8-K
EAGLE MATERIALS INC false 0000918646 0000918646 2021-05-19 2021-05-19

 

 

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): May 19, 2021

 

 

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.)

 

5960 Berkshire Ln., Suite 900

Dallas, Texas

  75225
(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 Since 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))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Common Stock, $0.01 par value   EXP   New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 2.02

Results of Operations and Financial Condition

On May 19, 2021, Eagle Materials Inc., a Delaware corporation (“Eagle”), announced its results of operations for the quarter and fiscal year ended March 31, 2021. 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.

 

Item 9.01

Financial Statements and Exhibits

 

Exhibit
Number

  

Description

99.1    Earnings Press Release dated May 19, 2021 issued by Eagle Materials Inc. (announcing quarterly and fiscal-year-end operating results)
104    Cover Page Interactive Data File (embedded within the Inline XBRL document).


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.

 

EAGLE MATERIALS INC.
By:  

/s/ D. Craig Kesler

  D. Craig Kesler
 

Executive Vice President – Finance and

Administration and Chief Financial Officer

Date: May 19, 2021

EX-99.1

LOGO

   

EXHIBIT 99.1

 

Contact at 214-432-2000

Michael R. Haack

President and CEO

D. Craig Kesler

Executive Vice President & CFO

Robert S. Stewart

Executive Vice President

 

 

News For Immediate Release

EAGLE MATERIALS ANNOUNCES RECORD FISCAL 2021 RESULTS

AND UPDATES ON CORPORATE ACTIONS

Record revenue of $1.6 billion, up 16%

Decision to remain a combined company

Reinstatement and increase of quarterly cash dividend

DALLAS, TX (May 19, 2021) Eagle Materials Inc. (NYSE: EXP) today reported financial results for fiscal year 2021 and the fiscal fourth quarter ended March 31, 2021, and provided an update on certain corporate actions. Notable items for the fiscal year and quarter are highlighted below. (Unless otherwise noted, all comparisons are with the prior fiscal year or prior year’s fiscal fourth quarter, as applicable.)

Full Year Fiscal 2021 Results

 

   

Record revenue of $1.6 billion, up 16%

 

   

Net Earnings of $339 million, up 379%

 

   

Net Earnings from Continuing Operations of $334 million, up 45%

 

   

Diluted earnings per share from continuing operations of $7.99, up 46%

 

   

Net earnings benefitted from a $52.0 million (pre-tax), or $0.98 per diluted share, gain on the sale of our northern California concrete and aggregates business

 

   

Adjusted EBITDA from Continuing Operations of $571 million, up 21%

 

   

Adjusted EBITDA from Continuing Operations is a non-GAAP financial measure calculated by excluding non-routine items and certain non-cash expenses in the manner described in Attachment 6

Fourth Quarter Fiscal 2021 Results

 

   

Record revenue of $343 million, up 12%

 

   

Net Earnings of $66 million, down 9%

 

   

Net Earnings from Continuing Operations of $66 million, down 5%

 

   

Diluted earnings per share from continuing operations of $1.56, down 7%

 

   

Prior-year fourth quarter net earnings benefitted by $31.7 million, $0.76 per diluted share, from the carryback of net operating losses to prior years, as allowed under the CARES Act


   

Adjusted EBITDA from Continuing Operations of $124 million, up 22%

 

   

Adjusted EBITDA from Continuing Operations is a non-GAAP financial measure calculated by excluding non-routine items and certain non-cash expenses in the manner described in Attachment 6

Commenting on the annual results, Michael Haack, President and CEO, said, “Across all measures, fiscal 2021 was extraordinary for Eagle as we met and overcame challenges that were inconceivable just a year earlier. The resilience of our business model, our financial discipline and our team’s operational and strategic execution allowed us to deliver record financial results, integrate the largest acquisition in the Company’s history and further streamline our business portfolio by divesting several non-core businesses, all while achieving industry leading safety performance. Our strong operating cash flow enabled us to reduce leverage to under 1.5 times net debt-to-EBITDA, providing us with significant liquidity and increased financial flexibility.”

Mr. Haack continued, “As we begin our new fiscal year, Eagle is well-positioned, both geographically and financially, with ample raw material reserves to capitalize on the underlying demand fundamentals that are expected to support steady and sustainable construction activity growth over the near and long-term. We remain confident in Eagle’s prospects for continued growth and sustainable value creation for all shareholders.”

