UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

October 22, 2009

 

 

Eagle Materials Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		1-12984		75-2520779
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

3811 Turtle Creek Blvd., Suite 1100, Dallas, Texas		75219
(Address of principal executive offices)		(Zip code)

Registrant’s telephone number including area code: (214) 432-2000

Not Applicable

(Former name or former address if changed from last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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Item 2.02

Results of Operations and Financial Condition

On October 22, 2009, Eagle Materials Inc., a Delaware corporation (“Eagle”), announced its results of operations for the quarter ended September 30, 2009. A copy of Eagle’s earnings press release announcing these results is being furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

In the press release, as part of the comparison of the current quarter’s earnings to Eagle’s earnings in the same quarter of the prior fiscal year, Eagle excludes from the prior year’s earnings the after-tax gain on the disposition of certain company assets (rail cars). This non-GAAP financial measure adjusts for a factor that is unusual and not part of Eagle’s business operations, and is presented in the context of the comparison between the two periods using the financial measure prepared in accordance with GAAP. Eagle’s management believes the presentation of this non-GAAP financial measure provides useful information to investors regarding Eagle’s ongoing business performance; however, Eagle cautions investors to consider this non-GAAP financial measure in addition to, and not as a substitute for, the financial measure prepared in accordance with GAAP.

 

Item 9.01

Financial Statements and Exhibits

 

Exhibit Number		Description
99.1		Earnings Press Release dated October 22, 2009 issued by Eagle Materials Inc. (announcing quarterly operating results)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: October 22, 2009

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EXHIBIT INDEX

 

Exhibit Number		Description
99.1		Earnings Press Release dated October 22, 2009 issued by Eagle Materials Inc. (announcing quarterly operating results)

Exhibit 99.1

 

		Contact at 214/432-2000 Steven R. Rowley President & CEO D. Craig Kesler Executive Vice President & CFO Robert S. Stewart Executive Vice President

 

 

News For Immediate Release

EAGLE MATERIALS INC. REPORTS

SECOND QUARTER RESULTS

DALLAS, TX (October 22, 2009) - Eagle Materials Inc. (NYSE: EXP) today reported financial results for the second quarter of fiscal 2010 ended September 30, 2009. Notable items for the quarter include:

 

•

Net earnings of $12.2 million, or $0.28 per diluted share

 

•

Revenues of $138.2 million

 

•

Cash flow from operations was $39 million

 

•

Net debt-to-total capitalization ratio declined to 40% from 48% a year ago

Revenues this quarter were down 23% compared with the same quarter a year ago. Net earnings were down 22% compared to the same quarter last year, or 13% when excluding the prior year’s after-tax gain on sale of railcars of $1.7 million, or $0.04 per diluted share. Lower operating costs across nearly all of Eagle’s businesses, as well as lower financing costs associated with lower borrowing levels, substantially offset the impact of quarterly sales volumes and price declines.

Gypsum Wallboard and Paperboard

Gypsum Wallboard and Paperboard’s second quarter operating earnings of $5.7 million were up 63% over the same quarter last year. Lower energy, transportation and raw materials costs were the primary drivers of the quarterly earnings improvement.

Gypsum Wallboard and Paperboard revenues for the second quarter totaled $68.7 million, a 28% decrease from the same quarter a year ago. The revenue decline reflects lower gypsum wallboard and paperboard sales volumes and prices. The average gypsum wallboard net sales price this quarter was $92.71 per MSF, 6% less than the same quarter a year ago. Gypsum Wallboard sales volume for the quarter of 469 million square feet (MMSF) represents a 16% decline from the same quarter last year.

Cement, Concrete and Aggregates

Operating earnings from Cement for the second quarter were $22.0 million, a 19% decline from the same quarter a year ago. Cement revenues for the quarter, including joint

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venture and intersegment revenues, totaled $72.9 million, 15% less than the same quarter last year. Cement sales volumes for the quarter were 790,000 tons, 5% below the same quarter a year ago.

