Vulcan Materials Company

Good morning, everyone. Welcome to the Vulcan Materials Company second quarter 2026 earnings call. My name is Beau 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 would like to turn the call over to your host, Mr. Mark Warren, Vice President of Investor Relations for Vulcan Materials. Please go ahead, sir.

Thank you, operator. I'm joined today by Ronnie Pruitt, Chief Executive Officer, and Mary Andrews Carlisle, Senior Vice President and Chief Financial Officer. Before we begin our prepared remarks, please note that a press release and a supplemental presentation related to this call are available at our website, vulcanmaterials.com. Today's discussion may include forward-looking statements, which are subject to risks and uncertainties. Details on these risks, other legal disclaimers and reconciliations of any non-GAAP financial measures are defined and described in our earnings release, supplemental presentation and other filings with the Securities and Exchange Commission. For the question and answer session, we kindly ask that you limit your participation to one question. This will help us address as many questions as possible during the time we have available. And with that, I'll turn the call over to Ronnie.

Thanks, Mark, and thank you all for your interest in Vulcan Materials. The resiliency of our aggregates-led business and the importance of our strategic disciplines are evident in periods of inflationary pressure. I am proud of how our commercial and operating teams have navigated the first half of the year to deliver adjusted EBITDA growth and aggregates cash growth profit return expansions. and most importantly, they did so while keeping each other safe. In the quarter, we generated $654 million of adjusted EBITDA, approximating the prior year despite energy headwinds of almost $40 million. Our teams executed well, earning higher prices for our products in each segment and driving operational efficiencies to help offset inflationary increases in our input costs. Second quarter aggregates cash gross profit per ton top $12 and was 14 cents higher than the prior year. Shipments increased 1% compared to the prior year and varied widely across geographies depending upon weather conditions. Aggregates freight adjusted selling prices moved higher both sequentially and year over year. On a mixed adjusted basis, average selling prices in the quarter improved 5% compared to the prior year with improvement widespread across geographies. Our commercial teams continue to execute our Vulcan way of selling disciplines to capture value for our products and deliver solutions for our customers. Excluding diesel, aggregate freight adjusted unit cash cost of sales increased 3% compared to the prior year. Our Vulcan way of operating disciplines were executed well to drive efficiencies and control spending Even with lower than expected volumes in many areas due to wet weather. From coast to coast, our teams are aligned with a relentless focus to drive compounding improvements in the profitability of our existing portfolio and to win the future in aggregates. Winning the future will also mean continuing to strategically add to our portfolio through acquisitions and greenfield projects. Both of these growth pipelines remain active, including numerous acquisition opportunities likely to be finalized this year. The strength of our balance sheet gives us the financial flexibility to pursue those opportunities that will drive the most value for our shareholders. During the second quarter, we completed several strategic portfolio actions. We finalized the divestitures of our concrete operations in California and our non-core operations in the U.S. Virgin Islands, generating cash proceeds that can be redeployed to strategically grow our aggregates business. A clear example was our acquisition of an aggregate operation from Brannon Sand and Gravel in early June. This acquisition expanded our reach into southern Colorado and strengthened our distribution network in Dallas-Fort Worth. Our team is already hard at work capturing synergies and driving value from this strategic acquisition. In terms of the demand environment, what I see ahead of us is similar to what the views that I shared on the last call. We still expect strong public activity in our markets and improving private large project opportunities to drive year-over-year shipments growth in 2026. Trading 12 months highway awards in bulk in markets remain up double digits from a year ago, The same is true for public infrastructure awards, which are up 20% year over year in Vulcan markets, yet down in other markets. The amount of work in the pipeline bodes well for public shipments for the next several years, providing good demand visibility, which is important for a healthy pricing environment. With the August recess upon us, as expected, there will likely be a continuing resolution to fund federal highway swimming while Congress completes this work. The House Transportation and Infrastructure Committee passed its Build America 250 Act with overwhelming bipartisan support in late May. The bill enhanced the focus on aggregate intensive construction and shifted to a Formula First distribution approach compared to the Infrastructure Investment and Jobs Act Both changes benefiting Vulcan. While the final text and timing remain uncertain, we anticipate a smooth transition between funding programs given the significant amount of IIJ funds that are yet to be spent. On the private side, large project opportunities continue to drive non-residential activity, particularly data centers. Our footprint is well aligned with data center activity in addition to power infrastructure expansion, recently announced L&D projects, and other manufacturing opportunities. Our scale, quality, and customer service make us a supplier of choice for these large, complex projects. Residential construction continues to struggle due to the ongoing lack of affordability. Longer term, there remains a fundamental need for additional housing, and our footprint is well positioned to benefit from an eventual recovery. With a continued expectation of modest growth in aggregate shipments in 2026, a healthy pricing environment, and a solid year-to-date execution from our operating teams, we reiterate our full-year adjusted EBITDA guidance range of $2.4 to $2.6 billion. Now I'll turn the call over to Mary Andrews to provide some additional commentary on our second quarter performance before we take your questions.

