Press Release

Summit Materials, Inc. Reports First Quarter 2022 Results

Company Release - 05/04/2022

Strong pricing and demand conditions continue

Results in line with expectations

Net Leverage Ratio remains below Elevate Summit target

DENVER--(BUSINESS WIRE)-- Summit Materials, Inc. (NYSE: SUM) (“Summit,” “Summit Materials,” "Summit Inc." or the “Company”), a leading vertically integrated construction materials company, today announced results for the first quarter ended April 2, 2022 (“first quarter”). All comparisons are versus the quarter ended April 3, 2021 unless noted otherwise.

 

 

Three months ended

($ in thousands)

 

April 2, 2022

 

April 3, 2021

 

% Chg vs. PY

Net revenue

 

$

392,495

 

 

$

398,481

 

 

(1.5

)%

Operating loss

 

 

(34,295

)

 

 

(25,059

)

 

(36.9

)%

Net loss

 

 

(34,800

)

 

 

(23,245

)

 

(49.7

)%

Basic EPS

 

$

(0.29

)

 

$

(0.19

)

 

(52.6

)%

 

 

 

 

 

 

 

Adjusted Cash Gross Profit

 

 

67,567

 

 

 

81,150

 

 

(16.7

)%

Adjusted EBITDA

 

 

23,263

 

 

 

41,734

 

 

(44.3

)%

"Our first quarter 2022 results demonstrate that we have sustained the momentum we built in 2021 and are on solid footing as we head into the prime construction season," said Summit Materials CEO Anne Noonan. "Our unwavering focus is squarely on our strategic execution and controlling what we can control to make further progress towards our Horizon One financial objectives of driving margin expansion, controlling leverage, and increasing ROIC. Price increases were communicated across all markets and lines of business with effective dates varying from January 1 to April 1, 2022, depending upon seasonality. We expect those increases will be fully reflected in the second quarter of 2022. We would characterize current market conditions as favorable towards the potential for additional price increases this year in all lines of business. We are diligently moving forward with portfolio optimization moves, implementing our Value Pricing principles, and pulling all available self-help margin levers to improve performance, offset inflation, and upgrade our quality of earnings. We are updating our 2022 Adjusted EBITDA guidance to reflect the impact of a divestiture and we remain confident that Summit Materials is on track for another year of solid growth."

Brian Harris, CFO of Summit Materials, added, "Sound strategic execution has put Summit in a position to pursue a broader range of high return capital allocation priorities. As part of our Elevate Summit strategy, we have closed nine strategic divestitures with line of sight to completing the ten to twelve as part of our Horizon One goal. We believe these divestitures advance our market leadership and asset light priorities and together with continued organic growth, provides Summit the financial flexibility to invest in greenfields, pursue attractive M&A opportunities, and opportunistically buy back our shares when they present compelling value."

In the three months ended April 2, 2022, Summit Materials sold one business in the East segment, resulting in cash proceeds of $47.8 million and a total gain on disposition of $14.2 million. To date, as part of its Elevate Summit Strategy, the Company has received $176.1 million in proceeds from a total of nine divestitures. As of April 2, 2022, Summit reclassified an operating unit in its East segment as held for sale, and expects to close the transaction in the second quarter of 2022.

In March 2022, the Company repurchased 1.5 million shares of Class A common stock for $47.5 million. As of April 2, 2022, approximately $202.5 million remained available for share repurchases under the share repurchase program.

2022 Guidance

For the full year 2022, Summit is updating its Adjusted EBITDA guidance to approximately $529 million to $557 million, from $535 million to $565 million previously, and continues to expect 2022 capital expenditures of approximately $270 million to $290 million, including greenfield projects.

First Quarter 2022 | Total Company Results

Net Revenue decreased $6.0 million, or 1.5% in the first quarter to $392.5 million, primarily resulting from divestitures completed in 2021, partially offset by increases in average sales prices.

Operating loss increased $9.2 million, or 36.9% in the first quarter to $34.3 million, as timing of price increases temporarily lagged increased costs from inflation, timing of repair and maintenance expenditures and certain stripping activities, unplanned downtime at a few of our locations, mitigated by a $5.1 million decrease in depreciation, depletion, amortization and accretion expenses. Summit's operating margin percentage for the three months ended April 2, 2022 decreased to (8.7)% from (6.3)%, from the comparable period a year ago.