Eagle’s purchased cement sales volumes for the quarter declined to approximately 15,000 tons, or 2% of total cement sales volume, compared to approximately 134,000 tons, or 16% of total sales volume for the quarter a year ago. The average net sales price this quarter was $85.99 per ton, 11% less than the same quarter last year.

Concrete and Aggregates reported a $0.3 million operating profit for the second quarter, down from the $1.4 million operating profit for the same quarter a year ago, primarily due to lower sales volumes in both Concrete and Aggregates and to lower net sales prices in Concrete.

Revenues from Concrete and Aggregates were $14.1 million for the quarter, 34% less than the same quarter a year ago. Concrete sales volume decreased 29% from the same quarter a year ago to 128,000 cubic yards. Concrete average net sales price for the quarter of $67.82 per cubic yard was 7% less than the same quarter a year ago. Aggregates sales volume of 0.9 million tons for this quarter is 32% less than the sales volume for the same quarter a year ago. Aggregates average net sales price for the quarter was $6.18, essentially flat compared to last year’s second quarter.

Details of Financial Results

Texas Lehigh Cement Company LP, one of our cement plant operations, is conducted 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 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 in 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 4 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 from 25 facilities across the US. The company is headquartered in Dallas, Texas.

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EXP’s senior management will conduct a conference call to discuss the financial results, forward looking information and other matters at 2:00 p.m. Eastern Time (1:00 p.m. Central Time) on Thursday, October 22, 2009. The conference call will be webcast simultaneously on the EXP 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 EXP at 214-432-2000.

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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; availability of raw materials; changes in energy costs including, without limitation, natural gas and oil; changes in the cost and availability of transportation; unexpected operational difficulties; inability to timely execute announced capacity expansions; governmental regulation and changes in governmental and public policy (including, without limitation, climate change regulation); changes in economic conditions specific to any one or more of the Company’s markets; competition; announced increases in capacity in the gypsum wallboard and cement industries; changes in the demand for residential housing construction or commercial construction; 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 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, 2009 and in its Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2009. These reports are filed with the Securities and Exchange Commission. 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.

For additional information, contact at 214/432-2000.

Steven R. Rowley

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

 

(1)	Summary of Consolidated Earnings

 

(2)	Revenues and Earnings by Lines of Business (Quarter)

 

(3)	Revenues and Earnings by Lines of Business (Six Months)

 

(4)	Sales Volume, Net Sales Prices and Intersegment and Cement Revenues

 

(5)	Consolidated Balance Sheets

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Eagle Materials Inc.

Attachment 1

Eagle Materials Inc.

Summary of Consolidated Earnings

(dollars in thousands, except per share data)

(unaudited)

 

		Quarter Ended September 30,
		2009			2008			Change
Revenues		$	138,185		$	178,934		-23	%
Earnings Before Income Taxes		$	17,490		$	22,244		-21	%
Net Earnings		$	12,194		$	15,645		-22	%
Earnings Per Share:
- Basic		$	0.28		$	0.36		-22	%
- Diluted		$	0.28		$	0.36		-22	%
Average Shares Outstanding:
- Basic			43,630,040			43,480,047		0	%
- Diluted			44,012,140			43,835,459		0	%
		Six Months Ended September 30,
		2009			2008			Change
Revenues		$	266,077		$	355,737		-25	%
Earnings Before Income Taxes		$	34,683		$	33,176		+5	%
Net Earnings		$	24,114		$	23,475		+3	%
Earnings Per Share:
- Basic		$	0.55		$	0.54		+2	%
- Diluted		$	0.55		$	0.54		+2	%
Average Shares Outstanding:
- Basic			43,605,975			43,451,146		0	%
- Diluted			44,004,492			43,853,220		0	%

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Eagle Materials Inc.

Attachment 2

Eagle Materials Inc.

