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Vulcan Materials: A Steady Climb in Shares Vulcan Materials: A Steady Climb in Shares

Vulcan Materials CoVMC shares are trading higher after the company reported fourth-quarter FY23 results.

Revenue of $1.83 billion was in line with the consensus. Gross profit rose to $472 million from $350 million a year ago. Adjusted EPS of $1.46 beat the consensus of $1.39.

The Aggregate segment saw a significant increase in gross profit to $424 million ($7.67 per ton) with a 30% rise, expanding the margin by 400 basis points. Cash gross profit improved to $9.92 per ton, driven by sustained pricing momentum and moderating inflationary pressures.

Gross profit in the Asphalt, Concrete, and Calcium segment rose 19% to $36 million, with a 550 basis points margin expansion and 73% increase in cash gross profit, reaching $45 million.

Vulcan returned $428 million to shareholders through $200 million of share repurchases and $228 million of dividends.

In 2023, operating cash flow stood at $1.5 billion, up 34% Y/Y, and capital expenditures for maintenance and growth projects came in at $243 million.

The company expects net earnings of $1.07 billion-$1.19 billion and adjusted EBITDA of $2.15 billion-$2.30 billion. The company plans to spend $625 million-$675 million for maintenance and growth projects in 2024.

Vulcan anticipates continued improvement in Aggregates segment cash gross profit per ton and sees Asphalt, Concrete, and Calcium segment cash gross profit of about $275 million.

Tom Hill, Chairman and Chief Executive Officer, said, “We are well positioned to deliver another year of earnings growth and strong cash generation in 2024. The pricing environment remains positive, and we expect pricing momentum and operational execution will lead to attractive expansion in aggregates unit profitability, regardless of the macro demand environment.”

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Price Action: VMC shares are up 6.94% at $259.29 on the last check Friday.

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