Net loss attributable to Summit Inc. increased to $34.3 million, or $(0.29) per basic share, compared to $22.5 million, or $(0.19) per basic share in the comparable prior year period. Summit reported adjusted diluted net loss of $49.0 million, or $(0.41) per adjusted diluted share as compared to $38.9 million, or $(0.33) per adjusted diluted share in the prior year period.

Adjusted EBITDA decreased $18.5 million, or 44.3% to $23.3 million.

First Quarter 2022 | Results by Line of Business

Aggregates Business: Aggregates net revenues increased by $6.0 million to $123.4 million in the first quarter. Aggregates adjusted cash gross profit margin decreased to 36.3% in the first quarter as compared to 41.8% in the first quarter 2021. Aggregates sales volume decreased 0.8% in the first quarter as solid organic volume growth in several markets was more than offset by volume decreases in certain markets due to divestitures. Average selling prices for aggregates increased 4.8% in the first quarter with growth across both reporting segments.

Cement Business: Cement segment net revenues increased 13.7% to $46.2 million in the first quarter. Cement segment adjusted cash gross profit margin decreased to (2.0)% in the first quarter, compared to 1.9% in the prior year period, reflecting the impact of an annual maintenance shutdown and slightly slower than expected resumption of operations. Sales volume of cement increased 0.3% and average selling prices increased 10.1% in the first quarter.

Products Business: Products net revenues were $189.7 million in the first quarter, compared to $198.7 million in the prior year period. Products adjusted cash gross profit margin decreased to 11.6% in the first quarter, versus 13.6% in the prior year period. Average sales price for ready-mix concrete increased 7.3% driven by pricing growth in all markets, with strong, double-digit growth in the Intermountain West. Sales volumes of ready-mix concrete decreased 7.2% due to lower volumes in Kansas and north Texas due to weather. Average selling prices for asphalt increased 10.2%, driven by strong pricing gains in Virginia and the Intermountain West market. Asphalt volume decreased 45.1% due primarily to the impact of divestitures.

First Quarter 2022 | Results By Reporting Segment

West Segment: The West Segment operating income decreased 46.9% to $8.0 million and Adjusted EBITDA decreased 19.6% to $32.7 million in the first quarter primarily due to higher sub contractor costs, as well as increased repair and maintenance and fuel costs that were realized ahead of price increases broadly going into effect. Aggregates revenue in the first quarter increased 7.8% on 3.7% pricing growth and 3.9% volume growth, which was driven by strong demand in Texas and the Intermountain West geography, as well as increased projects in British Columbia. Ready-mix concrete revenue in the first quarter increased 6.0% as 7.0% pricing growth was partially offset by lower volumes. Asphalt revenue decreased 50.9% in the first quarter as volumes decreased 50.7%, due to a divestiture made in the second quarter of 2021. Asphalt sales prices increased 10.3% in the period.

East Segment: The East Segment operating loss increased 3.4% to $10.7 million and Adjusted EBITDA decreased 30.7% to $8.1 million in the first quarter. Lower operating income and Adjusted EBITDA reflects increased cost of revenue that exceeded pricing growth. Aggregates revenue was flat to prior year. Aggregates volumes decreased 6.5% primarily due to divestitures and partially offset by growth in Georgia. Average selling prices for aggregates increased 7.0%. Ready-mix concrete revenue decreased 26.6% as volumes decreased by 32.5%, partially offset by average selling price growth of 8.9%. Asphalt revenue increased 10.3% as lower volumes were more than offset by pricing growth. Asphalt average selling prices increased 14.5% due to product mix and asphalt mix design.

Cement Segment: The Cement Segment operating loss increased 34.4% to $13.5 million in the first quarter. Adjusted EBITDA decreased $8.3 million as our repair and maintenance costs associated our annual shutdown were elevated relative to the comparable prior period. In first quarter, the Cement Segment reported volume growth of 0.3% and average selling price growth of 10.1%.

Liquidity and Capital Resources

As of April 2, 2022, the Company had $287.4 million in cash and $1.6 billion in debt outstanding. The Company's $345 million revolving credit facility has $324.6 million available after outstanding letters of credit. For the quarter ended April 2, 2022, cash flow used in operations was $16.7 million and cash paid for capital expenditures was $57.8 million.

