US Concrete Slumps Most in Four Months as Rains Hurt Volumeby
US Concrete Inc. dropped the most in four months after second-quarter profit missed analysts’ estimates as poor weather in key markets hurt volume in its core business.
Adjusted earnings declined to 54 cents a share, 39 cents below the average of estimates compiled by Bloomberg. Revenue of $275.8 million fell short of the $293 million analysts expected. Weaker-than-expected volume for ready-mix concrete, the aggregate producer’s core business, drove the shortfall.
“Results didn’t fare too different from competitors this season,” analyst Stanley S. Elliott of Stifel Nicolaus & Co. said in a research note. Construction-materials companies have been plagued by heavy rains in North Texas, Virginia and California. Those markets account for 60 percent of US Concrete’s business, Elliott said.
“A lack of acquisition-driven growth since the first half of 2015 has taken some of the earnings momentum out for the time being,” said Elliott. US Concrete acquired ready-mix concrete business NYCON Supply Corp. in June.
The Euless, Texas-based company completed a $400 million offering of senior unsecured notes to provide “an attractive source of financing to further supplement our growth through acquisitions,” Chief Executive Officer William J. Sandbrook said in a statement Thursday.
Shares fell 5.1 percent to $59.25 at 10:59 a.m. in New York, after sliding as much as 8.7 percent, the most intraday since March 30. The stock had gained 19 percent this year through Wednesday.
Rival aggregate producers Vulcan Materials Co., Martin Marietta Materials Inc. and Summit Materials Inc. missed estimates this week, citing the bad weather.