
|
|
|
$
|
84.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) attributable to Martin Marietta Materials, Inc.
per common share:
|
|
|
|
|
|
Basic from continuing operations attributable to common shareholders
|
|
|
|
$
|
0.79
|
|
|
$
|
0.47
|
|
|
$
|
2.64
|
|
|
$
|
1.86
|
|
|
Discontinued operations attributable to common shareholders
|
|
|
|
|
(0.01
|
)
|
|
|
-
|
|
|
|
(0.02
|
)
|
|
|
(0.03
|
)
|
|
|
|
|
|
$
|
0.78
|
|
|
$
|
0.47
|
|
|
$
|
2.62
|
|
|
$
|
1.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted from continuing operations attributable to common
shareholders
|
|
|
|
$
|
0.78
|
|
|
$
|
0.46
|
|
|
$
|
2.63
|
|
|
$
|
1.86
|
|
|
Discontinued operations attributable to common shareholders
|
|
|
|
|
(0.01
|
)
|
|
|
-
|
|
|
|
(0.02
|
)
|
|
|
(0.03
|
)
|
|
|
|
|
|
$
|
0.77
|
|
|
$
|
0.46
|
|
|
$
|
2.61
|
|
|
$
|
1.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share
|
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
1.60
|
|
|
$
|
1.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
46.3
|
|
|
|
45.9
|
|
|
|
46.2
|
|
|
|
45.8
|
|
|
Diluted
|
|
|
|
|
46.4
|
|
|
|
46.1
|
|
|
|
46.3
|
|
|
|
46.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Unaudited Financial Highlights
|
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
$
|
169.5
|
|
|
$
|
165.5
|
|
|
$
|
678.5
|
|
|
$
|
658.9
|
|
|
Southeast Group
|
|
|
|
|
55.0
|
|
|
|
55.2
|
|
|
|
226.4
|
|
|
|
226.2
|
|
|
West Group
|
|
|
|
|
208.8
|
|
|
|
184.7
|
|
|
|
812.7
|
|
|
|
745.6
|
|
|
Total Aggregates Business
|
|
|
|
|
433.3
|
|
|
|
405.4
|
|
|
|
1,717.6
|
|
|
|
1,630.7
|
|
|
Specialty Products
|
|
|
|
|
58.1
|
|
|
|
50.6
|
|
|
|
225.6
|
|
|
|
202.3
|
|
|
Total
|
|
|
|
$
|
491.4
|
|
|
$
|
456.0
|
|
|
$
|
1,943.2
|
|
|
$
|
1,833.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (loss):
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
$
|
55.2
|
|
|
$
|
48.4
|
|
|
$
|
191.7
|
|
|
$
|
180.1
|
|
|
Southeast Group
|
|
|
|
|
(0.6
|
)
|
|
|
(6.4
|
)
|
|
|
(3.5
|
)
|
|
|
(6.0
|
)
|
|
West Group
|
|
|
|
|
23.6
|
|
|
|
20.8
|
|
|
|
93.5
|
|
|
|
81.3
|
|
|
Total Aggregates Business
|
|
|
|
|
78.2
|
|
|
|
62.8
|
|
|
|
281.7
|
|
|
|
255.4
|
|
|
Specialty Products
|
|
|
|
|
22.9
|
|
|
|
18.2
|
|
|
|
83.7
|
|
|
|
77.2
|
|
|
Corporate
|
|
|
|
|
(0.1
|
)
|
|
|
(4.3
|
)
|
|
|
(1.4
|
)
|
|
|
(5.5
|
)
|
|
Total
|
|
|
|
$
|
101.0
|
|
|
$
|
76.7
|
|
|
$
|
364.0
|
|
|
$
|
327.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
$
|
12.5
|
|
|
$
|
13.1
|
|
|
$
|
50.0
|
|
|
$
|
53.0
|
|
|
Southeast Group
|
|
|
|
|
4.7
|
|
|
|
4.5
|
|
|
|
18.1
|
|
|
|
18.2
|
|
|
West Group
|
|
|
|
|
12.2
|
|
|
|
11.7
|
|
|
|
46.6
|
|
|
|
45.2
|
|
|
Total Aggregates Business
|
|
|
|
|
29.4
|
|
|
|
29.3
|
|
|
|
114.7
|
|
|
|
116.4
|
|
|
Specialty Products
|
|
|
|
|
2.6
|
|
|
|
2.4
|
|
|
|
10.2
|
|
|
|
9.3
|
|
|
Corporate
|
|
|
|
|
5.5
|
|
|
|
6.3
|
|
|
|
25.2
|
|
|
|
12.7
|
|
|
Total
|
|
|
|
$
|
37.5
|
|
|
$
|
38.0
|
|
|
$
|