In March 2022, the Company repurchased 1.5 million shares of Class A common stock for $47.5 million. As of April 2, 2022, approximately $202.5 million remained available for share repurchases under the share repurchase program.

Webcast and Conference Call Information

Summit Materials will conduct a conference call on Thursday, May 5, 2022, at 11:00 a.m. eastern time (9:00 a.m. mountain time) to review the Company’s first quarter 2022 financial results, discuss recent events and conduct a question-and-answer session.

A webcast of the first quarter results 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/420213312. 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.

To participate in the live teleconference for first quarter 2022 financial results:

Domestic Live:

1-888-330-3416

International Live:

1-646-960-0820

Conference ID:

1542153

Password:

Summit

To listen to a replay of the teleconference, which will be available through May 12, 2022:

Domestic Replay:

1-800-770-2030

International Replay:

1-647-362-9199

Conference ID:

1542153

About Summit Materials

Summit Materials is a leading vertically integrated materials-based company that supplies aggregates, cement, ready-mix concrete and asphalt in the United States and British Columbia, Canada. Summit is a geographically diverse, materials-based business of scale that offers customers a single-source provider of construction materials and related downstream products in the public infrastructure, residential and nonresidential end markets. Summit has a strong track record of successful acquisitions since its founding and continues to pursue growth opportunities in new and existing markets. For more information about Summit Materials, please visit www.summit-materials.com.

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 Income, Adjusted Diluted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Free Cash Flow, Net Leverage and Net Debt 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 Income, Adjusted Diluted EPS, Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Free Cash Flow, Net Leverage and Net Debt 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 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, Further Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Adjusted Net Income (Loss), Adjusted Diluted Net Income, Adjusted Diluted EPS, Free Cash Flow, Net Leverage and Net Debt 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. 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.

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,” “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 January 1, 2022, as filed with the SEC, and any factors discussed in the section entitled “Risk Factors” in any of our subsequently filed SEC filings.

  • the impact of the COVID-19 pandemic, and responses to it, including vaccine mandates, or any similar crisis, on our business;
  • our dependence on the construction industry and the strength of the local economies in which we operate;
  • the cyclical nature of our business;
  • risks related to weather and seasonality;
  • risks associated with our capital-intensive business;
  • competition within our local markets;
  • our ability to execute on our acquisition strategy, successfully integrate acquisitions with our existing operations and retain key employees of acquired businesses;
  • our dependence on securing and permitting aggregate reserves in strategically located areas;
  • declines in public infrastructure construction and delays or reductions in governmental funding, including the funding by transportation authorities and other state agencies;
  • 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;
  • costs associated with pending and future litigation;
  • 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;
  • conditions in the credit markets;
  • 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 substantial current level of indebtedness, including our exposure to variable interest rate risk;
  • our dependence on senior management and other key personnel, and our ability to retain and attract 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 regulations;
  • unexpected operational difficulties;
  • interruptions in our information technology systems and infrastructure; including cybersecurity and data leakage risks; and
  • potential labor disputes, strikes, other forms of work stoppage or other union activities.

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.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Operations

($ in thousands, except share and per share amounts)

 

 

 

Three months ended

 

 

April 2,

 

April 3,

 

 

2022

 

2021

Revenue:

 

 

 

 

Product

 

$

355,669

 

 

$

354,234

 

Service

 

 

36,826

 

 

 

44,247

 

Net revenue

 

 

392,495

 

 

 

398,481

 

Delivery and subcontract revenue

 

 

28,452

 

 

 

29,363

 

Total revenue

 

 

420,947

 

 

 

427,844

 

Cost of revenue (excluding items shown separately below):

 

 

 

 

Product

 

 

290,345

 

 

 

277,134

 

Service

 

 

34,583

 

 

 

40,197

 

Net cost of revenue

 

 

324,928

 

 

 

317,331

 

Delivery and subcontract cost

 

 

28,452

 

 

 

29,363

 

Total cost of revenue

 

 

353,380

 

 

 

346,694

 

General and administrative expenses

 

 

51,924

 

 

 

51,642

 

Depreciation, depletion, amortization and accretion

 

 

51,193

 

 

 

56,336

 

Gain on sale of property, plant and equipment

 

 

(1,255

)

 

