DALLAS--(BUSINESS WIRE)--Jan. 31, 2018-- Eagle Materials Inc. (NYSE: EXP) today reported financial results for the third quarter of fiscal 2018 ended December 31, 2017. Notable items for the quarter include (all comparisons, unless otherwise noted, are with the prior year’s third quarter):

Company Third Quarter Results

• Record Revenues of $359.4 million, up 19%
• Record Net Earnings per diluted share of $2.08, up 78%
  • Eagle’s third quarter financial results include a tax benefit of approximately $61 million, or $1.25 per share, primarily due to the remeasurement of our deferred tax liabilities to lower statutory rates as a result of the Tax Cuts and Jobs Act enacted on December 22, 2017
  • Eagle’s third quarter financial results also include a $39 million pre-tax charge related to the settlement of its class action wallboard antitrust litigation

Third quarter gross profit improved 8%, reflecting the financial results of the recently acquired cement plant in Fairborn, Ohio and related assets (the Fairborn Business) and improved net sales prices across most businesses.

Cement, Concrete and Aggregates

Cement revenues for the third quarter, including joint venture and intersegment revenues, totaled $161.6 million, which was 17% higher than the same quarter last year. The average net sales price for this quarter was $106.83 per ton, 6% higher than the same quarter last year. Total Cement sales volumes for the quarter were 1.3 million tons, 12% greater than the same quarter a year ago. Like-for-like average net cement sales prices increased 4% and sales volumes declined 2%, respectively, versus the third quarter of fiscal 2017 (comparison excludes cement sales from the Fairborn Business since its acquisition date).

Operating earnings from Cement for the third quarter were a record $52.5 million and 16% greater than the same quarter a year ago. The earnings improvement was driven primarily by earnings from the Fairborn Business and improved average net cement sales prices offset by lower sales volumes from our legacy facilities.

Concrete and Aggregates reported revenues for the third quarter of $38.5 million, a decline of 5%. Third quarter operating earnings were $3.4 million, 26% below the same quarter a year ago, reflecting lower concrete and aggregates sales volumes partially offset by record third quarter concrete and aggregates sales prices. Sales volumes in our Austin concrete and aggregates business were impacted by wet weather in the latter portion of the quarter.

Gypsum Wallboard and Paperboard

Gypsum Wallboard and Paperboard revenues for the third quarter totaled $162.6 million, which were 11% greater than the same quarter a year ago. The average Gypsum Wallboard net sales price this quarter was $151.13 per MSF, 1% less than the same quarter a year ago. Gypsum Wallboard sales volumes were a third quarter record 709 million square feet (MMSF), a 10% increase from the same quarter last year. Paperboard sales volumes for the quarter were also a record and 7% greater than the same quarter a year ago. The average Paperboard net sales price this quarter was $581.95 per ton, 11% greater than the same quarter a year ago.

Gypsum Wallboard and Paperboard reported third quarter operating earnings of $50.7 million, up 1% from the same quarter last year. The earnings improvement primarily reflects improved Gypsum Wallboard and Paperboard sales volumes and higher average Paperboard net sales prices.

During the third quarter, Eagle and its subsidiary, American Gypsum, entered into settlement agreements with counsel representing the direct and indirect purchaser classes to settle all claims made against the Company and American Gypsum. Pursuant to the settlement agreements, which remain subject to court approval, the Company and American agreed to make payments totaling approximately $39 million. Eagle and American Gypsum continue to deny all wrongdoing but settled to avoid further litigation expense, distraction of management, and the risk of litigation. We expect to make this cash payment in the next twelve months.

Oil and Gas Proppants

Oil and Gas Proppants reported third quarter revenues of $21.9 million, a 208% increase from the prior year reflecting improved frac sand sales volumes and net sales prices. The third quarter’s operating loss of $1.0 million includes depreciation, depletion and amortization of $5.8 million.

Details of Financial Results

We conduct one of our cement plant operations, Texas Lehigh Cement Company LP, through a 50/50 joint venture (the “Joint Venture”). We utilize the equity method of accounting for our 50% interest in the Joint Venture. For segment reporting purposes only, we proportionately consolidate our 50% share of the Joint Venture’s revenues and operating earnings, which is consistent with the way management organizes the segments within the Company for making operating decisions and assessing performance.

In addition, for segment reporting purposes, we report intersegment revenues as a part of a segment’s total revenues. Intersegment sales are eliminated on the income statement. Refer to Attachment 3 for a reconciliation of the amounts referred to above.

About Eagle Materials Inc.

Eagle Materials Inc. manufactures and distributes Cement, Gypsum Wallboard, Recycled Paperboard, Concrete and Aggregates, and Oil and Gas Proppants from over 75 facilities across the US. Eagle is headquartered in Dallas, Texas.

Eagle’s senior management will conduct a conference call to discuss the financial results, forward-looking information and other matters at 8:30 a.m. Eastern Time (7:30 a.m. Central Time) on January 31, 2018.The conference call will be webcast simultaneously on the Eagle Web site http://www.eaglematerials.com.A replay of the webcast and the presentation will be archived on that site for one year.For more information, contact Eagle at (214) 432-2000.

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 activity in the oil and gas industry, including the level of fracturing activities and the demand for frac sand; 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 revenues 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. These and other factors are described in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2017 and the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2017.These reports are filed with the Securities and Exchange Commission.With respect to our completed acquisition of the Fairborn Business as described in this press release, factors, risks and uncertainties that may cause actual events and developments to vary materially from those anticipated in such forward-looking statements include, but are not limited to, failure to realize any expected synergies from or other benefits of the transaction, possible negative effects of consummation of the transaction, significant transaction or ownership transition costs, unknown liabilities or other adverse developments affecting the Fairborn Business, including the results of operations of the Fairborn Business prior and after the closing, the effect on the Fairborn Business of the same or similar factors discussed above to which our business is subject, including changes in market conditions in the construction industry and general economic and business conditions that may affect us following the acquisition.All forward-looking statements made herein are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed herein will increase with the passage of time.The Company undertakes no duty to update any forward-looking statement to reflect future events or changes in the Company's expectations.

David B. Powers
President and Chief Executive Officer

D. Craig Kesler
Executive Vice President and Chief Financial Officer

Robert S. Stewart
Executive Vice President, Strategy, Corporate Development and Communications

Attachment 1 Statement of Consolidated Earnings
Attachment 2 Revenues and Earnings by Lines of Business (Quarter and Nine Months)
Attachment 3 Sales Volume, Net Sales Prices and Intersegment and Cement Revenues
Attachment 4 Consolidated Balance Sheets
Attachment 5 Depreciation, Depletion and Amortization by Lines of Business

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Source: Eagle Materials Inc.

Eagle Materials Inc.
David B. Powers, 214-432-2000
President & CEO
or
D. Craig Kesler, 214-432-2000
Executive Vice President & CFO
or
Robert S. Stewart, 214-432-2000
Executive Vice President