Mr. Haack concluded, “I want to thank our dedicated employees for their exceptional efforts and focus during this unprecedented time. We have a long history of managing through challenging market conditions, and we have once again shown the benefits of our business model as we navigated through this unpredictable year.”

Decision to Remain a Combined Company

Eagle’s Board of Directors has decided not to pursue the proposed separation of Eagle Materials into two independent, publicly traded companies at this time. Much has transpired since the announcement of the proposed separation that has caused the Board to reevaluate the separation’s merits:

 

   

First, the size and financial strength of the combined Company, with its diversified asset base and geographical footprint and its robust balance sheet, have provided great comfort, stability and value to our shareholders, employees, customers and suppliers during an unprecedented and uncertain time.

 

   

Second, given the continued consolidation of the industries in which we participate and the Company’s rigorous examination of a number of strategic alternatives since the announcement of the proposed separation, it has become clear that a combined company with greater financial scale and flexibility will be better positioned to pursue key strategic growth options and enhance shareholder value.

 

   

Third, since the announcement of the proposed separation, the Company has streamlined its business portfolio including the divestiture of its Oil and Gas Proppants business and other non-core assets.

Mike Nicolais, Chairman of the Board, commented, “Eagle is exceedingly well-positioned and is performing as well as at any time in its history. Both major business segments continue to post industry leading results on just about every measure. As a shareholder, I could not be more pleased with the position of the combined Company. While the Board will continue to evaluate the merits of a separation on a periodic basis, it has concluded, in consultation with external advisors, that the combined Company is in the best position to create long-term shareholder value.”

 

2


Capital Allocation Priorities

Eagle remains dedicated to a disciplined capital allocation process to enhance shareholder value. Consistent with our track record, our allocation priorities remain unchanged: 1. Growth investments that meet our strict financial return standards and are consistent with our strategic focus; 2. Operating capital investments to maintain and strengthen our low-cost producer positions; 3. Return excess cash to shareholders, primarily through our share repurchase program.

In the past three years, we have invested nearly $700 million in acquisitions, $303 million in organic capital expenditures and $626 million in share repurchases and dividends. At March 31, 2021, nearly 7.3 million shares remain under the current repurchase authorization.

Reinstatement and Increase of Quarterly Cash Dividend

Eagle’s Board of Directors today declared a quarterly cash dividend of $0.25 per share, payable on July 16, 2021, to stockholders of record of its Common Stock at the close of business on June 18, 2021. The reinstated quarterly dividend represents a 150% increase from the quarterly dividend in place prior to the COVID-19 pandemic. Mike Nicolais commented, “The reinstatement of our quarterly dividend reflects Eagle’s strong operational and financial performance, our confidence in the resilience of the business, and our commitment to reward shareholders, while preserving the financial flexibility to continue to grow Eagle and create long-term shareholder value.”

Financial Results

Heavy Materials: Cement, Concrete and Aggregates

Fiscal 2021 revenue in the Heavy Materials sector, which includes Cement, Concrete and Aggregates, as well as Joint Venture and intersegment Cement revenue, was $1.1 billion, a 19% improvement. Heavy Materials annual operating earnings increased 27% to $253.0 million primarily because of improved Cement net sales prices and earnings from the recently acquired Kosmos Cement Business.

Fiscal 2021 Cement revenue, including Joint Venture and intersegment revenue, was up 26% to $944.6 million, and Cement operating earnings increased 29% to $234.0 million. The annual revenue and earnings improvements reflect higher sales volume and net sales prices as well as the significant contribution of the recently acquired Kosmos Cement Business, which added approximately $176 million of revenue and $34 million of operating earnings during the year.

The average annual net Cement sales price for the year increased 1% to $111.19 per ton. Organic (not including the recently acquired Kosmos Cement Business) average net Cement sales prices increased 3%. Cement sales volume for the year was a record 7.5 million tons, up 26%. Organic annual Cement sales volume increased 1%.

