Vulcan Materials CO Q3 FY2024 earnings call

• Executing two-pronged strategy to create long-term value. Despite hurricanes, gross margin and adjusted EBITDA margin expanded. Cash gross profit per ton increased double-digits for eighth consecutive quarter. - In July, July shipments down mid-teens due to hurricanes. August shipments rebounded except for hurricane impact. September shipments down ~25% due to Hurricane Helene. - Announced acquisition of Wake Stone Corporation, a leading aggregate supplier in Carolinas, consistent with aggregates-led growth strategy. - Demand outlook: Higher single-family starts, multifamily starts may benefit from lower rates, private non-residential demand varied but improving interest rates help, public construction expected to grow. - Downstream businesses complement aggregates franchise. SAG expenses $129 million (6.4% of revenues), 10% lower than prior year. - Generated nearly $1 billion operating cash flow through first nine months, free cash flow up 36%, capital expenditures expected between $625M-$650M for full year, net debt to trailing 12 months adjusted EBITDA leverage 1.5x.

The aggregates business generated $581 million of adjusted EBITDA in the quarter, with a modest decline vs prior year due to 10% lower aggregate shipments and divested Texas concrete business. Asphalt business maintained healthy margins at nearly 16% in the third quarter with cash unit profitability improving 11%. East Coast concrete business delivered unit profitability improvement, while West Coast concrete business had compressed margins due to weak private demand in Northern California. Aggregates revenue contribution is significant, with asphalt and concrete segments also contributing to overall performance.

• Expect to finish 2024 with approximately $2 billion of adjusted EBITDA. - Anticipate aggregate shipments to grow in 2025. - Expect aggregate price to improve by high-single-digit in 2025. - Confident in continuing double-digit cash gross profit per ton growth in 2025, driven by pricing momentum and operating efficiencies.

• Weather events such as hurricanes can significantly impact shipments and operations. - Volume fluctuations due to weather and demand variability pose challenges. - Inflationary pressures can affect unit costs, although cost increases are moderating.

Q: Cash gross profit per ton target, moving into 2025 with volume increase?

A: Reached previous targets faster, now setting new goals, confident in continuing growth with volume increase and operating efficiencies, plan to get new goals in not-too-distant future.

Q: 2025 free cash flow, CapEx, working capital?

A: Full 2025 guidance in February, CapEx historically 8%-9% of revenues, historical level reasonable, specific view on acquired operations CapEx not available yet as acquisitions not closed.