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): July 25, 2019

VULCAN MATERIALS COMPANY
(Exact name of registrant as specified in its charter)
 
New Jersey	 	001-33841	 	20-8579133	
(State or other jurisdiction	 	 (Commission File Number)	 	(IRS Employer Identification No.)	
of incorporation)	 	 	 		
 
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 July 25, 2019, Vulcan Materials Company announced its financial results for the second quarter ended June 30, 2019. 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 July 25, 2019	

 
 
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: July 25, 2019	 	By:	/s/ Michael R. Mills	
 	 	 	Name:	Michael R. Mills	
 	 	 	Title:	Chief Administrative Officer and Secretary

 

 
Exhibit 99.1

  

July 25, 2019
FOR IMMEDIATE RELEASE
Investor Contact:  Mark Warren (205) 298-3220
Media Contact:   Janet Kavinoky (205) 298-3220
 
VULCAN ANNOUNCES SECOND QUARTER 2019 RESULTS
 
EPS from Continuing Operations Increases 23 Percent to $1.48 per Diluted Share
Aggregates Unit Profitability Expands
 
Birmingham, Alabama – July 25, 2019 – Vulcan Materials Company (NYSE:VMC), the nation’s largest producer of construction aggregates, today announced results for the quarter ended June 30, 2019.
 
Net earnings were $198 million, up 24 percent, and Adjusted EBITDA was $372 million, up 15 percent compared to last year’s second quarter. The double-digit growth was driven primarily by a 16 percent increase in Aggregates segment gross profit. For the quarter, aggregates shipments increased 4 percent year-over-year, and freight-adjusted aggregates pricing increased 5.9 percent (5.4 percent mix-adjusted). Same-store aggregates gross profit incremental flow-through rate for the trailing-twelve months was 65 percent.
 
Tom Hill, Chairman and Chief Executive Officer, said, “We continued to execute well. Our industry-leading unit profitability in aggregates increased from $5.16 to $5.74 per ton, an 11 percent increase compared to the prior year’s second quarter. We remain keenly focused on creating long-term value by compounding our aggregates unit margins, while continuing to operate safely. Shipment growth in the second quarter was solid and consistent with full-year expectations. Importantly, price improvements were widespread. These results further highlight the strength of our aggregates-focused business, which serves Vulcan’s attractive long-term growth markets.
 
“Our key markets are benefitting from robust growth in public construction demand, driven by highways. State-level transportation funding increases signed into law in recent years have led to new highway construction starts that are 21 percent higher than two years ago. This significant increase will support continued shipment growth into transportation-related end markets in the coming years. Shipments into private construction continue to grow as well. Aggregates pricing momentum continues to improve, consistent with our expectations. The continuing improvement in unit profitability is a direct result of our focus on operating disciplines and compounding pricing improvements. As a result, we reiterate our full-year expectations for 2019 earnings from continuing operations of between $4.55 and $5.05 per diluted share and Adjusted EBITDA of between $1.250 and $1.330 billion.”

Page  2 
July 25, 2019
FOR IMMEDIATE RELEASE

Highlights as of June 30, 2019 include:
 
