0001621563
false
0001621563
2024-05-01
2024-05-01
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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):
May 1, 2024
Summit Materials, Inc.
(Exact name of registrant as specified in its charter)
Delaware 001-36873 47-1984212
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
1801 California Street
,
Suite 3500
Denver
,
Colorado
80202
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (
303
)
893-0012
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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
Class A Common Stock (par value, $0.01 per share) SUM 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 ((s)230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 ((s)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.
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Item 2.02
Results of Operations and Financial Condition
.
On
May 1, 2024
, Summit Materials, Inc. (the "Company") issued a press release announcing the
results of the Company's operations for the fiscal quarter ended March 30,
2024. A copy of the press release is furnished as Exhibit 99.1 to this Current
Report on Form 8-K and is incorporated herein by reference.
The information in this Current Report on Form 8-K, including Exhibit 99.1
hereto, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be
deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), or otherwise subject to the
liabilities of that section, nor shall it be deemed incorporated by reference
in any filing made by the Company under the Securities Act of 1933, as
amended, or the Exchange Act, except as shall be expressly set forth by
specific reference in such a filing.
Item 9.01
Financial Statements and Exhibits
.
(d) Exhibits
Exhibit No. Description
99.1 Press Release of Summit Materials,
Inc. dated May 1, 2024.
104.1 Cover Page Interactive Data File (embedded
within the Inline XBRL document)
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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.
SUMMIT MATERIALS, INC.
DATED: By: /s/ Christopher B. Gaskill
May 1, 2024
Name: Christopher B. Gaskill
Title: EVP, Chief Legal Officer & Secretary
Exhibit 99.1
Summit Materials, Inc. Reports First Quarter 2024 Results
Margin Expansion Fueled by Pricing Momentum and Operational Improvements
Raises 2024 Synergy Target to At Least $40 million
Adjusting 2024 Guidance Higher
DENVER, CO. - (
May 1, 2024
) -
Summit Materials, Inc. (NYSE: SUM) ("Summit," "Summit Materials," "Summit
Inc." or the "Company"), market-leading producer of aggregates and cement
company, today announced results for the first quarter ended March 30, 2024.
All comparisons are versus the quarter ended April 1, 2023 unless noted
otherwise.
Three months ended
($ in thousands, except per share amounts) March 30, 2024 April 1, 2023 % Chg vs. PY
Net revenue $ 773,229 $ 407,270 89.9 %
Operating loss (44,853) (15,475) (189.8) %
Net loss (67,270) (31,212) (115.5) %
Basic EPS $ (0.40) $ (0.26) (53.8) %
Adjusted Cash Gross Profit 181,004 81,351 122.5 %
Adjusted EBITDA 121,225 41,201 194.2 %
Adjusted Diluted EPS $ (0.12) $ (0.26) 53.8 %
"I am delighted to report that our transformative combination with Argos USA
is off to a strong start as we effectively, swiftly, and safely move to
integrate our two businesses," remarked Anne Noonan, Summit Materials
President and CEO. "This progress, together with a better than anticipated
first quarter, improved synergy visibility, and a positive outlook allows us
to increase the lower end of our full year 2024 guidance range. Today's
updated outlook reflects our view that pricing momentum is healthy and
persistent across our businesses, cost headwinds are decelerating, and demand
conditions, in general, are accommodating of material margin expansion in
2024. We expect this, combined with meaningful synergies, self-help
operational improvements, and a more profitable portfolio will catalyze
superior value creation for Summit shareholders. Moreover, with our leverage
well below target we have a balance sheet that complements a promising
pipeline of accretive, aggregates-oriented acquisition targets and the
organization is well positioned to continue its financial and strategic
progress in the year ahead."
2024 Guidance
For the full year 2024, Summit is currently projecting Adjusted EBITDA of
approximately $970 million to $1,010 million and capital expenditures of
approximately $430 million to $470 million.
Adjusted EBITDA is a non-GAAP measure. Refer to the "Non-GAAP Financial
Measures" section for more information. Because GAAP financial measures on a
forward-looking basis are not accessible, and reconciling information is not
available without unreasonable effort, we have not provided reconciliations
for forward-looking non-GAAP measures. For the same reasons, we are unable to
address the probable significance of the unavailable information, which could
be material to future results.
