In recent weeks, we have seen the effects of the COVID-19 pandemic continue to grow and evolve. Eagle’s primary manufacturing facilities span across the US heartland in areas where construction has generally been deemed essential by government authorities. We intend to continue operations as an essential business and deliver quality products to our customers. Although market conditions for our construction materials have been robust in this environment, there is obvious uncertainty about the level of mid-term demand sustainability. Accordingly, we have taken actions to both protect our employees, focus on business continuity and improve our financial flexibility. The following are updates with respect to these actions.
Update on Health and Safety Protocols
We have implemented enhanced health and safety protocols to safeguard our employees who perform jobs that must be done in our facilities or at our customers’ job sites. We have proactively undertaken an expanding number of initiatives since early March in an effort to reduce the spread of the virus and limit our employees’ potential exposure, including implementing policies and practices that are consistent with or exceed CDC and government guidelines, restricting visitor access to facilities, enforcing social distancing protocols and undertaking additional, rigorous facility-cleaning procedures.
Update on Planned Separation of Heavy and Light Materials Businesses
Today’s market conditions caused by the COVID-19 pandemic have affected the Company’s previously announced timeline to separate its heavy (cement, aggregates and concrete) and light-side (gypsum wallboard and paperboard) businesses.
Update on Actions to Further Improve Financial Stability
Given the current uncertainties surrounding the economic environment, the Company is taking prudent and precautionary actions to maintain its financial flexibility. We recently took several actions to reduce our spending and maximize free cash flow, including limiting capital spending to critical maintenance, safety and regulatory projects and managing the timing and duration of our maintenance programs. We also amended our bank credit facility and term loan to extend the maturity to
Additionally, the Company’s priority for our free cash flow will be on debt reduction. The Company will pay its dividend declared on
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; material nonpayment or non-performance by any of our key customers; fluctuations in or changes in the nature of activity in the oil and gas industry, including fluctuations in the level of fracturing activities and the demand for frac sand and changes in processes or substitutions in materials used in well fracturing; 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; a cyber-attack or data security breach; announced increases in capacity in the gypsum wallboard, cement and frac sand industries; changes in the demand for residential housing construction or commercial construction; risks related to pursuit of acquisitions, joint ventures and other transactions; 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 revenue 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. With respect to our acquisition of certain assets from
For additional information, contact at 214/432-2000.
President and Chief Executive Officer
Executive Vice President and Chief Financial Officer
Executive Vice President, Strategy,