Executive Summary

Q1 2025 delivered modest headline beats: Revenue $1.353B vs. S&P Global consensus $1.343B (+$9.4M), Adjusted EBITDA $351M vs. $349M, and Diluted EPS $1.90 vs. $1.88; results were driven by 6.8% ASP growth, cost discipline, and margin-accretive M&A . Estimates marked with * are from S&P Global.
Mix and cost execution expanded consolidated gross margin to 25% (+300 bps YoY), while aggregates set first‑quarter records in revenues ($1.002B), gross margin (30%), and gross profit per ton ($7.60) .
Management reaffirmed FY 2025 guidance (Adjusted EBITDA $2.15–$2.35B; midpoint $2.25B), citing strong infrastructure demand and emerging data center tailwinds; guidance excludes material tariff effects and will be revisited midyear .
Capital return was a positive surprise: ~911k shares repurchased for ~$450M at ~$494/share and $49M dividends; interim CFO appointed after CFO resignation, with a formal search underway .

What Went Well and What Went Wrong

What Went Well

Record aggregates profitability: shipments +6.6% to 39.0M tons, ASP +6.8% to $23.77/ton, gross margin to 30%, and gross profit/ton +16% to $7.60; Nye: “record first quarter aggregate revenues, gross profit, gross margin and gross profit per ton” .
Magnesia Specialties delivered all-time quarterly records for revenue ($87M), gross profit ($38M), and margin (44%), with Nye adding the business has “earned the right to grow” organically and via M&A .
Cost control: unit energy and contract services down low double digits; supplies/repairs down mid-single digits; diesel tailwind; underlying unit costs down 2.3% when excluding inventory drawdown effects .

What Went Wrong

Downstream softness and weather: cement/ready-mix revenue -12% to $233M and gross profit -23% to $24M on South Texas divestiture, winter weather, and slower residential; asphalt had a $23M gross loss on seasonal shutdowns and higher raw material costs .
Inventory headwinds: ~$28M gross margin headwind in Q1 and ~$0.72/ton impact from targeted inventory reduction, expected to end by midyear .
Leadership transition risk: CFO resignation effective April 11; interim CFO appointed while search proceeds; management emphasized no disagreement on financial practices .

Financial Results

Metric	Q1 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$1,251	$1,632	$1,353
Adjusted EBITDA ($USD Millions)	$291	$545	$351
Gross Margin %	22%	30%	25%
Diluted EPS ($USD)	$16.87 (nonrecurring gain)	$4.79	$1.90

Segment/Product Line Breakdown

Segment	Q1 2024 Revenues	Q4 2024 Revenues	Q1 2025 Revenues	Q1 2024 Gross Profit	Q4 2024 Gross Profit	Q1 2025 Gross Profit
Aggregates	$885	$1,137	$1,002	$239	$379	$297
Cement & Ready‑Mix	$265	$261	$233	$31	$68	$24
Asphalt & Paving	$59	$223	$80	$(22)	$25	$(23)
Magnesia Specialties	$81	$77	$87	$29	$22	$38

KPIs

KPI	Q1 2024	Q4 2024	Q1 2025
Aggregates Shipments (M tons)	36.6	47.9	39.0
ASP ($/ton)	$22.26	$21.95	$23.77
Aggregates Gross Profit per ton ($/ton)	$6.53	$7.92	$7.60

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Consolidated Revenues	FY 2025	$6,830–$7,230M	$6,830–$7,230M	Maintained
Adjusted EBITDA	FY 2025	$2,150–$2,350M (midpoint $2.25B)	$2,150–$2,350M (midpoint reiterated)	Maintained
Net Earnings Attributable	FY 2025	$1,005–$1,175M	$1,005–$1,175M	Maintained
Interest Expense	FY 2025	$220–$230M	$220–$230M	Maintained
Estimated Tax Rate	FY 2025	20.5%–21.5%	20.5%–21.5%	Maintained
Capital Expenditures	FY 2025	$725–$775M	$725–$775M	Maintained
Aggregates Volume Growth	FY 2025	2.5%–5.5%	2.5%–5.5%	Maintained
Aggregates ASP Growth	FY 2025	5.5%–7.5%	5.5%–7.5%	Maintained
Aggregates Gross Profit	FY 2025	$1,610–$1,710M	$1,610–$1,710M	Maintained
Cement/Ready‑Mix/Asphalt Gross Profit	FY 2025	$305–$385M	$305–$385M	Maintained
Magnesia Specialties Gross Profit	FY 2025	$110–$120M	$110–$120M	Maintained
Dividend per share	Next payment	$0.79 declared (Feb/Q4 level)	$0.79 payable June 30, 2025	Maintained