First Quarter 2024 | Total Company Results
Net revenue
increased $366.0 million, or 89.9% in the first quarter to $773.2 million,
including the partial quarter impact of the Argos USA assets. In the quarter,
$378.5 million of revenue was recognized from recent acquisitions which more
than offset a decrease of $21.7 million in net revenue related to
divestitures. Organic prices increased across all lines of business.
Operating loss
increased in the first quarter to $44.9 million, driven exclusively by $61.3
million of transaction and integration costs related to the Argos USA
transaction. Summit's operating margin percentage for the three months ended
March 30, 2024, decreased to (5.8)% from (3.8)%, from the comparable period a
year ago primarily reflecting the aforementioned transaction and integration
costs related to the Argos USA transaction.
1
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Net loss attributable to Summit Inc.
increased to $66.9 million, or $(0.40) per basic share, compared to $30.8
million, or $(0.26) per basic share in the comparable prior year period.
Summit reported adjusted diluted net loss of $19.9 million, or $(0.12) per
adjusted diluted share, compared to an adjusted diluted net loss of $30.7
million, or $(0.26) per adjusted diluted share, in the prior year period.
Adjusted EBITDA
increased $80.0 million, or 194.2%, to $121.2 million reflecting the
integration of and strong contribution from the new Argos USA cement assets as
well as strong organic pricing growth across all lines of business.
First Quarter 2024 | Results by Line of Business
Aggregates Business:
Aggregates net revenues increased by $1.9 million to $145.5 million in the
first quarter. Aggregates adjusted cash gross profit margin was 40.5% in the
first quarter as compared to 35.0% in the prior year period. Aggregates sales
volume decreased 7.3% in the first quarter. Organic aggregates sales volumes
decreased 8.3% reflecting poor weather conditions in many markets and
restrained residential activity. Average selling prices for aggregates
increased 10.8%, reflecting both carry-over pricing from 2023 as well as price
increases implemented across markets to start the year. Pricing growth was
strongest in the East Segment, but both the West and East Segments recognized
double-digit price increase over the prior year period.
Cement Business:
Cement Segment net revenues increased to $231.8 million in the first quarter.
Cement Segment adjusted cash gross profit margin increased to 30.6% in the
first quarter, compared to 9.6% in the prior year period, driven by pricing
gains, operational efficiencies, and favorable year-on-year kiln fuel costs.
Sales volume of cement increased 416.0% on a nominal basis and decreased 2.7%
organically on unfavorable weather conditions. Organic average selling prices
increased 5.6% in the first quarter due pricing actions implemented in 2023
and price increases that went into effect at the beginning of 2024.
Products Business:
Products net revenues were $359.1 million in the first quarter, up 100.0%
versus the prior year period. Products adjusted cash gross profit margin
decreased to 12.3% in the first quarter. Organic average sales price for
ready-mix concrete increased 8.3%, driven by pricing growth across all
markets, including our key markets of Houston and Salt Lake City. Organic
sales volumes of ready-mix concrete decreased 15.1% due to reduced residential
activity. Organic average selling prices for asphalt increased 5.8%, due to
pricing gains both the West and East Segment. Organic asphalt sales volume
increased 9.4%, fueled by public infrastructure growth.
First Quarter 2024 | Results By Reporting Segment
West Segment:
The West Segment operating income increased $6.9 million to $12.6 million and
Adjusted EBITDA of $43.4 million in the first quarter increased 32.8% versus
the prior year period reflecting sustained pricing momentum, more favorable
weather conditions in certain markets relative to the prior year period, and
the contribution from Argos USA ready-mix concrete plants in the Houston
market. Aggregates revenue increased 1.9%, including 10.0% pricing growth led
by Houston and British Columbia performance while volume declined 7.4% due, in
part, to unfavorable weather conditions in South Texas. Ready-mix concrete
revenue increased 29.5% on 6.4% pricing growth and 21.9% volume growth.
Organic ready-mix pricing increased 8.5% and because of subdued private
construction activity, organic ready-mix volumes decreased 16.8% in the
period. Asphalt revenue increased 16.6% due to volumes growth of 10.1%,
including organic growth of 9.4%. Asphalt pricing increased 5.6% with strong
gains in North Texas.
East Segment:
The East Segment operating income increased $11.0 million to $14.0 million and
Adjusted EBITDA increased $18.6 million to $37.5 million. Aggregates revenue
increased 3.4% versus the prior year period. Organic aggregates volumes
decreased 7.8%, on unfavorable weather conditions and lower volumes in Kansas.