 	 	Second Quarter	 	 	Year-to-Date	 	 	Trailing Twelve Months	 	
Amounts in millions, except per unit data	 	2019	 	 	2018	 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Total revenues	 	$	1,327.7	 	 	$	1,200.2	 	 	$	2,324.2	 	 	$	2,054.6	 	 	$	4,652.4	 	 	$	4,126.8	 	
Gross profit	 	$	370.5	 	 	$	323.2	 	 	$	562.2	 	 	$	482.5	 	 	$	1,180.6	 	 	$	1,027.8	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Segment sales	 	$	1,062.1	 	 	$	956.3	 	 	$	1,897.0	 	 	$	1,655.9	 	 	$	3,754.8	 	 	$	3,284.1	 	
Freight-adjusted revenues	 	$	806.4	 	 	$	730.5	 	 	$	1,435.1	 	 	$	1,259.9	 	 	$	2,842.4	 	 	$	2,524.4	 	
Gross profit	 	$	329.2	 	 	$	283.5	 	 	$	514.9	 	 	$	431.7	 	 	$	1,075.1	 	 	$	896.0	 	
Shipments (tons)	 	 	57.3	 	 	 	55.0	 	 	 	102.9	 	 	 	95.5	 	 	 	208.8	 	 	 	192.5	 	
Freight-adjusted sales price per ton	 	$	14.07	 	 	$	13.29	 	 	$	13.94	 	 	$	13.19	 	 	$	13.61	 	 	$	13.12	 	
Gross profit per ton	 	$	5.74	 	 	$	5.16	 	 	$	5.00	 	 	$	4.52	 	 	$	5.15	 	 	$	4.66	 	
Asphalt, Concrete & Calcium segment gross profit	 	$	41.3	 	 	$	39.7	 	 	$	47.2	 	 	$	50.8	 	 	$	105.5	 	 	$	131.8	 	
Selling, Administrative and General (SAG)	 	$	95.7	 	 	$	89.0	 	 	$	186.0	 	 	$	167.4	 	 	$	351.9	 	 	$	326.9	 	
SAG as % of Total Revenues	 	 	7.2	%	 	 	7.4	%	 	 	8.0	%	 	 	8.1	%	 	 	7.6	%	 	 	7.9	%	
Earnings from continuing operations before income taxes	 	$	245.5	 	 	$	200.3	 	 	$	320.1	 	 	$	248.8	 	 	$	694.6	 	 	$	412.4	 	
Net earnings	 	$	197.6	 	 	$	159.7	 	 	$	260.9	 	 	$	212.6	 	 	$	564.0	 	 	$	648.8	 	
Adjusted EBIT	 	$	278.5	 	 	$	239.2	 	 	$	382.0	 	 	$	325.6	 	 	$	841.9	 	 	$	713.0	 	
Adjusted EBITDA	 	$	372.0	 	 	$	324.8	 	 	$	564.7	 	 	$	492.7	 	 	$	1,203.8	 	 	$	1,037.6	 	
Earnings from continuing operations per diluted share	 	$	1.48	 	 	$	1.20	 	 	$	1.97	 	 	$	1.59	 	 	$	4.25	 	 	$	4.84	 	
Adjusted earnings from continuing operations per diluted share	 	$	1.48	 	 	$	1.23	 	 	$	1.94	 	 	$	1.66	 	 	$	4.33	 	 	$	3.45	 	
 
Segment Results
 
Aggregates
Second quarter segment sales increased 11 percent, and gross profit increased 16 percent to $329 million. Unit margins increased $0.58 per ton, or 11 percent, to $5.74 per ton. This improvement resulted from solid growth in shipments, price improvements and execution of operating disciplines and efficiencies.
 
Second quarter aggregates shipments increased 4 percent (3 percent on a same-store basis) versus the prior year quarter. The solid underlying demand fundamentals of increased public funding for highways, along with employment and population growth, helped drive shipment strength across most of the Company’s footprint, particularly in the Southeast and Mid-Atlantic. Wet weather delayed shipments across Illinois, Tennessee and Texas. California overcame another quarter of wet weather to realize shipment growth compared to the prior year. A healthy demand environment, led by transportation-related construction, is driving volume growth and price improvement.
 
All of the Company’s key markets reported year-over-year price growth. For the quarter, freight-adjusted average sales price increased 5.9 percent versus the prior year’s quarter. Mix-adjusted average sales price increased 5.4 percent. Positive trends in backlogged project work, along with demand visibility and customer confidence, support similar price improvement throughout the remainder of 2019.

Page  3 
July 25, 2019
FOR IMMEDIATE RELEASE

Second quarter same-store unit cost of sales (freight-adjusted) increased less than 2 percent compared to the prior year quarter. Trailing-twelve month same-store incremental gross profit flow-through rate was 65 percent, which is slightly ahead of longer-term expectations of 60 percent. Quarterly gross profit flow-through rates can vary widely from quarter to quarter; therefore, the Company evaluates this metric on a trailing-twelve month basis. The Company remains focused on compounding improvements in unit margins throughout the cycle through fixed cost leverage, price growth and operating efficiencies.
 
Asphalt, Concrete and Calcium
Asphalt segment gross profit was $28 million for the second quarter, an increase of $2 million from the prior year. Asphalt shipments increased 8 percent (5 percent same-store), and asphalt mix selling prices increased 8 percent, or $4.34 per ton, in the second quarter. The average unit cost for liquid asphalt was 16 percent higher than the prior year quarter. Liquid asphalt costs have remained relatively stable through the first half of the year and have allowed pricing gains to begin offsetting the higher unit costs for liquid asphalt.
 
