UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549

 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): February 16, 2021
 
VULCAN MATERIALS COMPANY
(Exact name of registrant as specified in its charter)

New Jersey	 	001-33841	 	20-8579133	
(State or other jurisdiction
of incorporation)	 	(Commission File Number)	 	(IRS Employer Identification No.)	
 
1200 Urban Center Drive
Birmingham, Alabama 35242
(Address of principal executive offices) (zip code)
 
(205) 298-3000
Registrant's telephone number, including area code
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class	Trading Symbol(s)	Name of each exchange on which
registered	
Common Stock, $1 par value	VMC	New York Stock Exchange	
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company ¨
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

	Item 2.02	Results of Operations and Financial Condition.	
 
On February 16, 2021, Vulcan Materials Company announced its financial results for the fourth quarter ended December 31, 2020. The press release announcing the results is furnished as Exhibit 99.1.
 
	Item 9.01	Financial Statements and Exhibits.	
 
(d) Exhibits
 
Exhibit No.	 	Description	
 	 	 	
99.1	 	Press Release, dated February 16, 2021	
 	 	 	
104	 	Cover Page Interactive Data File (embedded within the Inline XBRL document)	

 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 	VULCAN MATERIALS COMPANY	

Date: February 16, 2021	By:	/s/ Denson N. Franklin III	
 	Name:   	Denson N. Franklin III	
 	Title:	Senior Vice President, General Counsel and Secretary	

 

 

 
Exhibit 99.1

 
February 16, 2021
FOR IMMEDIATE RELEASE
Investor Contact: Mark Warren (205) 298-3220
Media Contact: Janet Kavinoky (205) 298-3220
 
VULCAN REPORTS FOURTH QUARTER AND FULL YEAR RESULTS
 
Strong Full-Year Results Reflect Improvements in Aggregates Unit Profitability
Solid Earnings Growth Expected in 2021
 
Birmingham, Alabama – February 16, 2021 – Vulcan Materials Company (NYSE: VMC), the nation’s largest producer of construction aggregates, today announced results for the quarter ended December 31, 2020.
 
Tom Hill, Chairman and Chief Executive Officer, said, “Our best-in-class aggregates business, along with the efforts and dedication of our employees, allowed us to overcome COVID-19 related disruptions in 2020. Most impressive, we delivered year-over-year gains in aggregates unit profitability throughout each quarter in 2020. Our ability to leverage Vulcan’s four strategic disciplines enabled us to expand unit margins, deliver improved cash flows, and increase returns on invested capital. Our team’s hard work along with Vulcan’s leading market positions and strong financial footing will enable us to capitalize on an improving demand outlook in 2021.”
 
Net earnings were $115 million in the fourth quarter, and Adjusted EBITDA was $311 million. Fourth quarter Adjusted EBITDA increased 4 percent despite a 1 percent decline in total revenues. Effective cost management throughout the organization and aggregates price growth helped drive margin expansion.
 
Full year revenues were $4.86 billion, 1 percent lower than the prior year, while gross profit margins expanded across each segment driving an improvement of 150 basis points in the Company’s EBITDA margin. Net earnings were $584 million, and Adjusted EBITDA was a record $1.324 billion.
 
Mr. Hill continued, “Construction employment gains in key markets are a positive signal that activity levels are recovering across our footprint, as compelling fundamentals in residential construction support growing demand in 2021. Shipments into private nonresidential continue to benefit from growth in heavy industrial projects such as data centers and warehouses, while construction starts in other categories remain below the prior year. Recent improvements in highway lettings and contract awards indicate growing confidence and visibility fueling advancement of planned projects, particularly in the second half of 2021. The pricing environment remains positive, and we continue to execute at a high level, positioning us well for 2021. We expect our 2021 Adjusted EBITDA will range between $1.340 billion to $1.440 billion.”

 

Page 2
February 16, 2021
FOR IMMEDIATE RELEASE
 
Highlights as of December 31, 2020 include:
 
 	 	Fourth Quarter	 	 	Full Year	 	
Amounts in millions, except per unit data	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Total revenues	 	$	1,175.1	 	 	$	1,186.2	 	 	$	4,856.8	 	 	$	4,929.1	 	
Gross profit	 	$	302.7	 	 	$	293.1	 	 	$	1,281.5	 	 	$	1,255.9	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Segment sales	 	$	956.5	 	 	$	960.2	 	 	$	3,944.3	 	 	$	3,990.3	 	
Freight-adjusted revenues	 	$	737.3	 	 	$	720.6	 	 	$	3,007.6	 	 	$	3,014.2	 	
Gross profit	 	$	276.0	 	 	$	274.5	 	 	$	1,159.2	 	 	$	1,146.6	 	
Shipments (tons)	 	 	51.1	 	 	 	51.6	 	 	 	208.3	 	 	 	215.5	 	
Freight-adjusted sales price per ton	 	$	14.42	 	 	$	13.96	 	 	$	14.44	 	 	$	13.99	 	
Gross profit per ton	 	$	5.40	 	 	$	5.32	 	 	$	5.57	 	 	$	5.32	 	
Asphalt, Concrete & Calcium segment gross profit	 	$	26.7	 	 	$	18.6	 	 	$	122.3	 	 	$	109.3	 	
Selling, Administrative and General (SAG)	 	$	98.6	 	 	$	95.8	 	 	$	359.8	 	 	$	370.5	 	
SAG as % of Total revenues	 	 	8.4	%	 	 	8.1	%	 	 	7.4	%	 	 	7.5	%	
Earnings from continuing operations before income taxes	 	$	141.2	 	 	$	166.0	 	 	$	743.8	 	 	$	757.7	 	
Net earnings	 	$	114.5	 	 	$	141.1	 	 	$	584.5	 	 	$	617.7	 	
Adjusted EBIT	 	$	210.3	 	 	$	202.8	 	 	$	926.7	 	 	$	895.4	 	
Adjusted EBITDA	 	$	311.2	 	 	$	298.5	 	 	$	1,323.5	 	 	$	1,270.0	 	
Earnings from continuing operations per diluted share	 	$	0.87	 	 	$	1.07	 	 	$	4.41	 	 	$	4.67	 	
Adjusted earnings from continuing operations per diluted share	 	$	1.07	 	 	$	1.08	 	 	$	4.68	 	 	$	4.70	 	
 