150.1
|
|
|
$
|
138.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) from operations:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
$
|
44.6
|
|
|
$
|
36.4
|
|
|
$
|
146.9
|
|
|
$
|
131.4
|
|
|
Southeast Group
|
|
|
|
|
(4.9
|
)
|
|
|
(10.5
|
)
|
|
|
(19.8
|
)
|
|
|
(25.5
|
)
|
|
West Group
|
|
|
|
|
12.1
|
|
|
|
9.7
|
|
|
|
50.5
|
|
|
|
38.9
|
|
|
Total Aggregates Business
|
|
|
|
|
51.8
|
|
|
|
35.6
|
|
|
|
177.6
|
|
|
|
144.8
|
|
|
Specialty Products
|
|
|
|
|
20.4
|
|
|
|
15.8
|
|
|
|
73.5
|
|
|
|
68.5
|
|
|
Corporate
|
|
|
|
|
(9.4
|
)
|
|
|
(11.2
|
)
|
|
|
(33.1
|
)
|
|
|
(57.1
|
)
|
|
Total
|
|
|
|
$
|
62.8
|
|
|
$
|
40.2
|
|
|
$
|
218.0
|
|
|
$
|
156.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Unaudited Financial Highlights
|
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales by product line:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates
|
|
|
|
$
|
331.2
|
|
|
$
|
318.4
|
|
|
$
|
1,347.5
|
|
|
$
|
1,304.0
|
|
|
Asphalt
|
|
|
|
|
14.0
|
|
|
|
18.2
|
|
|
|
66.2
|
|
|
|
79.8
|
|
|
Ready Mixed Concrete
|
|
|
|
|
42.7
|
|
|
|
31.8
|
|
|
|
146.1
|
|
|
|
110.5
|
|
|
Road Paving
|
|
|
|
|
45.4
|
|
|
|
37.0
|
|
|
|
157.8
|
|
|
|
136.4
|
|
|
Total Aggregates Business
|
|
|
|
|
433.3
|
|
|
|
405.4
|
|
|
|
1,717.6
|
|
|
|
1,630.7
|
|
|
Specialty Products Business
|
|
|
|
|
58.1
|
|
|
|
50.6
|
|
|
|
225.6
|
|
|
|
202.3
|
|
|
Total
|
|
|
|
$
|
491.4
|
|
|
$
|
456.0
|
|
|
$
|
1,943.2
|
|
|
$
|
1,833.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit (loss) by product line:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates Business:
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates
|
|
|
|
$
|
69.9
|
|
|
$
|
57.7
|
|
|
$
|
259.1
|
|
|
$
|
240.6
|
|
|
Asphalt
|
|
|
|
|
3.2
|
|
|
|
3.0
|
|
|
|
12.9
|
|
|
|
12.1
|
|
|
Ready Mixed Concrete
|
|
|
|
|
3.4
|
|
|
|
(0.3
|
)
|
|
|
8.3
|
|
|
|
0.1
|
|
|
Road Paving
|
|
|
|
|
1.7
|
|
|
|
2.4
|
|
|
|
1.4
|
|
|
|
2.6
|
|
|
Total Aggregates Business
|
|
|
|
|
78.2
|
|
|
|
62.8
|
|
|
|
281.7
|
|
|
|
255.4
|
|
|
Specialty Products Business
|
|
|
|
|
22.9
|
|
|
|
18.2
|
|
|
|
83.7
|
|
|
|
77.2
|
|
|
Corporate
|
|
|
|
|
(0.1
|
)
|
|
|
(4.3
|
)
|
|
|
(1.4
|
)
|
|
|
(5.5
|
)
|
|
Total
|
|
|
|
$
|
101.0
|
|
|
$
|
76.7
|
|
|
$
|
364.0
|
|
|
$
|
327.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
$
|
40.5
|
|
|
$
|
41.4
|
|
|
$
|
162.7
|
|
|
$
|
166.9
|
|
|
Depletion
|
|
|
|
|
1.8
|
|
|
|
1.6
|
|
|
|
5.7
|
|
|
|
5.0
|
|
|
Amortization
|
|
|
|
|
1.4
|
|
|
|
1.2
|
|
|
|
5.4
|
|
|
|
5.3
|
|
|
|
|
|
|
$
|
43.7
|
|
|
$
|
44.2
|
|
|
$
|
173.8
|
|
|
$
|
177.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Balance Sheet Data
|
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
(Unaudited)
|
|
(Audited)
|
|
ASSETS
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
42.4
|
|
$
|
25.4
|
|
Accounts receivable, net
|
|
|
|
|
245.4
|
|
|
224.1
|
|
Inventories, net
|
|
|
|
|
347.3
|
|
|
332.3
|
|