Earnings Call Themes & Trends

Topic	Q3 2024 (Q-2)	Q4 2024 (Q-1)	Q1 2025 (Current)	Trend
AI/data centers & energy	Identified big DC and related energy demand; Amazon DC in DFW; data centers in SC, KS; energy build to follow	Emphasis on infrastructure/data center demand underpinning 2025; portfolio reshaped	Hyperscaler DC projects in TX, SC, LA; expect energy generation demand to follow; Warehousing showing green shoots	Strengthening
Tariffs/macro	Infrastructure funding visibility; weather delayed volumes	2025 EBITDA midpoint confidence, macro challenged	Tariffs could help aggregates/cement; supply chain domestic; guidance excludes tariff impacts	Neutral/watch
Pricing/midyears	Lower midyear realization vs prior year; organic mix‑adjusted ASP +8.9%	Organic ASP strong; 2025 mid‑to‑high single digit pricing outlook	Reported ASP +6.8%; organic +7.4%; expect midyear increases; guide does not assume them	Positive
Inventory mgmt & unit costs	Inventory drawdown added to COGS; inflation mid‑single digits view for 2025	Continued portfolio optimization	$0.72/ton inventory headwind; ~$28M Q1 margin headwind; expected to conclude by midyear; diesel tailwind	Headwind fading
State DOT budgets/IIJA	Public spend baseline elevated; severe weather impact	Reiterated public end‑market strength	8 of top 10 states budgets up; only ~34% IIJA reimbursements spent; IIJA peak expected in 2026	Strengthening
Weather	Multiple hurricanes; volumes/mix hurt	More normal weather aided Q4	Winter weather headwinds; March shipments double‑digit growth; April daily shipments strong	Improving seasonally
M&A pipeline	Bolt‑on aggregates in FL & CA; margin accretive, reserves >150M tons	More bolt‑ons and reshaping completed	Active pipeline; CFO transition not a constraint; opportunistic buybacks	Steady

Management Commentary

Nye: “record first quarter aggregate revenues, gross profit, gross margin and gross profit per ton… driven by 7% pricing growth, disciplined cost control and margin accretive acquisitions” .
Nye on Magnesia: business has “earned the right to grow,” citing pricing and efficiency, with all‑time quarterly records delivered .
Cardin: “we repurchased nearly 911,000 shares at an average share price of $494 and paid $49 million of dividends… $1.3B total liquidity and net debt-to-EBITDA 2.5x” .
Nye on guidance: reaffirmed 2025 Adjusted EBITDA midpoint $2.25B; guidance excludes material tariff effects .

Q&A Highlights

Infrastructure volumes and visibility: Top 10 states—8 budgets up; backlog building with no cancellations; IIJA reimbursements only ~34% so far; volumes expected to be stronger than post‑Q4 outlook .
Cement/ready‑mix outlook and tariffs: Cement pricing +6% in Q1; ready‑mix pressured by residential softness; Texas tariffs likely insulate Midlothian from imports; overall tariff impact skewed supportive for aggregates/cement .
Pricing cadence: Reported ASP +6.8%, organic +7.4%; expect midyear increases in multiple markets; ASPs likely trend toward higher end of guidance; guide does not include midyears .
Costs and inventory: Ex‑inventory, unit costs down 2.3%; inventory drawdown ~$0.72/ton; expect healthy gross margin expansion as headwind ends by midyear .
Capital allocation & M&A: Opportunistic buyback ($450M) not a signal of weaker M&A; pipeline remains active; potential to lean into compelling deals .

Estimates Context

Metric	S&P Global Consensus*	Actual	Surprise
Revenue ($USD Millions)	$1,343.6*	$1,353	+$9.4*
Adjusted EBITDA ($USD Millions)	$348.9*	$351	+$2.1*
Diluted EPS ($USD)	$1.88*	$1.90	+$0.02*

Values with * are retrieved from S&P Global via the GetEstimates tool.
Implication: Minor beats reduce downside estimate risk; management’s comment that pricing trends favor the high end of ASP guidance suggests upward bias to revenue/EBITDA run‑rate as inventory headwinds abate .

Key Takeaways for Investors

Aggregates-led margin expansion is intact; expect sequential margin improvement into H2 as inventory headwinds (~$28M, $0.72/ton) conclude midyear and seasonality improves .
Demand backdrop strengthening: public infrastructure (IIJA) and state budgets point to sustained volume/pricing tailwinds; data center and related energy projects provide medium‑term upside (2026+) .
Pricing power remains solid: reported ASP +6.8%; organic +7.4%; likely midyear increases not in guidance provide optionality to out‑earn current consensus .
Capital returns and balance sheet: $450M buyback and $0.79 dividend signal confidence; net debt/EBITDA at 2.5x with $1.3B liquidity enables both M&A and returns .
Watch risks: residential softness in some markets, downstream margin pressure, and leadership transition (CFO) though interim coverage is in place and no financial policy disagreements indicated .
Trading angle: small beats plus reaffirmed guidance and commentary toward higher ASPs support positive sentiment; catalysts include midyear price actions, Q2 confirmation of inventory headwind’s end, and visibility on large public projects .
Medium‑term thesis: aggregates mix shift and portfolio optimization (FL/CA bolt‑ons) should sustain margin accretion; Magnesia Specialties’ record profitability adds differentiated earnings resilience .

Notes:

Non-GAAP adjustments materially affect YoY EPS comparability; Q1 2024 included a $1.3B divestiture gain (~$14.94/share), inflating prior-year EPS—Adjusted EBITDA is a better operating comparator (+21% YoY to $351M) .
FY 2025 guidance is unchanged and excludes tariff impacts; management will revisit at midyear .

MARTIN MARIETTA MATERIALS INC (MLM)·Q1 2025 Earnings Summary