Reported earnings from continuing operations for the year were $588 million, or $4.41 per diluted share. Comparing adjusted earnings from continuing operations of $4.68 per diluted share in 2020 to $4.70 per diluted share in 2019, the prior year benefited from a lower tax rate due to certain tax benefits and credits that were higher than in 2020. The effect of the resulting higher tax rate in 2020 was $0.18 per diluted share.
 
Segment Results
Aggregates
 
Fourth quarter gross profit increased to $276 million due to growth in pricing and effective cost control, despite a 1 percent decline in shipments. Gains in unit profitability were widespread and marked the fourth consecutive quarter of growth in gross profit per ton. For the full year, gross profit per ton increased 5 percent, despite 3 percent lower volumes. This growth marks the tenth consecutive quarter of year-over-year improvement in the Company’s trailing-twelve-month unit profitability.
 
The pricing environment continues to be positive across the Company’s footprint. On a mix-adjusted basis, all of the Company’s markets reported full year price growth. For the year, mix-adjusted pricing increased 3.1 percent (reported freight-adjusted sales price increased 3.2 percent) despite a 3 percent decline in shipments. For the quarter, mix-adjusted sales price increased 1.8 percent, and reported freight-adjusted pricing increased 3.3 percent.
 
Fourth quarter operating efficiencies and lower diesel fuel costs helped to mitigate increased spending to remove overburden ahead of future shipments and the timing of repair costs. The Aggregates segment earnings impact from lower diesel fuel cost was $8 million in the quarter. For the full year, freight-adjusted unit cost of sales increased 2 percent and 1 percent on a cash basis. Flexible operating plans, disciplined cost control, and lower diesel fuel costs mitigated the impact of operational disruptions caused by the pandemic during the year.

 

Page 3
February 16, 2021
FOR IMMEDIATE RELEASE
 
Asphalt, Concrete and Calcium
Fourth quarter gross profit increased sharply in each segment. Asphalt segment gross profit increased 53 percent to $17 million in the fourth quarter. The year-over-year improvement was driven by higher material margins (sales price less unit cost of raw materials). Segment earnings benefited from price discipline and effective cost containment, including lower liquid asphalt costs. Shipments in the current year’s quarter were lower than the prior year, as prior year shipments included certain large projects in the Arizona and Tennessee markets.
 
Fourth quarter concrete segment gross profit increased 28 percent to $9 million as a result of higher material margins. Shipments decreased 12 percent versus the prior year, and average selling prices increased 2 percent compared to the prior year. Fourth quarter shipments were impacted by the lingering effects of cement supply shortages in Northern California.
 
Calcium segment gross profit was $1.2 million versus $0.8 million in the prior year quarter.
 
Full year segment earnings increased 12 percent collectively, driven by strong year-over-year improvement in asphalt. Each segment reported year-over-year margin expansion on lower revenues.
 
Selling, Administrative and General (SAG) and Other Nonoperating Expense
SAG expense was $99 million in the quarter and $360 million for the full year. As a percentage of total revenues, SAG expense was 7.4 percent in 2020. The Company remains focused on further leveraging its overhead cost structure.
 
Other nonoperating expense was $21 million, compared to income of $3 million in the prior year quarter. This year-over-year change resulted from a non-cash pension settlement charge of $23 million, or $0.13 per diluted share, recorded in the fourth quarter in connection with a voluntary lump sum distribution of benefits to certain fully vested plan participants. This action will benefit future expense and funding requirements.
 
Financial Position, Liquidity and Capital Allocation 
Capital expenditures in the fourth quarter were $132 million and $361 million for the full year, most of which was directed toward core operating and maintenance projects. During the fourth quarter, the Company restarted planned growth projects that were put on hold in March 2020 as a result of the pandemic. In 2021, the Company expects to spend between $450 and $475 million on capital expenditures, including growth projects. The Company will continue to review its plans and will adjust as needed, while being thoughtful about preserving liquidity.

 

Page 4
February 16, 2021
FOR IMMEDIATE RELEASE
 
In 2020, the Company returned $180 million to shareholders through dividends, a 10 percent increase versus the prior year. For the year, the Company repurchased $26 million in common stock.
 
At year end, total debt to trailing-twelve month Adjusted EBITDA was 2.5 times or 1.6 times on a net debt basis reflecting $1.2 billion of cash on hand. Approximately $500 million will be used to pay off certain debt maturities due in March 2021. The Company’s weighted-average debt maturity was 13 years, and the effective weighted-average interest rate was 4.1 percent.
 
