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Exhibit 99.1

 

LOGO     Contact at 214/432-2000
   

Steven R. Rowley

   

President & CEO

   

D. Craig Kesler

   

Executive Vice President & CFO

   

Robert S. Stewart

   

Executive Vice President

News For Immediate Release

EAGLE MATERIALS REPORTS RECORD FIRST QUARTER

REVENUES AND STRONG EARNINGS IMPROVEMENT

DALLAS, TX (July 22, 2014) – Eagle Materials Inc. (NYSE: EXP) today reported financial results for the first quarter of fiscal 2015 ended June 30, 2014. Notable items for the quarter include (all comparisons, unless otherwise noted, are with the prior year’s first quarter):

 

    Record first quarter revenues of $266.3 million, up 17%

 

    Record first quarter cement sales volumes of 1.3 million tons

 

    Net earnings per diluted share of $0.75, up 25%

 

    Receipt of the final permit enabling operation of our frac-sand mine in northern Illinois

First quarter earnings before interest and income taxes increased 21% to $59.8 million, as first quarter sales volumes improved across nearly all businesses. In addition, sales prices improved in all businesses. These results reflect improving, early-cycle construction fundamentals in the US.

We also received the final permit necessary for us to begin operating our frac-sand mine in Utica, Illinois during the first quarter. The first shipments of raw sand from our mine to our 1.5 million ton processing facility at Corpus Christi, Texas are expected to occur no later than our fiscal third quarter.

Cement, Concrete and Aggregates

Operating earnings from Cement for the first quarter were $20.5 million, an 8% increase from the same quarter a year ago. The earnings increase was driven by record first quarter cement sales volumes and a 5% increase in average net cement sales prices, partially offset by $5.2 million of costs associated with a shift to the first quarter of the annual maintenance outages at our Kansas City and Tulsa cement plants, which had last occurred in the fourth quarter of fiscal 2013. While underlying demand for our cement continues to recover, extraordinary rail congestion associated with the harsh winter weather adversely impacted the timing of cement shipments during the first quarter.

Cement revenues for the first quarter, including joint venture and intersegment revenues, totaled $127.9 million, 9% greater than the same quarter last year. Cement sales volumes for the quarter were 1.3 million tons, 4% higher than the same quarter a year ago. The average net sales price for this quarter was $90.66 per ton, 5% higher than the same quarter last year.


Concrete and Aggregates reported operating earnings of $1.4 million for the first quarter, a 34% improvement from the same quarter a year ago, reflecting improved concrete and aggregates pricing along with improved concrete sales volumes.

Gypsum Wallboard and Paperboard

Gypsum Wallboard and Paperboard reported first quarter operating earnings of $45.0 million, up 27% from the same quarter last year. Improved Gypsum Wallboard net sales prices and increased Gypsum Wallboard and Paperboard sales volumes were the primary drivers of the quarterly earnings increase.

Gypsum Wallboard and Paperboard revenues for the first quarter totaled $136.1 million, an 18% increase from the same quarter a year ago. The revenue increase reflects higher average Gypsum Wallboard net sales prices and higher Gypsum Wallboard and Paperboard sales volumes. The average Gypsum Wallboard net sales price this quarter was $161.74 per MSF, 11% greater than the same quarter a year ago. Gypsum Wallboard sales volume for the quarter of 569 million square feet (MMSF) represents a 7% increase from the same quarter last year. The average Paperboard net sales price this quarter was $509.62 per ton, 1% higher than the same quarter a year ago. Paperboard sales volumes for the quarter were 72,000 tons, 13% higher than the same quarter a year ago.

Oil and Gas Proppants

Oil and Gas Proppants reported first quarter revenues of $11.2 million and an operating loss of $0.6 million. During this year’s first quarter, we continued to process and sell purchased sand in Corpus Christi awaiting the opening of our mine in Illinois. With the receipt of the final permit necessary to start-up our mine, we expect to be able to sell our owned sand through our Corpus Christi facility no later than our fiscal third quarter, primarily into Eagle Ford shale-drilling applications.

