Martin Marietta Supplies (MLM) Tops Q2 EPS by 47c, Revenues Beat


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Martin Marietta Supplies (NYSE: MLM) reported Q2 EPS of $3.49, $0.47 higher than the analyst estimate of $3.02. Income for the quarter got here in at $1.27 billion versus the consensus estimate of $1.15 billion.

Ward Nye, Chairman and CEO of Martin Marietta, said, “We’re proud to have concluded the primary half of 2020 with the best profitability and finest security efficiency in Martin Marietta’s historical past. Our report efficiency underscores Martin Marietta’s collective dedication to operational excellence and the disciplined execution of our strategic plan as we navigate the uncertainties and financial hardships offered by COVID-19.

“The Firm expanded consolidated gross margin by 200 foundation factors and delivered Adjusted EBITDA of $407 million within the second quarter, pushed by pricing momentum and improved value administration throughout the Constructing Supplies enterprise. We stay assured that our favorable pricing traits will proceed, aided partly by the continued success of our locally-driven pricing technique. We anticipate our full-year 2020 aggregates pricing to extend Three p.c to four p.c, barely beneath our pre-COVID-19 forecast, largely on account of year-over-year geographic and product combine fluctuations.

“Although Martin Marietta, together with a lot of our clients, has operated as a delegated “important enterprise” via the COVID-19 shutdowns and subsequent phased re-openings, we nonetheless skilled impacts from the macroeconomic slowdown. Regardless of these challenges, product demand traits remained sturdy throughout our key geographies, together with North Texas and the Entrance Vary of Colorado, two of our main vertically-integrated markets, pushed by engaging buyer backlogs and continued development exercise. Buyer backlogs are anticipated to assist the Firm’s near-term cargo ranges, although we at the moment anticipate an industry-wide decline in product demand over the subsequent few quarters, notably with the uncertainty of extra U.S. federal financial stimulus actions, as companies and governments tackle finances shortfalls. Quantity impacts from lowered demand will doubtless be short-term, gradual and different by finish use and geography. Within the medium- and long-term, we stay assured that the underlying demand drivers and elementary energy of our High 10 states place the Firm to outperform via typical financial cycles.”

Mr. Nye concluded, “Transferring ahead, we stay centered on the world-class attributes of our business–including, security, operational excellence and value management–as properly as our confirmed strategic plan. Martin Marietta is well-positioned geographically and financially and has the advantage of an skilled administration workforce to responsibly navigate via difficult instances and drive sustainable long-term development and shareholder worth.”

Full-Yr Outlook

Martin Marietta will reinstate full-year earnings steering when it has ample visibility. At the moment, the Firm can’t reliably forecast the disruptions to the U.S. economic system, the timing and advantages of associated governmental stimulus actions and, extra particularly, demand for its services ensuing from the COVID-19 pandemic and a number of measures put in place to reduce the unfold of the virus. Whereas it has not seen important disruption so far, Martin Marietta believes its {industry} will doubtless expertise decrease general product demand over the subsequent few quarters because of the COVID-19 pandemic. Nevertheless, the magnitude of declines and the velocity and fee of restoration will range by development end-use market and geography and might be influenced by the timing and scope of near-term federal stimulus measures, a longer-term reauthorized infrastructure invoice and different governmental actions.

Martin Marietta stays assured that the engaging underlying fundamentals and long-term secular development traits in our key geographies, each of which underpinned the Firm’s report 2019 efficiency, stay intact and might be evident as soon as once more when the U.S. economic system stabilizes and recovers.

For earnings historical past and earnings-related information on Martin Marietta Supplies (MLM) click on right here.

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