Thanks, Ronnie, and good morning. The strong cash generation of our business, coupled with the recent proceeds from divestitures Ronnie commented on earlier, have the balance sheet extremely well positioned for us to continue to pursue our disciplined and balanced capital allocation strategy, reinvesting in our business, growing our franchise through strategic acquisitions, and returning capital to shareholders through both dividends and share repurchases. Through the first six months of this year, we have invested $370 million in maintenance and growth capital projects, $75 million in a strategic aggregate acquisition, and returned over half a billion dollars to shareholders, including $400 million of share repurchases. We continue to expect between $750 and $800 million of capital expenditures for the full year. During the second quarter, we used cash on hand to pay down our outstanding commercial paper balances of approximately $200 million and maintained approximately $300 million of cash at quarter end. At June 30, net debt to adjusted EBITDA leverage stood at 1.7 times, providing plenty of capacity to support an active acquisition pipeline. We are focused on improving our return on invested capital as we continue to compound profitability in our existing business and make disciplined capital allocation decisions. Our trailing 12 months return on invested capital improved 20 basis points from a year ago to 16.1% at quarter end. SAD expenses in the first six months were 2% lower than the prior year. Trailing 12 months expenses of $558 million were 6.9% of revenues. 30 basis points lower than the prior year period. We continue to closely manage our overhead costs. As Ronnie said, we are pleased with the first half execution and results that our teams delivered and are reaffirming our full year adjusted EBITDA outlook. Now before we take your questions, I'll pass back to Ronnie to provide an update on Vulcan's arbitration against Mexico.

Thanks, Mary Andrews. As previously disclosed, Vulcan pursued an arbitration against Mexico under the North American Free Trade Agreement, commonly referred to as NAFTA. We received the award on Monday. All three members of the tribunal found that Mexico's actions were arbitrary, grossly unfair, and unjust. All three members of the tribunal also found that numerous actions taken by Mexico clearly violated NAFTA, including those related to the claims associated with a large majority of damages. However, the two members of the tribunal who wrote the majority opinion awarded us only immaterial damages. The third member dissented, disagreeing with the low damages award. As we look ahead, we remain focused on driving improved profitability in our business, and I would like to thank the men and women of Vulcan Materials for a great performance during the quarter, controlling our costs, and expanding our cash gross profit per ton while keeping each other safe. Now, Mary Andrews and I will be happy to take your questions.

Thank you, Mr. Pruitt. Ladies and gentlemen, at this time, if you do have any questions or comments, please press star 1. If your question has been addressed, you may remove yourself from the queue by pressing star 2. Once again, that's star 1 for questions. We'll go first this morning to Anthony Pedinari with Citi.

Good morning. Ronnie, can you talk a little bit more about puts and takes on demand and maybe specifically what gives you confidence in the second half of the year to meet the full year volume guidance?

Yes, thank you. Good morning, Anthony. I would say, first of all, Demand is tracking as we expected. And, you know, we're an outdoor sport, so we're always going to have some weather disruptions. But I would say overall, tracking is expected. You know, as we entered the year, we had healthy backlogs. And as we sit here today, we have healthy backlogs. And our quoting activity continues to remain very robust. On the positive side, trends across public infrastructure, public highways, data centers, and other forms of manufacturing are all good. and we've also seen a pickup in LNG projects along with energy generation and power infrastructure expansion, which is really being driven by the data centers. Conversely, we continue to see single family and residential growth remain weak. But other parts of light non-res, you know, they're going to follow rooftops and so that's another area that as we see single families start to recover, I think light non-res will follow. But I will also remind you of our Advantage footprint. I mean, where we're at, and that matters, and when we start seeing single-family recovery, I like our footprint, and I think we're in a really good position to capture that.