Details of Financial Results

Beginning in our fiscal 2015, we have begun reporting our frac-sand business as a separately reportable segment — Oil and Gas Proppants. The results of this business were previously included in our Concrete and Aggregates segment during the initialization phase at start-up and have been reclassified to conform to the current year presentation.

We conduct one of our cement plant operations, Texas Lehigh Cement Company LP, through a 50/50 joint venture (the “Joint Venture”). We utilize the equity method of accounting for our 50% interest in the Joint Venture. For segment reporting purposes only, we proportionately consolidate our 50% share of the Joint Venture’s revenues and operating earnings, which is consistent with the way management organizes the segments within the Company for making operating decisions and assessing performance.

In addition, for segment reporting purposes, we report intersegment revenues as a part of a segment’s total revenues. Intersegment sales are eliminated on the income statement. Refer to Attachment 3 for a reconciliation of the amounts referred to above.

About Eagle Materials Inc.

Eagle Materials Inc. manufactures and distributes Cement, Gypsum Wallboard, Recycled Paperboard, Concrete and Aggregates, and Oil and Gas Proppants from 40 facilities across the US. Eagle is headquartered in Dallas, Texas.

 

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Eagle’s senior management will conduct a conference call to discuss the financial results, forward-looking information and other matters at 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on Wednesday, July 23, 2014. The conference call will be webcast simultaneously on the Eagle Web site http://www.eaglematerials.com. A replay of the webcast and the presentation will be archived on that site for one year. For more information, contact Eagle at (214) 432-2000.

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Forward-Looking Statements. This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the context of the statement and generally arise when the Company is discussing its beliefs, estimates or expectations. These statements are not historical facts or guarantees of future performance but instead represent only the Company’s belief at the time the statements were made regarding future events which are subject to certain risks, uncertainties and other factors many of which are outside the Company’s control. Actual results and outcomes may differ materially from what is expressed or forecast in such forward-looking statements. The principal risks and uncertainties that may affect the Company’s actual performance include the following: the cyclical and seasonal nature of the Company’s business; public infrastructure expenditures; adverse weather conditions; the fact that our products are commodities and that prices for our products are subject to material fluctuation due to market conditions and other factors beyond our control; availability of raw materials; changes in energy costs including, without limitation, natural gas, coal and oil; changes in the cost and availability of transportation; unexpected operational difficulties, including unexpected maintenance costs, equipment downtime and interruption of production; inability to timely execute announced capacity expansions; difficulties and delays in the development of new business lines; governmental regulation and changes in governmental and public policy (including, without limitation, climate change regulation);possible outcomes of pending or future litigation or arbitration proceedings; changes in economic conditions specific to any one or more of the Company’s markets; competition; announced increases in capacity in the gypsum wallboard and cement industries; changes in the demand for residential housing construction or commercial construction; general economic conditions; and interest rates. For example, increases in interest rates, decreases in demand for construction materials or increases in the cost of energy (including, without limitation, natural gas, coal and oil) could affect the revenues and operating earnings of our operations. In addition, changes in national or regional economic conditions and levels of infrastructure and construction spending could also adversely affect the Company’s result of operations. These and other factors are described in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2014. This report is filed with the Securities and Exchange Commission. All forward-looking statements made herein are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed herein will increase with the passage of time. The Company undertakes no duty to update any forward-looking statement to reflect future events or changes in the Company’s expectations.

Steven R. Rowley

President and Chief Executive Officer

D. Craig Kesler

Executive Vice President and Chief Financial Officer

Robert S. Stewart

Executive Vice President, Strategy, Corporate Development and Communications

 

Attachment 1    Statement of Consolidated Earnings
Attachment 2    Revenues and Earnings by Lines of Business (Quarter)
Attachment 3    Sales Volume, Net Sales Prices and Intersegment and Cement Revenues
Attachment 4    Consolidated Balance Sheets

 

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Eagle Materials Inc.

Attachment 1

Eagle Materials Inc.