Concrete segment gross profit was $13 million, approximating the prior year quarter. Shipments were 0.8 million cubic yards, down from 0.9 million cubic yards in the prior year. Average selling prices increased 5 percent and led to modest gains in material margins.
 
Calcium segment gross profit was $0.8 million, a slight increase versus the prior year quarter.
 
Capital Allocation and Financial Position
 
Capital expenditures in the second quarter included $64 million of core operating and maintenance capital to improve or replace existing property, plant and equipment. In addition, the Company invested $40 million in internal growth projects to secure new aggregates reserves, develop new production sites, enhance the Company’s distribution capabilities and support the targeted growth of its asphalt operations. Through the first six months of the year, core operating and maintenance capital investment totaled $131 million, and internal growth projects investment was $95 million. The Company’s full-year expectations for 2019 remain unchanged at $250 million on maintenance capital and $200 million on internal growth projects.
 
During the quarter, the Company returned $41 million to shareholders through dividends, an 11 percent increase versus the prior year quarter. No shares were repurchased during the quarter. At quarter-end, total debt was $2.9 billion, or 2.4 times trailing-twelve month Adjusted EBITDA.
 
Selling, Administrative and General (SAG) Expenses
 
SAG expense in the quarter was $96 million versus $89 million in the prior year quarter. The year-over-year increase was due mainly to compensation related expense, including incentives that are tied to earnings expectations and the share price. Additionally, we have made investments in people and processes to accelerate the benefits derived from our sales and operational initiatives. On a trailing-twelve month basis, SAG expense as a percentage of total revenues was 7.6 percent, 30 basis points lower than the prior year period. The Company remains focused on further leveraging its overhead structure.

Page  4 
July 25, 2019
FOR IMMEDIATE RELEASE

Outlook
 
Regarding the Company’s full-year outlook for 2019, Mr. Hill stated, “Overall demand growth in Vulcan markets remains healthy. Public demand growth, led by highways, continues to be robust across our footprint. Current shipments into private construction end markets continue to benefit from the ongoing economic recovery. Demand fundamentals, including population and employment growth, underpin long-term growth in residential and private nonresidential construction. We delivered good incremental earnings in the first half of this year. Unit profitability in Aggregates increased 11 percent during this period, and we are well positioned to carry that momentum forward through the remainder of the year. For the full year, we expect earnings from continuing operations of between $4.55 and $5.05 per diluted share and Adjusted EBITDA of between $1.250 and $1.330 billion.”
 
Conference Call
 
Vulcan will host a conference call at 10:00 a.m. CT on July 25, 2019. 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 800-458-4121, or 720-543-0206 if outside the U.S., approximately 10 minutes before the scheduled start. The conference ID is 3003613. The conference call will be recorded and available for replay at the Company’s website approximately two hours after the call.
 
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 mix 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  5 
July 25, 2019
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; 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 for Vulcan’s ticketing, procurement, financial statements and other processes could adversely affect operations in the event 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 materials 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; 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; 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.

 
   