 

3


Fourth quarter Cement revenue, including Joint Venture and intersegment revenue, was up 17% to $171.0 million. Excluding the results of the recently acquired Kosmos Cement Business, revenue was down 1%. Operating earnings decreased 6% to $23.2 million. Eagle’s fourth quarter Cement earnings were affected by a severe winter storm during February 2021 which had a significant impact on Texas and the broader Southern United States. Our cement facilities in Texas, Missouri and Oklahoma were forced to curtail production during the storm and energy prices spiked during this time period. We estimate the storm’s impact on Cement operating earnings was approximately $6 million primarily due to higher costs during the quarter. We are still engaged in discussions with contractual counterparties regarding the responsibility for certain charges and obligations arising as a result of the storm, and therefore, it is not possible at the present time to make a final determination as to the storm’s impact on our financial results.

The average net Cement sales price for the quarter increased 2% to $112.77 per ton. Organic average net Cement sales prices increased 3%. Cement sales volume for the quarter was up 17% to a record 1.4 million tons. Organic quarterly Cement sales volume declined 2% to 1.1 million tons.

Fiscal 2021 revenue from Concrete and Aggregates decreased 7% to $168.7 million because of the divestiture of our northern California concrete and aggregates businesses during the first quarter of fiscal 2021. Concrete and Aggregates reported fiscal 2021 operating earnings of $19.1 million, up 9%, reflecting improved organic sales volume and pricing as well as operating efficiencies, including lower diesel fuel costs.

Fourth quarter Concrete and Aggregates revenue was $34.8 million, a decrease of 12%, because of the divestiture of our northern California concrete and aggregates businesses. Fourth quarter operating earnings were $3.3 million, a 30% increase, reflecting improved sales volume and pricing and improved operating efficiencies.

Light Materials: Gypsum Wallboard and Paperboard

Fiscal 2021 revenue in the Light Materials sector, which includes Gypsum Wallboard and Paperboard, increased 5%, reflecting improved Wallboard sales volume and pricing. Gypsum Wallboard annual sales volume was a record 2.9 billion square feet (BSF), up 6%, while the average Gypsum Wallboard net sales price increased 1% to $149.62 per MSF. Given the improved demand outlook for single-family construction activity in the US and increasing demand for our products, we implemented wallboard price increases during the second half of our fiscal year. We also announced a wallboard price increase for early April 2021.

Fiscal 2021 operating earnings were $192.8 million, an increase of 2%, driven by improved sales volume and pricing, partially offset by increased operating cost, primarily due to higher recycled fiber costs and startup costs associated with our paper mill expansion.

Fourth quarter Gypsum Wallboard and Paperboard revenue increased 15% to $176.9 million, reflecting improved Wallboard sales volume and pricing. Gypsum Wallboard sales volume increased 3% to 706 million square feet (MMSF), while the average Gypsum Wallboard net sales price increased 10% to $161.07 per MSF.

 

4


Paperboard sales volume for the quarter increased 4% to a record 82,000 tons. The average Paperboard net sales price for the fourth quarter was $481.40 per ton, up 5%, consistent with the pricing provisions in our long-term sales agreements.

Fourth quarter operating earnings in the sector were $52.4 million, an increase of 15%, reflecting improved Wallboard sales volume and pricing partially offset by the impact of the winter storm in February 2021. Our Oklahoma paper mill was forced to curtail production during the week of the storm and also experienced higher energy costs during the shutdown. Additionally, our wallboard shipments were significantly affected by the harsh winter conditions. We estimate the storm affected fourth quarter Light Materials operating earnings by approximately $6 million. We are still engaged in discussions with contractual counterparties regarding the responsibility for certain charges and obligations arising as a result of the storm, and therefore, it is not possible at the present time to make a final determination as to the storm’s impact on our financial results. Although the operating earnings of our Light Materials sector were adversely affected by the storm, we were able to curtail some of our operations and release a portion of our natural gas commitments to third parties in a timely manner. The release of these commitments contributed to a significant increase in Other Non-Operating Income in the fourth quarter.

Sale of Oil and Gas Proppants Business

On September 18, 2020, the Company sold its Oil and Gas Proppants business to Smart Sand, Inc. The current-year and prior-year financial results of the Oil and Gas Proppants segment have been classified as Discontinued Operations on the Statement of Earnings. The assets and liabilities of the Oil and Gas Proppants segment have been reflected on separate lines for Discontinued Operations on the Balance Sheet.