Okay, that's helpful. I'll turn it over. Thank you. We'll go next now to Tyler Brown with Raymond James. Hey, good morning.

Hey, Tyler. Hi. Hey, so I've got a couple questions on cost, but cost performance was pretty solid here in Q2.

It maybe came in slightly better than the guidance despite fuel and let's call it some weather friction. But Mary Andrews, you know, if we look at the four-year guide, it seems to imply that that cost inflation is maybe a bit better in the second half than the first half. Can you just give us any color on what's kind of driving that and just your confidence in hitting those trends?

Thanks.

Yeah, Tyler, thank you. I'll address the first part and then I'll give it to Mary Andrews to talk about some of the numbers. But as I look at our Q2 performance, it was really good. And I would say it was better than a lot of expectations. We dampened the impact of a $26 million diesel headlamp. And we really did that through our vocally operating disciplines. I mean, when I look at our production efficiencies that we continue to focus on with VWO, as well as our labor scheduling and how we continue to focus on how we're going to get the most out of that, and really in the backdrop of wet weather that does impact our costs as well. So I'm very pleased with where we're at, and I think VWO continues to be something that is evident in our results and the productivity of that. For the rest of the year, I think there's other levers that we'll continue to look at as far as oil continues to be inflated. So we're going to continue to really think about our operating efficiencies and how we drive that through our process intelligence and labor efficiencies. but also there's things, levers we can pull with our stripping, and so we're focused on things that are heavily consuming of diesel, so stripping is one of those. We'll continue to focus on that. Also leverage our liquid asphalt storage that we've had. We've got one in Southern California. We recently closed on another one in Northern California, and that's another way for us on the downstream business to fight some of those headwinds of volatility and cost.

Yeah, and Tyler, just to add to what Ronnie covered on some of the levers that we have in the second half, another dynamic in the second half is how unusual the second half of last year was from a cost standpoint, particularly the first quarter. We faced unusually concentrated repair costs and higher insurance costs last year that we don't expect to repeat this year. So those anomalies and Some benefit of seasonally higher tonnage in the second half compared to the first are also things that should drive both a much improved year-over-year performance and an improved absolute cost performance in the back half. As Ronnie said, even if those diesel prices remain sticky, quite likely, and right now at levels still similar to the second quarter, and one other thing I mentioned is since we're talking about cost is, you know, our year-to-date SAG expense, which we've maintained at levels lower than last year. You know, in fact, I would expect full-year SAG expenses, you know, to probably be $10 million to $15 million lower now than the initial range we provided of $580 million to $590 million back in February. So overall, you know, we are pleased with the cost execution in the first half and, you know, confident and a solid performance in the second half as well.

All right. Yep. Excellent detail. Thank you. Thanks, Tyler. We'll go next now to Trey Grooms with Stevens.

Hey, good morning, everyone. Thanks for taking my questions. Ronnie, you know, you guys talked about, you know, some mid-years out there in some market, mid-year price increases in some markets and, you know, given the diesel backdrop, but any update you can give us on mid-year increases? And then if I could sneak just one more in, just given the Mexico situation, you know, I really appreciate your prepared comments there, but any additional color you could give us at this time around the tribunal's decision there? I think they said Unfair and Unjust, which is, I think, an understatement here. But at any rate, any additional color there? Thank you.

