TXI Reports Third Quarter Results

TXI Reports Third Quarter Results

DALLAS, March 27, 2013 (GLOBE NEWSWIRE) -- Texas Industries, Inc. (NYSE:TXI)
today reported financial results for the quarter ended February 28, 2013.
Results for the quarter were a net loss of $5.8 million or $.21 per share.
Results for the quarter ended February 28, 2012 were a net loss of $24.3
million or $.87 per share.

General Comments

"Construction activity in Texas and California continued to improve this
quarter," stated Mel Brekhus, Chief Executive Officer. "Gross profit increased
$14.2 million on increased sales of $19.5 million. This increase in
profitability primarily reflects the benefits of increased shipments in
reducing unit costs, and success in increasing efficiencies throughout the
Company."

"The commissioning of the second kiln at our central Texas plant is on target
to be completed this spring. This additional 1.4 million tons of cement
capacity, in combination with the East Texas ready mix assets we acquired last
week, places TXI in a strong position to benefit from the recovery in
construction that is underway," added Brekhus.

A teleconference will be held tomorrow, March 28, 2013 at 10:00 Central
Daylight Time to further discuss quarter results. A real-time webcast of the
conference is available by logging on to TXI's website at www.txi.com.

The following is a summary of operating results for our business segments and
certain other operating information related to our principal products.

Cement Operations

                          Three months ended        Nine months ended
In thousands except per    February 28, February 29, February 28, February 29,
unit                       2013         2012         2013         2012
Operating Results                                              
Cement sales               $73,086    $57,830    $242,983   $202,802
Other sales and delivery   7,480        7,641        26,230       25,540
fees
Total segment sales        80,566       65,471       269,213      228,342
Cost of products sold      68,501       63,359       237,326      219,641
Gross profit               12,065       2,112        31,887       8,701
Selling, general and       (3,247)      (4,663)      (10,520)     (12,906)
administrative
Restructuring charges      —            —            —            (1,074)
Other income               1,031        167          2,961        4,057
Operating Profits (Loss)   $9,849     $(2,384)   $24,328    $(1,222)
Cement                                                         
Shipments (tons)           933          743          3,086        2,596
Prices ($/ton)             $78.39     $77.76     $78.75     $78.11
Cost of sales ($/ton)      $64.35     $75.95     $68.62     $75.20

Three months ended February 28, 2013

Cement operating profit (loss) for the three-month periods ended February 28,
2013 and February 29, 2012 was $9.8 million and $(2.4) million, respectively.

Total segment sales for the three-month period ended February 28, 2013 were
$80.6 million compared to $65.5 million for the prior year period. Cement
sales increased $15.1 million from the prior year period. Our Texas market
area accounted for approximately 71% of cement sales in the current period
compared to 69% of cement sales in the prior year period. Average cement
prices increased 2% in our Texas market from the prior year period. Average
cement prices decreased 3% due to a change in product mix in our California
market from the prior year period. Shipments increased 27% in our Texas market
area and 22% in our California market area.

Cost of products sold for the three-month period ended February 28, 2013
increased $5.1 million from the prior year period primarily due to higher
shipments. Cement unit cost of sales decreased 15% from prior year period
primarily due to higher shipments offset slightly by higher fuel and power
costs.

Selling, general and administrative expense for the three-month period ended
February 28, 2013 decreased $1.4 million from the prior year period primarily
due to our work force reduction initiatives.

Other income for the three-month period ended February 28, 2013 increased $0.9
million from the prior year period primarily due to higher royalties.