Return on invested capital increased 40 basis points from the prior year to 14.3 percent. Operating cash flows were $1.1 billion, up 9 percent versus the previous year. Solid operating earnings growth coupled with disciplined capital management led to these results.
 
Outlook
Regarding the Company’s outlook, Mr. Hill stated, “We are encouraged by the continued strength in residential construction activity, particularly single-family housing. Our expectation is also supported by the recent improvement in highway awards and construction employment trends in key markets. Data centers, distribution centers, and warehouses, which now comprise the largest share of new private nonresidential project awards, will continue to underpin demand in this end market. We believe these leading indicators, along with sustaining a positive pricing environment, can be a catalyst for further recovery in construction activity during 2021.”
 
Management expectations for 2021 include:
	·	Aggregates shipments down 2 percent to up 2 percent versus 2020	
	·	Year-over-year aggregates freight-adjusted price increase of 2 to 4 percent	
	·	Asphalt, Concrete and Calcium gross profit up mid-to-high single digits	
	·	SAG expenses of $365 to $375 million	
	·	Interest expense of approximately $130 million	
	·	Depreciation, depletion, accretion and amortization expense of approximately $400 million	
	·	An effective tax rate of approximately 21 percent	
	·	Earnings from continuing operations of $4.80 to $5.40 per diluted share	
	·	Adjusted EBITDA of $1.340 to $1.440 billion	
	·	No major changes in COVID shelter-in-place restrictions	
 
Mr. Hill concluded, “As we saw in 2020, demand for our products can be subject to market fluctuations outside of our control. That said, we remained focused on the factors within our control, including our pricing and cost actions, both of which contributed to further improvement in our industry-leading unit margins in 2020. We will carry that determination through 2021 and beyond. Our operating plans are underpinned by our four strategic disciplines (Commercial and Operational Excellence, Logistics Innovation and Strategic Sourcing), a healthy balance sheet, strong liquidity, and the engagement of our people.”

 

Page 5
February 16, 2021
FOR IMMEDIATE RELEASE
 
Conference Call
Vulcan will host a conference call at 10:00 a.m. CT on February 16, 2021. A webcast will be available via the Company’s website at www.vulcanmaterials.com. Investors and other interested parties may access the teleconference live by calling 833-962-1439, or 832-900-4623 if outside the U.S., approximately 10 minutes before the scheduled start. The conference ID is 5378297. The conference call will be recorded and available for replay at the Company’s website approximately two hours after the call.
 
About Vulcan Materials Company 
Vulcan Materials Company, a member of the S&P 500 Index with headquarters in Birmingham, Alabama, is the nation's largest producer of construction aggregates – primarily crushed stone, sand and gravel – and a major producer of aggregates-based construction materials, including asphalt and ready-mixed concrete. For additional information about Vulcan, go to www.vulcanmaterials.com.
 
FORWARD-LOOKING STATEMENT DISCLAIMER
This document contains forward-looking statements.  Statements that are not historical fact, including statements about Vulcan's beliefs and expectations, are forward-looking statements. Generally, these statements relate to future financial performance, results of operations, business plans or strategies, projected or anticipated revenues, expenses, earnings (including EBITDA and other measures), dividend policy, shipment volumes, pricing, levels of capital expenditures, intended cost reductions and cost savings, anticipated profit improvements and/or planned divestitures and asset sales. These forward-looking statements are sometimes identified by the use of terms and phrases such as “believe,” “should,” “would,” “expect,” “project,” “estimate,” “anticipate,” “intend,” “plan,” “will,” “can,” “may” or similar expressions elsewhere in this document.  These statements are subject to numerous risks, uncertainties, and assumptions, including but not limited to general business conditions, competitive factors, pricing, energy costs, and other risks and uncertainties discussed in the reports Vulcan periodically files with the SEC.

 

Page 6
February 16, 2021
FOR IMMEDIATE RELEASE
 
Forward-looking statements are not guarantees of future performance and actual results, developments, and business decisions may vary significantly from those expressed in or implied by the forward-looking statements. The following risks related to Vulcan's business, among others, could cause actual results to differ materially from those described in the forward-looking statements: general economic and business conditions; a pandemic, epidemic or other public health emergency, such as the recent outbreak of COVID-19; Vulcan’s dependence on the construction industry, which is subject to economic cycles; the timing and amount of federal, state and local funding for infrastructure; changes in the level of spending for private residential and private nonresidential construction; changes in Vulcan’s effective tax rate; the increasing reliance on information technology infrastructure, including the risks that the infrastructure does not work as intended, experiences technical difficulties or is subjected to cyber-attacks; the impact of the state of the global economy on Vulcan’s businesses and financial condition and access to capital markets; the highly competitive nature of the construction industry; the impact of future regulatory or legislative actions, including those relating to climate change, wetlands, greenhouse gas emissions, the definition of minerals, tax policy or international trade; the outcome of pending legal proceedings; pricing of Vulcan's products; weather and other natural phenomena, including the impact of climate change and availability of water; energy costs; costs of hydrocarbon-based raw materials; healthcare costs; the amount of long-term debt and interest expense incurred by Vulcan; changes in interest rates; the impact of a discontinuation of the London Interbank Offered Rate (LIBOR); volatility in pension plan asset values and liabilities, which may require cash contributions to the pension plans; the impact of environmental cleanup costs and other liabilities relating to existing and/or divested businesses; Vulcan's ability to secure and permit aggregates reserves in strategically located areas; Vulcan's ability to manage and successfully integrate acquisitions; the effect of changes in tax laws, guidance and interpretations; significant downturn in the construction industry may result in the impairment of goodwill or long-lived assets; changes in technologies, which could disrupt the way Vulcan does business and how Vulcan’s products are distributed; and other assumptions, risks and uncertainties detailed from time to time in the reports filed by Vulcan with the SEC. All forward-looking statements in this communication are qualified in their entirety by this cautionary statement.  Vulcan disclaims and does not undertake any obligation to update or revise any forward-looking statement in this document except as required by law.
 
