Friday, July 28, 2006

Hot report from Florida

Florida Rock Industries, Inc. weighed in with third quarter results, announcing record net income of $58,317,000, or $.87 per diluted share, for its fiscal 2006 third quarter, a 27% increase over the same quarter last year. Consolidated total sales for the quarter rose 15% to $360,993,000 from $313,499,000 in the same quarter last year. Improved pricing in all segments contributed to a 19% increase in gross profit, which rose to $121,405,000 compared to $102,116,000 in the same quarter last year. Product volumes increased 6% in the aggregates segment versus the third quarter of 2005. Concrete yardage rose 1.4% in the quarter while block volumes remained virtually level. Cement volume declined 9.5% from last year's third quarter. Commenting on the third quarter results, President and CEO John Baker stated: "Product demand in the third quarter continued at strong levels as non-residential demand grew and residential demand showed a slight decline. Price increases taking effect July 1 should help improve margins in aggregates and cement and help sustain margins in concrete." Your comment?

Thursday, July 27, 2006

The plane truth

It could have been a lot worse. A small plane burst into flames after crashing in the parking lot of an Aggregate Industries plant in Mason, Michigan. Aggregate Industries is right next to the airport's runways, so employees say they're used to hearing planes taking off and landing, but Wednesday, the noise was different. Fortunately, no one was killed, and Aggregates Industries' employees are credited with helping the victims and calling 911. Your comment?

Wednesday, July 26, 2006

Eagle eyes growth

Eagle has its eye on increased profits. Eagle Materials Inc. reported financial results for the first quarter of fiscal 2007 ended June 30, 2006 and issued guidance for the second quarter of its fiscal year 2007. Eagle produces and distributes Gypsum Wallboard, Cement, Recycled Paperboard and Concrete and Aggregates. For the quarter ended June 30, 2006, revenues and net earnings were $260 million and $59 million, respectively. Revenues increased 27% over the prior year first quarter and net earnings increased 69% over the same period last year.Revenues from Concrete and Aggregates were $24 million for this year's first quarter, 5% greater than the $23 million for the first quarter a year ago. Concrete and Aggregates reported a $4 million operating profit for this year's first quarter, up 9% from the same quarter last year, due to increased net sales prices at both of its operations. Its Aggregates segment reported sales volume of 1.3 million tons for the current quarter, 17% less than the 1.6 million tons reported in the first quarter last year. Its Aggregates quarterly average net sales price was a record high $6.57 per ton during the first quarter and was 15% above last year's first quarter Aggregates average net sales price. Your comment?

Tuesday, July 25, 2006

Pay roads

I had the following response to my post on selling roads to private companies.

"I found your post quite interesting. We've had similar things happen here in Canada. The one that immediately jumps to mind is Highway 407, a toll road that runs along the northern part of the Greater Toronto Area. While its great b/c the road is usually less busy than the free Highway 401 further to the south (and is in much, much better shape), the toll is ridiculous. For light vehicles, its 16.25 cents/km during peak times, and 15.50 cents/km during off-peak. For heavy trucks, the rate jumps to 32.50 cents/km (peak) and 31.00 cents/km (off peak). The road is managed through a 99-year lease with a couple of the companies mentioned in the article you linked to, Cintra and Macquarie, along with SNC-Lavalin. The consortium has the power to raise tolls whenever they want, by however much they want, with no say from the government. And they've got the power to deny you new or renewed plates if you don't pay the tolls, since the tolls are billed monthly. Its a pretty slick system, to be sure, but their customer service is horrible.I found your post quite interesting. We've had similar things happen here in Canada. The one that immediately jumps to mind is Highway 407, a toll road that runs along the northern part of the Greater Toronto Area. While its great b/c the road is usually less busy than the free Highway 401 further to the south (and is in much, much better shape), the toll is ridiculous. For light vehicles, its 16.25 cents/km during peak times, and 15.50 cents/km during off-peak. For heavy trucks, the rate jumps to 32.50 cents/km (peak) and 31.00 cents/km (off peak). The road is managed through a 99-year lease with a couple of the companies mentioned in the article you linked to, Cintra and Macquarie, along with SNC-Lavalin. The consortium has the power to raise tolls whenever they want, by however much they want, with no say from the government. And they've got the power to deny you new or renewed plates if you don't pay the tolls, since the tolls are billed monthly. Its a pretty slick system, to be sure, but their customer service is horrible."


Thanks,

Sean Kautzman
Land Manager - North & East Ontario
Aggregates, Concrete & Asphalt
Lafarge Canada Inc.