Aggregates Operations

                          Three months ended        Nine months ended
In thousands except per    February 28, February 29, February 28, February 29,
unit                       2013         2012         2013         2012
Operating Results                                              
Stone, sand and gravel     $22,021    $16,829    $77,911    $60,022
sales
Delivery fees              8,799        5,787        34,101       21,758
Total segment sales        30,820       22,616       112,012      81,780
Cost of products sold      28,106       23,825       100,294      76,203
Gross profit               2,714        (1,209)      11,718       5,577
Selling, general and       (900)        (1,341)      (2,763)      (4,441)
administrative
Restructuring charges      —            —            —            (374)
Other income               295          1,259        674          1,732
Operating Profit (Loss)    $2,109     $(1,291)   $9,629     $2,494
Stone, sand and gravel                                         
Shipments (tons)           3,029        2,363        10,751       8,324
Prices ($/ton)             $7.27      $7.12      $7.25      $7.21
Cost of sales ($/ton)      $6.46      $7.47      $6.12      $6.62

Previously, the aggregates segment included our expanded shale and clay
lightweight aggregates operations which has been classified as discontinued
operations in the current period and all prior periods.Therefore, amounts for
these operations are not included in the information presented.

On March 22, 2013, our subsidiaries exchanged their expanded shale and clay
lightweight aggregates manufacturing business for the ready-mix concrete
business of subsidiaries of Trinity Industries, Inc. in east Texas and
southwest Arkansas. Pursuant to the agreements, we transferred our expanded
shale and clay manufacturing facilities in Streetman, Texas; Boulder, Colorado
and Frazier Park, California; and our DiamondPro® product line in exchange for
42 ready-mix concrete plants stretching from Texarkana to Beaumont in east
Texas and in southwestern Arkansas, two aggregate distribution facilities in
Beaumont and Port Arthur, Texas, and related assets.We anticipate recognizing
a gain on the transaction, the amount of which is still being finalized and
will be included in the results for our discontinued operations in our fourth
quarter 2013.

Three months ended February 28, 2013

Aggregates operating profit for the three-month period ended February 28, 2013
was $2.1 million and operating loss for the three-month period ended February
29, 2012 was $(1.3) million.

Total segment sales for the three-month period ended were $30.8 million
compared to $22.6 million for the prior year period. Stone, sand and gravel
sales increased $8.2 million from the prior year period on 28% higher
shipments.

Cost of products sold for the three-month period ended February 28, 2013
increased $4.3 million from the prior year period primarily due to increased
stone, sand and gravel shipments. Stone, sand and gravel unit costs decreased
14% from the prior year period primarily due to the effect of higher shipments
on unit costs.

Selling, general and administrative expense for the three-month period ended
February 28, 2013 decreased $0.4 million from the prior year period primarily
due to our work force reduction initiatives.

Consumer Products Operations

                          Three months ended        Nine months ended
In thousands except per    February 28, February 29, February 28, February 29,
unit                       2013         2012         2013         2012
Operating Results                                              
Ready-mix concrete sales   $44,582    $37,481    $149,276   $138,288
Package products sales and 46           12,398       274          40,736
delivery fees
Total segment sales        44,628       49,879       149,550      179,024
Cost of products sold      47,081       52,663       153,877      183,072
Gross loss                 (2,453)      (2,784)      (4,327)      (4,048)
Selling, general and       (2,475)      (1,297)      (7,239)      (8,107)
administrative
Restructuring charges      —            —            —            (536)
Other income               666          (177)        2,789        2,487
Operating Loss             $(4,262)   $(4,258)   $(8,777)   $(10,204)
Ready-mix concrete                                             
Shipments (cubic yards)    541          508          1,833        1,836
Prices ($/cubic yard)      $82.49     $73.80     $81.46     $75.31
Cost of sales ($/cubic     $87.04     $81.87     $83.88     $80.29
yard)

Three months ended February 28, 2013

Consumer products operating loss for the three-month periods ended February
28, 2013 and February 29, 2012 was $(4.3) million and $(4.3) million,
respectively.

Total segment sales for the three-month period ended February 28, 2013 were
$44.6 million compared to $49.9 million for the prior year period. Segment
sales decreased $5.3 million from the prior year period due to the sale of our
Texas-based package products operations. Ready-mix concrete sales from ongoing
operations increased $7.1 million from the prior year period on 6% higher
shipments and 12% higher average prices.

