Sign in

You're signed outSign in or to get full access.

SM

Summit Materials, Inc. (SUM)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 was reported via preliminary FY 2024 ranges rather than a stand‑alone Q4 release; Summit projected FY net revenue of $3.90–$3.95B and Adjusted EBITDA of $0.999–$1.004B with 25.0–25.5% margins, implying a solid finish despite severe weather headwinds .
  • Guidance was refined twice during 2H: Q2 reaffirmed FY Adjusted EBITDA of $0.97–$1.01B and CapEx of $0.43–$0.47B ; Q3 tightened FY Adjusted EBITDA to $0.97–$1.00B and lowered CapEx to $0.39–$0.41B while lifting margin expectations to at least 24% .
  • Key operating positives in Q4 context: double‑digit aggregates pricing, mid‑single‑digit organic cement pricing with ASP exiting in the mid‑$150s/ton, and synergy execution offsetting volumes lost to storms .
  • Stock reaction catalyst: definitive agreement (Nov 25, 2024) and subsequent closing (Feb 10, 2025) of Summit’s sale to Quikrete for $52.50/share cash, enterprise value ≈$11.5B; shares ceased trading upon close .

What Went Well and What Went Wrong

  • What Went Well

    • Pricing power held: Aggregates pricing rose 7.4% YoY in Q3; cement ASP exited 2024 in the mid‑$150s/ton, supporting full‑year margin resilience .
    • Synergies delivered: FY 2024 synergy trajectory on track, powering cement margins and offsetting volume deleverage; cement segment Q3 Adjusted EBITDA margin up 180 bps YoY .
    • Management execution: “record” EBITDA margins in the Elevate era and increased confidence into Q4; “increasing our Adjusted EBITDA margin expectations to at least 24% in 2024” .

  • What Went Wrong

    • Weather headwinds: Hurricanes/tropical storms across Houston, Florida, Carolinas reduced volumes and added costs during Q3, with ~$15M foregone EBITDA in Q3 and ~>$20M headwind for 2024; Milton expected to impact Q4 by ~$5M .
    • Volume softness: Organic cement volumes down 11.3% YoY in Q3; aggregates volumes choppy by market, with private end‑market restraint and barge constraints on river markets .
    • CapEx deferral: FY CapEx cut to $390–$410M to maintain ~10% of net revenue, reflecting project deferrals and land purchases pushed to 2025 .

Financial Results

Note: Summit furnished preliminary FY ranges covering Q4 2024; exact Q4 line items were not disclosed. Q4 figures below are derived estimates from FY preliminary ranges minus reported 9M actuals where indicated.

MetricQ2 2024Q3 2024Q4 2024 (Estimated)
Net Revenue ($USD Billions)$1.08 $1.11 $0.94–$0.99 (FY $3.90–$3.95B minus 9M $2.96B)
Adjusted EBITDA ($USD Billions)$0.30 $0.31 ~$0.27–$0.27 (FY $0.999–$1.004B minus 9M $0.732B)
Adjusted EBITDA Margin %27.5% 28.3% N/A (FY guidance 25.0–25.5%)
Adjusted Diluted EPS ($)$0.66 $0.75 N/A (not disclosed)

Segment net revenue trend (Q4 not disclosed):

Segment Net Revenue ($USD Millions)Q2 2024Q3 2024
West$423.7 $492.0
East$327.0 $296.6
Cement$324.8 $323.2
Total Net Revenue$1,075.5 $1,111.8

KPI trends:

KPIQ2 2024Q3 2024Q4 2024 (Context)
Aggregates ASP ($/ton)$15.26 $15.34 Pricing sustained; double‑digit FY aggregates pricing expected
Aggregates Volume (MM tons)14.76 15.37 Flat to modest recovery dependent on weather
Cement ASP ($/ton)$153.43 $155.76 ASP exiting year in mid‑$150s
Cement Volume (MM tons)2.38 2.26 River imports down; volumes softer in legacy Argos markets
Adjusted Cash Gross Profit Margin (Total)34.2% 34.4% Full‑year margins ≥24% (Adj. EBITDA)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDAFY 2024$0.97–$1.01B (Aug 5) $0.97–$1.00B (Oct 30) Lower top end; tightened range
Adjusted EBITDA MarginFY 2024“Upper end or above 23–24%” (Q2 call) ≥24% (Oct 30) Raised expectation floor
Capital ExpendituresFY 2024$0.43–$0.47B (Aug 5) $0.39–$0.41B (Oct 30) Lowered
Preliminary ResultsFY 2024—Net revenue $3.90–$3.95B; Adj. EBITDA $0.999–$1.004B; Adj. EBITDA margin 25.0–25.5%; CapEx $0.38–$0.385B; Total debt $2.80–$2.81B; Cash $0.80–$0.82B (Jan 28) Finalization pending close procedures

