Summit Materials, Inc. Reports Fourth Quarter and Full Year 2020 Results

Nachrichtenquelle: Business Wire (engl.)
23.02.2021, 22:15  |  101   |   |   

Summit Materials, Inc. (NYSE: SUM, “Summit,” "Summit Inc." or the “Company”), a leading vertically integrated construction materials company, today announced results for the fourth quarter and full year 2020.

For the three months ended January 2, 2021, the Company reported net income attributable to Summit Inc. of $35.2 million, or $0.31 per basic share, compared to net income attributable to Summit Inc. of $35.7 million, or $0.32 per basic share in the comparable prior year period. Summit reported adjusted diluted net income of $28.8 million, or $0.25 per adjusted diluted share as compared to adjusted diluted net income of $71.5 million, or $0.62 per adjusted diluted share in the prior year period. For the full year 2020, net income attributable to Summit Inc. was $138.0 million, or $1.21 per basic share, compared to $59.1 million, or $0.53 per basic share, in 2019.

Summit's net revenue increased 13.0% in the fourth quarter of 2020 to $571.9 million, compared to $506.3 million in the fourth quarter of 2019, on higher ready-mix concrete, aggregates, asphalt and paving revenue, relative to a year ago. Net revenue increased $104.1 million to $2,134.8 million in the year ended January 2, 2021, resulting from growth in all lines of business other than cement.

The Company reported operating income of $66.2 million in the fourth quarter 2020, compared to $59.9 million in the prior year period, and operating income of $225.2 million in the full year 2020, compared to $213.6 million in 2019. Operating income increased by $11.6 million, or 5.4%, in 2020 as compared to 2019, primarily due to net revenue gains, partially offset by higher G&A costs due in part to a management transition that occurred earlier in the year. Summit's operating margin percentage for the three and twelve months ended January 2, 2021 decreased to 11.6% from 11.8%, and was unchanged at 10.5% respectively, from the comparable period a year ago, due to the factors noted above.

Adjusted EBITDA increased in the fourth quarter to $130.6 million as compared to $121.1 million in the fourth quarter 2019, and for full year 2020 Adjusted EBITDA increased to $485.0 million from $461.5 million in 2019.

For the three months ended January 2, 2021, sales volumes increased 24.7% in aggregates, 4.5% in cement, 6.4% in ready-mix concrete and 20.3% in asphalt relative to the same period last year. Organic average selling prices for aggregates decreased 3.6% in the fourth quarter of 2020 due to changes in product mix relative to a year ago as the fourth quarter 2019 included a contribution from flood repair work. Inclusive of acquisitions, average selling prices in the fourth quarter of 2020 decreased 6.2% in aggregates, and increased 2.8% in cement, 3.2% in ready-mix concrete and 2.1% in asphalt. For the full year 2020, sales volumes increased 9.5% in aggregates, 5.0% in ready-mix concrete and 4.7% in asphalt, and decreased 4.6% in cement. Average selling prices in full year 2020 decreased 2.0% in aggregates due to product mix, and increased 1.5% in cement, 4.7% in ready-mix concrete and 1.4% in asphalt. On a mix-adjusted basis, aggregates prices increased 1.7%.

Anne Noonan, CEO of Summit Materials, commented, "Summit delivered a strong finish to 2020 as migration trends continued to favor our rural and exurban markets, which directly benefited residential construction activity. In many of our key states, public spending activity was resilient and we had more working days. We are reporting record annual net income, Adjusted EBITDA and free cash flow. We are focused on sustainable growth with investments in greenfields and end markets that are underpinned by strong growth fundamentals. Our leverage ratio declined to 3.2x at year end, down from 3.6x a year ago. Most importantly, we continue to vigilantly practice safety and distancing protocols in response to the COVID-19 outbreak."

As of January 2, 2021, the Company had $418.2 million in cash and $1.9 billion in debt outstanding. The Company's $345 million revolving credit facility has $329 million available after letters of credit. For the year ended January 2, 2021, cash flow provided by operations was $408.9 million while cash paid for capital equipment was $177.2 million. Brian Harris, CFO of Summit Materials added, "Record annual net income and improved working capital management resulted in record annual free cash flow of $245.6 million. We ended 2020 at 3.2x leverage, which is the lowest year-end leverage ratio in Summit's history, combined with nearly $750 million in available liquidity."

For the full year 2021, Summit is currently projecting Adjusted EBITDA of approximately $490 million to $520 million.

The Company is announcing 2021 capital expenditure guidance of $200 million to $220 million including approximately $25 million to $35 million for greenfield projects.

Full-Year 2020 | Results by Line of Business

 

Aggregates Business: Aggregates net revenues were $498.0 million in 2020, compared to $469.7 million the prior year. Aggregates adjusted cash gross profit margin decreased to 59.2% in 2020 compared to 60.2% on a combination of higher volumes, and product mix. Aggregates sales volumes increased 9.5% in 2020, when compared to the prior year period on higher organic volume growth, particularly in Texas, Utah, and Kansas. Average selling prices for aggregates decreased 2.0% in 2020 when compared to the prior year period, which included some favorably priced levee repair work in 2019. On a mix-adjusted basis, Summit estimates that aggregates prices increased by approximately 1.7% in 2020.

Cement Business: Cement segment net revenues decreased 6.9% to $270.6 million in 2020 when compared to the prior year period. Cement adjusted cash gross profit margin decreased to 39.6%, compared to 40.3% in the prior year. Organic sales volume of cement decreased 4.6% in 2020 when compared to the prior year. Organic average selling prices on cement increased 1.5% in 2020 relative to 2019. In addition, our solid waste processing facility continued to undergo repairs related to an explosion that occurred in April 2020. The full year 2020 impact was approximately $14 million of foregone adjusted EBITDA.

Products Business: Products net revenues were $1,069.0 million in 2020, compared to $988.6 million in the prior year. Products adjusted cash gross profit margin increased to 23.8%, versus 22.1% in the prior year. Our organic average sales price for ready-mix concrete increased 4.7%, coupled with a 5.0% increase in organic sales volumes of ready-mix concrete, led by higher volumes in Utah and Kansas. Our organic average sales price for asphalt increased 1.4% while we had a 4.7% increase in asphalt organic sales volumes, driven in part by volume growth in Texas, Kansas and Virginia.

