Vulcan Materials Announces Debt Reduction, Asset Sales And Strategic
Transactions Enhance Company's Leading Aggregates Portfolio and Liquidity
BIRMINGHAM, Ala., Jan. 17, 2013
BIRMINGHAM, Ala., Jan. 17, 2013 /PRNewswire/ --Vulcan Materials Company
(NYSE:VMC) today announced that it has completed asset sale transactions which
generated total gross proceeds of approximately $149 million. These
transactions include the sale of reclaimed and excess land in California, one
small quarry in rural Virginia, and a percentage of future production at four
aggregates quarries in South Carolina. The South Carolina transaction is with
Plum Creek Timber Company, Inc. (NYSE: PCL), one of the largest landowners in
the U.S. and a leading manager of timberlands and other natural resources, and
enables Vulcan to unlock long-term value in these quarries tax-efficiently,
while maintaining full ownership as well as operational and marketing control.
With this transaction, Vulcan received $75 million in exchange for an
estimated 10.5% royalty interest in the sale of approximately 144 million tons
of production over 25 years.
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Pre-tax gains on these transactions total approximately $120 million, $47
million of which will be recognized in the fourth quarter of 2012 with the
remainder to be recognized over the life of the transaction with Plum Creek.
Consistent with its long-term strategy of enhancing aggregates reserves
positions in the fastest-growing regions and urban markets of the U.S., Vulcan
will further strengthen its aggregates businesses in Texas and Georgia with
the acquisition of two active quarries and additional reserves adjacent to two
existing quarries for a total investment of approximately $80 million. Total
reserves related to these investments are approximately 91 million tons.
In the fourth quarter the Company retired $135 million of debt as scheduled.
As of December 31, 2012, the Company's cash and cash equivalents, net of the
above transactions, was in excess of $200 million.
Donald M. James, Chairman and Chief Executive Officer of Vulcan Materials,
said, "These transactions mark important progress on Vulcan's planned asset
sales, debt reduction, and strategic investment programs to strengthen our
balance sheet and our aggregates asset portfolio, which already delivers among
the highest profit margins in our industry. Our management team will continue
its focus on selling non-core assets, reducing debt and building our
aggregates positions in key markets."
About Vulcan Materials Company
Vulcan Materials Company, a member of the S&P 500 index, is the nation's
largest producer of construction aggregates, a major producer of asphalt mix
and concrete and a leading producer of cement in Florida.
Forward-Looking Statement Disclaimer
This document contains forward-looking statements. Statements that are not
historical fact, including statements about Vulcan's beliefs and expectations,
are forward-looking statements. Generally, these statements relate to future
financial performance, results of operations, business plans or strategies,
projected or anticipated revenues, expenses, earnings (including EBITDA and
other measures), dividend policy, shipment volumes, pricing, levels of capital
expenditures, intended cost reductions and cost savings, anticipated profit
improvements and/or planned divestitures and asset sales. These
forward-looking statements are sometimes identified by the use of terms and
phrases such as "believe," "should," "would," "expect," "project," "estimate,"
"anticipate," "intend," "plan," "will," "can," "may" or similar expressions
elsewhere in this document. These statements are subject to numerous risks,
uncertainties, and assumptions, including but not limited to general business
conditions, competitive factors, pricing, energy costs, and other risks and
uncertainties discussed in the reports Vulcan periodically files with the SEC.
Forward-looking statements are not guarantees of future performance and actual
results, developments, and business decisions may vary significantly from
those expressed in or implied by the forward-looking statements. The
following risks related to Vulcan's business, among others, could cause actual
results to differ materially from those described in the forward-looking
statements: risks that Vulcan's intentions, plans and results with respect to
cost reductions, profit enhancements and asset sales, as well as streamlining
and other strategic actions adopted by Vulcan, will not be able to be realized
to the desired degree or within the desired time period and that the results
thereof will differ from those anticipated or desired; uncertainties as to the
timing and valuations that may be realized or attainable with respect to
intended asset sales; those associated with general economic and business
conditions; the timing and amount of federal, state and local funding for
infrastructure; the impact of a prolonged economic recession on Vulcan's
industry, business and financial condition and access to capital markets;
changes in the level of spending for private residential and nonresidential
construction; the highly competitive nature of the construction materials
industry; the impact of future regulatory or legislative actions; the outcome
of pending legal proceedings; pricing of Vulcan's products; weather and other
natural phenomena; energy costs; costs of hydrocarbon-based raw materials;
healthcare costs; the amount of long-term debt and interest expense incurred
by Vulcan; changes in interest rates; the impact of Vulcan's below investment
grade debt rating on Vulcan's cost of capital; volatility in pension plan
asset values which may require cash contributions to the pension plans; the
impact of environmental clean-up costs and other liabilities relating to
previously divested businesses; Vulcan's ability to secure and permit
aggregates reserves in strategically located areas; Vulcan's ability to manage
and successfully integrate acquisitions; the potential of goodwill impairment;
the potential impact of future legislation or regulations relating to climate
change or greenhouse gas emissions or the definition of minerals; and other
assumptions, risks and uncertainties detailed from time to time in the reports
filed by Vulcan with the SEC. All forward-looking statements in this
communication are qualified in their entirety by this cautionary statement.
Vulcan disclaims and does not undertake any obligation to update or revise
any forward-looking statement in this document except as required by law.
SOURCE Vulcan Materials Company
Contact: Investors, Mark Warren, +1-205-298-3220; or Media, David Donaldson,
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