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4)Trend
Weather impactsHouston storms: ~$6.5M lost/ delayed EBITDA; volumes down; strong backlogs Hurricanes Debbie/Helene: ~$15M foregone EBITDA in Q3; >$20M FY headwind; Milton expected ~$5M in Q4 Ongoing dependency on “normal weather” to recoup in Q4 Persistent headwind; partial recovery possible
Pricing (Aggregates)Double‑digit; mid‑years 2–7% depending on market; FY >10% +7.4% YoY; ASP up $0.08 seq.; continued strong execution Above historical avg. in 2025 (6–9% target) Strong, durable
Pricing (Cement)Organic +7.3% in Q2; inland markets led ASP +$2.33 seq.; mid‑single‑digit FY; harmonized Jan 1 plan Exit ASP mid‑$150s/ton; contracts repricing over 12–18 months Improving via commercial excellence
Synergies (Argos USA)$17.5M 1H; $40M FY; $130M LT; OEE/alt fuels/PLC conversion Driving cement margins; $80M cumulative by end of 2025 Continued realization supports Q4 finish On plan, compounding
CapEx disciplineTarget ≈8–10% of net revenue LT; moderating CapEx intensity CapEx recalibrated to ~$400M (10%) FY CapEx $390–$410M then prelim $380–$385M Downshift near‑term
Macro/Private marketsHigher‑for‑longer rates defer commercial jobs (SLC/Phoenix) Public strong; private choppy; back‑half weighted 2025 Backlog supports recovery opportunistically Cautious stance

Management Commentary

  • “Our materials‑led portfolio delivered another resilient quarter… we are refining the mid‑point of our full year guide to $985 million… increasing our Adjusted EBITDA margin expectations to at least 24% in 2024.” — Anne Noonan, CEO
  • “With nearly $740 million in cash on hand and a capable balance sheet, Summit is well‑equipped to invest in top growth prospects.” — Scott Anderson, CFO
  • “We achieved $17.5 million in first half synergies… well on our way towards our $40 million full year target… at least $130 million over our integration time line.” — Anne Noonan (Q2 call)
  • “Import volumes in our river markets decreased more than 55% year‑over‑year in Q3… margin expansion powered by synergies and lower kiln fuels.” — Scott Anderson (Q3 call)

Q&A Highlights

  • Weather and recapture: Teams expect to recoup part of Q3 losses in seasoned states; Q4 assumes normal weather; strong backlogs in Houston .
  • Aggregates margins: Four straight quarters of expansion; operational excellence added ~$8–$15M in 2024; target continued points of improvement .
  • Cement pricing and contracts: January price harmonization; mid‑years likely with back‑half demand; below‑market legacy contracts repriced over 12–18 months .
  • Cost inflation/hedging: Diesel hedged; natural gas modest headwind in 2025 but alternative fuels to offset; SG&A scale synergies to continue .

Estimates Context

  • S&P Global consensus for Q4 2024 EPS, revenue, and EBITDA was unavailable due to missing mapping for SUM in the SPGI CIQ system. As a result, we cannot quantify beat/miss versus Wall Street consensus for Q4 2024. Values retrieved from S&P Global were unavailable.
  • Management’s refined FY guidance and preliminary ranges suggest Q4 contribution consistent with a ~$985M FY midpoint and ≥24% full‑year margin .

Key Takeaways for Investors

  • Pricing and synergy execution are offsetting volume/weather headwinds, supporting full‑year margin uplift to ≥24% and preliminary FY margin of 25.0–25.5% .
  • Aggregates pricing momentum remains strong into 2025 (6–9% targeted), with operational excellence driving continued margin expansion; cement pricing supported by harmonized January hikes and contract repricing .
  • CapEx discipline (~10% of net revenue) and portfolio optimization enhance FCF trajectory and ROIC, while synergy compounding lifts cement profitability .
  • Weather remains the key swing factor for Q4 close; upside depends on dry days in river markets and continued backlog execution in Houston .
  • Corporate outcome: The Quikrete acquisition was a defining catalyst; deal closed Feb 10, 2025, removing public market exposure and potentially accelerating integration/CapEx synergies under private ownership .
  • Near‑term trading implication (pre‑close): Event‑driven setup converged on deal spread; fundamentals supported by pricing/synergies, but weather uncertainty limited incremental Q4 alpha .
  • Medium‑term thesis considerations: Under Quikrete, the integrated platform could amplify synergy capture and capital efficiency; watch cement OEE/alt fuels and aggregates bolt‑ons as core margin drivers .

Appendix: Other Relevant Q4 2024 Press Releases

  • Definitive agreement to be acquired by Quikrete for $52.50/share (Nov 25, 2024) .
  • Competition Act (Canada) waiting period expiration (Jan 9, 2025) .
  • Stockholder approval (Feb 5, 2025); transaction closed (Feb 10, 2025) .

Notes

  • Q4 2024 earnings call transcript was not available in our document catalog; insights for Q4 are inferred from Q3 call and Q4 preliminary FY disclosures .
  • All quantitative values are sourced from Summit’s furnished press releases/8‑Ks; Q4 standalone metrics were not disclosed beyond preliminary FY ranges .