Fourth Quarter 2020 | Results by Line of Business

 

Aggregates Business: Aggregates net revenues increased by $19.8 million to $135.5 million in the fourth quarter 2020 when compared to the prior year period. Aggregates adjusted cash gross profit margin decreased to 57.6% in the fourth quarter 2020 as compared to 61.9% in the fourth quarter 2019 on differences in product mix. Aggregates sales volumes increased 24.7% in the fourth quarter 2020 when compared to the prior year period on higher volumes in Texas, partially offset by lower volumes in Missouri and Kansas. Average selling prices for aggregates decreased 6.2% in the fourth quarter 2020, reflecting acquisition related volumes. On an organic basis, average selling prices for aggregates decreased 3.6%. On a mix-adjusted basis, Summit estimates that aggregates prices increased by approximately 1.7% in 2020.

Cement Business: Cement segment net revenues increased 3.3% to $72.2 million in the fourth quarter 2020, when compared to the prior year period, on higher sales volume of cement. Cement adjusted cash gross profit margin increased to 47.5% in the fourth quarter, compared to 45.4% in the prior year period, as higher volumes resulted in lower unit plant costs. In addition, our solid waste processing facility continued to undergo repairs related to an explosion that occurred in April 2020. The Adjusted EBITDA impact from the down time at the facility was approximately $4.2 million in the fourth quarter 2020. Sales volume of cement increased 4.5% in the fourth quarter and average selling prices increased 2.8% when compared to the prior year period.

Products Business: Products net revenues were $286.0 million in the fourth quarter 2020, compared to $251.4 million in the prior year period. Products adjusted cash gross profit margin increased to 24.0% in the fourth quarter, versus 23.9% in the prior year period. Our organic average sales price for ready-mix concrete increased 3.2% and organic sales volumes of ready-mix concrete increased 6.4%, as higher volumes in residential construction markets were offset by flat to slightly lower volumes in other parts of Texas (Permian) and Kentucky. Our organic average sales price for asphalt increased 2.1%, while asphalt organic sales volumes increased 20.3%, as lower volume in Kentucky was offset by higher volumes in North Texas and Kansas.

Full-Year 2020 | Results By Reporting Segment

 

Net revenue increased by 5.1% to $2.1 billion in 2020, versus $2.0 billion in 2019. The increase in consolidated net revenue relative to 2019 was primarily attributable to a 12.2% increase in West Segment net revenue, partially offset by a 0.1% decrease in East Segment net revenue, combined with a 6.9% decrease in Cement Segment net revenue. The Company reported operating income of $225.2 million in 2020, compared to $213.6 million in the prior year. Adjusted EBITDA was $485.0 million in 2020, an increase of 5.1% compared to $461.5 million in 2019.

West Segment: The West Segment reported operating income of $176.5 million in 2020, compared to $109.2 million in 2019, due to higher revenue from all lines of business. Adjusted EBITDA increased to $271.1 million in 2020, an increase of 32.2% compared to $205.0 million in 2019. Aggregates revenue in 2020 increased 15.9% over 2019, partly as a result of a 4.4% increase in organic volumes, led by volume growth in Texas, and a 1.8% increase in organic average selling prices. Ready-mix concrete revenue in 2020 increased 7.8% over 2019, reflecting improved weather conditions relative to a year ago. Organic ready-mix concrete volumes increased 3.0% while organic average sales prices increased 4.7%. Asphalt revenue increased by 12.7% in 2020, as organic volumes increased 10.3% and average sales prices increased 2.9% compared to 2019. The Company completed the acquisition of Multisources of Houston, Texas and Valley Gravel of Abbotsford, British Columbia, in 2020, both of which are primarily aggregates businesses.

East Segment: The East Segment reported operating income of $69.8 million in 2020, compared to $101.8 million in 2019, primarily due to decreased asphalt and paving activity in Kentucky. Adjusted EBITDA decreased to $162.3 million in 2020, compared to $187.6 million in 2019. Aggregates net revenue increased 1.3%, primarily due to a 3.0% increase in organic volume despite a decrease in organic average sales prices of 2.1%, as sales prices decreased in Missouri relative to 2019, which included more higher priced flood and levy volumes related to public repair work. Organic ready-mix concrete revenue increased 16.4% due to a 11.2% increase in volume and a 4.6% increase in price. Organic asphalt revenue decreased 18.8%, reflecting a 7.9% decrease in volume, combined with a 3.3% decrease in price, reflecting less activity in Kentucky, partially offset by higher volume in Kansas and Virginia.

Cement Segment: The Cement Segment reported operating income of $55.3 million in 2020, compared to $64.7 million in 2019. Adjusted EBITDA declined to $93.0 million in 2020, compared to $103.4 million in 2019. Cement Segment revenue decreased 6.9%, reflecting a 4.6% decrease in volume despite a 1.5% increase in price. Cement segment operating income declined in part due to lower sales volumes related to COVID-19, notably in our southern markets. Additionally, our solid waste processing facility that provides fuel for one of our plants remained closed to processing solid waste due to an explosion in April 2020, which increased our operating costs.

Fourth Quarter 2020 | Results By Reporting Segment

 

Net revenue increased by 13.0% to $571.9 million in the fourth quarter 2020, versus $506.3 million in the prior year period on higher volume in all lines of business. Aggregates reported average selling prices declined 6.2% in the fourth quarter 2020 relative to the prior year, but on a product mix adjusted basis, year to date aggregates pricing has increased approximately 2.1%. The Company reported operating income of $66.2 million in the fourth quarter 2020, compared to $59.9 million in the prior year period.

Net income decreased to $36.3 million in the fourth quarter of 2020, compared to income of $36.4 million in the prior year period. Adjusted EBITDA increased 7.9% to $130.6 million in the fourth quarter of 2020, compared to $121.1 million in the prior year period on higher revenue.

West Segment: The West Segment reported operating income of $47.2 million in the fourth quarter 2020, compared to $30.7 million in the prior year period. Adjusted EBITDA increased to $74.2 million in the fourth quarter 2020, compared to $53.9 million in the prior year period. Improvements in operating income reflected increased demand for aggregates and ready-mix concrete in Utah and Texas. Aggregates revenue in the fourth quarter increased 43.1% over the prior year period, while organic volumes and average sales prices increased 15.9% and 2.3%, respectively. Ready-mix concrete revenue in the fourth quarter 2020 increased 12.3% over the prior year period, as organic volumes increased 8.8% and organic average sales prices increased 3.3%, reflecting favorable market conditions in Utah and Texas. Asphalt revenue increased by 38.9% in the fourth quarter 2020 over the prior year period. Asphalt volumes increased 33.5%, reflecting higher demand in Texas and Utah, and sales prices increased 4.0%.

