Martin Marietta Materials announced results for the fourth quarter and year ended Dec. 31, 2011.The company reported:
- Consolidated net sales of $374.8 million, up 8.0 percent.
- Heritage aggregates product line pricing up 6.0 percent.
- Heritage aggregates product line volume down 1.2 percent.
- Heritage aggregates product line direct production costs up slightly, primarily due to an 11 percent increase in energy costs.
Ward Nye, president and CEO of Martin Marietta Materials, stated, “2011 was an exciting year for our company in terms of both strong operational and financial performance and execution against stated strategic objectives. Considering the challenges that confronted the construction materials industry throughout the year, I am pleased that we concluded 2011 with fourth-quarter earnings that exceeded market expectations, before charges related to business development expenses. Underlying these results is a 6 percent increase in average selling price in our heritage aggregates product line that continued the momentum generated throughout the entire year. Further, our Specialty Products segment established new records for fourth-quarter and annual earnings.
“In addition to delivering strong operating results for the quarter, we completed three aggregates-related acquisitions during 2011, which enhanced our platform for future growth in previously identified target markets,” Nye said. “Coupled with tactical execution, our continued disciplined business approach and commitment to fundamentals and strategic vision have once again yielded impressive results, especially in a challenging environment. We are well positioned to continue building long-term shareholder value.
“The average selling price in our heritage aggregates product line was, as we expected, a positive trend that started in the first quarter and continued throughout the year,” Nye continued. “Pricing improved in each of our reporting segments, led by the 7.8 percent increase in our West Group, which supports our previously stated view that pricing growth is sustainable – despite depression-like shipment declines over the past five years.”
Nye also noted that direct production costs for the company’s heritage aggregates product line increased only 1 percent despite an 11 percent increase in non-controllable energy costs (principally diesel fuel), which reduced overall earnings by $0.05 per diluted share and was offset by reductions in personnel and depreciation costs. For the quarter, diesel fuel costs averaged $2.95 per gallon compared with $2.32 per gallon in the prior-year quarter. On a consolidated basis, cost of sales increased 9.5 percent over the prior-year quarter, reflecting higher raw materials costs, including liquid asphalt, and the impact from rising energy costs.