Aggregates pricing increased 11.5% with solid growth across several markets,
including Missouri and Kansas. Ready-mix concrete revenue increased $136.6
million to $152.5 million due to the acquisition of the Argos USA ready-mix
concrete operations in Florida, Georgia, and the Carolinas. Asphalt revenue
decreased $2.5 million versus the prior year period.
Cement Segment:
The Cement Segment operating income increased 322.4% to $17.7 million.
Adjusted EBITDA increased $59.4 million and Adjusted EBITDA margin increased
to 25.7% from 0.0% in the year-ago period. As noted above, the Cement Segment
reported an organic volume decrease of 2.7% and organic selling price growth
of 5.6%.
Liquidity and Capital Resources
2
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As of March 30, 2024, the Company had $498.1 million in cash and $2.8 billion
in debt outstanding. The Company's $625 million revolving credit facility has
$604.1 million available after outstanding letters of credit.
For the quarter ended March 30, 2024, cash flow used in operations was $40.2
million and cash paid for capital expenditures was $58.5 million.
Webcast and Conference Call Information
Summit Materials will conduct a conference call on Thursday, May 2, 2024, at
12:00 p.m. eastern time (10:00 a.m. mountain time) to review the Company's
first quarter 2024 financial results, discuss recent events and conduct a
question-and-answer session.
A webcast of the conference call and accompanying presentation materials will
be available in the Investors section of Summit's website at investors.summit-ma
terials.com. To listen to a live broadcast, go to the site at least 15 minutes
prior to the scheduled start time in order to register, download, and install
any necessary audio software.
A webcast of the conference call and accompanying presentation materials will
be available in the Investors section of Summit's website at
investors.summit-materials.com
or at the following link:
https://events.q4inc.com/attendee/875793406.
To participate in the live teleconference for first quarter 2024 financial
results:
North America Toll-Free: 1-888-330-3416
International Toll: 1-646-960-0820
Conference ID: 1542153
To listen to a replay of the teleconference, which will be available through
May 9, 2024:
US & Canada Toll-Free: 1-800-770-2030
Conference ID: 1542153
About Summit Materials
Summit Materials is a market-leading producer of aggregates and cement with
vertically integrated operations that supply ready-mix concrete and asphalt in
select markets. Summit is a geographically diverse, materials-led business of
scale that offers customers in the United States and British Columbia, Canada
high quality products and services for the public infrastructure, residential
and non-residential end markets. Summit has a strong track record of
successful acquisitions since its founding and continues to pursue high-return
growth opportunities in new and existing markets. For more information about
Summit Materials, please visit
www.summit-materials.com
.
3
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Non-GAAP Financial Measures
The Securities and Exchange Commission ("SEC") regulates the use of "non-GAAP
financial measures," such as Adjusted Net Income (Loss), Adjusted Diluted Net
Loss, Adjusted Diluted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted
Cash Gross Profit, Adjusted Cash Gross Profit Margin, and Free Cash Flow which
are derived on the basis of methodologies other than in accordance with U.S.
generally accepted accounting principles ("U.S. GAAP"). We have provided these
measures because, among other things, we believe that they provide investors
with additional information to measure our performance, evaluate our ability
to service our debt and evaluate certain flexibility under our restrictive
covenants. Our Adjusted Net Income (Loss), Adjusted Diluted Net Loss, Adjusted
Diluted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross
Profit, Adjusted Cash Gross Profit Margin, and Free Cash Flow may vary from
the use of such terms by others and should not be considered as alternatives
to or more important than net income (loss), operating income (loss), revenue
or any other performance measures derived in accordance with U.S. GAAP as
measures of operating performance or to cash flows as measures of liquidity.
Adjusted EBITDA, Adjusted EBITDA Margin, and other non-GAAP measures have
important limitations as analytical tools, and you should not consider them in
isolation or as substitutes for analysis of our results as reported under U.S.
GAAP. Some of the limitations of Adjusted EBITDA, Adjusted EBITDA Margin and
other non-GAAP measures are that these measures do not reflect: (i) our cash
expenditures or future requirements for capital expenditures or contractual
commitments; (ii) changes in, or cash requirements for, our working capital
needs; (iii) interest expense or cash requirements necessary to service
interest and principal payments on our debt; and (iv) income tax payments we
are required to make. Because of these limitations, we rely primarily on our
U.S. GAAP results and use Adjusted EBITDA, Adjusted EBITDA Margin and other
non-GAAP measures on a supplemental basis.
Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted
Cash Gross Profit Margin, Adjusted Net Income (Loss), Adjusted Diluted Net
Loss, Adjusted Diluted EPS, and Free Cash Flow reflect additional ways of
viewing aspects of our business that, when viewed with our GAAP results and
the accompanying reconciliations to U.S. GAAP financial measures included in
the tables attached to this press release, may provide a more complete
understanding of factors and trends affecting our business. We strongly
encourage investors to review our consolidated financial statements in their
entirety and not rely on any single financial measure. Reconciliations of the
non-GAAP measures used in this press release are included in the attached
tables.
4
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Cautionary Statement Regarding Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of
the federal securities laws, which involve risks and uncertainties.
Forward-looking statements include all statements that do not relate solely to
historical or current facts, and you can identify forward-looking statements
because they contain words such as "believes," "expects," "may," "will,"
"outlook," "should," "seeks," "intends," "trends," "plans," "estimates,"
"projects" or "anticipates" or similar expressions that concern our strategy,
plans, expectations or intentions. All statements made relating to our
estimated and projected earnings, margins, costs, expenditures, cash flows,
growth rates and financial results are forward-looking statements. These
forward-looking statements are subject to risks, uncertainties and other
factors that may cause our actual results, performance or achievements to be
materially different from future results, performance or achievements
expressed or implied by such forward-looking statements. We derive many of our
forward-looking statements from our operating budgets and forecasts, which are
based upon many detailed assumptions. While we believe that our assumptions
are reasonable, it is very difficult to predict the effect of known factors,
and, of course, it is impossible to anticipate all factors that could affect
our actual results. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by us or any other person that the
results or conditions described in such statements or our objectives and plans
will be realized. Important factors could affect our results and could cause
results to differ materially from those expressed in our forward-looking
statements, including but not limited to the factors discussed in the section
entitled "Risk Factors" in Summit Inc.'s Annual Report on Form 10-K for the
fiscal year ended December 30, 2023, as filed with the SEC, and any factors
discussed in the section entitled "Risk Factors" in any of our subsequently
filed SEC filings; and the following:
-
our dependence on the construction industry and the strength of the local
economies in which we operate, including residential;
-
the cyclical nature of our business;
-
risks related to weather and seasonality;
-
risks associated with our capital-intensive business;
-
competition within our local markets;
-
risks related to the integration of Argos USA and realization of intended
benefits within the intended timeframe;
-
our ability to execute on our acquisition strategy and portfolio optimization
strategy and, successfully integrate acquisitions with our existing operations;
-
our dependence on securing and permitting aggregate reserves in strategically
located areas;
-
the impact of rising interest rates;
-
declines in public infrastructure construction and delays or reductions in
governmental funding, including the funding by transportation authorities, the
federal government and other state agencies particularly;
-
our reliance on private investment in infrastructure, which may be adversely
affected by periods of economic stagnation and recession;
-
environmental, health, safety and climate change laws or governmental
requirements or policies concerning zoning and land use;
-
rising prices for, or more limited availability of, commodities, labor and
other production and delivery inputs as a result of inflation, supply chain
challenges or otherwise;
-
our ability to accurately estimate the overall risks, requirements or costs
when we bid on or negotiate contracts that are ultimately awarded to us;
-
material costs and losses as a result of claims that our products do not meet
regulatory requirements or contractual specifications;
-
cancellation of a significant number of contracts or our disqualification from
bidding for new contracts;
-
special hazards related to our operations that may cause personal injury or
property damage not covered by insurance;
-
unexpected factors affecting self-insurance claims and reserve estimates;
-
our current level of indebtedness, including our exposure to variable interest
rate risk;
-
potential incurrence of substantially more debt;
5
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-
restrictive covenants in the instruments governing our debt obligations;
-
our dependence on senior management and other key personnel, and our ability
to retain qualified personnel;
-
supply constraints or significant price fluctuations in the electricity and
petroleum-based resources that we use, including diesel and liquid asphalt;
-
climate change and climate change legislation or other regulations;
-
evolving corporate governance and corporate disclosure regulations and
expectations, including with respect to environmental, social and governance
matters;
-
unexpected operational difficulties;
-
costs associated with pending and future litigation;
-
interruptions in our information technology systems and infrastructure;
including cybersecurity and data leakage risks;
-
potential labor disputes, strikes, other forms of work stoppage or other union
activities; and
-
material or adverse effects related to the Argos USA combination.