East Segment: The East Segment reported operating income of $20.8 million in the fourth quarter 2020, compared to $29.8 million in the prior year period as lower asphalt revenues due to the ongoing fiscal constraints in Kentucky more than offset strength in ready-mix concrete. Adjusted EBITDA decreased to $42.4 million in the fourth quarter 2020, compared to $53.1 million in the prior year period. Aggregates revenue decreased 0.3%, as average selling prices decreased 7.0% on a difference in product mix from the year-ago quarter, which reflected significant flood repair work. The decrease in revenue was partially offset by a 6.4% increase in organic volumes on higher volumes in Kansas, Kentucky, and Virginia. Ready-mix concrete revenue increased 2.7% as organic average selling prices increased 2.7% due in part to wind farm work in Kansas. Asphalt revenue decreased 12.1% as organic volumes decreased 2.6% on a lower contribution from Kentucky, and organic average selling prices decreased 3.9%.

Cement Segment: The Cement Segment reported operating income of $20.8 million in the fourth quarter 2020, compared to $20.6 million in the prior year period. The segment reported organic sales volumes and organic average selling prices increased 4.5% and increased 2.8%, respectively, during the fourth quarter 2020 as compared to the prior year period. Adjusted EBITDA increased to $29.8 million in the fourth quarter 2020, compared to $27.9 million in the prior year period as volumes improved relative to the prior year, resulting in lower unit plant costs. In addition, our solid waste processing facility continued to undergo repairs related to an explosion that occurred in April 2020. The Adjusted EBITDA impact from the down time at the facility was approximately $4.0 million in the quarter.

Liquidity and Capital Resources

 

As of January 2, 2021, the Company had cash on hand of $418.2 million and borrowing capacity under its $345 million revolving credit facility of $329 million. The borrowing capacity on the revolving credit facility is currently fully available to the Company within the terms and covenant requirements of its credit agreement. As of January 2, 2021, the Company had $1.9 billion in debt outstanding.

Financial Outlook

 

For the full year 2021, Summit is currently projecting Adjusted EBITDA of approximately $490 million to $520 million.

The Company is announcing 2021 capital expenditure guidance of $200 million to $220 million including approximately $25 million to $35 million for greenfield projects.

Webcast and Conference Call Information

 

Summit Materials will conduct a conference call on Wednesday, February 24, 2021, at 11:00 a.m. eastern time (9:00 a.m. mountain time) to review the Company’s fourth quarter and full year 2020 financial results, discuss recent events and conduct a question-and-answer session.

A webcast of the conference call and accompanying presentation materials will be available in the Investors section of Summit’s website at investors.summit-materials.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download, and install any necessary audio software.

To participate in the live teleconference on February 24, 2021:
Domestic Live: 1-877-823-8690
International Live: 1-825-312-2236
Conference ID: 1994474
Password: Summit

To listen to a replay of the teleconference, which will be available through March 3, 2021:
Domestic Replay: 1-800-585-8367
International Replay: 1-416-621-4642
Conference ID: 1994474

About Summit Materials

 

Summit Materials is a leading vertically integrated materials-based company that supplies aggregates, cement, ready-mix concrete and asphalt in the United States and British Columbia, Canada. Summit is a geographically diverse, materials-based business of scale that offers customers a single-source provider of construction materials and related downstream products in the public infrastructure, residential and nonresidential end markets. Summit has a strong track record of successful acquisitions since its founding and continues to pursue growth opportunities in new and existing markets. For more information about Summit Materials, please visit www.summit-materials.com.

Non-GAAP Financial Measures

 

The Securities and Exchange Commission (“SEC”) regulates the use of “non-GAAP financial measures,” such as Adjusted Net Income (Loss), Adjusted Diluted Net Income, Adjusted Diluted EPS, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Free Cash Flow, Net Leverage and Net Debt which are derived on the basis of methodologies other than in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). We have provided these measures because, among other things, we believe that they provide investors with additional information to measure our performance, evaluate our ability to service our debt and evaluate certain flexibility under our restrictive covenants. Our Adjusted Net Income (Loss), Adjusted Diluted Net Income, Adjusted Diluted EPS, Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Free Cash Flow, Net Leverage and Net Debt may vary from the use of such terms by others and should not be considered as alternatives to or more important than net income (loss), operating income (loss), revenue or any other performance measures derived in accordance with U.S. GAAP as measures of operating performance or to cash flows as measures of liquidity.

Adjusted EBITDA, Adjusted EBITDA Margin, and other non-GAAP measures have important limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under U.S. GAAP. Some of the limitations of Adjusted EBITDA are that these measures do not reflect: (i) our cash expenditures or future requirements for capital expenditures or contractual commitments; (ii) changes in, or cash requirements for, our working capital needs; (iii) interest expense or cash requirements necessary to service interest and principal payments on our debt; and (iv) income tax payments we are required to make. Because of these limitations, we rely primarily on our U.S. GAAP results and use Adjusted EBITDA, Adjusted EBITDA Margin and other non-GAAP measures on a supplemental basis.

Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Cash Gross Profit, Adjusted Cash Gross Profit Margin, Adjusted Net Income (Loss), Adjusted Diluted Net Income, Adjusted Diluted EPS, Free Cash Flow, Net Leverage and Net Debt reflect additional ways of viewing aspects of our business that, when viewed with our GAAP results and the accompanying reconciliations to U.S. GAAP financial measures included in the tables attached to this press release, may provide a more complete understanding of factors and trends affecting our business. We strongly encourage investors to review our consolidated financial statements in their entirety and not rely on any single financial measure. Reconciliations of the non-GAAP measures used in this press release are included in the attached tables. Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, we have not provided reconciliations for forward-looking non-GAAP measures. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results.

Cautionary Statement Regarding Forward-Looking Statements

 

This press release includes “forward-looking statements” within the meaning of the federal securities laws, which involve risks and uncertainties. Forward-looking statements include all statements that do not relate solely to historical or current facts, and you can identify forward-looking statements because they contain words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “trends,” “plans,” “estimates,” “projects” or “anticipates” or similar expressions that concern our strategy, plans, expectations or intentions. All statements made relating to our estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and financial results are forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, it is very difficult to predict the effect of known factors, and, of course, it is impossible to anticipate all factors that could affect our actual results. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that the results or conditions described in such statements or our objectives and plans will be realized. Important factors could affect our results and could cause results to differ materially from those expressed in our forward-looking statements, including but not limited to the factors discussed in the section entitled “Risk Factors” in Summit Inc.’s Annual Report on Form 10-K for the fiscal year ended December 28, 2019 and Quarterly Report on Form 10-Q for the fiscal period ended March 28, 2020, each as filed with the SEC, and any factors discussed in the section entitled “Risk Factors” in any of our subsequently filed SEC filings.

