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U.S. Concrete First-Quarter Loss Narrows

May, 17 2005

U.S. Concrete First-Quarter Loss Narrows U.S. Concrete First-Quarter Loss Narrows, but Company Reduces Year-End Outlook (HOUSTON, Texas) -- U.S. Concrete Inc. said Tuesday that its first-quarter loss narrowed from a year ago when results were depressed by a charge for early debt payoffs. However, the company's said ready-mixed concrete volumes declined due to weather and project delays and it reduced its year-end earnings outlook. U.S. Concrete shares fell 15 cents, or 2.5 percent, to $5.76 in morning trading on the Nasdaq. The maker of concrete, cement and construction aggregates recorded a loss of $6.5 million, or 23 cents per share, compared with a year-ago loss of $24.6 million, or 87 cents per share. The year-ago loss would have been much smaller -- $4.1 million, or 15 cents per share -- except for a $28.8 million charge related to the early extinguishment of debt. Revenue increased 2 percent to $92.5 million from $90.3 million. The company said growth was driven by higher ready-mixed concrete prices and increased concrete product sales, partly offset by lower ready-mixed concrete volumes. The latest quarter results came in at the tail end of the company's predictions for a loss of 18 cents to 23 cents per share and revenue of $92 million to $97 million. U.S. Concrete usually reports a loss in the first quarter because of slow construction demand during the winter months. "Our first quarter results were negatively impacted by lower than anticipated volumes resulting from sustained inclement weather patterns and project permitting delays," said Michael Harlan, the company's executive vice president and chief operating officer. Profit was further hurt by higher labor and delivery costs, the company said. Looking to the second quarter, U.S. Concrete predicted earnings of 16 cents to 21 cents per share on sales of $149 million to $154 million. For the year, the company expects profit of 34 cents to 40 cents per share on sales of $530 million to $540 million. In March, U.S. Concrete had predicted earnings of 36 cents to 43 cents per share on sales of $530 million to $545 million. Analysts surveyed by Thomson Financial currently expect year-end profit of 42 cents per share. U.S. Concrete said the recent volume shortfall for ready-mixed concrete may lead it to reduce its capital spending for the rest of 2005. However, the company said it hopes to partly make up for lost volumes in ensuing quarters.