Revenues and Earnings by Lines of Business

(dollars in thousands)

(unaudited)

 

		Quarter Ended September 30,
		2009				2008				Change
Revenues*
Gypsum Wallboard and Paperboard:
Gypsum Wallboard		$	56,720			$	74,583			-24	%
Gypsum Paperboard			12,003				20,625			-42	%
			68,723				95,208			-28	%
			50	%			53	%
Cement (Wholly Owned)			55,528				59,317			-6	%
			40	%			33	%
Concrete & Aggregates			13,934				21,070			-34	%
			10	%			12	%
Other, net			—				3,339			-100	%
			0	%			2	%
Total		$	138,185			$	178,934			-23	%
			100	%			100	%
Operating Earnings
Gypsum Wallboard and Paperboard:
Gypsum Wallboard		$	1,332			$	(1,340	)		n/a
Gypsum Paperboard			4,369				4,844			-10	%
			5,701				3,504			+63	%
			20	%			10	%
Cement:
Wholly Owned			16,980				18,229			-7	%
Joint Venture			5,065				8,854			-43	%
			22,045				27,083			-19	%
			79	%			77	%
Concrete & Aggregates			280				1,362			-79	%
			1	%			4	%
Other, net **			(84	)			3,339			-103	%
			0	%			9	%
Total Operating Earnings			27,942				35,288			-21	%
			100	%			100	%
Corporate General Expenses			(4,851	)			(4,915	)
Interest Expense, net			(5,601	)			(8,129	)
Earnings Before Income Taxes		$	17,490			$	22,244			-21	%

 

*	Net of Intersegment and Joint Venture Revenues listed on Attachment 4.

**	Second quarter of fiscal 2009 results include a $2.6 million gain on sale of railcars.

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Eagle Materials Inc.

Attachment 3

Eagle Materials Inc.

Revenues and Earnings by Lines of Business

(dollars in thousands)

(unaudited)

 

		Six Months Ended September 30,
		2009				2008				Change
Revenues*
Gypsum Wallboard and Paperboard:
Gypsum Wallboard		$	113,642			$	155,981			-27	%
Gypsum Paperboard			25,398				40,155			-37	%
			139,040				196,136			-29	%
			52	%			55	%
Cement (Wholly Owned)			98,715				116,081			-15	%
			37	%			33	%
Concrete & Aggregates			28,235				39,781			-29	%
			11	%			11	%
Other, net			87				3,739			-98	%
			0	%			1	%
Total		$	266,077			$	355,737			-25	%
			100	%			100	%
Operating Earnings
Gypsum Wallboard and Paperboard:
Gypsum Wallboard		$	4,740			$	(6,728	)		n/a
Gypsum Paperboard			9,402				8,057			17	%
			14,142				1,329			964	%
			26	%			2	%
Cement:
Wholly Owned			26,760				32,983			-19	%
Joint Venture			12,366				16,740			-26	%
			39,126				49,723			-21	%
			71	%			85	%
Concrete & Aggregates			1,790				3,475			-48	%
			3	%			6	%
Other, net **			3				3,739			-100	%
			0	%			7	%
Total Operating Earnings			55,061				58,266			-6	%
			100	%			100	%
Corporate General Expenses			(9,144	)			(8,970	)
Interest Expense, net			(11,234	)			(16,120	)
Earnings Before Income Taxes		$	34,683			$	33,176			+5	%

 

*	Net of Intersegment and Joint Venture Revenues listed on Attachment 4.

**	Six months ended September 30, 2008 results include a $2.6 million gain on sale of railcars.

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Eagle Materials Inc.

Attachment 4

Eagle Materials Inc.