Table A
 
Vulcan Materials Company
and Subsidiary Companies
 
 	 	(in thousands, except per share data)	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
Consolidated Statements of Earnings	 	June 30	 	 	June 30	 	
(Condensed and unaudited)	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Total revenues	 	$	1,327,682	 	 	$	1,200,151	 	 	$	2,324,193	 	 	$	2,054,625	 	
Cost of revenues	 	 	957,180	 	 	 	876,967	 	 	 	1,762,016	 	 	 	1,572,106	 	
Gross profit	 	 	370,502	 	 	 	323,184	 	 	 	562,177	 	 	 	482,519	 	
Selling, administrative and general expenses	 	 	95,689	 	 	 	89,043	 	 	 	185,957	 	 	 	167,383	 	
Gain on sale of property, plant & equipment and businesses	 	 	3,451	 	 	 	2,106	 	 	 	10,748	 	 	 	6,270	 	
Other operating expense, net	 	 	(2,190	)	 	 	(5,994	)	 	 	(6,461	)	 	 	(9,969	)	
Operating earnings	 	 	276,074	 	 	 	230,253	 	 	 	380,507	 	 	 	311,437	 	
Other nonoperating income, net	 	 	2,466	 	 	 	3,339	 	 	 	5,595	 	 	 	8,421	 	
Interest expense, net	 	 	33,035	 	 	 	33,244	 	 	 	65,969	 	 	 	71,018	 	
Earnings from continuing operations before income taxes	 	 	245,505	 	 	 	200,348	 	 	 	320,133	 	 	 	248,840	 	
Income tax expense	 	 	47,598	 	 	 	40,046	 	 	 	58,291	 	 	 	35,143	 	
Earnings from continuing operations	 	 	197,907	 	 	 	160,302	 	 	 	261,842	 	 	 	213,697	 	
Loss on discontinued operations, net of tax	 	 	(349	)	 	 	(650	)	 	 	(985	)	 	 	(1,066	)	
Net earnings	 	$	197,558	 	 	$	159,652	 	 	$	260,857	 	 	$	212,631	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic earnings (loss) per share	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Continuing operations	 	$	1.50	 	 	$	1.21	 	 	$	1.98	 	 	$	1.61	 	
Discontinued operations	 	$	(0.01	)	 	$	0.00	 	 	$	(0.01	)	 	$	(0.01	)	
Net earnings	 	$	1.49	 	 	$	1.21	 	 	$	1.97	 	 	$	1.60	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted earnings (loss) per share	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Continuing operations	 	$	1.48	 	 	$	1.20	 	 	$	1.97	 	 	$	1.59	 	
Discontinued operations	 	$	0.00	 	 	$	(0.01	)	 	$	(0.01	)	 	$	(0.01	)	
Net earnings	 	$	1.48	 	 	$	1.19	 	 	$	1.96	 	 	$	1.58	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Weighted-average common shares outstanding	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	132,269	 	 	 	132,437	 	 	 	132,157	 	 	 	132,563	 	
Assuming dilution	 	 	133,354	 	 	 	134,051	 	 	 	133,199	 	 	 	134,280	 	
Depreciation, depletion, accretion and amortization	 	$	93,497	 	 	$	85,633	 	 	$	182,677	 	 	$	167,072	 	
Effective tax rate from continuing operations	 	 	19.4	%	 	 	20.0	%	 	 	18.2	%	 	 	14.1	%	

 
 