Yeah, Trey, thanks. I'll take the second part first, and then I'll talk about mid-year's second. So with regards to Mexico, you know, really what I said in my prepared remarks, I'll reiterate from the standpoint of the decision was disconcerting to us. You know, all three arbitrators agreed that Mexico had clearly violated NAFTA. Yet they awarded immaterial damages. And so that's really all I'm going to say about that. What I will also say, though, is that, look, we've continued to move forward with running our business. And even since the illegal taking of Calica back in 2022, we've successfully continued to supply the Gulf Coast and really meet the needs of our customers in a very dynamic market. And I would say, you know, overall, even though I've grown more than 50%, and over those four years. And so we've done things to continue to grow the company. I'm very pleased with the efforts that our people have given for that. When I look at the Gulf Coast today, it's still a very dynamic area, and it's still going to be challenged on how material gets to the Gulf Coast. And so we've still got the best distribution network along the Gulf Coast, and we're going to continue to serve that through different forms and fashions. And so we remain very well positioned to supply our customers there. And remember, we still own the land, and we still own the land around the port, which are two very valuable things when it comes to Mexico. With regards to your second part, or your first part, really, your pricing question, when I look at mid-years, I would say they went as expected. And when I really compare them year over year, and so that's, you know, we do a lot of comparisons. Sequentially, I mean, we're almost two times better than we were last year. And so we intentionally pulled mid-years forward. We pulled those forward to June. And I think we've had Thank you very much. throughout the remainder of the year.

Great. Thanks for all the color there. And I did want to say hats off on the cost. You guys did a great job. Thanks, Fred.

Thank you. We'll go next now to Philip Ng with Jefferies.

Hey, guys. Ronnie, great color. Any more color in terms of how demand is shaping up in July? You know, certainly Tukey has weather-related issues, color on that front. And you talked about orders and backlogs quite good right now, good momentum. Can you kind of quantify how things were to start the year and I guess how orders and backlogs perhaps from a gross standpoint are shaping up today?

Yeah, I would tell you that as we sit today, you know, backlogs look very similar as they did as we entered the year. And a lot of that is the puts and takes of where weather happens, geography matters. And so where those weather patterns, we had probably abnormal weather in Texas and a little bit of abnormal weather in the southeast. As we sit here in July, I would tell you we've continued to see strange weather patterns, but shipments are continuing kind of as expected. There's a lot of puts and takes around that, and where it's raining at, maybe dry somewhere else, and so that's why we continue to look at the mix adjustment of the geography impact, because all markets are not the same. As I look forward and thinking about the dynamics of where we're at with the end uses, I mean, I look at some of our Starts Momentum and referring to Dodge Awards. On the highway side, I mean, North Georgia on a trailing 12 is up 189%. I mean, those are – now, these are large dollar projects, and we can give you some specifics of those projects, but a lot of this is the 400 toll roads and some of this public-private partnership and other ways of looking at things that are funding mechanisms outside of the federal program. Total infrastructure in the Gulf Coast is up 360% over the last 12 months. So a lot of public, that's where we get our confidence in public. On the private side, continues to be really driven by data centers. But we are seeing some other manufacturing things. And I would tell you that I think the power side of power generation and power infrastructure is going to continue to be a tailwind as we move throughout the data center build out. And those are projects that are being reflected both in our quoting activity as well as some booking activity. We also talked about some LNG projects. We've seen that along the coast as well. And so those are different types of projects that we've seen in the past. Those have been relifted. And really the only part that we see continue to be on the negative side is single family. And so I believe that with the two legs of our stool, we continue to be confident in a year of growth. And if the other leg of the stool would kick in, I think, again, our footprint is a really dynamic footprint, very advantaged, and we would get the benefit of that.

Ronnie, any color on warehouses? You really haven't talked much about that.

Yeah, I mean, I would tell you we're seeing a couple of green shoots in very specific markets, but overall warehousing continues to be overall flat. I mean, we're not seeing any green shoots in warehouses from an overall perspective, but I do think it's one that as we see that kind of recovery as well, Again, our footprint is very advantaged on that as well.

Okay. Thank you. Appreciate that. Thank you.

We'll go next now to Stephen Fisher with UBS.

Thanks. Good morning and congrats again on the cost management. Just to follow up on the discussion about the large project activity, you know, we too are hearing a lot about the momentum there. Just curious what that might look like from a timing perspective for aggregates and based on kind of what you're seeing and hearing, is there a particular time frame when you think those will start to be more visible in your shipments? Is that sort of just on a rolling basis or is it more that in these things you're going to take a little time to ramp up so maybe like first half of 27 or second half of 27? Just curious when we can really start to see these big projects really kind of show up in the shipments. Thank you.

