Displaying items by tag: Summit Materials
US: Summit Materials' revenue rose by 3% year-on-year to US$739m in the first half of 2019 from US$717m in the same period in 2018. Its adjusted earnings before interest, taxation, deprecation and amortisation (EBITDA) grew by 4% to US$147m from US$141m. Cement sales volumes increased by 2% to 1Mt from 0.97Mt. Tom Hill, the chief executive officer of Summit Materials, noted that flooding on the Mississippi River had presented ‘significant’ challenges for its cement business during the second quarter of 2019.
Summit Materials is active in the aggregates, asphalt and concrete sectors. It also owns Continental Cement, a cement producer that runs two integrated cement plants at Hannibal, Missouri and Davenport, Iowa.
Grupo Argos in talks to merge with Summit Materials
14 June 2019US: Colombia’s Grupo Argos is in talks with US-based Summit Materials about a potential merger. Sources quoted by Reuters said that the Colombian company would like to combine Cementos Argos with Summit Materials to gain economies of scale.
Summit Materials owns Continental Cement, a cement producer that runs two integrated cement plants at Hannibal, Missouri and Davenport, Iowa. It operates cement terminals at Minneapolis in Minnesota, St Paul in Minnesota, LaCrosse in Wisconsin, Bettendorf in Iowa, West Des Moines in Iowa, St Louis in Missouri, Memphis in Tennessee, Convent in Louisiana and New Orleans in Louisiana. Summit Materials also owns a number of building material companies in the aggregates, ready-mixed concrete and asphalt industries.
US: Summit Materials’ mid-year results have been negatively affected by poor cement sales and lower aggregate sales from its Houston operations. Revenue rose by 15% year-on-year to US$717m in the first half of 2018 from US$623m in the same period in 2017. However, its sales volumes of cement fell by 10% to 0.97Mt from 1.08Mt. The company’s net loss rose to US$19m from US$3m.
“Organic sales volumes in our cement segment were impacted by a combination of high precipitation levels during April and May, together with competitive pressures in the markets we serve,” said chief executive officer (CEO) Tom Hill.
The building materials producer operates an integrated cement plant under the Continental Cement subsidiary at Hannibal in Missouri.
US: Summit Materials has appointed Karl H Watson Jr as its chief operating officer and executive vice president. He suceeds Douglas C Rauh.
Watson holds over 25 years of experience in the construction materials industry. In 2017, he served as President, Cement & Southwest Ready Mix at Martin Marietta Materials. Prior to joining Martin Marietta, Watson served in various leadership positions at Cemex, including President, Cemex USA. Prior to Cemex's acquisition of Rinker Group, Watson held various executive positions at Rinker in both the US and Australia.
Watson is currently on the board of directors of the Texas Aggregates & Concrete Association and on the executive committee of the Portland Cement Association where he served as the vice chairman from 2013 to 2015. He is a past chairman of the National Ready Mix Concrete Association and the Florida Concrete and Products Association and was on the board of directors of the National Stone, Sand and Gravel Association from 2007 to 2011. Watson has a Bachelor's of Science degree in Business Administration from Palm Beach Atlantic University.
Hold that cement empire!
11 October 2017Well it doesn’t normally happen like this. In late September 2017 Ash Grove Cement announced that it was set to be bought by Ireland’s CRH. The words it used were a ‘definitive merger agreement.’ Then suddenly this week on 5 October 2017 Ash Grove said that it had received a higher offer from an unnamed third party and that it was extending its so-called ‘window shop period.’ So much for definitive! The following day Reuters revealed that the new bid was from Summit Materials.
The on-going board machinations at LafargeHolcim and the PPC-AfriSam merger saga in South Africa show that the cement industry has its moments of boardroom high drama. Indeed, both of these long-rumbling stories have had murmurs this week with the early departure of LafargeHolcim’s finance director Ron Wirahadiraksa after less than two years and Dangote Cement’s decision to exit the ring from the PPC bidding. However, it’s rare that cement companies are publicly announced as sold and then get gazumped instead.
The Ash Grove debacle also carries a personal dimension. Ash Grove chairman Charlie Sunderland initially described CRH as his company’s biggest customer and one with a close relationship to the firm. Yet a US$300m higher bid suggests how much those ‘kind’ words were actually worth. To add insult to injury the chief executive officer (CEO) of Summit Materials, Tom Hill, used to work for CRH. This no doubt gave him an idea of how the management of CRH thinks. CRH’s public response so far has been that it has noted the extended shareholder approval period at Ash Grove.