Other current assets
|
|
|
|
|
120.3
|
|
|
118.6
|
|
Property, plant and equipment, net
|
|
|
|
|
1,799.2
|
|
|
1,753.2
|
|
Intangible assets, net
|
|
|
|
|
665.2
|
|
|
666.6
|
|
Other noncurrent assets
|
|
|
|
|
40.0
|
|
|
40.7
|
|
Total assets
|
|
|
|
$
|
3,259.8
|
|
$
|
3,160.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
Current maturities of long-term debt and short-term facilities
|
|
|
|
$
|
12.4
|
|
$
|
5.7
|
|
Other current liabilities
|
|
|
|
|
198.1
|
|
|
167.6
|
|
Long-term debt (excluding current maturities)
|
|
|
|
|
1,018.5
|
|
|
1,042.2
|
|
Other noncurrent liabilities
|
|
|
|
|
455.9
|
|
|
495.1
|
|
Total equity
|
|
|
|
|
1,574.9
|
|
|
1,450.3
|
|
Total liabilities and equity
|
|
|
|
$
|
3,259.8
|
|
$
|
3,160.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Unaudited Statements of Cash Flows
|
|
(In millions)
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Operating activities:
|
|
|
|
|
|
|
|
Consolidated net earnings
|
|
|
|
$
|
119.4
|
|
|
$
|
85.5
|
|
|
Adjustments to reconcile consolidated net earnings to net cash
provided by operating activities:
|
|
|
Depreciation, depletion and amortization
|
|
|
|
|
173.8
|
|
|
|
177.2
|
|
|
Stock-based compensation expense
|
|
|
|
|
7.0
|
|
|
|
7.8
|
|
|
Gains on divestitures and sales of assets
|
|
|
|
|
(2.3
|
)
|
|
|
(1.0
|
)
|
|
Deferred income taxes
|
|
|
|
|
24.1
|
|
|
|
13.9
|
|
|
Excess tax benefits from stock-based compensation
|
|
|
|
|
(2.4
|
)
|
|
|
(0.8
|
)
|
|
Other items, net
|
|
|
|
|
(0.4
|
)
|
|
|
2.2
|
|
|
Changes in operating assets and liabilities, net of effects of
acquisitions and divestitures:
|
|
|
|
Accounts receivable, net
|
|
|
|
|
(22.5
|
)
|
|
|
(20.3
|
)
|
|
Inventories, net
|
|
|
|
|
(11.6
|
)
|
|
|
(9.6
|
)
|
|
Accounts payable
|
|
|
|
|
20.1
|
|
|
|
(8.7
|
)
|
|
Other assets and liabilities, net
|
|
|
|
|
3.8
|
|
|
|
(23.5
|
)
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
|
|
309.0
|
|
|
|
222.7
|
|
|
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
|
|
Additions to property, plant and equipment
|
|
|
|
|
(155.2
|
)
|
|
|
(151.0
|
)
|
|
Acquisitions, net
|
|
|
|
|
(64.5
|
)
|
|
|
(0.2
|
)
|
|
Proceeds from divestitures and sales of assets
|
|
|
|
|
8.5
|
|
|
|
10.0
|
|
|
Loan to affiliate
|
|
|
|
|
(3.4
|
)
|
|
|
(2.0
|
)
|
|
|
|
|
|
|
|
|
|
Net cash used for investing activities
|
|
|
|
|
(214.6
|
)
|
|
|
(143.2
|
)
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
Borrowings of long-term debt
|
|
|
|
|
604.4
|
|
|
|
181.0
|
|
|
Repayments of long-term debt
|
|
|
|
|
(621.1
|
)
|
|
|
(193.7
|
)
|
|
Payments on capital leases
|
|
|
|
|
(0.1
|
)
|
|
|
-
|
|
|
Change in bank overdraft
|
|
|
|
|
2.5
|
|
|
|
-
|
|
|
Dividends paid
|
|
|
|
|
(74.2
|
)
|
|
|
(73.8
|
)
|
|
Debt issue costs
|
|
|
|
|
(2.1
|
)
|
|
|
(0.6
|
)
|
|
Issuances of common stock
|
|
|
|
|
11.7
|
|
|
|
7.0
|
|
|
Excess tax benefits from stock-based compensation
|
|
|
|
|
2.4
|
|
|
|
0.8
|
|
|
