Vulcan Materials cement shipments improve, Jan-March 2013

Leading US aggregates producer Vulcan Materials' first quarter turnover was a mere 0.4 per cent ahead at US$538.2m higher and the EBITDA, which had recovered by 36.4 per cent a year ago, came off by 33.5 per cent to US$27.9m.

At the trading level the seasonal loss increased by 8.2 per cent to US$50.1m. After a net interest charge that was 0.9 per cent higher at US$52.8m, the pre-tax loss emerged 5.2 per cent higher at US$100.4m and the net attributable loss was 5.4 per cent higher at US$54.8m. Net debt at the end of March was 5.4 per cent lower than a year earlier at US$2477.9m to give a gearing of 66.7 per cent , compared with 70 per cent 12 months earlier. 

Vulcan's cement shipments improved by 14.3 per cent to 225,000t, with third party sales rising by 13 per cent to 110,700t. The average cement price improved by 5.9 per cent to US$91.40/t (US$82.92/st) and the cement turnover rose by 10.6 per cent to US$22.7m. For the full year, the cement business should benefit from lower production costs.

Aggregates shipments in the quarter were 5.4 per cent lower at 25.27Mt (27.86Mst), but the average price improved by 4.6 per cent to US$11.82/t (US$10.72/st) and the aggregates turnover improved by one per cent to US$359m. Volumes, which had benefited from unusually mild and dry weather a year earlier, came off by around five per cent, but increases in double digits were still in California, Arizona and Florida.

The important Texas market also reported increased volumes across the board. For the full year, Vulcan expects aggregates shipments to improve by up to five per cent. Aggregates demand from private construction is growing and significant growth is being seen in housebuilding activity in important states such Florida, Texas, California, Georgia and Arizona. Aggregates demand from public sector construction is expected to be similar to the levels seen last year.

Ready-mixed concrete deliveries increased by a further 6.1 per cent to 0.78Mm³ while prices were 0.3 per cent ahead. The increased volumes seen in the first quarter to a large extent reflect deliveries in Florida and should boost profitability for the full year. The asphalt volume declined by 4.3 per cent and the average price eased by 0.8 per cent , but the cost of buying in liquid asphalt came down by seven per cent, reducing the seasonal loss. Asphalt prices are expected to increase on modestly higher shipments.