  • the impact of the COVID-19 pandemic, or any similar crisis, on our business;
  • our dependence on the construction industry and the strength of the local economies in which we operate;
  • the cyclical nature of our business;
  • risks related to weather and seasonality;
  • risks associated with our capital-intensive business;
  • competition within our local markets;
  • our ability to execute on our acquisition strategy, successfully integrate acquisitions with our existing operations and retain key employees of acquired businesses;
  • our dependence on securing and permitting aggregate reserves in strategically located areas;
  • declines in public infrastructure construction and delays or reductions in governmental funding, including the funding by transportation authorities and other state agencies;
  • our reliance on private investment in infrastructure, which may be adversely affected by periods of economic stagnation and recession;
  • environmental, health, safety and climate change laws or governmental requirements or policies concerning zoning and land use;
  • costs associated with pending and future litigation;
  • rising prices for commodities, labor and other production and delivery inputs as a result of inflation or otherwise;
  • conditions in the credit markets;
  • our ability to accurately estimate the overall risks, requirements or costs when we bid on or negotiate contracts that are ultimately awarded to us;
  • material costs and losses as a result of claims that our products do not meet regulatory requirements or contractual specifications;
  • cancellation of a significant number of contracts or our disqualification from bidding for new contracts;
  • special hazards related to our operations that may cause personal injury or property damage not covered by insurance;
  • unexpected factors affecting self-insurance claims and reserve estimates;
  • our substantial current level of indebtedness, including our exposure to variable interest rate risk;
  • our dependence on senior management and other key personnel, and our ability to retain and attract qualified personnel;
  • supply constraints or significant price fluctuations in the electricity and petroleum-based resources that we use, including diesel and liquid asphalt;
  • climate change and climate change legislation or regulations;
  • unexpected operational difficulties;
  • interruptions in our information technology systems and infrastructure; including cybersecurity and data leakage risks; and
  • potential labor disputes, strikes, other forms of work stoppage or other union activities.

All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements. Any forward-looking statement that we make herein speaks only as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

($ in thousands, except share and per share amounts)

 

 

Three months ended

 

Year ended

 

 

January 2,

 

December 28,

 

January 2,

 

December 28,

 

 

2021

 

2019

 

2021

 

2019

Revenue:

 

 

 

 

 

 

 

 

Product

 

$

490,208

 

 

$

430,463

 

 

$

1,824,679

 

 

$

1,724,462

 

Service

 

81,654

 

 

75,796

 

 

310,075

 

 

306,185

 

Net revenue

 

571,862

 

 

506,259

 

 

2,134,754

 

 

2,030,647

 

Delivery and subcontract revenue

 

52,771

 

 

50,269

 

 

197,697

 

 

191,493

 

Total revenue

 

624,633

 

 

556,528

 

 

2,332,451

 

 

2,222,140

 

Cost of revenue (excluding items shown separately below):

 

 

 

 

 

 

 

 

Product

 

308,354

 

 

269,960

 

 

1,166,266

 

 

1,116,662

 

Service

 

57,554

 

 

50,627

 

 

220,033

 

 

218,177

 

Net cost of revenue

 

365,908

 

 

320,587

 

 

1,386,299

 

 

1,334,839

 

Delivery and subcontract cost

 

52,771

 

 

50,269

 

 

197,697

 

 

191,493

 

Total cost of revenue

 

418,679

 

 

370,856

 

 

1,583,996

 

 

1,526,332

 

General and administrative expenses

 

84,000

 

 

75,420

 

 

309,531

 

 

275,813

 

Depreciation, depletion, amortization and accretion

 

57,560

 

 

52,962

 

 

221,320

 

 

217,102

 

Gain on sale of property, plant and equipment

 

(1,822)

 

 

(2,636)

 

 

(7,569)

 

 

(10,665)

 

Operating income

 

66,216

 

 

59,926

 

 

225,173

 

 

213,558

 

Interest expense

 

25,546

 

 

28,086

 

 

103,595

 

 

116,509

 

Loss on debt financings

 

 

 

 

 

4,064

 

 

14,565

 

Tax receivable agreement (benefit) expense

 

(7,559)

 

 

16,237

 

 

(7,559)

 

 

16,237

 

Other income, net

 

(1,229)

 

 

(3,623)

 

 

(3,982)

 

 

(11,977)

 

Income from operations before taxes

 

49,458

 

 

19,226

 

 

129,055

 

 

78,224

 

Income tax expense (benefit)

 

13,148

 

 

(17,171)

 

 

(12,185)

 

 

17,101

 

Net income

 

36,310

 

 

36,397

 

 

141,240

 

 

61,123

 

Net income attributable to Summit Holdings (1)

 

1,158

 

 

726

 

 

3,273

 

 

2,057

 

Net income attributable to Summit Inc.

 

$

35,152

 

 

$

35,671

 

 

$

137,967

 

 

$

59,066

 

Earnings per share of Class A common stock:

 

 

 

 

 

 

 

 

Basic

 

$

0.31

 

 

$

0.32

 

 

$

1.21

 

 

$

0.53

 

Diluted

 

$

0.31

 

 

$

0.31

 

 

$

1.20

 

 

$

0.52

 

Weighted average shares of Class A common stock:

 

 

 

 

 

 

 

 

Basic

 

114,613,695

 

 

112,755,444

 

 

114,227,192

 

 

112,204,067

 

Diluted

 

115,146,597

 

 

114,036,924

 

 

114,631,768

 

 

112,684,718

 

________________________________________________________

(1) Represents portion of business owned by pre-IPO investors rather than by Summit.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Consolidated Balance Sheets

($ in thousands, except share and per share amounts)

 

 

January 2,

 

December 28,

 

 

2021

 

2019

Assets

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

418,181

 

 

$

311,319

 

Accounts receivable, net

 

254,696

 

 

253,256

 

Costs and estimated earnings in excess of billings

 

8,666

 

 

13,088

 

Inventories

 

200,308

 

 

204,787

 

Other current assets

 

11,428

 

 

13,831

 

Total current assets

 

893,279

 

 

796,281

 

Property, plant and equipment

 

1,850,169

 

 

1,747,449

 

Goodwill

 

1,201,291

 

 

1,199,699

 

Intangible assets

 

47,852

 

 

23,498

 

Deferred tax assets

 

231,877

 

 

212,333

 

Operating lease right-of-use assets

 

28,543

 

 

32,777

 

Other assets

 

55,000

 

 

55,519

 

Total assets

 

$

4,308,011

 

 

$

4,067,556

 

Liabilities and Stockholders’ Equity

 

 

 

 

Current liabilities:

 

 

 

 

Current portion of debt

 

$

6,354

 

 

$

7,942

 

Current portion of acquisition-related liabilities

 

10,265

 

 

32,700

 

Accounts payable

 

120,813

 

 

116,359

 

Accrued expenses

 

160,570

 

 

120,005

 