Source: Vulcan Materials Company

 

Table A
 
Vulcan Materials Company
and Subsidiary Companies
 
 	 	(in thousands, except per share data)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
Consolidated Statements of Earnings	 	December 31	 	 	December 31	 	
(Condensed and unaudited)	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Total revenues	 	$	1,175,120	 	 	$	1,186,152	 	 	$	4,856,826	 	 	$	4,929,103	 	
Cost of revenues	 	 	872,379	 	 	 	893,071	 	 	 	3,575,345	 	 	 	3,673,202	 	
Gross profit	 	 	302,741	 	 	 	293,081	 	 	 	1,281,481	 	 	 	1,255,901	 	
Selling, administrative and general expenses	 	 	98,627	 	 	 	95,801	 	 	 	359,772	 	 	 	370,548	 	
Gain on sale of property, plant & equipment and businesses	 	 	1,681	 	 	 	12,770	 	 	 	3,997	 	 	 	23,752	 	
Other operating expense, net	 	 	(9,366	)	 	 	(16,474	)	 	 	(29,975	)	 	 	(31,647	)	
Operating earnings	 	 	196,429	 	 	 	193,576	 	 	 	895,731	 	 	 	877,458	 	
Other nonoperating income (expense), net	 	 	(21,357	)	 	 	3,289	 	 	 	(17,540	)	 	 	9,243	 	
Interest expense, net	 	 	33,884	 	 	 	30,835	 	 	 	134,393	 	 	 	129,000	 	
Earnings from continuing operations before income taxes	 	 	141,188	 	 	 	166,030	 	 	 	743,798	 	 	 	757,701	 	
Income tax expense	 	 	25,273	 	 	 	23,434	 	 	 	155,803	 	 	 	135,198	 	
Earnings from continuing operations	 	 	115,915	 	 	 	142,596	 	 	 	587,995	 	 	 	622,503	 	
Loss on discontinued operations, net of tax	 	 	(1,397	)	 	 	(1,504	)	 	 	(3,515	)	 	 	(4,841	)	
Net earnings	 	$	114,518	 	 	$	141,092	 	 	$	584,480	 	 	$	617,662	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings (loss) per share	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Continuing operations	 	$	0.87	 	 	$	1.08	 	 	$	4.44	 	 	$	4.71	 	
Discontinued operations	 	$	(0.01	)	 	$	(0.01	)	 	$	(0.03	)	 	$	(0.04	)	
Net earnings	 	$	0.86	 	 	$	1.07	 	 	$	4.41	 	 	$	4.67	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings (loss) per share	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Continuing operations	 	$	0.87	 	 	$	1.07	 	 	$	4.41	 	 	$	4.67	 	
Discontinued operations	 	$	(0.01	)	 	$	(0.01	)	 	$	(0.02	)	 	$	(0.04	)	
Net earnings	 	$	0.86	 	 	$	1.06	 	 	$	4.39	 	 	$	4.63	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted-average common shares outstanding	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	132,619	 	 	 	132,467	 	 	 	132,578	 	 	 	132,300	 	
Assuming dilution	 	 	133,367	 	 	 	133,467	 	 	 	133,245	 	 	 	133,385	 	
Depreciation, depletion, accretion and amortization	 	$	100,894	 	 	$	95,671	 	 	$	396,806	 	 	$	374,596	 	
Effective tax rate from continuing operations	 	 	17.9	%	 	 	14.1	%	 	 	20.9	%	 	 	17.8	%	

 

