Martin Marietta Materials Stock Gains After Beating Q3 Estimates, Raised FY21 outlook

Martin Marietta Materials, Inc. MLM reported third-quarter FY21 revenue growth of 17.9% year-over-year to $1.56 billion, beating the consensus of $1.41 billion.
Total revenues comprised $1.46 billion in Products and services revenues and $94.6 million in Freight revenues.
Building Materials business revenue was $1.39 billion (+17.3% Y/Y), and the product gross profit was $413.1 million (+7.9%).
Q3 aggregates shipments, including shipments from acquired operations, grew 10.2%. Aggregates product gross margin decreased 220 bps to 34.2%.
Cement product gross margin declined 250 bps to 37.7% as higher energy and raw materials costs outpaced shipment and pricing gains.
Ready-mixed concrete shipments increased 23.2%, or 20.5% Y/Y organically. Total asphalt shipments increased 115.9% Y/Y.
On an organic basis, aggregates shipments increased 6% while pricing increased 2.2%.
Adjusted EPS decreased to $4.25 compared to $4.71 in 3Q20, beating the consensus of $4.24.
The adjusted gross margin contracted by 172 bps to 28.9%. The adjusted operating income decreased 7% Y/Y to $372.4 million, and the margin contracted by 640 bps to 23.9%.
Adjusted EBITDA was $490 million (-2.3% Y/Y), and margin contracted by 650 bps to 31.5%.
Martin Marietta Materials generated cash from operating activities year-to-date of $780.3 million, compared to $684 million a year ago. It held $2.4 billion of cash and equivalents as of September 30, 2021.
The company's preliminary view of 2022 anticipates organic aggregates shipments to increase in the low-to-mid-single-digits as third-party labor and logistics challenges continue to impact an otherwise robust product demand environment.
FY21 Outlook: The company expects Products and services revenues of $4.955 billion - $5.05 billion (prior view $4.705 billion-$4.85 billion), adjusted gross profit of $1.35 billion-$1.4 billion (previous $1.325 billion - $1.395 billion).
It expects Adjusted EBITDA of $1.5 billion-$1.55 billion (prior $1.465 billion - $1.535 billion).
Price Action: MLM shares are trading higher by 5.10% at $410.34 on the last check Tuesday.

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