Distributions to owners of noncontrolling interests
|
|
|
|
|
(0.9
|
)
|
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
|
|
Net cash used for financing activities
|
|
|
|
|
(77.4
|
)
|
|
|
(80.1
|
)
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
|
17.0
|
|
|
|
(0.6
|
)
|
|
Cash and cash equivalents, beginning of period
|
|
|
|
|
25.4
|
|
|
|
26.0
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
|
|
$
|
42.4
|
|
|
$
|
25.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Unaudited Operational Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
Volume
|
|
Pricing
|
|
Volume
|
|
Pricing
|
|
Volume/Pricing Variance (1)
|
|
|
|
|
|
|
|
|
|
|
|
Heritage Aggregates Product Line: (2)
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
(2.8%)
|
|
5.2%
|
|
(0.4%)
|
|
3.2%
|
|
Southeast Group
|
|
|
|
(8.2%)
|
|
0.4%
|
|
(5.6%)
|
|
1.9%
|
|
West Group
|
|
|
|
2.7%
|
|
3.6%
|
|
1.2%
|
|
3.9%
|
|
Heritage Aggregates Operations
|
|
|
|
(1.4%)
|
|
3.3%
|
|
(0.5%)
|
|
2.9%
|
|
Aggregates Product Line (3)
|
|
|
|
(0.4%)
|
|
3.4%
|
|
0.1%
|
|
3.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
Shipments (tons in thousands)
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Heritage Aggregates Product Line: (2)
|
|
|
|
|
|
|
|
|
|
|
|
Mid-America Group
|
|
|
|
14,538
|
|
14,965
|
|
58,925
|
|
59,180
|
|
Southeast Group
|
|
|
|
3,870
|
|
4,215
|
|
16,575
|
|
17,549
|
|
West Group
|
|
|
|
12,716
|
|
12,381
|
|
52,204
|
|
51,563
|
|
Heritage Aggregates Operations
|
|
|
|
31,124
|
|
31,561
|
|
127,704
|
|
128,292
|
|
Acquisitions
|
|
|
|
324
|
|
-
|
|
726
|
|
-
|
|
Divestitures (4)
|
|
|
|
-
|
|
-
|
|
3
|
|
39
|
|
Aggregates Product Line (3)
|
|
|
|
31,448
|
|
31,561
|
|
128,433
|
|
128,331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Volume/pricing variances reflect the percentage
increase (decrease) from the comparable period in the prior year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Heritage Aggregates product line excludes volume and
pricing data for acquisitions that have not been included in
prior-year operations for the comparable period and divestitures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) Aggregates product line includes all acquisitions
from the date of acquisition and divestitures through the date of
disposal.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Divestitures include the tons related to divested
aggregates product line operations up to the date of divestiture.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Unit Shipments by Product Line (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates tons - external customers
|
|
|
|
30,274
|
|
30,493
|
|
123,792
|
|
123,873
|
|
Internal aggregates tons used in other product lines
|
|
|
|
1,174
|
|
1,068
|
|
4,641
|
|
4,458
|
|
Total aggregates tons
|
|
|
|
31,448
|
|
31,561
|
|
128,433
|
|
128,331
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asphalt tons - external customers