 	 	 	 	 	 	 	 	Table B	
Vulcan Materials Company	 	 	 	 	 	 	
and Subsidiary Companies	 	 	 	 	 	 	
 
 	 	 	 	 	 	 	 	(in thousands)	 	
Consolidated Balance Sheets	 	June 30	 	 	December 31	 	 	June 30	 	
(Condensed and unaudited)	 	2019	 	 	2018	 	 	2018	 	
Assets	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	26,031	 	 	$	40,037	 	 	$	55,059	 	
Restricted cash	 	 	491	 	 	 	4,367	 	 	 	6,056	 	
Accounts and notes receivable	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts and notes receivable, gross	 	 	700,175	 	 	 	542,868	 	 	 	640,742	 	
Allowance for doubtful accounts	 	 	(2,844	)	 	 	(2,090	)	 	 	(2,628	)	
Accounts and notes receivable, net	 	 	697,331	 	 	 	540,778	 	 	 	638,114	 	
Inventories	 	 	 	 	 	 	 	 	 	 	 	 	
Finished products	 	 	377,578	 	 	 	372,604	 	 	 	343,948	 	
Raw materials	 	 	31,137	 	 	 	27,942	 	 	 	29,684	 	
Products in process	 	 	6,332	 	 	 	3,064	 	 	 	1,882	 	
Operating supplies and other	 	 	26,376	 	 	 	25,720	 	 	 	28,250	 	
Inventories	 	 	441,423	 	 	 	429,330	 	 	 	403,764	 	
Other current assets	 	 	89,739	 	 	 	64,633	 	 	 	80,209	 	
Total current assets	 	 	1,255,015	 	 	 	1,079,145	 	 	 	1,183,202	 	
Investments and long-term receivables	 	 	51,667	 	 	 	44,615	 	 	 	41,989	 	
Property, plant & equipment	 	 	 	 	 	 	 	 	 	 	 	 	
Property, plant & equipment, cost	 	 	8,613,500	 	 	 	8,457,619	 	 	 	8,241,164	 	
Allowances for depreciation, depletion & amortization	 	 	(4,322,818	)	 	 	(4,220,312	)	 	 	(4,134,750	)	
Property, plant & equipment, net	 	 	4,290,682	 	 	 	4,237,307	 	 	 	4,106,414	 	
Operating lease right-of-use assets, net	 	 	418,896	 	 	 	0	 	 	 	0	 	
Goodwill	 	 	3,167,061	 	 	 	3,165,396	 	 	 	3,163,954	 	
Other intangible assets, net	 	 	1,076,986	 	 	 	1,095,378	 	 	 	1,156,898	 	
Other noncurrent assets	 	 	220,457	 	 	 	210,289	 	 	 	192,327	 	
Total assets	 	$	10,480,764	 	 	$	9,832,130	 	 	$	9,844,784	 	
Liabilities	 	 	 	 	 	 	 	 	 	 	 	 	
Current maturities of long-term debt	 	 	24	 	 	 	23	 	 	 	23	 	
Short-term debt	 	 	137,000	 	 	 	133,000	 	 	 	360,000	 	
Trade payables and accruals	 	 	284,875	 	 	 	216,473	 	 	 	231,913	 	
Other current liabilities	 	 	241,689	 	 	 	253,054	 	 	 	219,860	 	
Total current liabilities	 	 	663,588	 	 	 	602,550	 	 	 	811,796	 	
Long-term debt	 	 	2,781,826	 	 	 	2,779,357	 	 	 	2,776,906	 	
Deferred income taxes, net	 	 	601,189	 	 	 	567,283	 	 	 	545,756	 	
Deferred revenue	 	 	182,666	 	 	 	186,397	 	 	 	188,826	 	
Operating lease liabilities	 	 	396,952	 	 	 	0	 	 	 	0	 	
Other noncurrent liabilities	 	 	483,096	 	 	 	493,640	 	 	 	500,870	 	
Total liabilities	 	$	5,109,317	 	 	$	4,629,227	 	 	$	4,824,154	 	
Equity	 	 	 	 	 	 	 	 	 	 	 	 	
Common stock, $1 par value	 	 	132,231	 	 	 	131,762	 	 	 	132,268	 	
Capital in excess of par value	 	 	2,787,002	 	 	 	2,798,486	 	 	 	2,788,486	 	
Retained earnings	 	 	2,623,747	 	 	 	2,444,870	 	 	 	2,244,545	 	
Accumulated other comprehensive loss	 	 	(171,533	)	 	 	(172,215	)	 	 	(144,669	)	
Total equity	 	$	5,371,447	 	 	$	5,202,903	 	 	$	5,020,630	 	
Total liabilities and equity	 	$	10,480,764	 	 	$	9,832,130	 	 	$	9,844,784	 	

 
 
 	 	 	 	 	 	 	Table C	
Vulcan Materials Company	 	 	 	 	
and Subsidiary Companies	 	 	 	 	
 
 	 	 	 	 	(in thousands)	 	
 	 	Six Months Ended	 	
Consolidated Statements of Cash Flows	 	June 30	 	
(Condensed and unaudited)	 	2019	 	 	2018	 	
Operating Activities	 	 	 	 	 	 	 	 	
Net earnings	 	$	260,857	 	 	$	212,631	 	
Adjustments to reconcile net earnings to net cash provided by operating activities	 	 	 	 	 	 	 	 	
Depreciation, depletion, accretion and amortization	 	 	182,677	 	 	 	167,072	 	
Net gain on sale of property, plant & equipment and businesses	 	 	(10,748	)	 	 	(6,270	)	
Contributions to pension plans	 	 	(4,638	)	 	 	(104,794	)	
Share-based compensation expense	 	 	14,370	 	 	 	14,763	 	
Deferred tax expense (benefit)	 	 	34,816	 	 	 	40,549	 	
Cost of debt purchase	 	 	0	 	 	 	6,922	 	
Changes in assets and liabilities before initial effects of business acquisitions and dispositions	 	 	(201,256	)	 	 	(55,415	)	
Other, net	 	 	25,838	 	 	 	302	 	
Net cash provided by operating activities	 	$	301,916	 	 	$	275,760	 	
Investing Activities	 	 	 	 	 	 	 	 	
Purchases of property, plant & equipment	 	 	(225,837	)	 	 	(247,166	)	
Proceeds from sale of property, plant & equipment	 	 	11,200	 	 	 	8,523	 	
Proceeds from sale of businesses	 	 	1,744	 	 	 	11,256	 	
Payment for businesses acquired, net of acquired cash	 	 	1,122	 	 	 	(218,996	)	
Other, net	 	 	(4,577	)	 	 	(10,226	)	
Net cash used for investing activities	 	$	(216,348	)	 	$	(456,609	)	
Financing Activities	 	 	 	 	 	 	 	 	
Proceeds from short-term debt	 	 	360,100	 	 	 	506,200	 	
Payment of short-term debt	 	 	(356,100	)	 	 	(146,200	)	
Payment of current maturities and long-term debt	 	 	(11	)	 	 	(892,044	)	
Proceeds from issuance of long-term debt	 	 	0	 	 	 	850,000	 	
Debt issuance and exchange costs	 	 	0	 	 	 	(45,513	)	
Settlements of interest rate derivatives	 	 	0	 	 	 	3,378	 	
Purchases of common stock	 	 	0	 	 	 	(74,921	)	
Dividends paid	 	 	(81,927	)	 	 	(74,196	)	
Share-based compensation, shares withheld for taxes	 	 	(25,512	)	 	 	(31,386	)	
Net cash provided by (used for) financing activities	 	$	(103,450	)	 	$	95,318	 	
Net decrease in cash and cash equivalents and restricted cash	 	 	(17,882	)	 	 	(85,531	)	
Cash and cash equivalents and restricted cash at beginning of year	 	 	44,404	 	 	 	146,646	 	
Cash and cash equivalents and restricted cash at end of period	 	$	26,522	 	 	$	61,115	 	

