North / South America
Higher prices, volume lift Martin Marietta 2Q net
Aug, 08 2012
(Raleigh, N.C.) -- Martin Marietta Materials Inc. said Tuesday that its second-quarter net income edged up 3 percent on higher prices and increased demand for construction materials.
Its adjusted earnings came in below Wall Street estimates, however, and its shares fell 4 percent in midday trading.
Martin Marietta makes granite, sandstone, limestone, sand and gravel used for construction. It said demand was strongest in the western United States, especially in Texas where it was driven by the energy sector and residential market as homebuilding picked up.
The company said it expects the momentum from the first half of the year, combined with improvements in homebuilding and the passage of a new federal highway bill, to drive its results through next year.
Since it doesn't expect a significant pickup in demand from the highway bill until 2013, it forecasts volume in its infrastructure unit will be flat or lower for the year. It sees double-digit volume growth in its commercial construction business, on continued strength in the energy market. It also sees residential demand accelerating.
A leading index revealed Tuesday that U.S. home prices rose in May from April in every major market it tracked, a sign that increasing sales and tight inventories are supporting a modest housing recovery.
The Raleigh, N.C., company said its net income rose to $36.8 million, or 80 cents per share, for the three months ended June 30 compared with $35.8 million, or 78 cents per share, a year earlier.
Taking out one-time charges, the company said adjusted earnings were 92 cents per share in the most recent quarter. That was below the $1.01 per share that analysts polled by FactSet expected.
Revenue rose to $545.7 million from $462.4 million. Analysts expected revenue of $475.7 million.
Shares fell $3.20, or 4.1 percent, to $74.80 in midday trading. Its shares are down 17.4 percent since peaking for the past year at $90.57 in mid-February.
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