 

(1,769

)

Operating loss

 

 

(34,295

)

 

 

(25,059

)

Interest expense

 

 

20,149

 

 

 

24,186

 

Gain on sale of businesses

 

 

(14,205

)

 

 

(15,668

)

Other income, net

 

 

(696

)

 

 

(4,889

)

Loss from operations before taxes

 

 

(39,543

)

 

 

(28,688

)

Income tax benefit

 

 

(4,743

)

 

 

(5,443

)

Net loss

 

 

(34,800

)

 

 

(23,245

)

Net loss attributable to Summit Holdings (1)

 

 

(508

)

 

 

(728

)

Net loss attributable to Summit Inc.

 

$

(34,292

)

 

$

(22,517

)

Loss per share of Class A common stock:

 

 

 

 

Basic

 

$

(0.29

)

 

$

(0.19

)

Diluted

 

$

(0.29

)

 

$

(0.20

)

Weighted average shares of Class A common stock:

 

 

 

 

Basic

 

 

118,937,466

 

 

 

115,664,725

 

Diluted

 

 

118,937,466

 

 

 

115,411,204

 

_______________

(1) Represents portion of business owned by pre-IPO investors rather than by Summit.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

($ in thousands, except share and per share amounts)

 

 

 

April 2,

 

January 1,

 

 

2022

 

2022

 

 

(unaudited)

 

(audited)

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

287,392

 

$

380,961

Accounts receivable, net

 

 

239,839

 

 

 

287,226

 

Costs and estimated earnings in excess of billings

 

 

12,723

 

 

 

7,600

 

Inventories

 

 

187,009

 

 

 

180,760

 

Other current assets

 

 

14,305

 

 

 

11,827

 

Current assets held for sale

 

 

36,572

 

 

 

1,236

 

Total current assets

 

 

777,840

 

 

 

869,610

 

Property, plant and equipment, less accumulated depreciation, depletion and amortization (April 2, 2022 - $1,290,560 and January 1, 2022 - $1,266,513)

 

 

1,766,594

 

 

 

1,842,908

 

Goodwill

 

 

1,146,276

 

 

 

1,163,750

 

Intangible assets, less accumulated amortization (April 2, 2022 - $16,218 and January 1, 2022 - $15,269)

 

 

67,015

 

 

 

69,396

 

Deferred tax assets, less valuation allowance (April 2, 2022 - $1,675 and January 1, 2022 - $1,675)

 

 

211,372

 

 

 

204,566

 

Operating lease right-of-use assets

 

 

28,766

 

 

 

30,150

 

Other assets

 

 

43,200

 

 

 

58,745

 

Noncurrent assets held for sale

 

$

102,182

 

 

$

 

Total assets

 

$

4,143,245

 

 

$

4,239,125

 

Liabilities and Stockholders’ Equity

 

 

 

 

Current liabilities:

 

 

 

 

Current portion of debt

 

$

6,354

 

 

$

6,354

 

Current portion of acquisition-related liabilities

 

 

13,078

 

 

 

13,110

 

Accounts payable

 

 

146,292

 

 

 

128,232

 

Accrued expenses

 

 

113,569

 

 

 

147,476

 

Current operating lease liabilities

 

 

5,934

 

 

 

6,497

 

Billings in excess of costs and estimated earnings

 

 

6,734

 

 

 

7,401

 

Current liabilities held for sale

 

 

13,110

 

 

 

 

Total current liabilities

 

 

305,071

 

 

 

309,070

 

Long-term debt

 

 

1,590,050

 

 

 

1,591,019

 

Acquisition-related liabilities

 

 

22,928

 

 

 

33,369

 

Tax receivable agreement liability

 

 

326,548

 

 

 

326,548

 

Noncurrent operating lease liabilities

 

 

28,017

 

 

 

28,880

 

Other noncurrent liabilities

 

 

121,103

 

 

 

127,027

 

Noncurrent liabilities held for sale

 

 

3,031

 

 

 

 

Total liabilities

 

 

2,396,748

 

 

 

2,415,913

 

Stockholders’ equity:

 

 

 

 

Class A common stock, par value $0.01 per share; 1,000,000,000 shares authorized, 118,041,848 and 118,705,108 shares issued and outstanding as of April 2, 2022 and January 1, 2022, respectively