Current operating lease liabilities

 

8,188

 

 

8,427

 

Billings in excess of costs and estimated earnings

 

16,499

 

 

13,864

 

Total current liabilities

 

322,689

 

 

299,297

 

Long-term debt

 

1,892,347

 

 

1,851,057

 

Acquisition-related liabilities

 

12,246

 

 

19,801

 

Tax receivable agreement liability

 

321,680

 

 

326,965

 

Noncurrent operating lease liabilities

 

21,500

 

 

25,381

 

Other noncurrent liabilities

 

121,281

 

 

100,282

 

Total liabilities

 

2,691,743

 

 

2,622,783

 

Stockholders’ equity:

 

 

 

 

Class A common stock, par value $0.01 per share; 1,000,000,000 shares authorized, 114,390,595 and 113,309,385 shares issued and outstanding as of January 2, 2021 and December 28, 2019, respectively

 

1,145

 

 

1,134

 

Class B common stock, par value $0.01 per share; 250,000,000 shares authorized, 99 shares issued and outstanding as of January 2, 2021 and December 28, 2019

 

 

 

 

Additional paid-in capital

 

1,264,681

 

 

1,234,020

 

Accumulated earnings

 

326,772

 

 

188,805

 

Accumulated other comprehensive income

 

5,203

 

 

3,448

 

Stockholders’ equity

 

1,597,801

 

 

1,427,407

 

Noncontrolling interest in Summit Holdings

 

18,467

 

 

17,366

 

Total stockholders’ equity

 

1,616,268

 

 

1,444,773

 

Total liabilities and stockholders’ equity

 

$

4,308,011

 

 

$

4,067,556

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

($ in thousands)

 

 

Year ended

 

 

January 2,

 

December 28,

 

 

2021

 

2019

Cash flow from operating activities:

 

 

 

 

Net income

 

$

141,240

 

 

$

61,123

 

Adjustments to reconcile net income to net cash used in operating activities:

 

 

 

 

Depreciation, depletion, amortization and accretion

 

227,817

 

 

222,862

 

Share-based compensation expense

 

28,857

 

 

20,403

 

Net gain on asset disposals

 

(7,548)

 

 

(10,294)

 

Non-cash loss on debt financings

 

4,064

 

 

2,850

 

Change in deferred tax asset, net

 

(18,384)

 

 

16,012

 

Other

 

619

 

 

(2,135)

 

Decrease (increase) in operating assets, net of acquisitions and dispositions:

 

 

 

 

Accounts receivable, net

 

5,467

 

 

(37,049)

 

Inventories

 

3,339

 

 

8,582

 

Costs and estimated earnings in excess of billings

 

4,535

 

 

5,558

 

Other current assets

 

472

 

 

5,465

 

Other assets

 

10,264

 

 

5,085

 

(Decrease) increase in operating liabilities, net of acquisitions and dispositions:

 

 

 

 

Accounts payable

 

(4,231)

 

 

18,903

 

Accrued expenses

 

15,476

 

 

7,640

 

Billings in excess of costs and estimated earnings

 

2,616

 

 

1,988

 

Tax receivable agreement liability

 

(5,285)

 

 

17,291

 

Other liabilities

 

(449)

 

 

(7,100)

 

Net cash provided by operating activities

 

408,869

 

 

337,184

 

Cash flow from investing activities:

 

 

 

 

Acquisitions, net of cash acquired

 

(123,477)

 

 

(5,392)

 

Purchases of property, plant and equipment

 

(177,249)

 

 

(177,495)

 

Proceeds from the sale of property, plant and equipment

 

14,018

 

 

21,173

 

Other

 

1,121

 

 

(1,095)

 

Net cash used in investing activities

 

(285,587)

 

 

(162,809)

 

Cash flow from financing activities:

 

 

 

 

Proceeds from debt issuances

 

700,000

 

 

300,000

 

Debt issuance costs

 

(9,605)

 

 

(6,312)

 

Payments on debt

 

(674,045)

 

 

(270,229)

 

Payments on acquisition-related liabilities

 

(33,257)

 

 

(33,883)

 

Proceeds from stock option exercises

 

1,043

 

 

19,076

 

Other

 

(907)

 

 

(502)

 

Net cash (used in) provided by financing activities

 

(16,771)

 

 

8,150

 

Impact of foreign currency on cash

 

351

 

 

286

 

Net increase in cash

 

106,862

 

 

182,811

 

Cash and cash equivalents—beginning of period

 

311,319

 

 

128,508

 

Cash and cash equivalents—end of period

 

$

418,181

 

 

$

311,319

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Revenue Data by Segment and Line of Business

($ in thousands)

 

 

Three months ended

 

Year ended

 

 

January 2,

 

December 28,

 

January 2,

 

December 28,

 

 

2021

 

2019

 

2021

 

2019

Segment Net Revenue:

 

 

 

 

 

 

 

 

West

 

$

312,895

 

 

$

249,694

 

 

$

1,147,921

 

 

$

1,022,730

 

East

 

186,806

 

 

186,705

 

 

716,211

 

 

717,213

 

Cement

 

72,161

 

 

69,860

 

 

270,622

 

 

290,704

 

Net Revenue

 

$

571,862

 

 

$

506,259

 

 

$

2,134,754

 

 

$

2,030,647

 

 

 

 

 

 

 

 

 

 

Line of Business - Net Revenue:

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

135,461

 

 

$

115,620

 

 

$

498,007

 

 

$

469,670

 

Cement (1)

 

68,775

 

 

63,455

 

 

257,629

 

 

266,235

 

Products

 

285,972

 

 

251,388

 

 

1,069,043

 

 

988,557

 

Total Materials and Products

 

490,208

 

 

430,463

 

 

1,824,679

 

 

1,724,462

 

Services

 

81,654

 

 

75,796

 

 

310,075

 

 

306,185

 

Net Revenue

 

$

571,862

 

 

$

506,259

 

 

$

2,134,754

 

 

$

2,030,647

 

 

 

 

 

 

 

 

 

 

Line of Business - Net Cost of Revenue:

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

57,378

 

 

$

44,026

 

 

$

203,393

 

 

$

186,724

 

Cement

 

34,532

 

 

31,726

 

 

150,519

 

 

149,149

 

Products

 

217,474

 

 

191,247

 

 

814,146

 

 

770,533

 

Total Materials and Products

 

309,384

 

 

266,999

 

 

1,168,058

 

 

1,106,406

 

Services

 

56,524

 

 

53,588

 

 

218,241

 

 

228,433

 

Net Cost of Revenue

 

$

365,908

 

 

$

320,587

 

 

$

1,386,299

 

 

$

1,334,839

 

 

 

 

 