Statement of Consolidated Earnings

(dollars in thousands, except per share data)

(unaudited)

 

     Quarter Ended
June 30,
 
     2014     2013  

Revenues

   $ 266,251      $ 227,044   

Cost of Goods Sold

     209,850        180,440   
  

 

 

   

 

 

 

Gross Profit

     56,401        46,604   

Equity in Earnings of Unconsolidated Joint Venture

     9,800        7,878   

Corporate General and Administrative Expenses

     (7,042     (5,594

Other, net

     679        583   
  

 

 

   

 

 

 

Earnings before Interest and Income Taxes

     59,838        49,471   

Interest Expense, net

     (4,052     (4,955
  

 

 

   

 

 

 

Earnings before Income Taxes

     55,786        44,516   

Income Tax Expense

     (18,076     (14,415
  

 

 

   

 

 

 

Net Earnings

   $ 37,710      $ 30,101   
  

 

 

   

 

 

 

NET EARNINGS PER SHARE

    

Basic

   $ 0.76      $ 0.61   
  

 

 

   

 

 

 

Diluted

   $ 0.75      $ 0.60   
  

 

 

   

 

 

 

AVERAGE SHARES OUTSTANDING

    

Basic

     49,501,847        48,955,724   
  

 

 

   

 

 

 

Diluted

     50,287,452        49,810,170   
  

 

 

   

 

 

 

 

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Eagle Materials Inc.

Attachment 2

Eagle Materials Inc.

Revenues and Segment Operating Earnings by Lines of Business

(dollars in thousands)

(unaudited)

 

     Quarter Ended
June 30,
 
     2014     2013  

Revenues*

    

Gypsum Wallboard and Paperboard:

    

Gypsum Wallboard

   $ 112,677      $ 95,981   

Gypsum Paperboard

     23,463        18,951   
  

 

 

   

 

 

 
     136,140        114,932   

Cement (Wholly Owned)

     92,998        87,304   

Oil and Gas Proppants

     11,180        942   

Concrete and Aggregates

     25,933        23,866   
  

 

 

   

 

 

 

Total

   $ 266,251      $ 227,044   
  

 

 

   

 

 

 

Segment Operating Earnings

    

Gypsum Wallboard and Paperboard:

    

Gypsum Wallboard

   $ 37,428      $ 29,636   

Gypsum Paperboard

     7,547        5,679   
  

 

 

   

 

 

 
     44,975        35,315   

Cement:

    

Wholly Owned

     10,707        11,132   

Joint Venture

     9,800        7,878   
  

 

 

   

 

 

 
     20,507        19,010   

Oil and Gas Proppants

     (637     (855

Concrete and Aggregates

     1,356        1,012   

Other, net

     679        583   
  

 

 

   

 

 

 

Sub-total

   $ 66,880      $ 55,065   

Corporate General and Administrative Expense

     (7,042     (5,594
  

 

 

   

 

 

 

Earnings before Interest and Income Taxes

   $ 59,838      $ 49,471   
  

 

 

   

 

 

 

 

* Net of Intersegment and Joint Venture Revenues listed on Attachment 3.

 

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Eagle Materials Inc.

Attachment 3

Eagle Materials Inc.

Sales Volume, Net Sales Prices and Intersegment and Cement Revenues

(unaudited)

 

     Sales Volume  
     Quarter Ended
June 30,
 
     2014      2013      Change  

Gypsum Wallboard (MMSF’s)

     569         532         +7

Paperboard (M Tons):

        

Internal

     27         26         +4

External

     45         38         +18
  

 

 

    

 

 

    
     72         64         +13

Cement (M Tons):

        

Wholly Owned

     1,007         979         +3

Joint Venture

     284         262         +8
  

 

 

    

 

 

    
     1,291         1,241         +4

Concrete (M Cubic Yards)

     235         227         +4

Aggregates * (M Tons)

     818         902         -9

 

* Aggregates sales volumes excludes sales of frac sand

 

     Average Net Sales Price *  
     Quarter Ended
June 30,
 
     2014      2013      Change  

Gypsum Wallboard (MSF)

   $ 161.74       $ 146.30         +11

Paperboard (Ton)

