USA: Martin Marietta 4Q16 and full-year results

For the 4Q16 Martin Marietta achieved net sales of US$889m compared with US$780.8m in the 4Q15. EBITDA was US$229.7m compared with US$204.4m in 4Q15.

For the full year, net sales were US$3.58bn, compared with US$3.27bn in 2015. EBITDA was US$971.6m, compared with US$750.7m.

Chairman, President and CEO of Martin Marietta, Ward Nye, said: "Every business across our enterprise continues to make meaningful contributions to the Company's enhanced profitability. The Southeast Group and the West Group saw gross profit increase 67 per cent and 35 per cent, respectively. Notably, the accelerating recovery in North Carolina and South Carolina contributed to the 19 per cent gain in the Mid-America Group's gross profit. These results are reflective of the soundness of our strategic planning together with market-specific execution.

“We expect infrastructure demand to be meaningfully and positively impacted by the US$305bn Fixing America's Surface Transportation Act (FAST Act) as well as multiple state initiatives. Longer term, infrastructure spending is expected to benefit from strong state and local support for increased funding, as evidenced by the significant number of state and local transportation funding-related ballot initiatives that have passed over the previous 24 months. Private-sector construction indicators also signal continued growth for both nonresidential and residential activity."

Cement
The cement business generated US$364.4m of net sales and US$120.1m of gross profit in 2016. For the full year, gross margin (excluding freight and delivery revenues) was 33 per cent, compared with 28 per cent for 2015 (excluding the results of the divested California cement business), an improvement of 500 basis points. Cement volumes increased 1.1 per cent (excluding the results of the divested California cement business). For the full year, cement kiln maintenance costs of US$20.9m were incurred, in line with management's expectations.

Aggregates
For the full year, shipments to the infrastructure market comprised 39 per cent of aggregates product line volumes. The nonresidential market represented 32 per cent of full-year aggregates product line shipments and increased three per cent as compared with 2015. The Mid-America Group led this growth with a 21.2 per cent increase, and the Southeast Group achieved a 3.1 per cent increase.

Meanwhile, the residential market accounted for 21 per cent of aggregates product line shipments for the year. Volumes to this segment increased 21.6 per cent, driven by continued strength in housing.

Ready-mix
The ready-mixed concrete product line benefitted from strong demand, higher pricing and improved operating conditions. Inclusive of the operations acquired during the year, ready-mixed concrete volumes increased 26.6 per cent and average selling price increased 8.3 per cent.