At first glimpse Summit Materials and CRH have a similar cement production base in the US. Both companies operate two integrated plants in the country. Summit Materials runs plants at Hannibal, Missouri and Davenport, Iowa. CRH runs plants at Sumterville, Florida and Trident, Montana. Summit then has 10 cement terminals along the Mississippi River from Minnesota to Louisiana compared to CRH US’ five cement terminals in Detroit, Michigan, Cleveland, Ohio, Dundee, Michigan, Buffalo, New York and Duluth, Minnesota.
Yet, CRH also has two plants in Canada. Then the sheer scale of CRH’s other operations in North America simply dwarfs Summit’s. CRH Americas reported sales of US$16.7bn in 2016, more than 10 times higher than the US$1.6bn that Summit Materials declared. Both companies cover aggregates, asphalt, readymix concrete and cement but CRH is by far the larger of the two. So much so in fact that Summit Materials might potentially be taking on a serious amount of debt to finance the Ash Grove sale. As such any blip to the US cement market over the next few years could have serious repercussions to an overleveraged Summit Materials.
On face value the possible engagement with Summit Materials might appear to show that there is a lack of trust between CRH and Ash Grove. However, this cannot be inferred. As its shares are traded over the counter, Ash Grove’s shareholders have allowed a two-week shop window to enable other companies to counter-offer. This is to ensure that they get the best possible value. Talking to Summit is part of this process and may, or may not, mean that the last remaining US-owned cement producer stays based in the US after all.
Summit Materials makes US$3.8bn counter bid for Ash Grove Cement
06 October 2017US: Summit Materials has offered US$3.8bn to buy Ash Grove Cement, according to Reuters. The board of Ash Grove Cement has described the proposal as ‘superior’ to the US$3.5bn bid made by Ireland’s CRH in September 2017. It has extended its so-called ‘shop window’ consideration period with CRH to 20 October 2017.
US: Douglas C Rauh has resigned as the Executive Vice President and Chief Operating Officer of Summit Materials with effect from 30 December 2017. Tom Hill, the company’s President and Chief Executive Officer, will act as Interim Chief Operating Officer while the building materials company searches for a replacement. During the recruitment period, the three Executive Vice Presidents of the company’s operating segments Tom Beck (Cement Segment), Shane Evans (West Segment) and Damian Murphy (East Segment) will report directly to Hill.
Summit Materials’ cement business grows revenue in 2016
23 February 2017US: Summit Materials cement business’ sales revenue rose by 49% year-on-year to US$250m in 2016 from US$168m in 2015. Its sales volumes of cement grew by 37% to 2.36Mt from 1.72Mt. Its adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) grew by 51% to US$113m from US$74.8m. It attributed the improvement to higher prices, cost reductions production efficiencies and increased sales volumes due to the acquisition of the Davenport cement assets in July 2015
“Our cement business represents a clear catalyst for growth heading into 2017,” said Tom Hill, chief executive officer of Summit Materials. “Limited domestic production capacity and continued growth in US demand have combined to create opportunities for sustained growth in industry industry pricing. During the fourth quarter, our cement segment generated organic price and volume growth of 6.8% and nearly 1%, respectively. Looking ahead to the remainder of 2017, we anticipate continued adjusted EBITDA growth in our cement business, as supported by sustained growth in organic cement prices and sales volumes along the Mississippi River corridor.”
US: Summit Materials has appointed Noel R Ryan III as its new Vice President, Investor Relations. Ryan has more than 15 years’ experience in the investor relations and capital markets industries, most recently serving as Vice President and Head of Investor Relations & External Communications for Calumet Specialty Products Partners, a publicly traded producer of specialty hydrocarbon and fuels products.
Previously, Ryan served as head of the investor relations function at Delek US Holdings and as head of corporate communications at QEP Resources. Prior to these roles, he was Executive Director and Co-Head of the Financial Communications Practice Group at a nationally-ranked investor relations consultancy. Ryan began his career in US equities research at Banc of America Securities. He holds a Bachelors of Arts degree from the University of California, Berkeley.
Belgium/US: HeidelbergCement has made a shortlist of potential bidders for assets in Belgium and the US that should be divested as part of its acquisition of Italcementi, according to Bloomberg. Bidders for Italcementi’s Belgian business include Turkey’s Çimsa Çimento and Italy’s Cementir Holding. The business are valued at around US$400m. Bidders for Italcementi’s US assets include Summit Materials and CRH. This business are valued at around US$600m according to sources quoted by Bloomberg. All shortlisted bidders will face a due diligence process.