 
 
 	 	 	 	 	 	 	 	 	 	 	Table D	
Segment Financial Data and Unit Shipments	 	 	
 
(in thousands, except per unit data)	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Total Revenues	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates 1	 	$	1,062,061	 	 	$	956,265	 	 	$	1,897,026	 	 	$	1,655,922	 	
Asphalt 2	 	 	247,163	 	 	 	211,828	 	 	 	379,253	 	 	 	315,663	 	
Concrete	 	 	103,768	 	 	 	106,723	 	 	 	187,405	 	 	 	207,685	 	
Calcium	 	 	2,003	 	 	 	2,282	 	 	 	3,954	 	 	 	4,224	 	
Segment sales	 	$	1,414,995	 	 	$	1,277,098	 	 	$	2,467,638	 	 	$	2,183,494	 	
Aggregates intersegment sales	 	 	(87,313	)	 	 	(76,947	)	 	 	(143,445	)	 	 	(128,869	)	
Total revenues	 	$	1,327,682	 	 	$	1,200,151	 	 	$	2,324,193	 	 	$	2,054,625	 	
Gross Profit	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	$	329,215	 	 	$	283,476	 	 	$	514,931	 	 	$	431,697	 	
Asphalt	 	 	27,583	 	 	 	25,750	 	 	 	24,311	 	 	 	25,996	 	
Concrete	 	 	12,887	 	 	 	13,191	 	 	 	21,450	 	 	 	23,511	 	
Calcium	 	 	817	 	 	 	767	 	 	 	1,485	 	 	 	1,315	 	
Total	 	$	370,502	 	 	$	323,184	 	 	$	562,177	 	 	$	482,519	 	
Depreciation, Depletion, Accretion and Amortization	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	$	75,760	 	 	$	69,738	 	 	$	148,281	 	 	$	135,691	 	
Asphalt	 	 	8,884	 	 	 	7,298	 	 	 	17,434	 	 	 	14,300	 	
Concrete	 	 	3,327	 	 	 	3,049	 	 	 	6,291	 	 	 	6,463	 	
Calcium	 	 	58	 	 	 	70	 	 	 	118	 	 	 	139	 	
Other	 	 	5,468	 	 	 	5,478	 	 	 	10,553	 	 	 	10,479	 	
Total	 	$	93,497	 	 	$	85,633	 	 	$	182,677	 	 	$	167,072	 	
Average Unit Sales Price and Unit Shipments	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Aggregates	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Freight-adjusted revenues 3	 	$	806,444	 	 	$	730,513	 	 	$	1,435,051	 	 	$	1,259,927	 	
Aggregates - tons	 	 	57,310	 	 	 	54,957	 	 	 	102,947	 	 	 	95,489	 	
Freight-adjusted sales price 4	 	$	14.07	 	 	$	13.29	 	 	$	13.94	 	 	$	13.19	 	
Other Products	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asphalt Mix - tons	 	 	3,595	 	 	 	3,330	 	 	 	5,617	 	 	 	5,149	 	
Asphalt Mix - sales price	 	$	58.31	 	 	$	53.97	 	 	$	57.45	 	 	$	53.69	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Ready-mixed concrete - cubic yards	 	 	815	 	 	 	876	 	 	 	1,484	 	 	 	1,692	 	
Ready-mixed concrete - sales price	 	$	126.12	 	 	$	120.56	 	 	$	125.14	 	 	$	121.48	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Calcium - tons	 	 	73	 	 	 	80	 	 	 	141	 	 	 	148	 	
Calcium - sales price	 	$	27.50	 	 	$	28.11	 	 	$	27.89	 	 	$	28.49	 	
 