 

 

 

 

 

Line of Business - Adjusted Cash Gross Profit (2):

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

$

78,083

 

 

$

71,594

 

 

$

294,614

 

 

$

282,946

 

Cement (3)

 

34,243

 

 

31,729

 

 

107,110

 

 

117,086

 

Products

 

68,498

 

 

60,141

 

 

254,897

 

 

218,024

 

Total Materials and Products

 

180,824

 

 

163,464

 

 

656,621

 

 

618,056

 

Services

 

25,130

 

 

22,208

 

 

91,834

 

 

77,752

 

Adjusted Cash Gross Profit

 

$

205,954

 

 

$

185,672

 

 

$

748,455

 

 

$

695,808

 

 

 

 

 

 

 

 

 

 

Adjusted Cash Gross Profit Margin (2)

 

 

 

 

 

 

 

 

Materials

 

 

 

 

 

 

 

 

Aggregates

 

57.6

%

 

61.9

%

 

59.2

%

 

60.2

%

Cement (3)

 

47.5

%

 

45.4

%

 

39.6

%

 

40.3

%

Products

 

24.0

%

 

23.9

%

 

23.8

%

 

22.1

%

Services

 

30.8

%

 

29.3

%

 

29.6

%

 

25.4

%

Total Adjusted Cash Gross Profit Margin

 

36.0

%

 

36.7

%

 

35.1

%

 

34.3

%

________________________________________________________

(1) Net revenue for the cement line of business excludes revenue associated with hazardous and non-hazardous waste, which is processed into fuel and used in the cement plants and is included in services net revenue. Additionally, net revenue from cement swaps and other cement-related products are included in products net revenue.

(2) Adjusted cash gross profit is calculated as net revenue by line of business less net cost of revenue by line of business. Adjusted cash gross profit margin is defined as adjusted cash gross profit divided by net revenue.

(3) The cement adjusted cash gross profit includes the earnings from the waste processing operations, cement swaps and other products. Cement line of business adjusted cash gross profit margin is defined as cement adjusted cash gross profit divided by cement segment net revenue.

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Volume and Price Statistics

(Units in thousands)

 

 

Three months ended

 

Year ended

Total Volume

 

January 2, 2021

 

December 28, 2019

 

January 2, 2021

 

December 28, 2019

Aggregates (tons)

 

16,622

 

 

13,325

 

 

59,098

 

 

53,954

 

Cement (tons)

 

600

 

 

574

 

 

2,286

 

 

2,395

 

Ready-mix concrete (cubic yards)

 

1,523

 

 

1,431

 

 

5,740

 

 

5,466

 

Asphalt (tons)

 

1,550

 

 

1,288

 

 

5,831

 

 

5,568

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Year ended

Pricing

 

January 2, 2021

 

December 28, 2019

 

January 2, 2021

 

December 28, 2019

Aggregates (per ton)

 

$

10.27

 

 

$

10.95

 

 

$

10.77

 

 

$

10.99

 

Cement (per ton)

 

118.44

 

 

115.27

 

 

116.80

 

 

115.03

 

Ready-mix concrete (per cubic yards)

 

117.86

 

 

114.21

 

 

116.47

 

 

111.27

 

Asphalt (per ton)

 

59.95

 

 

58.73

 

 

59.76

 

 

58.93

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Year ended

 

 

Percentage Change in

 

Percentage Change in

Year over Year Comparison

 

Volume

 

Pricing

 

Volume

 

Pricing

Aggregates (per ton)

 

24.7

%

 

(6.2)

%

 

9.5

%

 

(2.0)

%

Cement (per ton)

 

4.5

%

 

2.8

%

 

(4.6)

%

 

1.5

%

Ready-mix concrete (per cubic yards)

 

6.4

%

 

3.2

%

 

5.0

%

 

4.7

%

Asphalt (per ton)

 

20.3

%

 

2.1

%

 

4.7

%

 

1.4

%

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Year ended

 

 

Percentage Change in

 

Percentage Change in

Year over Year Comparison (Excluding acquisitions)

 

Volume

 

Pricing

 

Volume

 

Pricing

Aggregates (per ton)

 

10.7

%

 

(3.6)

%

 

3.6

%

 

(0.5)

%

Cement (per ton)

 

4.5

%

 

2.8

%

 

(4.6)

%

 

1.5

%

Ready-mix concrete (per cubic yards)

 

6.4

%

 

3.2

%

 

5.0

%

 

4.7

%

Asphalt (per ton)

 

20.3

%

 

2.1

%

 

4.7

%

 

1.4

%

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Reconciliations of Gross Revenue to Net Revenue by Line of Business

($ and Units in thousands, except pricing information)

 

 

Three months ended January 2, 2021

 

 

 

 

 

 

Gross Revenue

 

Intercompany

 

Net

 

 

Volumes

 

Pricing

 

by Product

 

Elimination/Delivery

 

Revenue

Aggregates

 

16,622

 

 

$

10.27

 

 

$

170,756

 

 

$

(35,295)

 

 

$

135,461

 

Cement

 

600

 

 

118.44

 

 

71,017

 

 

(2,242)

 

 

68,775

 

Materials

 

 

 

 

 

$

241,773

 

 

$

(37,537)

 

 

$

204,236

 

Ready-mix concrete

 

1,523

 

 

117.86

 

 

179,454

 

 

(104)

 

 

179,350

 

Asphalt

 

1,550

 

 

59.95

 

 

92,898

 

 

(72)

 

 

92,826

 

Other Products

 

 

 

 

 

97,265

 

 

(83,469)

 

 

13,796

 

Products

 

 

 

 

 

$

369,617

 

 

$

(83,645)

 

 

$

285,972

 

 

 

Year ended January 2, 2021

 

 

 

 

 

 

Gross Revenue

 

Intercompany

 

Net

 

 

Volumes

 

Pricing

 

by Product

 

Elimination/Delivery

 

Revenue

Aggregates

 

59,098

 

 

$

10.77

 

 

$

636,254

 

 

$

(138,247)

 

 

$

498,007

 

Cement

 

2,286

 

 

116.80

 

 

266,989

 

 

(9,360)

 

 

257,629

 

Materials

 

 

 

 

 

$

903,243

 

 

$

(147,607)

 

 

$

755,636

 

Ready-mix concrete

 

5,740

 

 

116.47

 

 

668,488

 

 

(428)

 

 

668,060

 

Asphalt

 

5,831

 

 

59.76

 

 

348,433

 

 

(706)

 

 

347,727

 

Other Products

 

 

 

 

 

372,830

 

 

(319,574)

 

 

53,256

 

Products

 

 

 

 

 

$

1,389,751

 

 

$

(320,708)

 

 

$

1,069,043

 

SUMMIT MATERIALS, INC. AND SUBSIDIARIES

Unaudited Reconciliations of Non-GAAP Financial Measures

($ in thousands, except share and per share amounts)

The tables below reconcile our net income to Adjusted EBITDA by segment for the three months and years ended January 2, 2021 and December 28, 2019.

