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Vulcan Reports Second Quarter Results

Vulcan Materials Co. announced that aggregates segment gross profit improved $9 million, or 9 percent, in the second quarter, reflecting lower unit cost of sales due to improved productivity and cost reduction initiatives. All key labor and energy efficiency metrics for aggregates improved for the quarter.

On a same-store basis, aggregates shipments increased slightly from the prior year period, notwithstanding the pull-forward effect of seasonally favorable weather conditions during the first quarter and the effects of Tropical Storm Debby in Florida in June. Overall, shipments decreased 1 percent due to the sale of operations in Indiana in 2011.

Aggregates pricing increased slightly, offsetting some of the earnings effect of a less favorable geographic mix.

Chairman and Chief Executive Officer Don James stated, “The improvement in our second quarter operating results demonstrates the continuing benefits of our ongoing focus on reducing overhead costs and maximizing operating efficiency across the organization. Despite weaker volumes in several of our most profitable markets, aggregates segment gross profit margin improved by 220 basis points. Cash earnings per ton of aggregates increased to $4.57 per ton. Both of these improvements demonstrate our cost reduction efforts and the earnings potential of our aggregates business, particularly as volume across our geographic markets recovers.”

Trends in both the private and public sector construction markets remain positive, according to James. “In particular, we are encouraged by the passage of the new multi-year highway bill by Congress in late June, which should provide state departments of transportation with funding certainty they need to move forward on infrastructure programs,” he said. “We remain focused on executing our initiatives and aggressively managing other items under our control. This will enable us to continue to generate higher levels of earnings and cash flow, further improve our operating leverage, reduce overhead costs and strengthen our credit profile.”