Details of Financial Results

We conduct one of our cement plant operations through a 50/50 joint venture, Texas Lehigh Cement Company LP (the Joint Venture). We use 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 revenue and operating earnings, which is consistent with the way management organizes the segments within Eagle for making operating decisions and assessing performance.

In addition, for segment reporting purposes, we report intersegment revenue as a part of a segment’s total revenue. Intersegment sales are eliminated on the consolidated statement of earnings. Refer to Attachment 3 for a reconciliation of these amounts.

About Eagle Materials Inc.

Eagle Materials Inc. manufactures and distributes Portland Cement, Gypsum Wallboard, Recycled Gypsum Paperboard, and Concrete and Aggregates from more than 70 facilities across the US. Eagle’s corporate headquarters is in Dallas, Texas.

 

5


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 Wednesday, May 19, 2021. The conference call will be webcast on the Eagle website, eaglematerials.com. A replay of the webcast and the presentation will be archived on the site for one year.

###

 

6


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 businesses; 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 the costs of energy, including, without limitation, natural gas, coal and oil, and the nature of our obligations to counterparties under energy supply contracts, such as those related to market conditions (such as fluctuations in spot market prices), governmental orders and other matters; 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; 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 and other environmental 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; severe weather conditions (such as winter storms, tornados and hurricanes) on our facilities, operations and contractual arrangements with third parties; competition; cyber-attacks or data security breaches; announced increases in capacity in the gypsum wallboard and cement industries; changes in the demand for residential housing construction or commercial construction or construction projects undertaken by state or local governments; risks related to pursuit of acquisitions, joint ventures and other transactions or the execution or implementation of such transactions, including the integration of operations acquired by the Company; 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 Kosmos Cement Company, factors, risks and uncertainties that may cause actual future events and developments to vary materially from those anticipated in such forward-looking statements include, but are not limited to, failure to realize expected synergies from or other benefits of the transaction, significant difficulties encountered in integration or unexpected ownership transition costs, unknown liabilities or other adverse developments affecting the assets acquired and the target business, including the effect on the acquired business of the same or similar factors discussed above to which our Heavy Materials business is subject. Finally, any forward-looking statements made by the Company are subject to the risks and impacts associated with natural disasters, pandemics or other unforeseen events, including, without limitation, the COVID-19 pandemic and responses thereto designed to contain its spread and mitigate its public health effects, as well as their impact on economic conditions, capital and financial markets. The COVID-19 pandemic and responses thereto may disrupt our business and are likely to have an adverse effect on demand for our products, attributable to, among other things, reductions in consumer spending, increases in unemployment and decreases in revenues and construction budgets of state or local governments. These and other factors are described in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2020 and subsequent quarterly and annual reports upon filing. 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.

Michael R. Haack

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

  

Consolidated Statement of Earnings

Attachment 2

  

Revenue and Earnings by Lines of Business

Attachment 3

  

Sales Volume, Net Sales Prices and Intersegment and Cement Revenue

Attachment 4

  

Consolidated Balance Sheets

Attachment 5

  

Depreciation, Depletion and Amortization by Lines of Business

Attachment 6

  

Reconciliation of Non-GAAP Financial Measures

 

7


Attachment 1

Eagle Materials Inc.

Consolidated Statement of Earnings

(dollars in thousands, except per share data)

(unaudited)

 

     Quarter Ended
March 31,
    Fiscal Year Ended
March 31,
 
     2021     2020     2021     2020  

Revenue

   $ 343,302     $ 305,195     $ 1,622,642     $ 1,404,033  

Cost of Goods Sold

     273,472       242,846       1,214,287       1,061,367  
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross Profit

     69,830       62,349       408,355       342,666  

Equity in Earnings of Unconsolidated JV

     8,985       10,096       37,441       42,585  

Corporate General and Administrative Expenses

     (9,286     (16,904     (49,511     (65,410

Gain on Sale of Businesses

     —         —         51,973       —    

Impairment Losses

     —         —         —         (25,131

Other Non-Operating Income

     18,376       (2,039     20,274       (594
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings from Continuing Operations before Interest and Income Taxes

     87,905       53,502       468,532       294,116  

Interest Expense, net

     (8,463     (9,895     (44,420     (38,421
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings from Continuing Operations before Income Taxes