All subsequent written and oral forward-looking statements attributable to us,
or persons acting on our behalf, are expressly qualified in their entirety by
these cautionary statements. Any forward-looking statement that we make herein
speaks only as of the date of this press release. We undertake no obligation
to publicly update or revise any forward-looking statement as a result of new
information, future events or otherwise, except as required by law.
6
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
($ in thousands, except share and per share amounts)
Three months ended
March 30, April 1,
2024 2023
Revenue:
Product $ 728,694 $ 372,172
Service 44,535 35,098
Net revenue 773,229 407,270
Delivery and subcontract revenue 31,786 28,118
Total revenue 805,015 435,388
Cost of revenue (excluding items shown separately below):
Product 556,020 295,881
Service 36,205 30,038
Net cost of revenue 592,225 325,919
Delivery and subcontract cost 31,786 28,118
Total cost of revenue 624,011 354,037
General and administrative expenses 68,526 45,998
Depreciation, depletion, amortization and accretion 95,971 50,894
Transaction and integration costs 62,208 364
Gain on sale of property, plant and equipment (848) (430)
Operating loss (44,853) (15,475)
Interest expense 51,892 27,420
Loss on debt financings 5,453 493
Gain on sale of businesses (14,985) -
Other income, net (8,878) (5,710)
Loss from operations before taxes (78,335) (37,678)
Income tax benefit (11,065) (6,466)
Net loss (67,270) (31,212)
Net income attributable to Summit Holdings (1) (404) (408)
Net loss attributable to Summit Inc. $ (66,866) $ (30,804)
Loss per share of Class A common stock:
Basic $ (0.40) $ (0.26)
Diluted $ (0.40) $ (0.26)
Weighted average shares of Class A common stock:
Basic 167,511,575 118,679,656
Diluted 167,511,575 118,679,656
________________________________________________________
(1) Represents portion of business owned by pre-IPO investors rather than by
Summit.
7
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
($ in thousands, except share and per share amounts)
March 30, December 30,
2024 2023
(unaudited) (audited)
Assets
Current assets:
Cash and cash $ 498,110 $ 374,162
equivalents
Restricted cash - 800,000
Accounts 454,650 287,252
receivable, net
Costs and estimated 11,681 10,289
earnings
in excess
of billings
Inventories 338,501 241,350
Other current 40,644 17,937
assets
Current assets 1,375 1,134
held for sale
Total current 1,344,961 1,732,124
assets
Property, 4,417,355 1,976,820
plant and
equipment, net
Goodwill 1,990,482 1,224,861
Intangible 179,587 68,081
assets, net
Deferred - 52,009
tax assets
Operating lease 89,251 36,553
right-of-use
assets
Other assets 108,264 59,134
Total assets $ 8,129,900 $ 5,149,582
Liabilities and
Stockholders' Equity
Current liabilities:
Current $ 7,575 $ 3,822
portion
of debt
Current portion of 8,993 7,007
acquisition-related
liabilities
Accounts payable 290,914 123,621
Accrued expenses 191,776 171,691
Current operating 16,745 8,596
lease liabilities
Billings in 6,005 8,228
excess of costs
and estimated
earnings
Total current 522,008 322,965
liabilities
Long-term debt 2,772,709 2,283,639
Acquisition-related 20,655 28,021
liabilities
Tax receivable 44,267 41,276
agreement
liability
Deferred tax 205,669 15,854
liabilities
Noncurrent 78,618 33,230
operating
lease liabilities
Other noncurrent 267,337 108,017
liabilities
Total liabilities 3,911,263 2,833,002
Stockholders' equity:
Class A common stock, par value $0.01 per share; 1,755 1,196
1,000,000,000 shares authorized, 175,454,250 and
119,529,380 shares issued and outstanding as of
March 30, 2024 and December 30, 2023, respectively
Class B common stock, par value $0.01 per - -
share; 250,000,000 shares authorized, 0 and 99
shares issued and outstanding as of March 30,
2024 and December 30, 2023, respectively
Preferred Stock, par value $0.01 per share; - -
250,000,000 shares authorized, 1 and 0
shares issued and outstanding as of March 30,
2024 and December 30, 2023, respectively
Additional 3,403,307 1,421,813
paid-in capital
Accumulated 809,885 876,751
earnings
Accumulated other 3,690 7,275
comprehensive
income
Stockholders' 4,218,637 2,307,035
equity
Noncontrolling - 9,545
interest
in Summit Holdings
Total 4,218,637 2,316,580
stockholders'
equity
Total $ 8,129,900 $ 5,149,582
liabilities and