Table B
 
Vulcan Materials Company
and Subsidiary Companies
 
 	 	 	 	 	(in thousands)	 	
Consolidated Balance Sheets	 	December 31	 	 	December 31	 	
(Condensed and unaudited)	 	2020	 	 	2019	 	
Assets	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	1,197,068	 	 	$	271,589	 	
Restricted cash	 	 	945	 	 	 	2,917	 	
Accounts and notes receivable	 	 	 	 	 	 	 	 	
Accounts and notes receivable, gross	 	 	558,848	 	 	 	573,241	 	
Allowance for doubtful accounts	 	 	(2,551	)	 	 	(3,125	)	
Accounts and notes receivable, net	 	 	556,297	 	 	 	570,116	 	
Inventories	 	 	 	 	 	 	 	 	
Finished products	 	 	378,389	 	 	 	391,666	 	
Raw materials	 	 	33,780	 	 	 	31,318	 	
Products in process	 	 	4,555	 	 	 	5,604	 	
Operating supplies and other	 	 	31,861	 	 	 	29,720	 	
Inventories	 	 	448,585	 	 	 	458,308	 	
Other current assets	 	 	74,270	 	 	 	76,396	 	
Total current assets	 	 	2,277,165	 	 	 	1,379,326	 	
Investments and long-term receivables	 	 	34,301	 	 	 	60,709	 	
Property, plant & equipment	 	 	 	 	 	 	 	 	
Property, plant & equipment, cost	 	 	9,102,086	 	 	 	8,749,217	 	
Allowances for depreciation, depletion & amortization	 	 	(4,676,087	)	 	 	(4,433,179	)	
Property, plant & equipment, net	 	 	4,425,999	 	 	 	4,316,038	 	
Operating lease right-of-use assets, net	 	 	423,128	 	 	 	408,189	 	
Goodwill	 	 	3,172,112	 	 	 	3,167,061	 	
Other intangible assets, net	 	 	1,123,544	 	 	 	1,091,475	 	
Other noncurrent assets	 	 	230,656	 	 	 	225,995	 	
Total assets	 	$	11,686,905	 	 	$	10,648,793	 	
Liabilities	 	 	 	 	 	 	 	 	
Current maturities of long-term debt	 	 	515,435	 	 	 	25	 	
Trade payables and accruals	 	 	273,080	 	 	 	265,159	 	
Other current liabilities	 	 	259,368	 	 	 	270,379	 	
Total current liabilities	 	 	1,047,883	 	 	 	535,563	 	
Long-term debt	 	 	2,772,240	 	 	 	2,784,315	 	
Deferred income taxes, net	 	 	706,050	 	 	 	633,039	 	
Deferred revenue	 	 	174,045	 	 	 	179,880	 	
Operating lease liabilities	 	 	399,582	 	 	 	388,042	 	
Other noncurrent liabilities	 	 	559,775	 	 	 	506,097	 	
Total liabilities	 	$	5,659,575	 	 	$	5,026,936	 	
Equity	 	 	 	 	 	 	 	 	
Common stock, $1 par value	 	 	132,516	 	 	 	132,371	 	
Capital in excess of par value	 	 	2,802,012	 	 	 	2,791,353	 	
Retained earnings	 	 	3,274,107	 	 	 	2,895,871	 	
Accumulated other comprehensive loss	 	 	(181,305	)	 	 	(197,738	)	
Total equity	 	$	6,027,330	 	 	$	5,621,857	 	
Total liabilities and equity	 	$	11,686,905	 	 	$	10,648,793	 	

 

Table C
Vulcan Materials Company
and Subsidiary Companies
 
 	 	 	 	 	(in thousands)	 	
 	 	Twelve Months Ended	 	
Consolidated Statements of Cash Flows	 	December 31	 	
(Condensed and unaudited)	 	2020	 	 	2019	 	
Operating Activities	 	 	 	 	 	 	 	 	
Net earnings	 	$	584,480	 	 	$	617,662	 	
Adjustments to reconcile net earnings to net cash provided by operating activities	 	 	 	 	 	 	 	 	
Depreciation, depletion, accretion and amortization	 	 	396,806	 	 	 	374,596	 	
Noncash operating lease expense	 	 	38,272	 	 	 	35,344	 	
Net gain on sale of property, plant & equipment and businesses	 	 	(3,997	)	 	 	(23,752	)	
Contributions to pension plans	 	 	(8,819	)	 	 	(8,882	)	
Share-based compensation expense	 	 	32,991	 	 	 	31,843	 	
Deferred tax expense	 	 	62,018	 	 	 	76,011	 	
Changes in assets and liabilities before initial effects of business acquisitions and dispositions	 	 	(39,710	)	 	 	(147,218	)	
Other, net	 	 	8,318	 	 	 	28,518	 	
Net cash provided by operating activities	 	$	1,070,359	 	 	$	984,122	 	
Investing Activities	 	 	 	 	 	 	 	 	
Purchases of property, plant & equipment	 	 	(362,194	)	 	 	(384,094	)	
Proceeds from sale of property, plant & equipment	 	 	11,461	 	 	 	22,661	 	
Proceeds from sale of businesses	 	 	968	 	 	 	1,744	 	
Payment for businesses acquired, net of acquired cash	 	 	(43,223	)	 	 	(44,151	)	
Other, net	 	 	11,474	 	 	 	(11,997	)	
Net cash used for investing activities	 	$	(381,514	)	 	$	(415,837	)	
Financing Activities	 	 	 	 	 	 	 	 	
Proceeds from short-term debt	 	 	0	 	 	 	366,900	 	
Payment of short-term debt	 	 	0	 	 	 	(499,900	)	
Payment of current maturities and long-term debt	 	 	(250,025	)	 	 	(23	)	
Proceeds from issuance of long-term debt	 	 	750,000	 	 	 	0	 	
Debt issuance and exchange costs	 	 	(15,394	)	 	 	0	 	
Settlements of interest rate derivatives	 	 	(19,863	)	 	 	0	 	
Purchases of common stock	 	 	(26,132	)	 	 	(2,602	)	
Dividends paid	 	 	(180,216	)	 	 	(163,973	)	
Share-based compensation, shares withheld for taxes	 	 	(22,144	)	 	 	(38,522	)	
Other, net	 	 	(1,564	)	 	 	(63	)	
Net cash provided by (used for) financing activities	 	$	234,662	 	 	$	(338,183	)	
Net increase in cash and cash equivalents and restricted cash	 	 	923,507	 	 	 	230,102	 	
Cash and cash equivalents and restricted cash at beginning of year	 	 	274,506	 	 	 	44,404	 	
Cash and cash equivalents and restricted cash at end of year	 	$	1,198,013	 	 	$	274,506	 	

 