Cost of products sold for the three-month period ended February 28, 2013
decreased $5.6 million from the prior year period primarily due to the sale of
our package products operations. Ready-mix concrete unit costs increased 6%
from the prior year period on higher maintenance, diesel and material costs.

Selling, general and administrative expense for the three-month period ended
February 28, 2013 increased $1.2 million from the prior year period due to
insurance costs related to a prior event.

Other income for the three-month period ended February 28, 2013 increased $0.8
million from the prior year period primarily due to earnings from joint
venture of $0.5 million.

Corporate

                          Three months ended        Nine months ended
In thousands               February 28, February 29, February 28, February 29,
                           2013         2012         2013         2012
Other income               $98        $84        $190       $450
Selling, general and       (10,437)     (9,964)      (31,157)     (21,319)
administrative
Restructuring charges      —            —            —            (1,169)
                          $(10,339)  $(9,880)   $(30,967)  $(22,038)

Three months ended February 28, 2013

Other income for the three-month period ended February 28, 2013 remains
relatively unchanged from prior year period on flat oil and gas royalty
payments.

Selling, general and administrative expense for the three-month period ended
February 28, 2013 increased $0.5 million from the prior year period.

Interest

Interest expense incurred for the three-month period ended February 28, 2013
was $17.4 million, of which $10.2 million was capitalized in connection with
our Hunter, Texas cement plant expansion project and $7.2 million was
expensed. Interest expense incurred for the three-month period ended February
29, 2012 was $17.0 million, of which $8.5 million was capitalized in
connection with our Hunter, Texas cement plant expansion project and $8.5
million was expensed.

Income Taxes

Income taxes for the interim periods ended February 28, 2013 and February 29,
2012 have been included in the accompanying financial statements on the basis
of an estimated annual rate. The tax rate differs from the 35% federal
statutory corporate rate primarily due to percentage depletion that is tax
deductible, state income taxes and valuation allowances against deferred tax
assets.The estimated annualized rate for continuing operations is 7.9% for
fiscal year 2013 compared to 2.5% for fiscal year 2012. We made no income tax
payments and received no refunds in the nine-month period ended February 28,
2013.We made income tax payments of $0.1 million, and received income tax
refunds of less than $0.1 million in the nine-month period ended February 29,
2012.

Net deferred tax assets totaled $12.4 million at February 28, 2013 and $13.7
million at May31, 2012, of which $9.7 million at February 28, 2013 and $10.7
million at May31, 2012 were classified as current. Management reviews our
deferred tax position and in particular our deferred tax assets whenever
circumstances indicate that the assets may not be realized in the future and
records a valuation allowance unless such deferred tax assets are deemed more
likely than not to be recoverable. The ultimate realization of these deferred
tax assets depends upon various factors including the generation of taxable
income during future periods. The Company's deferred tax assets exceeded
deferred tax liabilities as of February 28, 2013 and May31, 2012 primarily as
a result of recent losses. Management has concluded that the sources of
taxable income we are permitted to consider do not assure the realization of
the entire amount of our net deferred tax assets. Accordingly, a valuation
allowance is required due to the uncertainty of realizing the deferred tax
assets. We recorded a valuation allowance of $5.2 million in fiscal year 2012
through a charge to other comprehensive loss given the increase in actuarial
losses in our retirement plans in 2012. We will continue to record additional
valuation allowance against additions to our net deferred tax assets for
fiscal year 2013 until Management believes it is more likely than not the
deferred tax assets will be realized