	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	 	 	Six Months Ended	 	
 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Segment sales	 	$	1,062,061	 	 	$	956,265	 	 	$	1,897,026	 	 	$	1,655,922	 	
Less:   Freight & delivery revenues 1	 	 	241,354	 	 	 	213,474	 	 	 	436,508	 	 	 	372,417	 	
Other revenues	 	 	14,263	 	 	 	12,278	 	 	 	25,467	 	 	 	23,578	 	
Freight-adjusted revenues	 	$	806,444	 	 	$	730,513	 	 	$	1,435,051	 	 	$	1,259,927	 	
Unit shipment - tons	 	 	57,310	 	 	 	54,957	 	 	 	102,947	 	 	 	95,489	 	
Freight-adjusted sales price	 	$	14.07	 	 	$	13.29	 	 	$	13.94	 	 	$	13.19	 	
 
	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 (we do not generate a profit associated with the transportation component of the selling price of the product). Reconciliations of these metrics to their nearest GAAP measures are presented below:
 
Aggregates Segment Incremental Gross Profit Margin in Accordance with GAAP
 
 	 	(dollars in thousands)	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	329,215	 	 	$	283,476	 	 	$	514,931	 	 	$	431,697	 	
Segment sales	 	$	1,062,061	 	 	$	956,265	 	 	$	1,897,026	 	 	$	1,655,922	 	
Gross profit margin	 	 	31.0	%	 	 	29.6	%	 	 	27.1	%	 	 	26.1	%	
Incremental gross profit margin	 	 	43.2	%	 	 	 	 	 	 	34.5	%	 	 	 	 	
 
Aggregates Segment Incremental Gross Profit Flow-through Rate (Non-GAAP)
 
 	 	(dollars in thousands)	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	329,215	 	 	$	283,476	 	 	$	514,931	 	 	$	431,697	 	
Segment sales	 	$	1,062,061	 	 	$	956,265	 	 	$	1,897,026	 	 	$	1,655,922	 	
Less:    Freight & delivery revenues 1	 	 	241,354	 	 	 	213,474	 	 	 	436,508	 	 	 	372,417	 	
Segment sales excluding freight & delivery	 	$	820,707	 	 	$	742,791	 	 	$	1,460,518	 	 	$	1,283,505	 	
Gross profit flow-through rate	 	 	40.1	%	 	 	38.2	%	 	 	35.3	%	 	 	33.6	%	
Incremental gross profit flow-through rate	 	 	58.7	%	 	 	 	 	 	 	47.0	%	 	 	 	 	
 
	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	 	 	Six Months Ended	 	
 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Aggregates segment	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	$	329,215	 	 	$	283,476	 	 	$	514,931	 	 	$	431,697	 	
Depreciation, depletion, accretion and amortization	 	 	75,760	 	 	 	69,738	 	 	 	148,281	 	 	 	135,691	 	
Aggregates segment cash gross profit	 	$	404,975	 	 	$	353,214	 	 	$	663,212	 	 	$	567,388	 	
Unit shipments - tons	 	 	57,310	 	 	 	54,957	 	 	 	102,947	 	 	 	95,489	 	
Aggregates segment cash gross profit per ton	 	$	7.07	 	 	$	6.43	 	 	$	6.44	 	 	$	5.94	 	

 