|
|
|
|
288
|
|
333
|
|
1,361
|
|
1,662
|
|
Internal asphalt tons used in road paving business
|
|
|
|
471
|
|
395
|
|
1,728
|
|
1,598
|
|
Total asphalt tons
|
|
|
|
759
|
|
728
|
|
3,089
|
|
3,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ready Mixed Concrete - cubic yards
|
|
|
|
481
|
|
419
|
|
1,742
|
|
1,481
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average unit sales price by product line (including internal
sales):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregates
|
|
|
|
$10.67/ton
|
|
$10.32/ton
|
|
$10.63/ton
|
|
$10.33/ton
|
|
Asphalt
|
|
|
|
$42.03/ton
|
|
$44.13/ton
|
|
$42.09/ton
|
|
$41.57/ton
|
|
Ready Mixed Concrete
|
|
|
|
$86.73/cubic yard
|
|
$78.98/cubic yard
|
|
$83.73/cubic yard
|
|
$77.24/cubic yard
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Non-GAAP Financial Measures
|
|
(Dollars in millions)
|
Gross margin as a percentage of net sales and operating margin as a
percentage of net sales represent non-GAAP measures. The Corporation
presents these ratios calculated based on net sales, as it is consistent
with the basis by which management reviews the Corporation's operating
results. Further, management believes it is consistent with the basis by
which investors analyze the Corporation's operating results, given that
freight and delivery revenues and costs represent pass-throughs and have
no profit markup. Gross margin and operating margin calculated as
percentages of total revenues represent the most directly comparable
financial measures calculated in accordance with generally accepted
accounting principles ("GAAP"). The following tables present the
calculations of gross margin and operating margin for the three months
and year ended December 31, 2013 and 2012, in accordance with GAAP and
reconciliations of the ratios as percentages of total revenues to
percentages of net sales:
|
|
|
|
|
|
|
|
|
Gross Margin in Accordance with Generally Accepted
|
|
|
|
Three Months Ended
|
Year Ended
|
|
Accounting Principles
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Gross profit
|
|
|
|
$
|
101.0
|
|
|
$
|
76.7
|
|
|
$
|
364.0
|
|
|
$
|
327.1
|
|
|
Total revenues
|
|
|
|
$
|
545.0
|
|
|
$
|
502.2
|
|
|
$
|
2,155.5
|
|
|
$
|
2,031.9
|
|
|
Gross margin
|
|
|
|
|
18.5
|
%
|
|
|
15.3
|
%
|
|
|
16.9
|
%
|
|
|
16.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
Gross Margin Excluding Freight and Delivery Revenues
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
|
$
|
101.0
|
|
|
$
|
76.7
|
|
|
$
|
364.0
|
|
|
$
|
327.1
|
|
|
Total revenues
|
|
|
|
$
|
545.0
|
|
|
$
|
502.2
|
|
|
$
|
2,155.5
|
|
|
$
|
2,031.9
|
|
|
Less: Freight and delivery revenues
|
|
|
|
|
(53.6
|
)
|
|
|
(46.2
|
)
|
|
|
(212.3
|
)
|
|
|
(198.9
|
)
|
|
Net sales
|
|
|
|
$
|
491.4
|
|
|
$
|
456.0
|
|
|
$
|
1,943.2
|
|
|
$
|
1,833.0
|
|
|
Gross margin excluding freight and delivery revenues
|
|
|
|
|
20.6
|
%
|
|
|
16.8
|
%
|
|
|