   $ 509.62       $ 502.42         +1

Cement (Ton)

   $ 90.66       $ 86.15         +5

Concrete (Cubic Yard)

   $ 84.50       $ 78.97         +7

Aggregates ** (Ton)

   $ 7.40       $ 6.88         +8

 

* Net of freight and delivery costs billed to customers.
** Aggregates net sales price is presented for traditional construction aggregates only, excluding sales of frac sand

 

     Intersegment and Cement Revenues
($ in thousands)
 
     Quarter Ended
June 30,
 
     2014      2013  

Intersegment Revenues:

     

Cement

   $ 2,360       $ 1,992   

Paperboard

     14,016         13,212   

Concrete and Aggregates

     229         398   
  

 

 

    

 

 

 
   $ 16,605       $ 15,602   
  

 

 

    

 

 

 

Cement Revenues:

     

Wholly Owned

   $ 92,998       $ 87,304   

Joint Venture

     32,578         28,404   
  

 

 

    

 

 

 
   $ 125,576       $ 115,708   
  

 

 

    

 

 

 

 

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Eagle Materials Inc.

Attachment 4

Eagle Materials Inc.

Consolidated Balance Sheets

(dollars in thousands)

(unaudited)

 

     June 30,     March 31,  
     2014     2013     2014*  

ASSETS

      

Current Assets –

      

Cash and Cash Equivalents

   $ 6,541      $ 6,744      $ 6,482   

Accounts and Notes Receivable, net

     134,108        117,834        102,917   

Inventories

     182,470        164,197        187,096   

Federal Income Tax Receivable

     —          —          —     

Prepaid and Other Assets

     8,290        9,606        10,465   
  

 

 

   

 

 

   

 

 

 

Total Current Assets

     331,409        298,381        306,960   
  

 

 

   

 

 

   

 

 

 

Property, Plant and Equipment –

     1,682,543        1,620,208        1,660,975   

Less: Accumulated Depreciation

     (691,946     (630,317     (676,924
  

 

 

   

 

 

   

 

 

 

Property, Plant and Equipment, net

     990,597        989,891        984,051   

Investments in Joint Venture

     44,434        41,074        43,008   

Notes Receivable

     3,197        3,843        3,063   

Goodwill and Intangibles

     160,262        161,916        160,690   

Other Assets

     14,468        20,278        13,757   
  

 

 

   

 

 

   

 

 

 
   $ 1,544,367      $ 1,515,217      $ 1,511,529   
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

      

Current Liabilities –

      

Accounts Payable

   $ 57,803      $ 54,983      $ 57,098   

Accrued Liabilities

     34,894        36,320        42,222   

Federal Income Tax Payable

     19,956        10,904        —     

Current Portion of Long-term Debt

     9,500        —          9,500   
  

 

 

   

 

 

   

 

 

 

Total Current Liabilities

     122,153        102,207        108,820   
  

 

 

   

 

 

   

 

 

 

Long-term Liabilities

     53,177        52,079        53,678   

Bank Credit Facility

     176,000        305,000        189,000   

Senior Notes

     182,759        192,259        182,759   

Deferred Income Taxes

     142,094        138,220        145,773   

Stockholders’ Equity –

      

Preferred Stock, Par Value $0.01; Authorized 5,000,000 Shares; None Issued

     —          —          —     

Common Stock, Par Value $0.01; Authorized 100,000,000 Shares; Issued and Outstanding 50,153,937; 49,552,819 and 50,053,738 Shares, respectively.

     502        496        501   

Capital in Excess of Par Value

     257,407        228,034        253,524   

Accumulated Other Comprehensive Losses

     (5,377     (6,887     (5,483

Retained Earnings

     615,652        503,809        582,957   
  

 

 

   

 

 

   

 

 

 

Total Stockholders’ Equity

     868,184        725,452        831,499   
  

 

 

   

 

 

   

 

 

 
   $ 1,544,367      $ 1,515,217      $ 1,511,529   
  

 

 

   

 

 

   

 

 

 

 

* From audited financial statements.

 

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