     79,442       43,607       424,112       255,695  

Income Tax Expense

     (13,431     25,713       (89,946     (24,504
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Earnings from Continuing Operations

   $ 66,011     $ 69,320     $ 334,166     $ 231,191  

Earnings (Loss) from Discontinued Operations, net of tax

     —         3,109       5,278       (160,297
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Earnings

   $ 66,011     $ 72,429     $ 339,444     $ 70,894  
  

 

 

   

 

 

   

 

 

   

 

 

 

BASIC EARNINGS (LOSS) PER SHARE

        

Continuing Operations

   $ 1.58     $ 1.68     $ 8.04     $ 5.50  

Discontinued Operations

   $ —       $ 0.08     $ 0.13     $ (3.81
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Earnings

   $ 1.58     $ 1.76     $ 8.17     $ 1.69  
  

 

 

   

 

 

   

 

 

   

 

 

 

DILUTED EARNINGS (LOSS) PER SHARE

        

Continuing Operations

   $ 1.56     $ 1.67     $ 7.99     $ 5.47  

Discontinued Operations

   $ —       $ 0.07     $ 0.13     $ (3.79
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Earnings

   $ 1.56     $ 1.74     $ 8.12     $ 1.68  
  

 

 

   

 

 

   

 

 

   

 

 

 

AVERAGE SHARES OUTSTANDING

        

Basic

     41,821,935       41,343,649       41,543,067       42,021,892  
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

     42,264,279       41,554,357       41,826,709       42,285,343  
  

 

 

   

 

 

   

 

 

   

 

 

 

 

8


Attachment 2

Eagle Materials Inc.

Revenue and Earnings by Lines of Business

(dollars in thousands)

(unaudited)

 

     Quarter Ended
March 31,
     Fiscal Year Ended
March 31,
 
     2021      2020      2021      2020  

Revenue*

           

Heavy Materials:

           

Cement (Wholly Owned)

   $ 142,080      $ 114,515      $ 818,503      $ 616,967  

Concrete and Aggregates

     34,809        39,511        168,723        181,273  
  

 

 

    

 

 

    

 

 

    

 

 

 
     176,889        154,026        987,226        798,240  

Light Materials:

           

Gypsum Wallboard

     141,991        127,691        539,009        508,145  

Gypsum Paperboard

     24,422        23,478        96,407        97,648  
  

 

 

    

 

 

    

 

 

    

 

 

 
     166,413        151,169        635,416        605,793  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total Revenue

   $ 343,302      $ 305,195      $ 1,622,642      $ 1,404,033  
  

 

 

    

 

 

    

 

 

    

 

 

 

Segment Operating Earnings

           

Heavy Materials:

           

Cement (Wholly Owned)

   $ 14,170      $ 14,407      $ 196,516      $ 138,745  

Cement (Joint Venture)

     8,985        10,096        37,441        42,585  

Concrete and Aggregates

     3,306        2,535        19,054        17,558  
  

 

 

    

 

 

    

 

 

    

 

 

 
     26,461        27,038        253,011        198,888  

Light Materials:

           

Gypsum Wallboard

     47,613        39,742        167,336        154,614  

Gypsum Paperboard

     4,741        5,919        25,449        34,979  
  

 

 

    

 

 

    

 

 

    

 

 

 
     52,354        45,661        192,785        189,593  

Other Operations

     —          (254      —          (3,230
  

 

 

    

 

 

    

 

 

    

 

 

 

Sub-total

     78,815        72,445        445,796        385,251  

Corporate General and Administrative Expense

     (9,286      (16,904      (49,511      (65,410

Gain on Sale of Businesses

     —          —          51,973        —    

Impairment Losses

     —          —          —          (25,131

Other Non-Operating Income

     18,376        (2,039      20,274        (594
  

 

 

    

 

 

    

 

 

    

 

 

 

Earnings from Continuing Operations before Interest and Income Taxes

   $ 87,905      $ 53,502      $ 468,532      $ 294,116  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

*

Excluding Intersegment and Joint Venture Revenue listed on Attachment 3

 

9


Attachment 3

Eagle Materials Inc.

