Pit & Quarry, December 2016
SPECIAL REPORT state department of transportation funding initiatives begin to meaningfully f low into the construction pipeline We see solid non residential demand in our key markets driven in part by growth in warehousing data center and wind farm construction despite the perception of weakening activity at the macroeconomic level Nye says We believe this perception relates to volatility in quarterly construction start data that is better explained by the natural ebb and f low of mega projects moving through the construction cycle Residential construction in our key markets is expected to continue increasing driven largely by historically low levels of construction activity over the previous several years together with low mortgage rates significant lot absorption and higher multi family rental rates Nye continues Our leadership positions in some of the nations most vibrant geographic and demographic markets For 2017 total construction starts are forecast to rise 5 percent to 713 billion ROBERT MURRAY CHIEF ECONOMIST DODGE DATA ANALYTICS should allow us to capitalize on a durable construction and infrastructure recovery in 2017 and beyond Driven by expected steady growth in volume and pricing as well as improved cost dynamics we believe that the companys profitability and cash generation outlook is the strongest it has been in years VULCAN MATERIALS Tom Hill chairman and CEO of Vulcan Materials says Core profitability in our business continues to strengthen despite recent volume headwinds in certain markets So far this year weather patterns and the timing of large project activity have led to higher month tomonth and state to state variability in our shipments somewhat masking the continuing recovery in demand for construction materials across our footprint However our unit margins continue to improve Per ton gross profit in our Aggregates segment grew by 9 percent in the third quarter despite lower shipments and uneven production schedules Hill adds Year to date per ton gross profit has improved by 22 percent As a result we remain on track to reach the low end of our 2016 profit plan despite shipments well below beginning of year expectations we expect full year 2016 adjusted EBITDA of 1 billion a 20 percent increase over the prior year Longer term project pipelines are 14 PIT QUARRY December 2016 pitandquarry com
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