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Three months ended January 2, 2021

 

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

 

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

48,051

 

$

22,629

 

$

25,052

 

$

(59,422)

 

$

36,310

 

Interest (income) expense

 

(2,968)

 

(1,505)

 

(4,110)

 

34,129

 

25,546

 

Income tax expense

 

2,763

 

75

 

 

10,310

 

13,148

 

Depreciation, depletion and amortization

 

26,572

 

20,424

 

8,752

 

1,022

 

56,770

 

EBITDA

 

$

74,418

 

$

41,623

 

$

29,694

 

$

(13,961)

 

$

131,774

 

Accretion

 

212

 

488

 

90

 

 

790

 

Tax receivable agreement benefit

 

 

 

 

(7,559)

 

(7,559)

 

Transaction costs

 

 

 

 

1,230

 

1,230

 

Non-cash compensation

 

 

 

 

5,738

 

5,738

 

Other

 

(459)

 

264

 

 

(1,135)

 

(1,330)

 

Adjusted EBITDA

 

$

74,171

 

$

42,375

 

$

29,784

 

$

(15,687)

 

$

130,643

 

Adjusted EBITDA Margin (1)

 

23.7

%

 

22.7

%

 

41.3

%

 

 

 

22.8

%

 

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Three months ended December 28, 2019

 

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

 

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

30,735

 

 

$

32,859

 

 

$

23,828

 

 

$

(51,025)

 

 

$

36,397

 

 

Interest (income) expense

 

(171)

 

 

(463)

 

 

(3,094)

 

 

31,814

 

 

28,086

 

 

Income tax expense (benefit)

 

440

 

 

(411)

 

 

 

 

(17,200)

 

 

(17,171)

 

 

Depreciation, depletion and amortization

 

22,986

 

 

21,411

 

 

7,061

 

 

1,011

 

 

52,469

 

 

EBITDA

 

$

53,990

 

 

$

53,396

 

 

$

27,795

 

 

$

(35,400)

 

 

$

99,781

 

 

Accretion

 

114

 

 

273

 

 

106

 

 

 

 

493

 

 

Tax receivable agreement expense

 

 

 

 

 

 

 

16,237

 

 

16,237

 

 

Transaction costs

 

84

 

 

 

 

 

 

689

 

 

773

 

 

Non-cash compensation

 

 

 

 

 

 

 

4,979

 

 

4,979

 

 

Other

 

(278)

 

 

(523)

 

 

 

 

(371)

 

 

(1,172)

 

 

Adjusted EBITDA

 

$

53,910

 

 

$

53,146

 

 

$

27,901

 

 

$

(13,866)

 

 

$

121,091

 

 

Adjusted EBITDA Margin (1)

 

21.6

%

 

28.5

%

 

39.9

%

 

 

 

23.9

%

 

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Year ended January 2, 2021

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

($ in thousands)

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

178,460

 

 

$

74,781

 

 

$

69,484

 

 

$

(181,485)

 

 

$

141,240

 

Interest (income) expense

 

(5,447)

 

 

(3,156)

 

 

(13,795)

 

 

125,993

 

 

103,595

 

Income tax expense (benefit)

 

4,287

 

 

(283)

 

 

 

 

(16,189)

 

 

(12,185)

 

Depreciation, depletion and amortization

 

93,279

 

 

84,504

 

 

36,917

 

 

3,982

 

 

218,682

 

EBITDA

 

$

270,579

 

 

$

155,846

 

 

$

92,606

 

 

$

(67,699)

 

 

$

451,332

 

Accretion

 

587

 

 

1,701

 

 

350

 

 

 

 

2,638

 

Loss on debt financings

 

 

 

 

 

 

 

4,064

 

 

4,064

 

Tax receivable agreement benefit

 

 

 

 

 

 

 

(7,559)

 

 

(7,559)

 

Transaction costs

 

 

 

 

 

 

 

2,747

 

 

2,747

 

Non-cash compensation

 

 

 

 

 

 

 

28,857

 

 

28,857

 

Other

 

(114)

 

 

4,728

 

 

 

 

(1,657)

 

 

2,957

 

Adjusted EBITDA

 

$

271,052

 

 

$

162,275

 

 

$

92,956

 

 

$

(41,247)

 

 

$

485,036

 

Adjusted EBITDA Margin (1)

 

23.6

%

 

22.7

%

 

34.3

%

 

 

 

22.7

%

Reconciliation of Net Income (Loss) to Adjusted EBITDA

 

Year ended December 28, 2019

by Segment

 

West

 

East

 

Cement

 

Corporate

 

Consolidated

($ in thousands)

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

108,751

 

 

$

106,307

 

 

$

75,480

 

 

$

(229,415)

 

 

$

61,123

 

Interest expense (income)

 

1,734

 

 

1,774

 

 

(10,489)

 

 

123,490

 

 

116,509

 

Income tax expense (benefit)

 

1,918

 

 

(267)

 

 

 

 

15,450

 

 

17,101

 

Depreciation, depletion and amortization

 

92,737

 

 

80,262

 

 

37,891

 

 

3,996

 

 

214,886

 

EBITDA

 

$

205,140

 

 

$

188,076

 

 

$

102,882

 

 

$

(86,479)

 

 

$

409,619

 

Accretion

 

519

 

 

1,141

 

 

556

 

 

 

 

2,216

 

Loss on debt financings

 

 

 

 

 

 

 

14,565

 

 

14,565

 

Tax receivable agreement expense

 

 

 

 

 

 

 

16,237

 

 

16,237

 

Transaction costs

 

96

 

 

 

 

 

 

2,126

 

 

2,222

 

Non-cash compensation

 

 

 

 

 

 

 

20,403

 

 

20,403

 

Other

 

(791)

 

 

(1,592)

 

 

 

 

(1,417)

 

 

(3,800)

 

Adjusted EBITDA

 

$

204,964

 

 

$

187,625

 

 

$

103,438

 

 

$

(34,565)

 

 

$

461,462

 

Adjusted EBITDA Margin (1)

 

20.0

%

 

26.2

%

 

35.6

%

 

 

 

22.7

%

________________________________________________

(1) Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of net revenue.

The table below reconciles our net income attributable to Summit Materials, Inc. to adjusted diluted net income per share for the three months and years ended January 2, 2021 and December 28, 2019. The per share amount of the net income attributable to Summit Materials, Inc. presented in the table is calculated using the total equity interests for the purpose of reconciling to adjusted diluted net income per share.