Certain statements contained in this quarterly report are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. All statements other than statements of historical fact are
forward-looking statements. Forward-looking statements may include the words
"may," "will," "estimate," "intend," "continue," "believe," "expect," "plan,"
"anticipate," and other similar words. Such statements are subject to risks,
uncertainties and other factors, which could cause actual results to differ
materially from future results expressed or implied by such forward-looking
statements. Potential risks and uncertainties include, but are not limited to,
the impact of competitive pressures and changing economic and financial
conditions on our business, the cyclical and seasonal nature of our business,
the level of construction activity in our markets, abnormal periods of
inclement weather, unexpected periods of equipment downtime, unexpected
operational difficulties, changes in the cost of raw materials, fuel and
energy, changes in cost or availability of transportation, changes in interest
rates, the timing and amount of federal, state and local funding for
infrastructure, delays in announced capacity expansions, ongoing volatility
and uncertainty in the capital or credit markets, the impact of environmental
laws, regulations and claims, changes in governmental and public policy, and
the risks and uncertainties described in our reports on Forms 10-K, 10-Q and
8-K. Forward-looking statements speak only as of the date hereof, and we
assume no obligation to publicly update such statements.

TXI is the largest producer of cement in Texas and a major cement producer in
California. TXI is also a major supplier of construction aggregate, ready-mix
concrete and concrete products.

(Unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
                                                              
                            Three months ended      Nine months ended
In thousands except per      February   February 29, February 28, February 29,
share                        28,        2012         2013         2012
                             2013
NET SALES                    $141,359 $121,894   $483,575   $435,696
Cost of products sold        129,035    123,774      444,297      425,464
GROSS PROFIT                 12,324     (1,880)      39,278       10,232
Selling, general and         17,056     17,265       51,679       46,774
administrative
Restructuring charges        —          —            —            3,153
Interest                     7,227      8,512        22,462       26,810
Other income                 (2,091)    (1,332)      (6,614)      (8,725)
                            22,192     24,445       67,527       68,012
LOSS BEFORE INCOME TAXES     (9,868)    (26,325)     (28,249)     (57,780)
FROM CONTINUING OPERATIONS
Income taxes (benefit)       (1,355)    (1,148)      (2,151)      (2,601)
NET LOSS FROM CONTINUING     $(8,513) $(25,177)  $(26,098)  $(55,179)
OPERATIONS
NET INCOME FROM
DISCONTINUEDOPERATIONS, NET 2,699      897          6,504        2,442
OF TAX
NET LOSS                     $(5,814) $(24,280)  $(19,594)  $(52,737)
NET LOSS PER SHARE FROM                                        
CONTINUING OPERATIONS:
Basic                        $(0.30)  $(0.90)    $(0.93)    $(1.98)
Diluted                      $(0.30)  $(0.90)    $(0.93)    $(1.98)
NET INCOME FROM DISCONTINUED                                   
OPERATIONS:
Basic                        $0.09    $0.03      $0.23      $0.09
Diluted                      $0.09    $0.03      $0.23      $0.09
NET LOSS PER SHARE:                                            
Basic                        $(0.21)  $(0.87)    $(0.70)    $(1.89)
Diluted                      $(0.21)  $(0.87)    $(0.70)    $(1.89)
AVERAGE SHARES OUTSTANDING                                     
Basic                        28,190     27,926       28,073       27,894
Diluted                      28,190     27,926       28,073       27,894
CASH DIVIDENDS DECLARED PER  $ —        $ —          $ —          $0.075
SHARE
                                                              
See notes to consolidated                                      
financial statements.


(Unaudited)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
                                                              
                          Three months ended        Nine months ended
In thousands               February 28, February 29, February 28, February 29,
                           2013         2012         2013         2012
Net loss                   $(5,814)   $(24,280)  $(19,594)  $(52,737)
Other comprehensive income                                     
Net actuarial gains
(losses) of defined                                            
postretirement benefit
plans
Reclassification of
recognized transactions,
net of taxes -- $126,      219          363          784          1,088
$209, $736 and $627,
respectively
Adjustment, net of tax     —            —            (55)         —
Prior service cost of
defined postretirement                                         
benefit plans
Reclassification of
recognized transactions,
net of taxes - ($71),      (123)        (123)        (168)        (369)
($71), ($413) and ($213),
respectively
Total other comprehensive  96           240          561          719
income
Comprehensive loss         $(5,718)   $(24,040)  $(19,033)  $(52,018)
                                                              
See notes to consolidated                                      
financial statements.