 

 

1,181

 

 

 

1,188

 

Class B common stock, par value $0.01 per share; 250,000,000 shares authorized, 99 shares issued and outstanding as of April 2, 2022 and January 1, 2022

 

 

 

 

 

 

Additional paid-in capital

 

 

1,330,548

 

 

 

1,326,340

 

Accumulated earnings

 

 

397,170

 

 

 

478,956

 

Accumulated other comprehensive income

 

 

8,389

 

 

 

7,083

 

Stockholders’ equity

 

 

1,737,288

 

 

 

1,813,567

 

Noncontrolling interest in Summit Holdings

 

 

9,209

 

 

 

9,645

 

Total stockholders’ equity

 

 

1,746,497

 

 

 

1,823,212

 

Total liabilities and stockholders’ equity

 

$

4,143,245

 

 

$

4,239,125

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Consolidated Statements of Cash Flows

($ in thousands)

 

 

 

Three months ended

 

 

April 2,

 

April 3,

 

 

2022

 

2021

Cash flows from operating activities:

 

 

 

 

Net loss

 

$

(34,800

)

 

$

(23,245

)

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation, depletion, amortization and accretion

 

 

54,838

 

 

 

59,107

 

Share-based compensation expense

 

 

5,422

 

 

 

5,363

 

Net gain on asset and business disposals

 

 

(15,660

)

 

 

(15,964

)

Change in deferred tax asset, net

 

 

(7,770

)

 

 

(10,145

)

Other

 

 

(221

)

 

 

483

 

Decrease (increase) in operating assets, net of acquisitions and dispositions:

 

 

 

 

Accounts receivable, net

 

 

35,836

 

 

 

4,946

 

Inventories

 

 

(36,752

)

 

 

(15,412

)

Costs and estimated earnings in excess of billings

 

 

(6,449

)

 

 

(8,442

)

Other current assets

 

 

(1,891

)

 

 

(9,209

)

Other assets

 

 

1,183

 

 

 

2,504

 

(Decrease) increase in operating liabilities, net of acquisitions and dispositions:

 

 

 

 

Accounts payable

 

 

16,744

 

 

 

14,518

 

Accrued expenses

 

 

(25,946

)

 

 

(24,130

)

Billings in excess of costs and estimated earnings

 

 

317

 

 

 

(2,578

)

Tax receivable agreement liability

 

 

 

 

 

4,152

 

Other liabilities

 

 

(1,564

)

 

 

(3,266

)

Net cash used in operating activities

 

 

(16,713

)

 

 

(21,318

)

Cash flows from investing activities:

 

 

 

 

Purchases of property, plant and equipment

 

 

(57,774

)

 

 

(69,757

)

Proceeds from the sale of property, plant and equipment

 

 

1,439

 

 

 

2,663

 

Proceeds from sale of businesses

 

 

47,821

 

 

 

33,077

 

Other

 

 

(857

)

 

 

(483

)

Net cash used in investing activities

 

 

(9,371

)

 

 

(34,500

)

Cash flows from financing activities:

 

 

 

 

Payments on debt

 

 

(7,603

)

 

 

(10,170

)

Payments on acquisition-related liabilities

 

 

(11,397

)

 

 

(8,096

)

Repurchases of common stock

 

 

(47,509

)

 

 

 

Proceeds from stock option exercises

 

 

27

 

 

 

15,920

 

Other

 

 

(1,180

)

 

 

(416

)

Net cash used in financing activities

 

 

(67,662

)

 

 

(2,762

)

Impact of foreign currency on cash

 

 

177

 

 

 

140

 

Net decrease in cash

 

 

(93,569

)

 

 

(58,440

)

Cash and cash equivalents—beginning of period

 

 

380,961

 

 

 

418,181

 

Cash and cash equivalents—end of period

 

$

287,392

 

 

$

359,741

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Revenue Data by Segment and Line of Business

($ in thousands)

 

 

 

Three months ended

 

Twelve months ended

 

 

April 2,

 

April 3,

 

April 2,

 

April 3,

 

 

2022

 

2021

 

2022

 

2021

Segment Net Revenue:

 

 

 

 

 

 

 

 

West

 

$

236,002

 

 

$

234,744

 

 

$

1,170,724

 

 

$

1,198,173

 

East

 