Sales Volume, Net Sales Prices and Intersegment and Cement Revenue

(unaudited)

 

     Sales Volume  
     Quarter Ended
March 31,
    Fiscal Year Ended
March 31,
 
     2021      2020      Change     2021      2020      Change  

Cement (M Tons):

                

Wholly Owned

     1,147        929        +23     6,576        4,975        +32

Joint Venture

     212        235        -10     890        956        -7
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 
     1,359        1,164        +17     7,466        5,931        +26

Concrete (M Cubic Yards)

     268        293        -9     1,300        1,388        -6

Aggregates (M Tons)

     423        705        -40     1,956        3,313        -41

Gypsum Wallboard (MMSFs)

     706        684        +3     2,857        2,694        +6

Paperboard (M Tons):

                

Internal

     34        30        +13     135        129        +5

External

     48        49        -2     190        197        -4
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 
     82        79        +4     325        326        0

 

     Average Net Sales Price*  
     Quarter Ended
March 31,
    Fiscal Year Ended
March 31,
 
     2021      2020      Change     2021      2020      Change  

Cement (Ton)

   $ 112.77      $ 111.09        +2   $ 111.19      $ 109.96        +1

Concrete (Cubic Yard)

   $ 115.30      $ 113.46        +2   $ 115.59      $ 109.28        +6

Aggregates (Ton)

   $ 9.39      $ 9.50        -1   $ 9.51      $ 9.39        +1

Gypsum Wallboard (MSF)

   $ 161.07      $ 146.62        +10   $ 149.62      $ 148.03        +1

Paperboard (Ton)

   $ 481.40      $ 457.13        +5   $ 486.15      $ 476.20        +2

 

*

Net of freight and delivery costs billed to customers.

 

     Intersegment and Cement Revenue
(dollars in thousands)
 
     Quarter Ended
March 31,
     Fiscal Year Ended
March 31,
 
     2021      2020      2021      2020  

Intersegment Revenue:

           

Cement

   $ 3,323      $ 4,369      $ 20,862      $ 21,499  

Concrete and Aggregates

     —          368        106        1,502  

Paperboard

     16,668        14,125        67,100        62,315  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 19,991      $ 18,862      $ 88,068      $ 85,316  
  

 

 

    

 

 

    

 

 

    

 

 

 

Cement Revenue:

           

Wholly Owned

   $ 142,080      $ 114,515      $ 818,503      $ 616,967  

Joint Venture

     25,588        27,761        105,191        113,536  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 167,668      $ 142,276      $ 923,694      $ 730,503  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

10


Attachment 4

Eagle Materials Inc.

Consolidated Balance Sheets

(dollars in thousands)

(unaudited)

 

     March 31,  
     2021     2020  

ASSETS

    

Current Assets –

    

Cash and Cash Equivalents

   $ 263,520     $ 118,648  

Restricted Cash

     5,000       —    

Accounts and Notes Receivable, net

     147,133       145,808  

Inventories

     235,749       272,121  

Federal Income Tax Receivable

     2,838       128,413  

Prepaid and Other Assets

     7,449       6,135  

Current Assets of Discontinued Operations

     —         7,092  
  

 

 

   

 

 

 

Total Current Assets

     661,689       678,217  
  

 

 

   

 

 

 

Property, Plant and Equipment, net

     1,659,100       1,756,417  

Investments in Joint Venture

     75,399       73,958  

Operating Lease Right of Use Asset

     25,811       29,483  

Notes Receivable

     8,419       9,139  

Goodwill and Intangibles

     392,315       396,463  

Assets from Discontinued Operations

     —         6,739  

Other Assets

     15,948       10,604  
  

 

 

   

 

 

 
   $ 2,838,681     $ 2,961,020  
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current Liabilities –

    

Accounts Payable and Accrued Liabilities

   $ 163,011     $ 154,625  

Operating Lease Liabilities

     6,343       6,585  

Current Liabilities of Discontinued Operations

     —         8,487  
  

 

 

   

 

 

 

Total Current Liabilities

     169,354       169,697  
  

 

 

   

 

 

 

Long-term Liabilities

     75,735       74,071  

Bank Credit Facility

     —         560,000  

Bank Term Loan

     662,186       660,761  

4.500% Senior Unsecured Notes due 2026

     346,430       346,554  

Deferred Income Taxes

     225,986       166,667  

Liabilities from Discontinued Operations

     —         15,427  

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 42,370,878 and 41,649,041 Shares, respectively.