18.7
|
%
|
|
|
17.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Margin in Accordance with Generally Accepted
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
Accounting Principles
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Earnings from operations
|
|
|
|
$
|
62.8
|
|
|
$
|
40.2
|
|
|
$
|
218.0
|
|
|
$
|
156.2
|
|
|
Total revenues
|
|
|
|
$
|
545.0
|
|
|
$
|
502.2
|
|
|
$
|
2,155.5
|
|
|
$
|
2,031.9
|
|
|
Operating margin
|
|
|
|
|
11.5
|
%
|
|
|
8.0
|
%
|
|
|
10.1
|
%
|
|
|
7.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
Operating Margin Excluding Freight and Delivery Revenues
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
Earnings from operations
|
|
|
|
$
|
62.8
|
|
|
$
|
40.2
|
|
|
$
|
218.0
|
|
|
$
|
156.2
|
|
|
Total revenues
|
|
|
|
$
|
545.0
|
|
|
$
|
502.2
|
|
|
$
|
2,155.5
|
|
|
$
|
2,031.9
|
|
|
Less: Freight and delivery revenues
|
|
|
|
|
(53.6
|
)
|
|
|
(46.2
|
)
|
|
|
(212.3
|
)
|
|
|
(198.9
|
)
|
|
Net sales
|
|
|
|
$
|
491.4
|
|
|
$
|
456.0
|
|
|
$
|
1,943.2
|
|
|
$
|
1,833.0
|
|
|
Operating margin excluding freight and delivery revenues
|
|
|
|
|
12.8
|
%
|
|
|
8.8
|
%
|
|
|
11.2
|
%
|
|
|
8.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
The presentation of incremental consolidated gross margin (excluding
freight and delivery revenues) is a non-GAAP financial measure.
Management presents this measure, as it believes it helps demonstrate
the impact of incremental sales on gross margin due to the significant
amount of fixed production costs. The following presents the calculation
of the incremental consolidated gross margin (excluding freight and
delivery revenues) for the quarter ended December 31, 2013:
|
|
|
|
|
|
|
|
|
Consolidated net sales for the quarter ended December 31, 2013
|
|
|
|
$
|
491.4
|
|
|
Consolidated net sales for the quarter ended December 31, 2012
|
|
|
|
|
456.0
|
|
|
Incremental consolidated net sales
|
|
|
|
$
|
35.4
|
|
|
|
|
|
|
|
|
Consolidated gross profit for the quarter ended December 31, 2013
|
|
|
|
$
|
101.0
|
|
|
Consolidated gross profit for the quarter ended December 31, 2012
|
|
|
|
|
76.7
|
|
|
Incremental consolidated gross profit
|
|
|
|
$
|
24.3
|
|
|
|
|
|
|
|
|
Incremental consolidated gross margin (excluding freight and
delivery revenues)
|
|
|
|
|
69
|
%
|
|
|
|
|
|
|
|
MARTIN MARIETTA MATERIALS, INC.
|
|
Non-GAAP Financial Measures (continued)
|
|
(Dollars in millions)
|
The ratio of Consolidated Debt-to-Consolidated EBITDA, as defined, for
the trailing twelve months is a covenant under the Corporation's
revolving credit facility, term loan facility and trade receivable
securitization facility. Under the terms of these agreements, as
amended, the Corporation's ratio of Consolidated Debt-to-Consolidated
EBITDA as defined, for the trailing twelve months can not exceed 3.50
times as of December 31, 2013, with certain exceptions related to
qualifying acquisitions, as defined.