 

110,268

 

 

 

123,068

 

 

 

752,196

 

 

 

719,290

 

Cement

 

 

46,225

 

 

 

40,669

 

 

 

303,790

 

 

 

273,366

 

Net Revenue

 

$

392,495

 

 

$

398,481

 

 

$

2,226,710

 

 

$

2,190,829

 

 

 

 

 

 

 

 

 

 

Line of Business - Net Revenue:

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

123,393

 

 

$

117,388

 

 

$

579,162

 

 

$

519,234

 

Cement (1)

 

 

42,554

 

 

 

38,139

 

 

 

286,496

 

 

 

262,905

 

Products

 

 

189,722

 

 

 

198,707

 

 

 

1,059,062

 

 

 

1,091,467

 

Total Materials and Products

 

 

355,669

 

 

 

354,234

 

 

 

1,924,720

 

 

 

1,873,606

 

Services

 

 

36,826

 

 

 

44,247

 

 

 

301,990

 

 

 

317,223

 

Net Revenue

 

$

392,495

 

 

$

398,481

 

 

$

2,226,710

 

 

$

2,190,829

 

 

 

 

 

 

 

 

 

 

Line of Business - Net Cost of Revenue:

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

78,609

 

 

$

68,297

 

 

$

287,068

 

 

$

250,856

 

Cement

 

 

43,485

 

 

 

37,360

 

 

 

169,233

 

 

 

151,238

 

Products

 

 

167,653

 

 

 

171,620

 

 

 

868,165

 

 

 

879,444

 

Total Materials and Products

 

 

289,747

 

 

 

277,277

 

 

 

1,324,466

 

 

 

1,281,538

 

Services

 

 

35,181

 

 

 

40,054

 

 

 

242,568

 

 

 

256,171

 

Net Cost of Revenue

 

$

324,928

 

 

$

317,331

 

 

$

1,567,034

 

 

$

1,537,709

 

 

 

 

 

 

 

 

 

 

Line of Business - Adjusted Cash Gross Profit (2):

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

44,784

 

 

$

49,091

 

 

$

292,094

 

 

$

268,378

 

Cement (3)

 

 

(931

)

 

 

779

 

 

 

117,263

 

 

 

111,667

 

Products

 

 

22,069

 

 

 

27,087

 

 

 

190,897

 

 

 

212,023

 

Total Materials and Products

 

 

65,922

 

 

 

76,957

 

 

 

600,254

 

 

 

592,068

 

Services

 

 

1,645

 

 

 

4,193

 

 

 

59,422

 

 

 

61,052

 

Adjusted Cash Gross Profit

 

$

67,567

 

 

$

81,150

 

 

$

659,676

 

 

$

653,120

 

 

 

 

 

 

 

 

 

 

Adjusted Cash Gross Profit Margin (2)

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

 

36.3

%

 

 

41.8

%

 

 

50.4

%

 

 

51.7

%

Cement (3)

 

 

(2.0

)%

 

 

1.9

%

 

 

38.6

%

 

 

40.8

%

Products

 

 

11.6

%

 

 

13.6

%

 

 

18.0

%

 

 

19.4

%

Services

 

 

4.5

%

 

 

9.5

%

 

 

19.7

%

 

 

19.2

%

Total Adjusted Cash Gross Profit Margin

 

 

17.2

%

 

 

20.4

%

 

 

29.6

%

 

 

29.8

%

_______________

(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.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Volume and Price Statistics

(Units in thousands)

 

 

 

Three months ended

Total Volume

 

April 2, 2022

 

April 3, 2021

Aggregates (tons)

 

 

13,402

 

 

 

13,509

 

Cement (tons)

 

 

341

 

 

 

340

 

Ready-mix concrete (cubic yards)

 

 

1,241

 

 

 

1,338

 

Asphalt (tons)

 

 

260

 

 

 

474

 

 

 

 

 

 

 

 

Three months ended

Pricing

 

April 2, 2022

 

April 3, 2021

Aggregates (per ton)

 

$

11.15

 

 

$

10.64

 

Cement (per ton)

 

 

128.42

 

 

 

116.69

 

Ready-mix concrete (per cubic yards)

 

 

127.00

 

 

 

118.31

 

Asphalt (per ton)

 

 

66.15

 

 

 

60.01

 