Sales Volume, Net Sales Prices and Intersegment and Joint Venture Revenues

(unaudited)

 

		Sales Volume
		Quarter Ended September 30,							Six Months Ended September 30,
		2009		2008		Change			2009		2008		Change
Gypsum Wallboard (MMSF’s)		469		556		-16	%		914		1,202		-24	%
Cement (M Tons):
Wholly Owned		614		584		+5	%		1,079		1,140		-5	%
Joint Venture		176		246		-28	%		363		525		-31	%
		790		830		-5	%		1,442		1,665		-13	%
Paperboard (M Tons):
Internal		20		25		-20	%		38		50		-24	%
External		32		42		-24	%		70		84		-17	%
		52		67		-22	%		108		134		-19	%
Concrete (M Cubic Yards)		128		180		-29	%		285		357		-20	%
Aggregates (M Tons)		883		1,302		-32	%		1,460		2,100		-30	%

 

		Average Net Sales Price*
		Quarter Ended September 30,									Six Months Ended September 30,
		2009			2008			Change			2009			2008			Change
Gypsum Wallboard (MSF)		$	92.71		$	98.37		-6	%		$	96.26		$	93.48		3	%
Cement (Ton)		$	85.99		$	97.12		-11	%		$	87.29		$	97.32		-10	%
Paperboard (Ton)		$	415.84		$	505.83		-18	%		$	407.60		$	502.22		-19	%
Concrete (Cubic Yard)		$	67.82		$	73.24		-7	%		$	68.16		$	73.76		-8	%
Aggregates (Ton)		$	6.18		$	6.21		0	%		$	6.39		$	6.61		-3	%

 

*	Net of freight and delivery costs billed to customers.

 

		Intersegment and Cement Revenues
		Quarter Ended September 30,						Six Months Ended September 30,
		2009			2008			2009			2008
Intersegment Revenues:
Cement		$	1,241		$	1,935		$	2,833		$	3,851
Paperboard			9,488			14,175			18,629			28,445
Concrete and Aggregates			196			271			505			496
		$	10,925		$	16,381		$	21,967		$	32,792
Cement Revenues:
Wholly Owned		$	55,528		$	59,317		$	98,715		$	116,081
Joint Venture			16,088			24,489			33,409			52,118
		$	71,616		$	83,806		$	132,124		$	168,199

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Eagle Materials Inc.

Attachment 5

Eagle Materials Inc.

Consolidated Balance Sheets

(dollars in thousands)

(unaudited)

 

		September 30,								March 31, 2009*
		2009				2008
ASSETS
Current Assets –
Cash and Cash Equivalents		$	4,411			$	17,018			$	17,798
Accounts and Notes Receivable, net			58,912				72,682				44,261
Inventories			95,180				103,173				107,063
Prepaid and Other Assets			4,507				3,015				6,161
Total Current Assets			163,010				195,888				175,283
Property, Plant and Equipment –			1,098,757				1,085,942				1,089,610
Less: Accumulated Depreciation			(443,948	)			(395,921	)			(419,669	)
Property, Plant and Equipment, net			654,809				690,021				669,941
Notes Receivable			7,315				7,026				6,301
Investments in Joint Venture			34,887				39,085				39,521
Goodwill and Intangibles			152,494				153,131				152,812
Other Assets			23,852				23,795				22,810
		$	1,036,367			$	1,108,946			$	1,066,668
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities –
Accounts Payable		$	22,813			$	39,286			$	19,645
Federal Income Taxes Payable			3,846				347				—
Accrued Liabilities			45,295				52,277				44,604
Total Current Liabilities			71,954				91,910				64,249
Senior Notes			300,000				400,000				300,000
Bank Credit Facility			—				—				55,000
Long-Term Liabilities			98,803				86,859				97,104
Deferred Income Taxes			119,171				114,165				122,488
Stockholders’ Equity –
Preferred Stock, Par Value $0.01; Authorized 5,000,000 Shares; None Issued			—				—				—
Common Stock, Par Value $0.01; Authorized 100,000,000 Shares; Issued and Outstanding 43,738,206, 43,544,038 and 43,589,775 Shares, respectively.			437				435				436
Capital in Excess of Par Value			14,397				4,255				11,166
Accumulated Other Comprehensive Losses			(6,040	)			(1,368	)			(6,040	)
Retained Earnings			437,645				412,690				422,265
Total Stockholders’ Equity			446,439				416,012				427,827
		$	1,036,367			$	1,108,946			$	1,066,668

 

*	From audited financial statements.