Table D
 
Segment Financial Data and Unit Shipments
 
 	(in thousands, except per unit data)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Total Revenues	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates 1	 	$	956,502	 	 	$	960,164	 	 	$	3,944,286	 	 	$	3,990,275	 	
Asphalt 2	 	 	194,665	 	 	 	206,331	 	 	 	792,605	 	 	 	855,821	 	
Concrete	 	 	85,362	 	 	 	95,258	 	 	 	383,617	 	 	 	395,627	 	
Calcium	 	 	2,451	 	 	 	2,118	 	 	 	7,720	 	 	 	8,191	 	
Segment sales	 	$	1,238,980	 	 	$	1,263,871	 	 	$	5,128,228	 	 	$	5,249,914	 	
Aggregates intersegment sales	 	 	(63,860	)	 	 	(77,719	)	 	 	(271,402	)	 	 	(320,811	)	
Total revenues	 	$	1,175,120	 	 	$	1,186,152	 	 	$	4,856,826	 	 	$	4,929,103	 	
Gross Profit	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	$	275,994	 	 	$	274,516	 	 	$	1,159,178	 	 	$	1,146,649	 	
Asphalt	 	 	16,987	 	 	 	11,073	 	 	 	75,233	 	 	 	63,023	 	
Concrete	 	 	8,562	 	 	 	6,664	 	 	 	44,159	 	 	 	43,151	 	
Calcium	 	 	1,198	 	 	 	828	 	 	 	2,911	 	 	 	3,078	 	
Total	 	$	302,741	 	 	$	293,081	 	 	$	1,281,481	 	 	$	1,255,901	 	
Depreciation, Depletion, Accretion and Amortization	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	$	80,757	 	 	$	77,787	 	 	$	321,127	 	 	$	305,046	 	
Asphalt	 	 	8,910	 	 	 	8,856	 	 	 	34,956	 	 	 	35,199	 	
Concrete	 	 	3,940	 	 	 	3,958	 	 	 	16,010	 	 	 	13,620	 	
Calcium	 	 	43	 	 	 	55	 	 	 	189	 	 	 	232	 	
Other	 	 	7,244	 	 	 	5,015	 	 	 	24,524	 	 	 	20,499	 	
Total	 	$	100,894	 	 	$	95,671	 	 	$	396,806	 	 	$	374,596	 	
Average Unit Sales Price and Unit Shipments	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Freight-adjusted revenues 3	 	$	737,313	 	 	$	720,584	 	 	$	3,007,634	 	 	$	3,014,157	 	
Aggregates - tons	 	 	51,132	 	 	 	51,620	 	 	 	208,295	 	 	 	215,465	 	
Freight-adjusted sales price 4	 	$	14.42	 	 	$	13.96	 	 	$	14.44	 	 	$	13.99	 	
Other Products	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asphalt Mix - tons	 	 	2,882	 	 	 	3,041	 	 	 	11,835	 	 	 	12,665	 	
Asphalt Mix - sales price	 	$	57.70	 	 	$	57.87	 	 	$	57.97	 	 	$	57.79	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Ready-mixed concrete - cubic yards	 	 	656	 	 	 	744	 	 	 	2,951	 	 	 	3,104	 	
Ready-mixed concrete - sales price	 	$	128.93	 	 	$	126.97	 	 	$	128.93	 	 	$	126.38	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Calcium - tons	 	 	88	 	 	 	78	 	 	 	282	 	 	 	294	 	
Calcium - sales price	 	$	27.64	 	 	$	27.30	 	 	$	27.32	 	 	$	27.85	 	
 
	1	Includes product sales (crushed stone, sand and gravel, sand, and other aggregates), as well as freight & delivery costs that we pass along to our customers, and service revenues related to aggregates.	
	2	Includes product sales, as well as service revenues from our asphalt construction paving business.	
	3	Freight-adjusted revenues are Aggregates segment sales excluding freight & delivery revenues and immaterial other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business.	
	4	Freight-adjusted sales price is calculated as freight-adjusted revenues divided by aggregates unit shipments.	

 

Appendix 1	
 
	1.	Reconciliation of Non-GAAP Measures	
 
Aggregates segment freight-adjusted revenues is not a Generally Accepted Accounting Principle (GAAP) measure. We present this metric as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. It also excludes immaterial other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business. Additionally, we use this metric as the basis for calculating the average sales price of our aggregates products. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
Aggregates Segment Freight-Adjusted Revenues
 
 	(in thousands, except per ton data)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Segment sales	 	$	956,502	 	 	$	960,164	 	 	$	3,944,286	 	 	$	3,990,275	 	
Less: Freight & delivery revenues 1	 	 	205,034	 	 	 	225,139	 	 	 	877,003	 	 	 	921,064	 	
  Other revenues	 	 	14,155	 	 	 	14,441	 	 	 	59,649	 	 	 	55,054	 	
Freight-adjusted revenues	 	$	737,313	 	 	$	720,584	 	 	$	3,007,634	 	 	$	3,014,157	 	
Unit shipment - tons	 	 	51,132	 	 	 	51,620	 	 	 	208,295	 	 	 	215,465	 	
Freight-adjusted sales price	 	$	14.42	 	 	$	13.96	 	 	$	14.44	 	 	$	13.99	 	
 
	1	At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote distribution sites.	
 
Aggregates segment incremental gross profit flow-through rate is not a GAAP measure and represents the year-over-year change in gross profit divided by the year-over-year change in segment sales excluding freight & delivery (revenues and costs). We present this metric as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
Aggregates Segment Incremental Gross Profit Margin in Accordance with GAAP
 
