Vulcan Materials Company

Please stand by, your program is about to begin. If you need assistance during your conference today, please press star zero. Good morning. Welcome everyone to the Vulcan Materials Company third quarter 2024 earnings call. My name is Angela and I will be your conference call coordinator today. Please be reminded that today's call is being recorded and will be available for replay later today at the company's website. All lines have been placed in a listen only mode. After the company's prepared remarks, there will be a question and answer session. Now I will turn the call over to your host, Mr. Mark Warren, Vice President of Investor Relations for Vulcan Materials. Mr. Warren, you may begin.

Thank you, Operator, and good morning, everyone. With me today are Tom Hill, Chairman and CEO, and Mary Andrews Carlyle, Senior Vice President and Chief Financial Officer. Today's call is accompanied by a press release and a supplemental presentation posted to our website, balkanmaterials.com. Please be reminded that today's discussion may include forward-looking statements which are subject to risks and uncertainties. These risks, along with other legal disclaimers, are described in detail in the company's earnings release and in other filings with the Securities and Exchange Commission. Reconciliations of non-GAAP financial measures are defined and reconciled in our earnings release, our supplemental presentation, and other SEC filings. During the Q&A, we ask that you limit your participation to one question. This will allow us to accommodate as many as possible during our time we have available. And with that, I'll turn the call over to Tom.

Thank you, Mark, and thank all of you for joining our call this morning. We continue to execute on our two-pronged strategy to deliver attractive, long-term value creation for our shareholders. Results and activities in the third quarter demonstrate our success in consistently expanding our aggregate unit profitability and successfully expanding our reach through strategic acquisition opportunities. Despite the disruption of four hurricanes impacting our industry-leading southeast footprint, both gross margin and adjusted EBITDA margin expanded in the quarter. In year-over-year aggregates, cash gross profit per ton increased double digits for the eighth consecutive quarter, a testament to the benefits of our unwavering focus on our vocal way of selling and vocal way of operating disciplines. In the quarter, we generated $581 million of adjusted EBITDA, a modest decline versus the prior year, given 10% lower aggregate shipments and the prior year earnings contribution from the now divested Texas concrete business. Difference in the quarter varied widely month to month and across geographies, reflecting the interruption caused by extreme weather events. So let me walk you through how the quarter played out. In July, seven of our top 10 markets experienced significant year-over-year increases in rainfall. and the first of four hurricanes, Hurricane Burl, made landfall in our footprint. Average daily shipments were down mid-teens for the month. Shipments in August rebounded after a slow start due to Hurricane Debbie tracking up the East Coast. Daily shipments in August, excluding the two shipping days most impacted by the hurricane, were only down 4%, consistent with our non-weather impacted demand view. As we are all aware, Hurricane Helene, the second of two September hurricanes, devastated many communities across Florida, Western North Carolina, East Tennessee, and other parts of the Southeast. I am thankful to report that all of our employees are safe, and I'm proud of their immediate efforts to help our communities and neighbors. The catastrophic destruction in Western North Carolina and East Tennessee is both tragic and historic. Vulcan materials is well positioned in the affected areas to support the immense rebuilding efforts that will be required. Due to the storm, shipments were down approximately 25% in the final week of September, resulting in quarterly shipments finishing 10% below the prior year. In spite of the challenges from volume, the pricing environment remains positive, rate-adjusted average selling prices improved 10% year-over-year, with increases widespread across geographies. We continue to use our VulcanWeb selling disciplines and processes to deliver value to our customers and earn their daily business. We also remain focused on our VulcanWeb operating disciplines to drive efficiencies and lower unit costs. Although weather and lower volumes for an even more significant headwind in the third quarter than the prior quarter, the rate of cost increases moderated. At the end of September, we announced the acquisition of Wakestone Corporation, a leading pure-plate agri-supplier in the Carolinas. This acquisition is consistent with our agri-led growth strategy and will be a great addition to the Vulcan family. We look forward to welcoming the Wakestone team upon closing later this year. Now, shifting to demand. The overall demand environment is improving, but with different dynamics impacting each end use. Higher single-family starts over the last 3 and 12 months provide a solid backdrop for growing single-family demand, particularly with potentially lower mortgage rates on the horizon to help address the ongoing affordability issue. Multi-family starts remain weak, but should also benefit from a lower interest rate environment. Fundamentally, there is a consistent need for additional housing in Vulcan markets, which bodes well for future residential construction activity. In private non-residential construction, demand remains varied across categories. Most categories will benefit from improving interest rates since projects in the planning and design pipeline have been accumulating for some time now. Warehouse activity remains a headwind, but comps are easing and starts seem to be stabilizing near pre-COVID levels. Data centers are still robust, and manufacturing remains a catalyst in some of our markets. Over time, light commercial activity should follow the positive trends in single-family housing. We are closely monitoring the macro dynamics and likely timing of private non-residential activity making the turn. On the public side, we continue to expect steady growth for multiple years. Our booking activity points to the conversion of growth in contract awards now flowing into aggregate shipments. I am confident we are well positioned to finish the year strong and deliver approximately $2 billion of adjusted EBITDA in 2024. Now I'll turn the call over to Mary Andrews to discuss A few more details about the quarter and 2024 before I share some preliminary views of 2025. May I address?