Monday, July 24, 2006

Lafarge turns 50

Lafarge North America turns 50 this week, and happy birthday wishes are in line. When Lafarge first built its flagship cement plant in the city of Richmond, British Columbia in 1956, it was an incredibly ambitious maneuver for the company. Lafarge, with more than a century of experience in the cement industry, was able to adapt to an entirely different environment and business culture. Within two decades, Lafarge established itself as the leader in the Canadian cement industry and continued to span its operations across the continent. Through a series of mergers and acquisitions, the company expanded into the United States and became a publicly traded U.S. company in 1983. Today, Lafarge employs more than 16,000 people at approximately 1,000 operational sites throughout North America. Your comment?

Friday, July 21, 2006

Divesting roads and bridges

Roads and bridges built by U.S. taxpayers are starting to be sold off, and so far foreign-owned companies are doing the buying. On a single day in June, an Australian-Spanish partnership paid $3.8 billion to lease the Indiana Toll Road. An Australian company bought a 99-year lease on Virginia's Pocahontas Parkway, and Texas officials decided to let a Spanish-American partnership build and run a toll road from Austin to Seguin for 50 years. The link to the full article is here. I would like to hear what our industry thinks about this. Your comment?

Thursday, July 20, 2006

Carmel confusion

If only Clint Eastwood was still the mayor. Martin Marietta Materials has filed a federal lawsuit accusing city of Carmel Mayor James Brainard of playing politics to stop the company from expanding its sand and gravel mine.. The company also is asking for appointment of a new and independent Board of Zoning Appeals to give its mine permit an impartial review. Martin Marietta wants a federal judge to prohibit the mayor from participating, directing or influencing future BZA review of company permit applications. An injunction also is sought to force the current BZA members to withdraw from Martin Marietta's case. Now that would make my day. Oh, wait a minute. Clint Eastwood was mayor of Carmel, Calif. This is Carmel, Ind. Never mind.Your comment?

Wednesday, July 19, 2006

Saving highway lives

While the aggregate industry's products contribute to smooth roads, which translates into highway safety, there are other safety efforts afoot along our highways. For instance, a relatively low-cost safety device — steel cable strung in highway medians — is proving phenomenally effective at saving lives, perhaps more so than steel-beam or concrete barriers, according to an article in USA Today.. Steel-beam, concrete and cable barriers all cut down on accidents in which cars cross over into oncoming traffic. Cable, however, also cuts down on the number of rebound accidents, in which a vehicle hits a barrier and bounces back into traffic. Interesting.

Tuesday, July 18, 2006

Water Act applauded

Water, water everywhere and not a drop to drink. Senate passage of the $12 billion reauthorization of Water Resources Development Act (WRDA) will authorize funding for major navigation, flood control and environmental restoration projects carried out by the U.S. Army Corps of Engineers (USACE). "This critical legislation will facilitate trade and commerce, and foster economic development," said Associated general Contractors CEO Stephen E. Sandherr. "We urge the House and Senate to work together to finalize this important bill to increase investment in our nation's waterways infrastructure." Your comment?

Monday, July 17, 2006

TXI looking good

Texas Industries Inc. is reporting net income from continuing operations of $41.9 million ($1.58 per share) for the quarter ended May 31, 2006. Net income from continuing operations for the same period last year was $26.7 million ($1.09 per share). "The recent quarter's earnings represented record quarterly performance for TXI's cement, aggregate and concrete operations," says Mel Brekhus, Chief Executive Officer. "Looking forward, the modernization and expansion of our California cement plant remains on time and on budget. The new plant should come online in late fall or early winter of 2007 and add one million tons of annual cement capacity. The California project, in combination with expansion opportunities at our Texas plants, should increase TXI's total annual cement production capacity from today's 5 million ton level to 7.5 million tons over the next four to five years." Your comment?

Friday, July 14, 2006

Weird geology

Not far from where General Washington made his famous crossing of the Delaware lies a strange place. Within a forest sits an open field, strewn with boulders and rocks of various shapes and sizes. The area seems devoid of any vegetation, save the lichens growing on the rocks. While such an area within the confines of Pennsylvania's forested Bucks County seems unusual in and of itself, it is a property of the rocks themselves that make the location so strange. They ring. Check out the story here. Your comment?