 	(dollars in thousands)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	275,994	 	 	$	274,516	 	 	$	1,159,178	 	 	$	1,146,649	 	
Segment sales	 	$	956,502	 	 	$	960,164	 	 	$	3,944,286	 	 	$	3,990,275	 	
Gross profit margin	 	 	28.9	%	 	 	28.6	%	 	 	29.4	%	 	 	28.7	%	
Incremental gross profit margin	 	 	N/A  	 	 	 	 	 	 	 	N/A  	 	 	 	 	 	
 
Aggregates Segment Incremental Gross Profit Flow-through Rate (Non-GAAP)
 
 	 	(dollars in thousands)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	275,994	 	 	$	274,516	 	 	$	1,159,178	 	 	$	1,146,649	 	
Segment sales	 	$	956,502	 	 	$	960,164	 	 	$	3,944,286	 	 	$	3,990,275	 	
Less: Freight & delivery revenues 1	 	 	205,034	 	 	 	225,139	 	 	 	877,003	 	 	 	921,064	 	
Segment sales excluding freight & delivery 	 	$	751,468	 	 	$	735,025	 	 	$	3,067,283	 	 	$	3,069,211	 	
Gross profit margin excluding freight & delivery	 	 	36.7	%	 	 	37.3	%	 	 	37.8	%	 	 	37.4	%	
Incremental gross profit flow-through rate	 	 	9.0	%	 	 	 	 	 	 	N/A 	 	 	 	 	 	
 
	1	At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote distribution sites.	
 
GAAP does not define "Aggregates segment cash gross profit" and it should not be considered as an alternative to earnings measures defined by GAAP. We and the investment community use this metric to assess the operating performance of our business. Additionally, we present this metric as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. Aggregates segment cash gross profit per ton is computed by dividing Aggregates segment cash gross profit by tons shipped. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
Aggregates Segment Cash Gross Profit
 
 	(in thousands, except per ton data)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	275,994	 	 	$	274,516	 	 	$	1,159,178	 	 	$	1,146,649	 	
Depreciation, depletion, accretion and amortization	 	 	80,757	 	 	 	77,787	 	 	 	321,127	 	 	 	305,046	 	
Aggregates segment cash gross profit	 	$	356,751	 	 	$	352,303	 	 	$	1,480,305	 	 	$	1,451,695	 	
Unit shipments - tons	 	 	51,132	 	 	 	51,620	 	 	 	208,295	 	 	 	215,465	 	
Aggregates segment cash gross profit per ton	 	$	6.98	 	 	$	6.82	 	 	$	7.11	 	 	$	6.74	 	

 

Appendix 2	
 
Reconciliation of Non-GAAP Measures (Continued)
 
GAAP does not define "Earnings Before Interest, Taxes, Depreciation and Amortization" (EBITDA) and it should not be considered as an alternative to earnings measures defined by GAAP. We use this metric to assess the operating performance of our business and as a basis for strategic planning and forecasting as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. We adjust EBITDA for certain items to provide a more consistent comparison of earnings performance from period to period. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
EBITDA and Adjusted EBITDA
 
 	(in thousands)	 	
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Net earnings	 	$	114,518	 	 	$	141,092	 	 	$	584,480	 	 	$	617,662	 	
Income tax expense	 	 	25,273	 	 	 	23,434	 	 	 	155,803	 	 	 	135,198	 	
Interest expense, net	 	 	33,884	 	 	 	30,835	 	 	 	134,393	 	 	 	129,000	 	
Loss on discontinued operations, net of tax	 	 	1,397	 	 	 	1,504	 	 	 	3,515	 	 	 	4,841	 	
EBIT	 	$	175,072	 	 	$	196,865	 	 	$	878,191	 	 	$	886,701	 	
Depreciation, depletion, accretion and amortization	 	 	100,894	 	 	 	95,671	 	 	 	396,806	 	 	 	374,596	 	
EBITDA	 	$	275,966	 	 	$	292,536	 	 	$	1,274,997	 	 	$	1,261,297	 	
Gain on sale of businesses	 	 	0	 	 	 	(9,289	)	 	 	0	 	 	 	(13,353	)	
Property donation	 	 	0	 	 	 	10,847	 	 	 	0	 	 	 	10,847	 	
Charges associated with divested operations	 	 	269	 	 	 	3,033	 	 	 	6,935	 	 	 	3,033	 	
Business development 1	 	 	9,447	 	 	 	1,345	 	 	 	7,334	 	 	 	1,748	 	
COVID-19 direct incremental costs	 	 	2,781	 	 	 	0	 	 	 	10,170	 	 	 	0	 	
Pension settlement charge	 	 	22,740	 	 	 	0	 	 	 	22,740	 	 	 	0	 	
Restructuring charges	 	 	0	 	 	 	0	 	 	 	1,333	 	 	 	6,457	 	
Adjusted EBITDA	 	$	311,203	 	 	$	298,472	 	 	$	1,323,509	 	 	$	1,270,029	 	
Depreciation, depletion, accretion and amortization	 	 	(100,894	)	 	 	(95,671	)	 	 	(396,806	)	 	 	(374,596	)	
Adjusted EBIT	 	$	210,309	 	 	$	202,801	 	 	$	926,703	 	 	$	895,433	 	
Adjusted EBITDA margin	 	 	26.5	%	 	 	25.2	%	 	 	27.3	%	 	 	25.8	%	
 
	1	Represents non-routine charges or gains associated with acquisitions including the cost impact of purchase accounting inventory valuations.	
 