 

 

 

 

 

 

 

Three months ended

 

 

Percentage Change in

Year over Year Comparison

 

Volume

 

Pricing

Aggregates (per ton)

 

 

(0.8

)%

 

 

4.8

%

Cement (per ton)

 

 

0.3

%

 

 

10.1

%

Ready-mix concrete (per cubic yards)

 

 

(7.2

)%

 

 

7.3

%

Asphalt (per ton)

 

 

(45.1

)%

 

 

10.2

%

 

 

 

 

 

 

 

Three months ended

 

 

Percentage Change in

Year over Year Comparison (Excluding acquisitions)

 

Volume

 

Pricing

Aggregates (per ton)

 

 

(1.5

)%

 

 

5.0

%

Cement (per ton)

 

 

0.3

%

 

 

10.1

%

Ready-mix concrete (per cubic yards)

 

 

(7.2

)%

 

 

7.3

%

Asphalt (per ton)

 

 

(45.1

)%

 

 

10.2

%

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 April 2, 2022

 

 

 

 

 

 

Gross Revenue

 

Intercompany

 

Net

 

 

Volumes

 

Pricing

 

by Product

 

Elimination/Delivery

 

Revenue

Aggregates

 

13,402

 

$

11.15

 

$

149,426

 

$

(26,033

)

 

$

123,393

Cement

 

341

 

 

 

128.42

 

 

 

43,806

 

 

 

(1,252

)

 

 

42,554

 

Materials

 

 

 

 

 

$

193,232

 

 

$

(27,285

)

 

$

165,947

 

Ready-mix concrete

 

1,241

 

 

 

127.00

 

 

 

157,602

 

 

 

(39

)

 

 

157,563

 

Asphalt

 

260

 

 

 

66.15

 

 

 

17,217

 

 

 

(80

)

 

 

17,137

 

Other Products

 

 

 

 

 

 

75,965

 

 

 

(60,943

)

 

 

15,022

 

Products

 

 

 

 

 

$

250,784

 

 

$

(61,062

)

 

$

189,722

 

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 by segment for the three months ended April 2, 2022 and April 3, 2021.

 

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Three months ended April 2, 2022

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

($ in thousands)

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

11,901

 

 

$

7,366

 

 

$

(8,431

)

 

$

(45,636

)

 

$

(34,800

)

Interest (income) expense

 

 

(3,970

)

 

 

(3,451

)

 

 

(4,962

)

 

 

32,532

 

 

 

20,149

 

Income tax expense (benefit)

 

 

176

 

 

 

(106

)

 

 

 

 

 

(4,813

)

 

 

(4,743

)

Depreciation, depletion and amortization

 

 

24,348

 

 

 

17,884

 

 

 

7,498

 

 

 

749

 

 

 

50,479

 

EBITDA

 

$

32,455

 

 

$

21,693

 

 

$

(5,895

)

 

$

(17,168

)

 

$

31,085

 

Accretion

 

 

227

 

 

 

411

 

 

 

76

 

 

 

 

 

 

714

 

Gain on sale of businesses

 

 

 

 

 

(14,205

)

 

 

 

 

 

 

 

 

(14,205

)

Non-cash compensation

 

 

 

 

 

 

 

 

 

 

 

5,422

 

 

 

5,422

 

Other

 

 

10

 

 

 

237

 

 

 

 

 

 

 

 

 

247

 

Adjusted EBITDA

 

$

32,692

 

 

$

8,136

 

 

$

(5,819

)

 

$

(11,746

)

 

$

23,263

 

Adjusted EBITDA Margin (1)

 

 

13.9

%

 

 

7.4

%

 

 

(12.6

)%

 

 

 

 

5.9

%

 

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Three months ended April 3, 2021

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

($ in thousands)

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

17,436

 

 

$

6,969

 

 

$

(1,605

)

 

$

(46,045

)

 

$

(23,245

)

Interest (income) expense

 

 

(2,032

)

 

 

(1,720

)

 

 

(4,045

)

 

 

31,983

 

 

 

24,186

 

Income tax expense (benefit)

 

 

186

 

 

 

(66

)

 

 

 

 

 

(5,563

)

 

 

(5,443

)

Depreciation, depletion and amortization

 

 

24,924

 

 

 

21,474

 

 

 