Yeah, thank you. Great question. I would tell you, we see them every day. I mean, and it is going to be more of that consistent approach, even though you think about the way these bookings come into us, and the influence they can have on our backlog. When you actually go to put the work in place, it's still a customer out there that's taking the material, putting it down on a public job or on a private job. And it still takes, you know, their scheduling and their tools to do that. And so in the end, you're not going to see These big, massive swings because a bigger job starts one place, and you're always wrapping one up, and you're starting another one. And so we love slow and steady, I mean, especially with the compounding interest of the nature of our business and how we're focused on growing our cash growth profit for time. And so I would tell you our backlog shapes up as we see it today. It's very predictable, and I would tell you slow and steady for us is what we would want to continue to see.

Thank you very much. We'll go next now to Keith Hughes with Truist.

Thank you. What kind of mix adjusted price are you anticipating in the guide in the second half of the year given the years of enrolling in all second quarter?

Yeah, so Keith, for pricing cadence, I think it's playing out exactly like we saw at the beginning of the year, which would mean the lower end of the range in the first half and will be You know, exiting at the upper end, you know, in the back half. And that, you know, is, you know, really reported and, you know, Nick suggested it'll just, you know, depend on, you know, what those comps look like. And I would tell you that compared to our pricing plans coming into the year, we are, you know, executing just as we expected, playing out like we thought.

And on volume, would it be similar to where you're at the higher end of the range in the second half versus the first half, same trend?

I think the volume was the opposite. We were at the higher end of the first half, and I think it will continue to be consistent in the second half. Obviously, weather is always a factor in the fourth quarter, but I would say that we look at it today and we think to hit our range that we said, it really is kind of continuing the shipping phases that we've seen throughout the second quarter. and the second half would be similar to that.

Okay, thank you. Thank you. We'll go next now to Katherine Thompson with Thompson Research Group.

Hi, thank you for taking my question today. You gave a lot of great color on in markets and the strivings demand and, you know, we'd like to step back and look at the forest for the trees and just conceptually more things are going to be made in the U.S., built in the U.S. a variety of different parts. And granted, as you said earlier, there's been a lot of focus on data centers, but it's a bit more than that. You did touch on comments on power. It'd be helpful if you could pull the string a little bit more on that on a couple of different levels. First, where are you seeing the power expansion? And then what type? Because there's now a variety of different power types Thank you. Yeah, you're absolutely right, Kevin. Thank you. I would say it's a lot of different forms, and so we've still got a combination of renewables, so we're still seeing solar work. We've bid several

solar manufacturing ones. And then we're seeing, I think the first phase of this, we're seeing like we have four projects that are converting coal-fired power plants back to natural gas. We're seeing Georgia, Georgia Power, Alabama Power be very active in those kind of projects. Obviously in Texas, you know, we're seeing a lot of growth there, but we're also seeing this combination of, you know, some of the dollars you see tied up with these data centers is because they include power. And so it's hard when you look at the data center numbers when you talk about dollars and then you start kind of stripping that out. What is that is the real data center itself and what part of that is power. But I would tell you a lot of these are now, to get them approved, they're coming with full power supply to the data center. So we're seeing a mix of that. I would say overall, when we look at our quoting activity in the category of power generation, We're just seeing a lot more quoting activity. Now, I'm not going to tell you it's going to go as fast as data centers because you and I both know that approval process is going to look a little different. And so we just see it as another form of healthy, forward-looking demand of our products. And again, I mean, we like slow and steady, and we like our ability to continue to compound a cash gross profit over the future. So I just see this as another area of future aggregate demand that's going to be Thank you.

We'll go next now to Angel Castillo at Morgan Stanley.

Good morning. Thanks for taking my question. Ronnie, just wanted to go back to price a little bit. You noted, I guess, a little bit of a pull forward here on price. And if I heard correctly, I think you mentioned that you might still pull the price lever throughout the remainder of the year. So can you tell us a little bit more about that? Just wanted to make sure or clarify, I guess, does that mean that you might still be announcing additional price increases in the second half? And if that's right, I guess, how should we think about the likelihood of that? Is it just energy price dependent? And to the extent that you do move forward with any additional price, I guess, how should we think about the implications on Gen 1 increases and the ability to do those?