     424       416  

Capital in Excess of Par Value

     62,497       10,943  

Accumulated Other Comprehensive Losses

     (3,440     (3,581

Retained Earnings

     1,299,509       960,065  
  

 

 

   

 

 

 

Total Stockholders’ Equity

     1,358,990       967,843  
  

 

 

   

 

 

 
   $ 2,838,681     $ 2,961,020  
  

 

 

   

 

 

 

 

11


Attachment 5

Eagle Materials Inc.

Depreciation, Depletion and Amortization by Lines of Business

(dollars in thousands)

(unaudited)

The following table presents depreciation, depletion and amortization by lines of business for the quarters and fiscal years ended March 31, 2021 and 2020:

 

     Depreciation, Depletion and Amortization  
     Quarter Ended
March 31,
     Fiscal Year Ended
March 31,
 
     2021      2020      2021      2020  

Cement

   $ 19,686      $ 16,806      $ 77,524      $ 59,081  

Concrete and Aggregates

     2,697        3,092        10,807        11,142  

Gypsum Wallboard

     5,445        5,171        21,646        20,320  

Paperboard

     3,708        2,335        13,913        8,945  

Corporate and Other

     1,272        919        4,976        2,720  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 32,808      $ 28,323      $ 128,866      $ 102,208  
  

 

 

    

 

 

    

 

 

    

 

 

 

 

12


Attachment 6

Eagle Materials Inc.

Reconciliation of Non-GAAP Financial Measures

(unaudited)

(dollars in thousands)

EBITDA and Adjusted EBITDA

We present Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA to provide more consistent comparison of operating performance from period to period. EBITDA is a non-GAAP financial measure that provides supplemental information regarding the operating performance of our business without regard to financing methods, capital structures or historical cost basis. Adjusted EBITDA is also a non-GAAP financial measure that excludes the impact from non-routine items, such as impairment losses, business development costs and gains on sale of businesses (Non-routine Items) and stock-based compensation. Management uses EBITDA and Adjusted EBITDA as alternative bases for comparing the operating performance of Eagle from period to period and for purposes of its budgeting and planning processes. Adjusted EBITDA may not be comparable to similarly titled measures of other companies because other companies may not calculate Adjusted EBITDA in the same manner. Neither EBITDA nor Adjusted EBITDA should be considered in isolation or as an alternative to net income, cash flow from operations or any other measure of financial performance in accordance with GAAP. The following shows the calculation of EBITDA and Adjusted EBITDA and reconciles them to net earnings in accordance with GAAP for the quarters and fiscal years ended March 31, 2021 and 2020:

 

     Quarter Ended
March 31,
     Fiscal Year Ended
March 31,
 
     2021      2020      2021      2020  

Net Earnings, as reported

   $ 66,011      $ 72,429      $ 339,444      $ 70,894  

(Earnings) Loss from Discontinued Operations

     —          (3,109      (5,278      160,297  

Income Tax Expense (Benefit)

     13,431        (25,713      89,946        24,504  

Interest Expense

     8,463        9,895        44,420        38,421  

Depreciation, Depletion and Amortization

     32,808        28,323        128,866        102,208  
  

 

 

    

 

 

    

 

 

    

 

 

 

EBITDA from Continuing Operations

   $ 120,713      $ 81,825      $ 597,398      $ 396,324  

Impairment Losses 1

     —          —          —          25,131  

Gain on Sale of Businesses

     —          —          (51,973      —    

Business Development Costs 2

     —          6,537        6,575        18,489  

Kosmos outage and purchase accounting 3

     —          6,756        3,700        6,756  

Stock-based Compensation

     3,236        3,416        15,293        19,823  

Plant Expansion Costs 4

     —          3,000        —          4,500  
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA from Continuing Operations

   $ 123,949      $ 101,534      $ 570,993      $ 471,023  

 

1 

Represents asset impairment losses related to retained Frac Sand assets recorded in fiscal 2020, primarily property

2 

Represents non-routine expenses associated with acquisitions and separation costs

3 

Represents the expenses of the annual maintenance outage at the Kosmos Cement Business which occurred shortly after the acquisition on March 6, 2020, and the impact of purchase accounting on inventory costs

4 

Represents the impact of an outage at the Republic Paperboard paper mill associated with the mill expansion

 

13