A Solid Financial Foundation
Martin Marietta’sMLM shares are finding solid ground after it reported fourth-quarter FY23 results.
The company saw revenue grow 8.9% Y/Y to $1.608 billion, slightly missing the expected $1.632 billion.
Earnings per share from continuing operations came in at $4.63, compared to $3.01 a year ago, surpassing the anticipated $3.99.
With a gross profit of $483.5 million (a 36.5% Y/Y increase) and an expanded margin of 30.1% from 24.0% a year ago, the company displayed robust financial health.
Of the $1.53 billion revenue generated by its Building Materials business (an 8.9% Y/Y increase), $461.3 million was accounted for as gross profit (a 39.2% Y/Y increase).
While there was a 2.1% decrease in aggregates shipments, a 15.0% increase in pricing, or 14.3% on a mix-adjusted basis, helped balance the scales.
Adjusted EBITDA also met expectations with a 28.3% Y/Y improvement, amounting to $502.6 million in the quarter.
Operating cash flow was at $1.53 billion, up from $991.2 million the previous year, indicating a strong fiscal stance.
The company held $1.27 billion in unrestricted cash and cash equivalents, alongside an unused borrowing capacity of $1.20 billion on its existing credit facilities as of December 31, 2023.
Additionally, Martin Marietta Materials returned $324.0 million to shareholders through dividend payments and share repurchases in the year.
Ward Nye, Chair and CEO, remarked, “Looking at the year ahead, we expect aggregates demand for infrastructure, large-scale energy and domestic manufacturing projects to be strong, largely offsetting weaker residential demand and anticipated softening in light nonresidential activity. That said, as mortgage rates stabilize and affordability headwinds recede, we fully expect single-family residential construction to recover, as demand still far exceeds supply particularly in our key markets.”
Also Read: Martin Marietta Materials Divests Materials Assets In Texas For $2.1B Cash
Forthright Forecast
FY24 Guidance: Martin Marietta Materials expects total revenues of $6.745 billion-$7.185 billion vs. consensus $7.355 billion and adjusted EBITDA of $2.14 billion-$2.34 billion.
The company anticipates an average selling price growth of 10%-12% for Aggregates in the year.
This week, it was revealed that Martin Marietta Materials sealed an agreement to acquire 20 active operations in Alabama, South Carolina, South Florida, Tennessee, and Virginia from affiliates of Blue Water Industries LLC (BWI Southeast) for $2.05 billion in cash.
Price Action: MLM shares are climbing by 1.61% at $535.72 on the last check Wednesday.