stockholders'
equity
8
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Consolidated Statements of Cash Flows
($ in thousands)
Three months ended
March 30, April 1,
2024 2023
Cash flows from operating activities:
Net loss $ (67,270) $ (31,212)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, amortization and accretion 106,354 53,927
Share-based compensation expense 6,720 4,708
Net gain on asset and business disposals (15,834) (868)
Non-cash loss on debt financings 5,453 161
Change in deferred tax asset, net (19,054) (7,522)
Other 748 26
Decrease (increase) in operating assets, net of acquisitions and dispositions:
Accounts receivable, net (11,127) 20,414
Inventories (5,302) (20,960)
Costs and estimated earnings in excess of billings (1,799) (7,868)
Other current assets (1,973) (3,748)
Other assets 4,839 2,239
(Decrease) increase in operating liabilities, net of acquisitions and dispositions:
Accounts payable 21,177 20,987
Accrued expenses (60,842) (27,968)
Billings in excess of costs and estimated earnings (1,780) (1,507)
Tax receivable agreement (benefit) expense 6,227 (531)
Other liabilities (6,782) 57
Net cash (used in) provided by operating activities (40,245) 335
Cash flows from investing activities:
Acquisitions, net of cash acquired (1,100,919) (55,477)
Purchase of intellectual property (21,400) -
Purchases of property, plant and equipment (58,519) (63,584)
Proceeds from the sale of property, plant and equipment 2,664 1,777
Proceeds from sale of businesses 75,993 -
Other (1,240) (1,045)
Net cash used in investing activities (1,103,421) (118,329)
Cash flows from financing activities:
Proceeds from debt issuances 1,007,475 -
Debt issuance costs (17,550) (1,566)
Payments on debt (506,392) (4,414)
Payments on acquisition-related liabilities (6,124) (11,374)
Proceeds from stock option exercises 593 15
Other (9,260) (5,719)
Net cash provided by (used in) financing activities 468,742 (23,058)
Impact of foreign currency on cash (1,128) 58
Net decrease in cash and cash equivalents and restricted cash (676,052) (140,994)
Cash and cash equivalents and restricted cash-beginning of period 1,174,162 520,451
Cash and cash equivalents and restricted cash-end of period $ 498,110 $ 379,457
9
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Revenue Data by Segment and Line of Business
($ in thousands)
Three months ended Twelve
months ended
March 30, April 1, March 30, April 1,
2024 2023 2024 2023
Segment Net
Revenue:
West $ 283,605 $ 234,370 $ 1,522,106 $ 1,270,409
East 257,841 118,783 726,273 600,822
Cement 231,783 54,117 560,316 365,628
Net $ 773,229 $ 407,270 $ 2,808,695 $ 2,236,859
Revenue
Line of Business
- Net Revenue:
Materials
Aggregates $ 145,511 $ 143,653 $ 665,409 $ 604,253
Cement (1) 224,097 49,013 530,870 338,977
Products 359,086 179,506 1,297,907 1,006,803
Total Materials 728,694 372,172 2,494,186 1,950,033
and Products
Services 44,535 35,098 314,509 286,826
Net $ 773,229 $ 407,270 $ 2,808,695 $ 2,236,859
Revenue
Line of Business -
Net Cost of Revenue:
Materials
Aggregates $ 86,514 $ 93,335 $ 325,732 $ 315,302
Cement 153,192 43,835 298,944 191,188
Products 314,945 157,241 1,072,088 832,478
Total Materials 554,651 294,411 1,696,764 1,338,968
and Products
Services 37,574 31,508 255,218 234,762
Net Cost $ 592,225 $ 325,919 $ 1,951,982 $ 1,573,730
of Revenue
Line of Business - Adjusted
Cash Gross Profit (2):
Materials
Aggregates $ 58,997 $ 50,318 $ 339,677 $ 288,951
Cement (3) 70,905 5,178 231,926 147,789
Products 44,141 22,265 225,819 174,325
Total Materials 174,043 77,761 797,422 611,065
and Products
Services 6,961 3,590 59,291 52,064
Adjusted Cash $ 181,004 $ 81,351 $ 856,713 $ 663,129
Gross Profit
Adjusted Cash Gross
Profit Margin (2)
Materials
Aggregates 40.5 % 35.0 % 51.0 % 47.8 %
Cement 30.6 % 9.6 % 41.4 % 40.4 %
(3)
Products 12.3 % 12.4 % 17.4 % 17.3 %
Services 15.6 % 10.2 % 18.9 % 18.2 %
Total Adjusted Cash 23.4 % 20.0 % 30.5 % 29.6 %
Gross Profit Margin
________________________________________________________
(1) Net revenue for the cement line of business excludes revenue associated
with hazardous and non-hazardous waste, which is processed into fuel and used
in the cement plants and is included in services net revenue. Additionally,
net revenue from cement swaps and other cement-related products are included
in products net revenue.