CONSOLIDATED BALANCE SHEETS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
                                                                
                                                    (Unaudited)  
In thousands                                         February28, May31,
                                                     2013         2012
ASSETS                                                           
CURRENT ASSETS                                                   
Cash and cash equivalents                            $31,664    $88,027
Receivables – net                                    98,458       98,836
Inventories                                          100,282      99,441
Deferred income taxes and prepaid expenses           20,282       19,007
Discontinued operations held for sale                38,769       40,344
TOTAL CURRENT ASSETS                                 289,455      345,655
PROPERTY, PLANT AND EQUIPMENT                                    
Land and land improvements                           170,078      168,173
Buildings                                            49,637       49,567
Machinery and equipment                              1,156,061    1,142,439
Construction in progress                             483,641      436,552
                                                    1,859,417    1,796,731
Less depreciation and depletion                      647,281      611,406
                                                    1,212,136    1,185,325
OTHER ASSETS                                                     
Goodwill                                             1,715        1,715
Real estate and investments                          23,024       20,865
Deferred income taxes and other charges              22,141       23,368
                                                    46,880       45,948
                                                    $ 1,548,471 $ 1,576,928
LIABILITIES AND SHAREHOLDERS' EQUITY                             
CURRENT LIABILITIES                                              
Accounts payable                                     $57,000    $64,825
Accrued interest, compensation and other             48,134       61,317
Current portion of long-term debt                    1,816        1,214
TOTAL CURRENT LIABILITIES                            106,950      127,356
LONG-TERM DEBT                                       658,392      656,949
OTHER CREDITS                                        88,088       96,352
SHAREHOLDERS' EQUITY                                             
Common stock, $1 par value; authorized 100,000
shares; issued and outstanding 28,324 and 27,996     28,324       27,996
shares, respectively
Additional paid-in capital                           506,112      488,637
Retained earnings                                    184,542      204,136
Accumulated other comprehensive loss                 (23,937)     (24,498)
                                                    695,041      696,271
                                                    $ 1,548,471 $ 1,576,928
                                                                
See notes to consolidated financial statements.                  

(Unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
                                                                
                                                    Nine months ended
In thousands                                         February 28, February 29,
                                                     2013         2012
OPERATING ACTIVITIES                                             
Net loss                                             $(19,594)  $(52,737)
Adjustments to reconcile net loss to cash provided               
by operating activities
Depreciation, depletion and amortization             42,968       46,495
(Gains)/Loss on asset disposals                      (4,822)      (3,736)
Deferred income tax (benefit) expense                1,025        (1,653)
Stock-based compensation expense                     7,015        1,710
Other – net                                          (7,555)      (4,424)
Changes in operating assets and liabilities                      
Receivables – net                                    830          7,624
Inventories                                          (710)        10,048
Prepaid expenses                                     (2,158)      3,261
Accounts payable and accrued liabilities             (7,228)      (4,466)
Net cash provided by operating activities            9,771        2,122
INVESTING ACTIVITIES                                             
Capital expenditures – expansions                    (61,344)     (64,901)
Capital expenditures – other                         (19,910)     (31,394)
Proceeds from asset disposals                        5,783        4,188
Investments in life insurance contracts              2,366        3,354
Other – net                                          (67)         (302)
Net cash used by investing activities                (73,172)     (89,055)
FINANCING ACTIVITIES                                             
Debt payments                                        (78)         (173)
Debt issuance costs                                  —            (1,829)
Stock option exercises                               7,116        1,749
Common dividends paid                                —            (2,091)
Net cash provided (used) by financing activities     7,038        (2,344)
Decrease in cash and cash equivalents                (56,363)     (89,277)
Cash and cash equivalents at beginning of period     88,027       116,432
Cash and cash equivalents at end of period           $31,664    $27,155
                                                                
See notes to consolidated financial statements.                  

CONTACT: T. Lesley Vines, Jr.
         Corporate Controller & Treasurer
         972.647.6700

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