Yeah, I think we'll be giving you a lot more color to that by our next call. I mean, look, as we went into the mid-years, we pulled them forward anticipating what old was doing to us at the time. At that time, we were also anticipating that this was going to be short-lived. As we see it continue to drag on, I mean, that's where we've told you in the past and we'll continue to be very disciplined around. Price is our biggest lever when it comes to overcoming headwinds like this and inflationary pressures. and so what I'm saying is that continues to be our strongest lever and we're evaluating that as we speak and we will continue to protect our margins and we have to. These inflationary things are hitting us, they're hitting our customers, they're hitting everyone so it's not like there's one side of the supply chain that's isolated in that and so our expectations would be that we continue to be very disciplined around our pricing approach and so I would tell you more color on that as we work through the year but it's a very fluid situation with you know what we see old prices doing and they just became more sticky than you know three months ago we thought it would be a little less sticky than this and they haven't been and so we're going to continue to look at that but again that's our biggest lever so we'll continue to exercise our ability to protect the margins that we have.

That's very helpful and then maybe just on the M&A pipeline I guess some of your closest peers have done some larger more kind of transformative deals so I'm hoping you could just talk about your pipeline of potential M&A, whether that includes anything more transformative or just remind us how we should be thinking about the evolution of your strategy, just key areas of interest and potential size of that pipeline and what you have coming forward.

Yeah, I would say in my prepared remarks I said we have a healthy pipeline and we will most likely see some of those transactions close in the second half of the year. but those transactions for us are going to continue to be very, very aggregate discipline. I mean, look, we're good at what we do. We're good at aggregates. We're going to be the most pure play aggregate company when all these other deals that are announced in the market gets done and so we like what we do and so what you will see out of us is very much a disciplined approach to continuing to do what we're good at and that's producing and driving value for our shareholders based on the aggregate business. So nothing we do or nothing we have in the pipeline or anything you see us announce in the future will be of any surprise.

Very helpful. Thank you.

We'll take our next question now from Rohit Seth at B. Reilly.

Hey, thanks for taking my question. Just when we prepared in the March, you had touched on the Build 250 Act and the prepared contract to the IJA. You mentioned something about more new construction in the Build 250. I just wondered if you can elaborate on that.

Yeah, Rohit, I would tell you as we look at the Build America 250, there are two things there. Really, when we look at the aggregate intensity of the projects that we believe are will happen because of going back to a matching program instead of the grants program. And that's one that we believe when you go back to the old formulas that we've experienced in the past, you're really going to rely on getting money to states where the miles are, which is where Vulcan footprint is. And so that's why we continue to say that's going to be better aggregate intensive for us, as well as the bridge program. So as you unwind kind of the headline number, and remember with IJA, there was a lot of other stuff in it. There was a lot of green projects, a lot of, you know, buses and other things that had no aggregate consumption whatsoever. It was a great headline number, but when you unpacked it all, you know, we really focused on what was moving the needle with aggregates. You know, you really talk about highway, those infrastructure projects, and then you layer in the bridge sites. So as we look at it today with what came out of the House version of it, we're pleased with that. And I think the Senate will take that on. And as I said, we're most likely going to get a continued resolution. We're fine with that. We think we're in a good place with the House version of it. We're pleased with it. And we think the Senate has the ability to add more to that. But it's going to be more aggregate intense, which is good for us.

So ultimately, the takeaway for you guys is the Bill 250 is better for the business than the average area was?

I think when you when you wind back to what was truly focused on highway infrastructure and bridges, yes.

Thank you.

Thank you.

We'll go next now to Ivan Gee with Wolf Research.

Hey, good morning, guys. Thanks for the thanks for the time. Speaking with pricing, just a quick clarification. Are any of the mid-year price increases included in your unchanged guidance? Were the mid-years incremental to that? And then also, costs exceeded pricing by about 200 basis points. When do you expect this price-cost spread to reflect positive? Can we see pricing exceed costs in 3Q, in 4Q? Thank you.

Yeah, I would say as we exit the year, we talked about that on our last call. Look, when we came into the year, we said, Thank you very much. Thank you for joining us. at the higher end of that range of the four to six. And so the pricing will continue to accelerate throughout the year and costs will continue to decelerate.

Yeah, and in terms of, you know, margins, Ivan, obviously the second quarter was pressured with the higher energy. And we do expect, you know, those inflationary energy headwinds to continue in the second half. But I think for the second half, we should see some expansion in gross margin year over year driven largely by the fourth quarter. The margins likely will still, on a gross margin basis, are likely to still be down in the third quarter, growing in the fourth quarter, and up a little bit overall in the back half.

