10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 1-12744

MARTIN MARIETTA MATERIALS, INC.

(Exact Name of Registrant as Specified in its Charter)


North Carolina	56-1848578
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
4123 Parklake Avenue, Raleigh, NC	27612
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (919) 781-4550

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 (Par Value $0.01)

MLM

NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of Common Stock, as of the latest practicable date.


Class		Outstanding as of July 24, 2023
Common Stock, $0.01 par value		61,804,211

MARTIN MARIETTA MATERIALS, INC. AND CONSOLIDATED SUBSIDIARIES

FORM 10-Q

For the Quarter Ended June 30, 2023


	Page
Part I. Financial Information:

Item 1. Financial Statements

Consolidated Balance Sheets – June 30, 2023 and December 31, 2022		3

Consolidated Statements of Earnings and Comprehensive Earnings – Three and Six Months Ended June 30, 2023 and 2022		4

Consolidated Statements of Cash Flows – Six Months Ended June 30, 2023 and 2022		5

Consolidated Statements of Total Equity – Three and Six Months Ended June 30, 2023 and 2022		6

Notes to Consolidated Financial Statements		8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		24

Item 3. Quantitative and Qualitative Disclosures About Market Risk		38

Item 4. Controls and Procedures		39

Part II. Other Information:

Item 1. Legal Proceedings		40

Item 1A. Risk Factors		40

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		40

Item 4. Mine Safety Disclosures		40

Item 5. Other Information		40

Item 6. Exhibits		41

Signatures		42

Page 2 of 42

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

MARTIN MARIETTA MATERIALS, INC. AND CONSOLIDATED SUBSIDIARIES

(UNAUDITED) CONSOLIDATED BALANCE SHEETS


	June 30,			December 31,
	2023			2022
	(In Millions, Except Par Value Data)
ASSETS
Current Assets:
Cash and cash equivalents	$	421.5		$	358.0
Restricted cash		—			0.8
Restricted investments (to satisfy discharged debt and related interest)		702.3			704.6
Accounts receivable, net		979.2			785.9
Inventories, net		954.7			873.7
Current assets held for sale		44.8			73.2
Other current assets		89.8			80.7
Total Current Assets		3,192.3			2,876.9

Property, plant and equipment		10,859.3			10,661.0
Allowances for depreciation, depletion and amortization		(4,546.5	)		(4,344.3	)
Net property, plant and equipment		6,312.8			6,316.7
Goodwill		3,649.5			3,649.5
Other intangibles, net		833.8			847.8
Operating lease right-of-use assets, net		384.4			383.5
Noncurrent assets held for sale		325.6			372.5
Other noncurrent assets		547.8			546.7
Total Assets	$	15,246.2		$	14,993.6

LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable	$	346.9		$	385.0
Accrued salaries, benefits and payroll taxes		63.6			71.6
Accrued other taxes		90.7			55.4
Accrued interest		42.5			42.8
Current maturities of discharged long-term debt		700.0			699.1
Operating lease liabilities		53.2			52.1
Current liabilities held for sale		0.9			4.5
Other current liabilities		144.6			135.1
Total Current Liabilities		1,442.4			1,445.6

Long-term debt		4,343.1			4,340.9
Deferred income taxes, net		915.8			914.3
Noncurrent operating lease liabilities		337.0			335.9
Noncurrent liabilities held for sale		17.5			21.8
Other noncurrent liabilities		767.0			762.3
Total Liabilities		7,822.8			7,820.8

Equity:
Common stock, par value $0.01 per share (61.8 shares and 62.1 shares outstanding at June 30, 2023 and December 31, 2022, respectively)		0.6			0.6
Preferred stock, par value $0.01 per share		—			—
Additional paid-in capital		3,500.8			3,489.0
Accumulated other comprehensive loss		(35.7	)		(38.5	)
Retained earnings		3,955.4			3,719.4
Total Shareholders' Equity		7,421.1			7,170.5
Noncontrolling interests		2.3			2.3
Total Equity		7,423.4			7,172.8
Total Liabilities and Equity	$	15,246.2		$	14,993.6

See accompanying notes to the consolidated financial statements.

Page 3 of 42

MARTIN MARIETTA MATERIALS, INC. AND CONSOLIDATED SUBSIDIARIES

(UNAUDITED) CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE EARNINGS


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2023			2022			2023			2022
	(In Millions, Except Per Share Data)
Total Revenues	$	1,820.8		$	1,641.7		$	3,174.9		$	2,872.5
Total Cost of Revenues		1,260.4			1,216.5			2,311.7			2,291.2

Gross Profit		560.4			425.2			863.2			581.3

Selling, general and administrative expenses		111.6			104.1			216.0			201.2
Acquisition and integration expenses		0.4			2.9			1.2			4.3
Other operating income, net		(14.9	)		(160.4	)		(13.3	)		(162.6	)
Earnings from Operations		463.3			478.6			659.3			538.4