8,068

 

 

 

1,104

 

 

 

55,570

 

EBITDA

 

$

40,514

 

 

$

26,657

 

 

$

2,418

 

 

$

(18,521

)

 

$

51,068

 

Accretion

 

 

216

 

 

 

469

 

 

 

81

 

 

 

 

 

 

766

 

Gain on sale of business

 

 

 

 

 

(15,668

)

 

 

 

 

 

 

 

 

(15,668

)

Non-cash compensation

 

 

 

 

 

 

 

 

 

 

 

5,363

 

 

 

5,363

 

Other

 

 

(82

)

 

 

287

 

 

 

 

 

 

 

 

 

205

 

Adjusted EBITDA

 

$

40,648

 

 

$

11,745

 

 

$

2,499

 

 

$

(13,158

)

 

$

41,734

 

Adjusted EBITDA Margin (1)

 

 

17.3

%

 

 

9.5

%

 

 

6.1

%

 

 

 

 

10.5

%

_______________

(1) Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of net revenue.

The table below reconciles our net loss attributable to Summit Materials, Inc. to adjusted diluted net loss per share for the three months ended April 2, 2022 and April 3, 2021. 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

 

 

April 2, 2022

 

April 3, 2021

Reconciliation of Net Loss Per Share to Adjusted Diluted EPS

 

Net Loss

 

Per Equity

Unit

 

Net Loss

 

Per Equity

Unit

Net loss attributable to Summit Materials, Inc.

 

$

(34,292

)

 

$

(0.29

)

 

$

(22,517

)

 

$

(0.19

)

Adjustments:

 

 

 

 

 

 

 

 

Net loss attributable to noncontrolling interest

 

 

(508

)

 

 

 

 

 

(728

)

 

 

(0.01

)

Gain on sale of businesses

 

 

(14,205

)

 

 

(0.12

)

 

 

(15,668

)

 

 

(0.13

)

Adjusted diluted net loss

 

$

(49,005

)

 

$

(0.41

)

 

$

(38,913

)

 

$

(0.33

)

Weighted-average shares:

 

 

 

 

 

 

 

 

Basic Class A common stock

 

 

118,777,341

 

 

 

 

 

115,411,204

 

 

 

LP Units outstanding

 

 

1,314,006

 

 

 

 

 

2,613,210

 

 

 

Total equity units

 

 

120,091,347

 

 

 

 

 

118,024,414

 

 

 

The following table reconciles operating loss to Adjusted Cash Gross Profit and Adjusted Cash Gross Profit Margin for the three months ended April 2, 2022 and April 3, 2021.

 

 

 

Three months ended

 

 

April 2,

 

April 3,

Reconciliation of Operating Loss to Adjusted Cash Gross Profit

 

2022

 

2021

($ in thousands)

 

 

 

 

Operating loss

 

$

(34,295

)

 

$

(25,059

)

General and administrative expenses

 

 

51,924

 

 

 

51,642

 

Depreciation, depletion, amortization and accretion

 

 

51,193

 

 

 

56,336

 

Gain on sale of property, plant and equipment

 

 

(1,255

)

 

 

(1,769

)

Adjusted Cash Gross Profit (exclusive of items shown separately)

 

$

67,567

 

 

$

81,150

 

Adjusted Cash Gross Profit Margin (exclusive of items shown separately) (1)

 

 

17.2

%

 

 

20.4

%

_______________

(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 operating activities to free cash flow for the three months ended April 2, 2022 and April 3, 2021.

 

 

 

Three months ended

 

 

April 2,

 

April 3,

($ in thousands)

 

2022

 

2021

Net loss

 

$

(34,800

)

 

$

(23,245

)

Non-cash items

 

 

36,609

 

 

 

38,844

 

Net loss adjusted for non-cash items

 

 

1,809

 

 

 

15,599

 

Change in working capital accounts

 

 

(18,522

)

 

 

(36,917

)

Net cash used in operating activities

 

 

(16,713

)

 

 

(21,318

)

Capital expenditures, net of asset sales

 

 

(56,335

)

 

 

(67,094

)

Free cash flow

 

$

(73,048

)

 

$

(88,412

)

 

Andy Larkin
VP, Investor Relations
andy.larkin@summit-materials.com
720-618-6013

Source: Summit Materials, Inc.