Thank you so much.

We'll go next now to Michael Dudas with Vertical Research.

Good morning, Mark, Mary Andrews, Ronnie. Good morning. Maybe you can, Ronnie, share some thoughts on over the last 18, 24 months, some of the acquisitions, asset positions you've made, certainly think about the one in North Carolina, how progress has been on a pricing, marketing front, product mix front, getting to the targets where you'd anticipate. And just quickly on the Colorado, it seems like it was opportunistic. Is there a focus area part of the country that you are taking another look at?

Let me talk about the past first and then we'll talk about the present. When I think about the acquisitions that we did over the last two years and really referring to Superior as well as Wake. In Superior, look, we've executed exactly what we said. We said we're going to go buy this business. We're going to evaluate the downstream. We wanted it for its aggregates. We were able to execute that. We were able to spin off and redeploy the downstream assets to a very good company in California, Portland will be a very good customer of ours long term. But in the end, we were able to do exactly what we said. We're going to buy the business for the average we wanted. I would tell you in the market there, and that market, there wasn't as many separation between where a bulk and price market would have been and where superior was, but there was some and we've been able to focus on getting those operations up to more like a Vulcan standard market when it comes to pricing and I'm very pleased with the execution of our California team and it's not easy when you buy these companies to integrate them and then spin things off and our California team really stepped up and performed well through all of this time and uncertainty of getting that thing done. When it comes to Wake, I'm extremely pleased with where we're at. I would tell you We said going into when we closed on Wake that it was significantly below the Vulcan standard when it came to what we felt like the value of those products should be. And that team and instituting our Vulcan web selling and the disciplines around that, and really the ownership of that local team as well has really performed well. And I would tell you we said it was going to take a couple of years, and I would tell you we're right on schedule. I mean, I'm very pleased with where we're at. The acquisition is doing exactly what we thought it would. And so as we look forward, I mean, that's the thing that we're going to be really good at. We're going to continue to focus on those kind of businesses that are agri-led, the things we can institute bulk of selling, institute bulk of operating, and continue to drive margin improvements. Brandon was an opportunity for us. When you look at Brandon, it's a small one. It's an entrant into Colorado, yes. About half of the volume out of that, let's roughly say about a million to a million and a half tons of annual production out of Brandon. About half of that stays locally. It's on the south side of Denver, so it does reach into the southern Denver market. But the other half comes to DFW and Dallas-Fort Worth and You know, the rail facility that we acquired there, you know, if you were leaving Fort Worth driving west, the rail facility is just on the west side of Fort Worth, and then you would hit our Weatherford Quarry. And so very complementary to our market strategy there. Again, dealing with selling to the same customers that we're already familiar with, that are familiar with Vulcan and our strategy and what we're going to do. So I'd say Brandon is a small... It's pretty much a bolt-on, but it also gives us some access to a new market. And I would say the things that I talk about in the future, those are the things that we're going to continue to focus on. The ones that we can do, the ones that are very agri-intensive, the ones that are easy for us to integrate, and the ones that we can continue to institute vocally of operating and vocally of selling disciplines in and drive margin improvement. So I'm very pleased with where we're at.

Excellent, Ronnie. Thank you.

Thank you. We'll go next now to Brent Dillman of Oppenheimer.

Great. Thanks. Hey, Ronnie, when you look across the what price wanted to get your reaction just to how competitors have responded with price increases, are you seeing any higher frequency of attempts to capture share by competitors just by holding price? Maybe there was a view energy cost inflation would be temporary. So they're in a holding pattern. Or has the response been pretty rational, just a higher cost? And I guess also just wondering if any of that's implicit in your volume outlook as well.

Yeah, I would tell you, look, I mean, at the end of the day, inflationary pressures, whether they're diesel or whether there are other factors involved in it, no one's immune to that. And so everybody feels it. And that includes our downstream customers feel it. And so everyone feels it. And I would tell you that The reactions and the disciplines and all those things have been as expected. I mean, I would, you know, everyone in this for the long term, even though we're measured in very short-term increments of quarter to quarter, I mean, we still have to focus on this business long term. And I would tell you we're in a great position to continue to execute on what we do with bulk web selling, bulk web operating. And then I think our competitors feel the same pressures that we do. And so in the end, no one is immune to diesel. Everyone has to use it. And it's just... David McGregor at Longbow Research.