The following presents the calculation of Consolidated
Debt-to-Consolidated EBITDA, as defined, for the trailing-twelve months
at December 31, 2013. For supporting calculations, refer to
Corporation's website at www.martinmarietta.com.
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve-Month Period
|
|
|
|
|
|
|
January 1, 2013 to
|
|
|
|
|
|
|
December 31, 2013
|
|
Earnings from continuing operations attributable to Martin
Marietta Materials, Inc.
|
$
|
122.1
|
|
|
Add back:
|
|
|
|
|
|
|
Interest expense
|
|
|
|
|
53.5
|
|
|
Income tax expense
|
|
|
|
|
43.9
|
|
|
Depreciation, depletion and amortization expense
|
|
|
|
|
168.7
|
|
|
Stock-based compensation expense
|
|
|
|
|
7.0
|
|
|
Deduct:
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
(0.4
|
)
|
|
Consolidated EBITDA, as defined
|
|
|
|
$
|
394.8
|
|
|
|
|
|
|
|
|
|
Consolidated Debt, including debt guaranteed by the Corporation,
at December 31, 2013
|
$
|
1,053.3
|
|
|
Less: Unrestricted cash and cash equivalents in excess of $50 at
December 31, 2013
|
|
|
|
|
-
|
|
|
Consolidated Net Debt, as defined, at December 31, 2013
|
|
|
|
$
|
1,053.3
|
|
|
|
|
|
|
|
|
|
Consolidated Debt-to-Consolidated EBITDA, as defined,
|
|
|
|
|
|
|
at December 31, 2013 for the trailing twelve-month EBITDA
|
|
|
|
|
2.67 times
|
|
|
|
|
|
|
|
|
EBITDA is a widely accepted financial indicator of a company's ability
to service and/or incur indebtedness. EBITDA is not defined by generally
accepted accounting principles and, as such, should not be construed as
an alternative to net earnings or operating cash flow. For further
information on EBITDA, refer to the Corporation's website at www.martinmarietta.com.
EBITDA is as follows for the three months and year ended December 31,
2013 and 2012.
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
2013
|
|
|
2012
|
|
Earnings Before Interest, Income Taxes, Depreciation, Depletion and
Amortization (EBITDA)
|
|
|
|
$
|
106.3
|
|
$
|
83.4
|
|
$
|
390.2
|
|
$
|
329.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A Reconciliation of Net Earnings Attributable to Martin Marietta
Materials, Inc. to EBITDA is as follows:
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
2013
|
|
|
2012
|
|
|
2013
|
|
|
2012
|
|
Net Earnings Attributable to Martin Marietta Materials, Inc.
|
|
|
|
$
|
36.0
|
|
$
|
21.5
|
|
$
|
121.3
|
|
$
|
84.5
|
|
Add back:
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
|
|
|
12.8
|
|
|
13.4
|
|
|
53.5
|
|
|
53.3
|
|
Income Tax Expense for Controlling Interests
|
|
|
|
|
14.3
|
|
|
4.7
|
|
|
43.5
|
|
|
16.6
|
|
Depreciation, Depletion and Amortization Expense
|
|
|
|
|
43.2
|
|
|
43.8
|
|
|
171.9
|
|
|
175.5
|
|
EBITDA
|
|
|
|
$
|
106.3
|
|
$
|
83.4
|
|
$
|
390.2
|
|
$
|
329.9
|
Copyright Business Wire 2014