Thursday, July 13, 2006

Dodge Diesel

It isn't often that a major automaker gets involved with the mining industry. But Dodge will utilize a Cummins Inc. 175-hp low-emissions Turbo Diesel engine in its Dodge Ram trucks used for underground mining applications. The Cummins-powered Dodge Ram is reportedly the only pickup truck produced in North America with an MSHA-approved engine for both coal and metal/non-metal mining. By offering a major reduction in emissions, the 5.9-liter Cummins Turbo Diesel will enable mine operators to reduce their annual expenditure on mine ventilation by $16,000 to $18,000 per year for each Dodge Ram vehicle in their fleet, according to the company. Now, I wonder what kind of gas mileage those puppies get. Your comment?

Wednesday, July 12, 2006

Going deeper into digital

Our digital media initiative continues. Pit & Quarry is pleased to announce our first interactive media event, a live webcast entitled "The MINER Act: Critical Compliance Issues for Quarry Operators." The seminar will cover the new safety and health law enacted by Congress, and will include Q&A. I will host the webcast, which will be presented by Pit & Quarry legal editor Michael T. Heenan, along with his colleagues Bill Doran and Margo Lopez of the law firm of Ogletree, Deakins, Nash, Smoak and Stewart. This event will take place August 23 at 2:00 P.M. EST. To pre-register for this event, click here. Your comment?

Tuesday, July 11, 2006

Beer and bricks

For anyone who is interested in beer and bricks, this story is a fascinating one. In the 1950s, Alfred Heineken had a square beer bottle designed which could stack, to be used as bricks in developing countries. The bottle/bricks provided good insulation, and excellent reuse of materials. A unique feature was that the short bottle neck would fit into a depression in the bottom of each bottle. Unfortunately the "World Beer" project didn't take off. Ultimately, the idea was either (according to different accounts) voted down by the Heineken board, or vetoed by the bottle companies and the customers. Now that was an opportunity lost! Your comment?

Monday, July 10, 2006

Market factors

Speaking of higher asphalt prices, economist Ken Simonson throws this little zinger into the latest release about construction employment issued by AGC: "Highway construction is also vulnerable," says Simonson. "Asphalt prices have risen 48 percent in the past 12 months, with spot shortages reported. Ready-mixed concrete and diesel fuel prices also are up sharply, so highway budgets don't cover as much paving as before. At the same time, a cutback in driving due to high gasoline prices means motorists are buying fewer gallons of gas, which reduces the revenues flowing into state highway trust funds." All told, this confluence of market negatives can be seen as a possible challenge to prosperity for producers. Your comment?

Friday, July 07, 2006

Asphalt shortages

I see a pattern here. Three separate news stories, same issue: 1) In Illinois, Rising asphalt prices also forced the county to drop one of two scheduled intersection improvement projects this year. 2) The escalating costs of asphalt because of shortages means the Utah Department of Transportation will scale back on plans for routine road fixes this summer, according to Jim McMinimee, the agency's director of project development. And 3) from Canada, transportation officials say they've been forced to cancel some road repairs in Nova Scotia this summer because of the rising price of asphalt. I see trouble "up the road." Your comment?

Thursday, July 06, 2006

I'm a highway star

As the old Deep Purple song from the 1970s goes, "I'm a highway star." Well, Highway spending was a shining star in May, according to the latest Census Bureau report. "Construction spending dropped in May for the second straight month but there are plenty of bright spots amidst the gloom," says Ken Simonson, Chief Economist for The Associated General Contractors of America. Simonson was commenting on a July 3 report from the Census Bureau that showed the value of construction put in place fell at a seasonally adjusted annual rate of 0.4 percent in May, following a dip of 0.2 percent in April. "Private residential construction dropped 0.8 percent and private nonresidential spending fell 0.3 percent for the month, more than offsetting a rise of 0.7 percent in public construction," Simonson observed."But nonresidential construction remained much stronger than a year ago. Private nonresidential construction was down slightly from April to May but up 13 percent compared to May 2005. Every category was in the plus column year-to-date. " Highway and street rose 0.1 percent for the month. Year-to-date highway spending was up 15 percent, boosted by exceptionally mild weather in the winter and early spring of 2006 and by steep increases in asphalt, diesel fuel, and concrete prices. Your comment?

Wednesday, July 05, 2006

Fatality #15

Details have now been released about Fatality #15, which happened on June 21 in Washington. A 75-year-old contractor electrician, with 50 years experience, was fatally injured at a sand and gravel operation. The victim contacted energized conductors while installing an electrical circuit. The building subsequently caught fire and burned before the primary circuit could be deenergized.
Your comment?

Monday, July 03, 2006

Happy Holiday

The P&Q Editor's Blog is on vacation today and tomorrow. Happy July 4th