Good morning, everyone, and thanks for taking my question. Good morning.

I guess you talked about the continued resolution, and it's pretty clear that's where we're heading.

I wonder if I could get you to just talk a little bit about, you know, how you grow shipments in that kind of environment. And I guess, sorry about that, I guess, you know, the quick and dirty is nothing changes in a continued resolution. We just kind of stay the course. But I wonder if I could get you to just maybe give us a little more of a nuanced look and, you know,

What changes in terms of the competitive position? Does it trigger change in how you may win in non-res business?

How do people respond to that condition?

Yeah, I mean, look, this is not abnormal for us to go through a continuing resolution. We've had lots of them in the past, and we'll have probably lots of them in the future, and that's just kind of the way that the D.C. model in getting things through the House and the Senate work works. I would say we don't see it as any change. Look, the continuing resolution continues to spin at current levels. You've got a lot of carryover with IJA, and I think that's going to be the unique thing about the transition of this bill. Historically, we haven't had that much carryover between bill to bill. And so we still, when we talk about the 60% of funds that are still going to be spent as a carryover, so you've got that. You've got really healthy state budgets as well. And so remember... Federal spending is only a third of the way we look at public funding. And so I think we're in a good position. But, I mean, look, we want slow and steady growth. And we've said through all of IJA, everyone was waiting on, well, when's that big step change coming? It wasn't going to happen. I mean, it's going to be slow and steady because that's the way work is performed. That's the way the states let it. That's the way the contractors look at it. And that's the way they actually perform the work. And so I look at it, I don't see any disruption as far as, Does it change how you think about CAPEX? No.

No, it does not. Thanks very much.

Thank you. We'll go next now to Brian Brophy at Stiefel.

Yeah, thanks. Good morning, everybody. Appreciate you taking my question. Just kind of continuing the conversation on the public side. Realize it's a moving target, but what are your latest thoughts on when we may see a new federal infrastructure bill? Thanks.

You know, I would tell you, you know, we're definitely headed straight towards a continuing resolution, and then time will tell whether that's before midterms or not. I wouldn't get caught up in it because at the end, I think a continuing resolution – we've had them where they've lasted a year. We've had them where they've lasted longer than a year. In the end, we've got a healthy level of spending, and remember, a continuing resolution continues that healthy level of spending. And so – I don't want to try to predict that. I mean, if you can predict anything in D.C. today, good luck. So in the end, let's just focus on we've got methods in place to continue public funding at a very healthy spot, and we're pleased with that.

Appreciate it.

Thank you.

Thank you. Moving next now to Garrett Greenblatt at J.P. Morgan.

Thanks for taking my question. I'm going to mention Power Generation has come off a few times earlier in the call. I'm curious if you could help us size out the impact of that to demand volumes. I think, you know, we think that data centers something like 3% to 5% of the overall volumes. I wonder if you could put some numbers around power generation and where that could go over, you know, the next couple of years into 2027, 2028.

Yeah, I mean, it's hard to predict today. It represents a very low percentage because if you think about power generation in the country, it's been a very slow growth area because of the – Thank you for joining us. Each individual state has its own ways that they're going to have to address that. And so I would look at it as another form of aggregate consumption long term that's going to build in consistency and aggregate supply. But I wouldn't get ahead of it saying it's going to look similar to data centers because it just can't move that fast.

Gotcha. Makes sense. Thank you.

Thank you, Mr. Pruitt. It appears we have no further questions, sir. I'd like to turn the conference back to you for any closing comments.

Thank you, Bo, and thank you all for joining our call today. Our first half results demonstrate the resiliency of our uniquely advantaged, pure-play, agri-business. I am confident that we have the right strategy and the right people to execute that strategy to create long-term value for our shareholders. We look forward to speaking with you next quarter. Thank you.

Thank you, Mr. Pruitt, and thank you, Ms. Carlisle. Again, ladies and gentlemen, this will conclude the Vulcan Materials Company second quarter earnings call. Again, thanks so much for joining us, everyone, and we wish you all a great day. Goodbye.