 

 

Three months ended

 

Year ended

 

 

January 2, 2021

 

December 28, 2019

 

January 2, 2021

 

December 28, 2019

Reconciliation of Net Income Per Share to Adjusted Diluted EPS

 

Net Income

 

Per Equity Unit

 

Net Income

 

Per Equity Unit

 

Net Income

 

Per Equity Unit

 

Net Income

 

Per Equity Unit

Net income attributable to Summit Materials, Inc.

 

$

35,152

 

 

$

0.30

 

 

$

35,671

 

 

$

0.31

 

 

$

137,967

 

 

$

1.18

 

 

$

59,066

 

 

$

0.51

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to noncontrolling interest

 

1,158

 

 

0.01

 

 

726

 

 

0.01

 

 

3,273

 

 

0.03

 

 

2,057

 

 

0.02

 

Adjustment to acquisition deferred liability

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,000)

 

 

(0.02)

 

Loss on debt financings

 

 

 

 

 

 

 

 

 

4,064

 

 

0.03

 

 

14,565

 

 

0.13

 

Adjusted diluted net income before tax related adjustments

 

36,310

 

 

0.31

 

 

36,397

 

 

0.32

 

 

145,304

 

 

1.24

 

 

73,688

 

 

0.64

 

Tax receivable agreement (benefit) expense

 

(7,559)

 

 

(0.06)

 

 

16,237

 

 

0.14

 

 

(7,559)

 

 

(0.06)

 

 

16,237

 

 

0.14

 

Changes in unrecognized tax expense (benefit)

 

 

 

 

 

18,885

 

 

0.16

 

 

(42,422)

 

 

(0.37)

 

 

18,885

 

 

0.16

 

Adjusted diluted net income

 

$

28,751

 

 

$

0.25

 

 

$

71,519

 

 

$

0.62

 

 

$

95,323

 

 

$

0.81

 

 

$

108,810

 

 

$

0.94

 

Weighted-average shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Class A common stock

 

114,213,808

 

 

 

 

112,755,444

 

 

 

 

114,014,749

 

 

 

 

112,204,067

 

 

 

LP Units outstanding

 

2,986,226

 

 

 

 

3,278,133

 

 

 

 

3,060,248

 

 

 

 

3,372,707

 

 

 

Total equity units

 

117,200,034

 

 

 

 

116,033,577

 

 

 

 

117,074,997

 

 

 

 

115,576,774

 

 

 

The following table reconciles operating income to Adjusted Cash Gross Profit and Adjusted Cash Gross Profit Margin for the three months and years ended January 2, 2021 and December 28, 2019.

 

 

Three months ended

 

Year ended

 

 

January 2,

 

December 28,

 

January 2,

 

December 28,

Reconciliation of Operating Income to Adjusted Cash Gross Profit

 

2021

 

2019

 

2021

 

2019

($ in thousands)

 

 

 

 

 

 

 

 

Operating income

 

$

66,216

 

 

$

59,926

 

 

$

225,173

 

 

$

213,558

 

General and administrative expenses

 

84,000

 

 

75,420

 

 

309,531

 

 

275,813

 

Depreciation, depletion, amortization and accretion

 

57,560

 

 

52,962

 

 

221,320

 

 

217,102

 

Gain on sale of property, plant and equipment

 

(1,822)

 

 

(2,636)

 

 

(7,569)

 

 

(10,665)

 

Adjusted Cash Gross Profit (exclusive of items shown separately)

 

$

205,954

 

 

$

185,672

 

 

$

748,455

 

 

$

695,808

 

Adjusted Cash Gross Profit Margin (exclusive of items shown separately) (1)

 

36.0

%

 

36.7

%

 

35.1

%

 

34.3

%

_______________________________________________________

(1) Adjusted Cash Gross Profit Margin is defined as Adjusted Cash Gross Profit as a percentage of net revenue.

The following table reconciles net cash provided by operating activities to free cash flow for the three months and years ended January 2, 2021 and December 28, 2019.

 

 

Three months ended

 

Year ended

 

 

January 2,

 

December 28,

 

January 2,

 

December 28,

($ in thousands)

 

2021

 

2019

 

2021

 

2019

Net income

 

$

36,310

 

 

$

36,397

 

 

$

141,240

 

 

$

61,123

 

Non-cash items

 

77,799

 

 

41,330

 

 

235,425

 

 

249,698

 

Net income adjusted for non-cash items

 

114,109

 

 

77,727

 

 

376,665

 

 

310,821

 

Change in working capital accounts

 

76,721

 

 

95,614

 

 

32,204

 

 

26,363

 

Net cash provided by operating activities

 

190,830

 

 

173,341

 

 

408,869

 

 

337,184

 

Capital expenditures, net of asset sales

 

(32,073)

 

 

(29,595)

 

 

(163,231)

 

 

(156,322)

 

Free cash flow

 

$

158,757

 

 

$

143,746

 

 

$

245,638

 

 

$

180,862

 

The table below reconciles our Adjusted EBITDA to Further Adjusted EBITDA and our calculation of Net Debt to arrive at our Net Leverage Ratio for the years ended January 2, 2021 and December 28, 2019.

 

Year ended

 

January 2,

 

December 28,

($ in thousands)

2021

 

2019

Adjusted EBITDA

$

485,036

 

$

461,462

EBITDA for certain acquisitions (1)

11,448

 

Further Adjusted EBITDA (2)

$

496,484

 

$

461,462

 

 

 

 

Long-term debt, including current portion

$

1,916,314

 

$

1,874,255

Acquisition related liabilities

20,073

 

47,866

Finance leases and other

56,328

 

56,417

Less: Cash and cash equivalents

(418,181)

 

(311,319)

Net Debt

$

1,574,534

 

$

1,667,219

 

 

 

 

Net Leverage Ratio (3)

3.2

x

 

3.6

x

 

_______________________________________________________

(1) Under the terms of our credit facilities, we include EBITDA from our acquisitions, net of dispositions, in each fiscal year for periods prior to acquisition.

(2) Further Adjusted EBITDA is defined as Adjusted EBITDA plus the EBITDA contribution for certain recent acquisitions.

(3) Net Leverage Ratio is defined as Net Debt divided by Further Adjusted EBITDA.



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Disclaimer

Summit Materials, Inc. Reports Fourth Quarter and Full Year 2020 Results Summit Materials, Inc. (NYSE: SUM, “Summit,” "Summit Inc." or the “Company”), a leading vertically integrated construction materials company, today announced results for the fourth quarter and full year 2020. For the three months ended January 2, …

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