(2) Adjusted cash gross profit is calculated as net revenue by line of
business less net cost of revenue by line of business. Adjusted cash gross
profit margin is defined as adjusted cash gross profit divided by net revenue.
(3) The cement adjusted cash gross profit includes the earnings from the waste
processing operations, cement swaps and other products. Cement line of
business adjusted cash gross profit margin is defined as cement adjusted cash
gross profit divided by cement segment net revenue.
10
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Volume and Price Statistics
(Units in thousands)
Three months ended
Total Volume March 30, 2024 April 1, 2023
Aggregates (tons) 11,654 12,572
Cement (tons) 1,739 337
Ready-mix concrete (cubic yards) 1,897 951
Asphalt (tons) 319 325
Three months ended
Pricing March 30, 2024 April 1, 2023
Aggregates (per ton) $ 14.89 $ 13.44
Cement (per ton) 152.11 147.41
Ready-mix concrete (per cubic yards) 164.59 146.29
Asphalt (per ton) 88.09 82.33
Three months ended
Percentage Change in
Year over Year Comparison Volume Pricing
Aggregates (per ton) (7.3) % 10.8 %
Cement (per ton) 416.0 % 3.2 %
Ready-mix concrete (per cubic yards) 99.5 % 12.5 %
Asphalt (per ton) (1.8) % 7.0 %
Three months ended
Percentage Change in
Year over Year Comparison (Excluding acquisitions & divestitures) Volume Pricing
Aggregates (per ton) (8.3) % 10.4 %
Cement (per ton) (2.7) % 5.6 %
Ready-mix concrete (per cubic yards) (15.1) % 8.3 %
Asphalt (per ton) 9.4 % 5.8 %
11
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Reconciliations of Gross Revenue to Net Revenue by Line of Business
($ and Units in thousands, except pricing information)
Three months ended March 30, 2024
Gross Revenue Intercompany Net
Volumes Pricing by Product Elimination/Delivery Revenue
Aggregates 11,654 $ 14.89 $ 173,497 $ (27,986) $ 145,511
Cement 1,739 152.11 264,492 (40,395) 224,097
Materials $ 437,989 $ (68,381) $ 369,608
Ready-mix concrete 1,897 164.59 312,155 (108) 312,047
Asphalt 319 88.09 28,119 (134) 27,985
Other Products 71,754 (52,700) 19,054
Products $ 412,028 $ (52,942) $ 359,086
12
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SUMMIT MATERIALS, INC. AND SUBSIDIARIES
Unaudited Reconciliations of Non-GAAP Financial Measures
($ in thousands, except share and per share amounts)
The tables below reconcile our net loss to Adjusted EBITDA and Adjusted EBITDA
Margin by segment and on a consolidated basis for the three months ended March
30, 2024 and April 1, 2023.
