Vulcan Materials sees revenues advance in 2022 despite poor weather

Vulcan Materials has announced total revenue of US$7315m in 2022, up from US$5552m in the previous year. Adjusted EBITDA came in at US$1626m in 2022, compared to US$1451m in 2021, while gross profit advanced from US$1373m in 2021 to US$1558m 12 months later. 

In the fourth quarter of 2022, total revenue stood at US$1732m, versus US$1606m in the 4Q21. Adjusted EBITDA fell from US$383m in the 4Q21 to US$375m in the same period a year later, while gross profit remained stable at US$350m in the 4Q22, compared to US$352m in the 4Q21. 

Tom Hill, Vulcan Materials' chairman and chief executive officer, said, "Our aggregates-led business delivered solid results in 2022 as our teams executed well in a challenging macro-environment.  We continued to improve our aggregates unit profitability and demonstrate the resiliency of our business. Our relentless focus on our operating disciplines, coupled with nimble pricing actions to overcome inflationary pressures, led to a 12 per cent increase in our full-year adjusted EBITDA.  

“Fourth quarter results were negatively impacted by abnormally wet and cold weather that disrupted construction activity and materials shipments, in addition to some softening in single-family residential demand.  Despite these disruptions, our industry-leading aggregates cash gross profit per ton increased 11 per cent in the fourth quarter.  We carry solid pricing momentum into 2023 and are focussed on our operating disciplines to manage costs and improve efficiencies.  By controlling what we can control, we expect to deliver another year of earnings growth." 

In the aggregates segment, gross profit increased to US$327m in the 4Q22, despite lower shipments due to unfavourable weather. Freight-adjusted pricing for the full year came in at US$16.40/t, up 10 per cent YoY. Adjusting for mix impacts, average selling prices increased 15 per cent in the 4Q22 and 11 per cent for the full year. According to the company, solid operational execution helped offer continued energy cost headwinds with the average unit price of diesel in the 4Q22 increasing 61 per cent YoY. 

In the asphalt segment, gross profit came in at US$17m in the 4Q22, an increase of US$13m over the same period a year earlier, as price actions introduced throughout the year outpaced higher input costs. Fourth-quarter shipments were 2.8Mt, down two per cent YoY. Asphalt pricing increased 24 per cent, or US$14.56/t, more than offsetting a 24 per cent increase in the unit cost of liquid asphalt.

Fourth-quarter concrete gross profit was US$17m lower than the same period a year earlier due to lower volumes and higher costs of diesel fuel. Shipments were 15 per cent lower YoY, mainly driven by significant rainfall in Texas and California and some slowdown in residential construction activity. Average selling prices expanded by 14 per cent, partially offsetting higher raw materials, diesel and labour costs.