Martin Marietta Materials, Inc. (NYSE:MLM) Q1 2018 Earnings Conference Call - Final Transcript

May 08, 2018 • 10:00 am ET


Martin Marietta Materials, Inc. (NYSE:MLM) Q1 2018 Earnings Conference Call - Final Transcript


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Good morning, ladies and gentlemen. Welcome to the Martin Marietta First Quarter 2018 Earnings Conference Call. My name is Kevin, and I'll be your coordinator today. At this time all participants have been placed on the listen-only mode. The question-and-answer session will follow the Company's prepared remarks. As a reminder, today's call is being recorded.

I will now turn the call over to your host, Ms. Suzanne Osberg, VP, IR for Martin Marietta. Ms. Osberg, you may begin.

Suzanne Osberg

Good morning, and thank you for joining Martin Marietta First Quarter 2018 Earnings Call. With me today are Ward Nye, Chairman and CEO; and Jim Nickolas, SVP and CFO. A few administrative and clarifying items before we begin. All financial and operating results discussed today are for the first quarter 2018 and any comparisons are versus the prior year's first quarter unless otherwise noted.

To facilitate today's discussion, we have made available during this webcast and on the Investor Relations section of our website Q1 2018 supplemental information that summarizes our quarterly results and trends. As detailed on Slide six, we have enhanced our product line disclosures to distinguish between revenues and gross profit generated from products and services and from freight arrangements. As a reminder, all margin references discussed today are based on revenues and any non-GAAP measures are defined and reconciled to the nearest GAAP measure in our Q1 2018 supplemental information and SEC filing.

(Forward-Looking Cautionary Statements)

We will begin today's teleconference with Ward Nye, who will discuss our first quarter operating performance and market trends as well as the recently completed Bluegrass Materials acquisition; Jim Nickolas will then review our financial results and upwardly revised 2018 guidance. A question-and-answer session will follow these prepared remarks.

I will now turn the call over to Ward.

Howard Nye

Our first quarter results were in line with our expectations. Importantly, as the quarter progressed, underlying customer demand remained strong and customer backlogs continue to grow as bidding activity increased, particularly in the West Group and most notably, in Texas.

Our Building Materials business saw strong shipment volumes on days not impacted by winter weather and improved pricing. Noteworthy as well, we once again posted record safety performance. With fewer reportable and lost time incidents than this point last year, our company's total injury incident rate now exceeds world-class benchmarks. With acceleration of construction activity through the balance of the year together with favorable underlying demand trends, safe and efficient operations and continued price discipline, we remain on target to achieve our original 2018 guidance and, as announced in today's release, we're increasing that guidance to reflect the expected contribution from the Bluegrass acquisition.

On April 27, we welcomed more than 400 talented employees to the Martin Marietta team as we successfully completed the acquisition of Bluegrass, the largest privately held pure play aggregates business in the United States. With more than 2 billion tons of high-quality reserves, the acquired operations expand our product offerings and importantly, strengthen our aggregates led positions in high-growth regions