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	 	 	Six Months Ended	 	 	 	 	 	TTM	 	
 	 	June 30	 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Net earnings	 	$	197,558	 	 	$	159,652	 	 	$	260,857	 	 	$	212,631	 	 	$	564,031	 	 	$	648,756	 	
Income tax expense (benefit)	 	 	47,598	 	 	 	40,046	 	 	 	58,291	 	 	 	35,143	 	 	 	128,597	 	 	 	(239,409	)	
Interest expense, net	 	 	33,035	 	 	 	33,244	 	 	 	65,969	 	 	 	71,018	 	 	 	132,374	 	 	 	289,572	 	
Loss on discontinued operations, net of tax	 	 	349	 	 	 	650	 	 	 	985	 	 	 	1,066	 	 	 	1,955	 	 	 	3,060	 	
EBIT	 	$	278,540	 	 	$	233,592	 	 	$	386,102	 	 	$	319,858	 	 	$	826,957	 	 	$	701,979	 	
Depreciation, depletion, accretion and amortization	 	 	93,497	 	 	 	85,633	 	 	 	182,677	 	 	 	167,072	 	 	 	361,851	 	 	 	324,698	 	
EBITDA	 	$	372,037	 	 	$	319,225	 	 	$	568,779	 	 	$	486,930	 	 	$	1,188,808	 	 	$	1,026,677	 	
Gain on sale of businesses	 	 	0	 	 	 	0	 	 	 	(4,064	)	 	 	(2,929	)	 	 	(4,064	)	 	 	(13,437	)	
Property donation	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	4,290	 	
Business interruption claims recovery	 	 	0	 	 	 	0	 	 	 	0	 	 	 	(1,694	)	 	 	(559	)	 	 	(1,694	)	
Charges associated with divested operations	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	18,545	 	 	 	1,661	 	
Business development 1	 	 	0	 	 	 	4,466	 	 	 	0	 	 	 	4,982	 	 	 	220	 	 	 	8,046	 	
One-time employee bonuses	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	0	 	 	 	6,716	 	
Restructuring charges	 	 	0	 	 	 	1,146	 	 	 	0	 	 	 	5,390	 	 	 	829	 	 	 	5,390	 	
Adjusted EBITDA	 	$	372,037	 	 	$	324,837	 	 	$	564,715	 	 	$	492,679	 	 	$	1,203,779	 	 	$	1,037,649	 	
Depreciation, depletion, accretion and amortization	 	 	(93,497	)	 	 	(85,633	)	 	 	(182,677	)	 	 	(167,072	)	 	 	(361,851	)	 	 	(324,698	)	
Adjusted EBIT	 	$	278,540	 	 	$	239,204	 	 	$	382,038	 	 	$	325,607	 	 	$	841,928	 	 	$	712,951	 	
 
	1	Represents non-routine charges associated with acquisitions including the cost impact of purchase accounting inventory valuations.	
 
Similar to our presentation of Adjusted EBITDA, we present Adjusted Diluted EPS from continuing operations to provide a more consistent comparison of earnings performance from period to period.
 
Adjusted Diluted EPS from Continuing Operations (Adjusted Diluted EPS)
 
 	 	Three Months Ended	 	 	Six Months Ended	 	 	TTM	 	
 	 	June 30	 	 	June 30	 	 	June 30	 	
 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	 	2019	 	 	2018	 	
Diluted EPS from continuing operations	 	$	1.48	 	 	$	1.20	 	 	$	1.97	 	 	$	1.59	 	 	$	4.25	 	 	$	4.84	 	
Items included in Adjusted EBITDA above	 	 	0.00	 	 	 	0.03	 	 	 	(0.03	)	 	 	0.03	 	 	 	0.08	 	 	 	0.06	 	
Debt refinancing costs	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	0.04	 	 	 	0.00	 	 	 	0.75	 	
Tax reform income tax savings	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	(1.99	)	
Alabama NOL carryforward valuation allowance	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	0.00	 	 	 	(0.21	)	
Adjusted Diluted EPS	 	$	1.48	 	 	$	1.23	 	 	$	1.94	 	 	$	1.66	 	 	$	4.33	 	 	$	3.45	 	
 
The following reconciliation to the mid-point of the range of 2019 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:

2019 Projected EBITDA	 	 	 	
 	 	(in millions)	 	
 	 	Mid-point	 	
Net earnings	 	$	640	 	
Income tax expense	 	 	160	 	
Interest expense, net	 	 	130	 	
Discontinued operations, net of tax	 	 	0	 	
Depreciation, depletion, accretion and amortization	 	 	360	 	
Projected EBITDA	 	$	1,290