Similar to our presentation of Adjusted EBITDA, we present Adjusted Diluted earnings per share (EPS) from continuing operations to provide a more consistent comparison of earnings performance from period to period. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
Adjusted Diluted EPS from Continuing Operations (Adjusted Diluted EPS)
 
 	 	Three Months Ended	 	 	Twelve Months Ended	 	
 	 	December 31	 	 	December 31	 	
 	 	2020	 	 	2019	 	 	2020	 	 	2019	 	
Diluted EPS from continuing operations	 	$	0.87	 	 	$	1.07	 	 	$	4.41	 	 	$	4.67	 	
Items included in Adjusted EBITDA above	 	 	0.20	 	 	 	0.01	 	 	 	0.27	 	 	 	0.03	 	
Adjusted Diluted EPS	 	$	1.07	 	 	$	1.08	 	 	$	4.68	 	 	$	4.70	 	
 
Net debt to Adjusted EBITDA is not a GAAP measure and should not be considered as an alternative to metrics defined by GAAP. We, the investment community and credit rating agencies use this metric to assess our leverage. Net debt subtracts cash and cash equivalents and restricted cash from total debt. Reconciliation to its nearest GAAP measure is presented below:
 
Net Debt to Adjusted EBITDA
 
 	 	 	 	 	(in thousands)	 	
 	 	Twelve Months Ended	 	
 	 	December 31	 	
 	 	2020	 	 	2019	 	
Debt	 	 	 	 	 	 	 	 	
Current maturities of long-term debt	 	$	515,435	 	 	$	25	 	
Long-term debt	 	 	2,772,240	 	 	 	2,784,315	 	
Total debt	 	$	3,287,675	 	 	$	2,784,340	 	
Less: Cash and cash equivalents and restricted cash	 	 	1,198,013	 	 	 	274,506	 	
Net debt	 	$	2,089,662	 	 	$	2,509,834	 	
Adjusted EBITDA	 	$	1,323,509	 	 	$	1,270,029	 	
Total debt to Adjusted EBITDA	 	 	2.5	x	 	 	2.2	x	
Net debt to Adjusted EBITDA	 	 	1.6	x	 	 	2.0	x	

 

Appendix 3	
 
Reconciliation of Non-GAAP Measures (Continued)
 
We define "Return on Invested Capital" (ROIC) as Adjusted EBITDA for the trailing-twelve months divided by average invested capital (as illustrated below) during the trailing 5-quarters. Our calculation of ROIC is considered a non-GAAP financial measure because we calculate ROIC using the non-GAAP metric EBITDA. We believe that our ROIC metric is meaningful because it helps investors assess how effectively we are deploying our assets. Although ROIC is a standard financial metric, numerous methods exist for calculating a company's ROIC. As a result, the method we use to calculate our ROIC may differ from the methods used by other companies.
 
Return on Invested Capital	
 
 	 	(dollars in thousands)	 	
 	 	TTM	 	
 	 	December 31	 	
 	 	2020	 	 	2019	 	
Adjusted EBITDA	 	$	1,323,509	 	 	$	1,270,029	 	
Average invested capital 1	 	 	 	 	 	 	 	 	
Property, plant & equipment	 	$	4,373,987	 	 	$	4,281,342	 	
Goodwill	 	 	3,170,092	 	 	 	3,165,685	 	
Other intangible assets	 	 	1,104,044	 	 	 	1,084,113	 	
Fixed and intangible assets	 	$	8,648,123	 	 	$	8,531,140	 	
 	 	 	 	 	 	 	 	 	
Current assets	 	$	1,845,743	 	 	$	1,224,316	 	
Less: Cash and cash equivalents	 	 	698,944	 	 	 	93,528	 	
Less: Current tax	 	 	18,545	 	 	 	12,633	 	
Adjusted current assets	 	 	1,128,254	 	 	 	1,118,155	 	
 	 	 	 	 	 	 	 	 	
Current liabilities	 	 	833,553	 	 	 	599,319	 	
Less: Current maturities of long-term debt	 	 	304,989	 	 	 	24	 	
Less: Short-term debt	 	 	0	 	 	 	89,700	 	
Adjusted current liabilities	 	 	528,564	 	 	 	509,595	 	
Adjusted net working capital	 	$	599,690	 	 	$	608,560	 	
 	 	 	 	 	 	 	 	 	
Average invested capital	 	$	9,247,813	 	 	$	9,139,700	 	
 	 	 	 	 	 	 	 	 	
Return on invested capital	 	 	14.3	%	 	 	13.9	%	
 
	1	Average invested capital is based on a trailing 5-quarters.	
 
The following reconciliation to the mid-point of the range of 2021 Projected EBITDA excludes adjustments (as noted in Adjusted EBITDA above) as they are difficult to forecast (timing or amount). Due to the difficulty in forecasting such adjustments, we are unable to estimate their significance. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:
 
2021 Projected EBITDA
 
 	 	(in millions)	 	
 	 	Mid-point	 	
Net earnings	 	$	680	 	
Income tax expense	 	 	180	 	
Interest expense, net	 	 	130	 	
Discontinued operations, net of tax	 	 	0	 	
Depreciation, depletion, accretion and amortization	 	 	400	 	
Projected EBITDA	 	$	1,390