Interest expense		42.2			43.1			84.3			83.6
Other nonoperating income, net		(18.7	)		(22.0	)		(34.9	)		(32.9	)
Earnings from continuing operations before income tax expense		439.8			457.5			609.9			487.7
Income tax expense		91.9			104.4			127.5			110.2
Earnings from continuing operations		347.9			353.1			482.4			377.5
Earnings (Loss) from discontinued operations, net of income tax expense (benefit)		0.7			13.3			(12.2	)		10.2
Consolidated net earnings		348.6			366.4			470.2			387.7
Less: Net earnings (loss) attributable to noncontrolling interests		0.3			(0.1	)		0.5			(0.2	)
Net Earnings Attributable to Martin Marietta	$	348.3		$	366.5		$	469.7		$	387.9

Consolidated Comprehensive Earnings (Loss) (See Note 1):
Earnings attributable to Martin Marietta	$	350.0		$	367.7		$	472.5		$	357.4
Earnings (Loss) attributable to noncontrolling interests		0.2			(0.1	)		0.5			(0.2	)
	$	350.2		$	367.6		$	473.0		$	357.2
Net Earnings (Loss) Attributable to Martin Marietta
Per Common Share:
Basic from continuing operations attributable to common shareholders	$	5.61		$	5.66		$	7.78		$	6.06
Basic from discontinued operations attributable to common shareholders		0.01			0.21			(0.20	)		0.16
	$	5.62		$	5.87		$	7.58		$	6.22

Diluted from continuing operations attributable to common shareholders	$	5.60		$	5.65		$	7.76		$	6.04
Diluted from discontinued operations attributable to common shareholders		0.01			0.21			(0.20	)		0.16
	$	5.61		$	5.86		$	7.56		$	6.20

Weighted-Average Common Shares Outstanding:
Basic		61.9			62.4			62.0			62.4
Diluted		62.1			62.5			62.2			62.6

See accompanying notes to the consolidated financial statements.

Page 4 of 42

MARTIN MARIETTA MATERIALS, INC. AND CONSOLIDATED SUBSIDIARIES

(UNAUDITED) CONSOLIDATED STATEMENTS OF CASH FLOWS


	Six Months Ended
	June 30,
	2023			2022
	(Dollars in Millions)
Cash Flows from Operating Activities:
Consolidated net earnings	$	470.2		$	387.7
Adjustments to reconcile consolidated net earnings to net cash provided by operating activities:
Depreciation, depletion and amortization		253.1			256.6
Stock-based compensation expense		27.7			24.5
Gain on sales of assets, divestitures and extinguishment of debt		(16.3	)		(173.9	)
Deferred income taxes, net		0.7			(32.7	)
Other items, net		(4.5	)		(3.4	)
Changes in operating assets and liabilities, net of effects of acquisitions and divestitures:
Accounts receivable, net		(196.2	)		(252.6	)
Inventories, net		(92.2	)		(79.5	)
Accounts payable		44.5			68.5
Other assets and liabilities, net		31.5			91.0
Net Cash Provided by Operating Activities		518.5			286.2

Cash Flows from Investing Activities:
Additions to property, plant and equipment		(293.4	)		(220.7	)
Acquisitions, net of cash acquired		—			11.0
Proceeds from sales of assets and divestitures		95.5			644.4
Investments in life insurance contracts, net		4.8			1.8
Other investing activities, net		(4.2	)		(3.0	)
Net Cash (Used for) Provided by Investing Activities		(197.3	)		433.5

Cash Flows from Financing Activities:
Repayments of debt		—			(47.7	)
Payments on finance lease obligations		(8.4	)		(7.3	)
Dividends paid		(82.5	)		(77.0	)
Repurchases of common stock		(150.0	)		(50.0	)
Distributions to owners of noncontrolling interest		(0.5	)		—
Proceeds from exercise of stock options		0.8			0.6
Shares withheld for employees’ income tax obligations		(17.9	)		(25.1	)
Net Cash Used for Financing Activities		(258.5	)		(206.5	)
Net Increase in Cash, Cash Equivalents and Restricted Cash		62.7			513.2
Cash, Cash Equivalents and Restricted Cash, beginning of period		358.8			258.9
Cash, Cash Equivalents and Restricted Cash, end of period	$	421.5		$	772.1

See accompanying notes to the consolidated financial statements.

Page 5 of 42

MARTIN MARIETTA MATERIALS, INC. AND CONSOLIDATED SUBSIDIARIES

(UNAUDITED) CONSOLIDATED STATEMENTS OF TOTAL EQUITY


(In Millions, Except Per Share Data)	Shares of Common Stock			Common Stock		Additional Paid-in Capital			Accumulated Other Comprehensive Loss			Retained Earnings			Total Shareholders' Equity			Noncontrolling Interests		Total Equity
Balance at March 31, 2023		62.0		$	0.6	$	3,487.2		$	(37.4	)	$	3,724.6		$	7,175.0		$	2.5	$	7,177.5
Consolidated net earnings		—			—		—			—			348.3			348.3			0.3		348.6
Other comprehensive earnings, net of tax		—			—		—			1.7			—			1.7			—		1.7
Dividends declared ($0.66 per common share)		—			—		—			—			(41.3	)		(41.3	)		—		(41.3	)
Issuances of common stock for stock award plans		—			—		0.7			—			—			0.7			—		0.7
Shares withheld for employees' income tax obligations		—			—		(1.1	)		—			—			(1.1	)		—		(1.1	)
Repurchases of common stock		(0.2	)		—		—			—			(76.2	)		(76.2	)		—		(76.2	)
Stock-based compensation expense		—			—