Reconciliation of Net Income (Loss) to Adjusted EBITDA Three months ended March 30, 2024
by Segment West East Cement Corporate Consolidated
($ in thousands)
Net income (loss) $ 18,950 $ 34,491 $ 24,993 $ (145,704) $ (67,270)
Interest (income) expense (6,763) (4,572) (6,354) 69,581 51,892
Income tax expense (benefit) 509 - - (11,574) (11,065)
Depreciation, depletion and amortization 29,894 22,559 40,663 1,847 94,963
EBITDA $ 42,590 $ 52,478 $ 59,302 $ (85,850) $ 68,520
Accretion 444 522 42 - 1,008
Loss on debt financings - - - 5,453 5,453
Loss (gain) on sale of businesses 844 (15,829) - - (14,985)
Non-cash compensation - - - 6,720 6,720
Argos USA acquisition and integration costs - 62 110 61,122 61,294
Other (478) 243 - (6,550) (6,785)
Adjusted EBITDA $ 43,400 $ 37,476 $ 59,454 $ (19,105) $ 121,225
Adjusted EBITDA Margin (1) 15.3 % 14.5 % 25.7 % 15.7 %
Reconciliation of Net Income (Loss) to Adjusted EBITDA Three months ended April 1, 2023
by Segment West East Cement Corporate Consolidated
($ in thousands)
Net income (loss) $ 8,922 $ 5,938 $ (3,025) $ (43,047) $ (31,212)
Interest (income) expense (3,331) (2,762) (4,963) 38,476 27,420
Income tax expense (benefit) 739 - - (7,205) (6,466)
Depreciation, depletion and amortization 26,123 15,097 7,980 988 50,188
EBITDA $ 32,453 $ 18,273 $ (8) $ (10,788) $ 39,930
Accretion 250 438 18 - 706
Loss on debt financings - - - 493 493
Non-cash compensation - - - 4,708 4,708
Other (25) 141 - (4,752) (4,636)
Adjusted EBITDA $ 32,678 $ 18,852 $ 10 $ (10,339) $ 41,201
Adjusted EBITDA Margin (1) 13.9 % 15.9 % - % 10.1 %
________________________________________________
(1) Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of
net revenue.
13
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The table below reconciles our net loss attributable to Summit Materials, Inc.
to adjusted diluted net loss per share for the three months ended March 30,
2024 and April 1, 2023. The per share amount of the net loss attributable to
Summit Materials, Inc. presented in the table is calculated using the total
equity interests for the purpose of reconciling to adjusted diluted net loss
per share.
Three months ended
March 30, 2024 April 1, 2023
Reconciliation Net Per Net Per
of Net Loss Per Loss Equity Loss Equity
Share to Adjusted Unit Unit
Diluted EPS
Net loss $ (66,866) $ (0.40) $ (30,804) $ (0.26)
attributable to
Summit
Materials, Inc.
Adjustments:
Net loss (404) - (408) -
attributable to
noncontrolling
interest
Argos USA 51,583 0.31 - -
acquisition and
integration
costs, net of tax
Gain on (9,699) (0.06) - -
sale of
businesses,
net of tax
Loss on 5,453 0.03 493 -
debt
financings
Adjusted $ (19,933) $ (0.12) $ (30,719) $ (0.26)
diluted
net
loss
Weighted-average
shares:
Basic 167,446,041 118,564,556
Class A
common
stock
LP 511,565 1,311,257
Units
outstanding
Total 167,957,606 119,875,813
equity
units
The following table reconciles operating loss to Adjusted Cash Gross Profit
and Adjusted Cash Gross Profit Margin for the three months ended March 30,
2024 and April 1, 2023.
Three months ended
March 30, April 1,
Reconciliation of Operating Loss to Adjusted Cash Gross Profit 2024 2023
($ in thousands)
Operating loss $ (44,853) $ (15,475)
General and administrative expenses 68,526 45,998
Depreciation, depletion, amortization and accretion 95,971 50,894
Transaction and integration costs 62,208 364
Gain on sale of property, plant and equipment (848) (430)
Adjusted Cash Gross Profit (exclusive of items shown separately) $ 181,004 $ 81,351
Adjusted Cash Gross Profit Margin (exclusive of items shown separately) (1) 23.4 % 20.0 %
_______________________________________________________
(1) Adjusted Cash Gross Profit Margin is defined as Adjusted Cash Gross Profit
as a percentage of net revenue.
The following table reconciles net cash (used in) provided by operating
activities to free cash flow for the three months ended March 30, 2024 and
April 1, 2023.
Three months ended
March 30, April 1,
($ in thousands) 2024 2023
Net loss $ (67,270) $ (31,212)
Non-cash items 84,387 50,432
Net loss adjusted for non-cash items 17,117 19,220
Change in working capital accounts (57,362) (18,885)
Net cash (used in) provided by operating activities (40,245) 335
Capital expenditures, net of asset sales (55,855) (61,807)
Free cash flow $ (96,100) $ (61,472)
Contact:
Andy Larkin
VP, Investor Relations
14
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andy.larkin@summit-materials.com
720-618-6013
15
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