Executive Summary

Q2 2025 delivered revenue of $2.10B, adjusted EBITDA of $659.5M, and adjusted diluted EPS of $2.45; year-over-year growth in margins and unit profitability, but results were below Wall Street consensus on revenue, EPS, and EBITDA. Guidance for FY 2025 adjusted EBITDA ($2.35–$2.55B) was reaffirmed . Consensus values marked with an asterisk; Values retrieved from S&P Global.
Aggregates cash gross profit per ton rose 9% YoY to $11.88, with segment gross margin expanding to 33.9% despite 1% lower shipments due to significant rainfall in key Southeast markets .
Capital allocation remained disciplined: Q2 capex $102M; quarterly dividend declared at $0.49 per share; net debt/TTM adjusted EBITDA 2.1x, total debt/TTM adjusted EBITDA 2.2x .
FY 2025 capex guidance was reduced to approximately $700M (from $750–$800M) given project timing and weather, while management highlighted accelerating highway awards (+22% in Vulcan-served states), improving private non-res signs (data centers), and double-digit July shipments as back-half catalysts .
Key stock-reaction drivers: reaffirmed EBITDA guide amid weather headwinds, visible public infrastructure tailwinds, and evidence of improving bookings/backlog; near-term narrative centers on volume catch-up and margin durability .

What Went Well and What Went Wrong

What Went Well

Pricing discipline and cost performance expanded aggregates gross margin to 33.9% and lifted cash gross profit/ton to $11.88; adjusted EBITDA margin improved to 31.4% .
CEO: “Our second quarter results reflected another quarter of outstanding execution… pricing discipline and excellent cost performance have led to a 13 percent increase in aggregates cash gross profit per ton, a 16 percent improvement in Adjusted EBITDA…” .
Healthy balance sheet and cash generation: TTM adjusted EBITDA $2.201B; ROIC 15.9%; leverage at 2.1x net debt/TTM adjusted EBITDA .

What Went Wrong

Weather materially impacted volumes in the Southeast; shipments fell ~1% YoY with estimated 2–3M tons delayed, pressuring reported price mix versus mix-adjusted .
Q2 missed Street consensus on revenue ($2.10B vs $2.20B*), EPS ($2.45 vs $2.52*), and adjusted EBITDA ($659.5M vs $695.0M*), reflecting volume/mix headwinds in the quarter . Consensus values marked with an asterisk; Values retrieved from S&P Global.
Downstream softness in ready-mixed concrete tied to weaker private demand; management expects improvement alongside better public infrastructure and lower liquid asphalt costs in H2 .

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Total Revenues ($USD Millions)	$2,014.4	$1,634.6	$2,102.4
Gross Profit ($USD Millions)	$592.2	$365.3	$625.2
Adjusted EBITDA ($USD Millions)	$603.1	$410.9	$659.5
Adjusted EBITDA Margin (%)	29.9%	25.1%	31.4%
Diluted EPS (Net) ($)	$2.31	$0.97	$2.42
Adjusted Diluted EPS (Cont. Ops) ($)	$2.35	$1.00	$2.45
SAG ($USD Millions)	$134.1	$138.3	$144.5
SAG % of Revenues	6.7%	8.5%	6.9%

Consensus vs Actual (Q2 2025):

Revenue: $2,102.4M actual vs $2,195.99M* consensus → bold miss . Values retrieved from S&P Global.
Adjusted EBITDA: $659.5M actual vs $695.0M* consensus → bold miss . Values retrieved from S&P Global.
Primary EPS: $2.45 actual vs $2.5210* consensus → bold miss . Values retrieved from S&P Global.

Segment Revenues and Gross Profit (Q2 2025 vs Q2 2024):

Segment	Revenues Q2 2024 ($MM)	Revenues Q2 2025 ($MM)	Gross Profit Q2 2024 ($MM)	Gross Profit Q2 2025 ($MM)
Aggregates	$1,613.5	$1,649.6	$528.5	$559.5
Asphalt	$351.2	$368.9	$59.0	$57.2
Concrete	$167.3	$220.6	$4.7	$8.5
Total	$2,014.4	$2,102.4	$592.2	$625.2

Aggregates KPIs (per ton metrics):

KPI	Q4 2024	Q1 2025	Q2 2025
Shipments (tons, MM)	53.9	47.8	59.3
Freight-Adjusted Sales Price ($/ton)	$21.41	$22.03	$22.11
Gross Profit per Ton ($/ton)	$9.02	$7.48	$9.44
Cash Gross Profit per Ton ($/ton)	$11.50	$10.63	$11.88
Segment Gross Margin (%)	32.8% (Q2 2024 for ref)	26.7% (Q1 2025)	33.9% (Q2 2025)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted EBITDA ($B)	FY 2025	$2.35–$2.55	$2.35–$2.55 (reaffirmed)	Maintained
Capital Expenditures ($M)	FY 2025	$750–$800	~$700	Lowered
SG&A ($M)	FY 2025	$550–$560	TTM $550; YTD $283 (no explicit change)	Maintained (implied)
Interest Expense ($M)	FY 2025	~$245	Expect reduction from CP repayment (no numeric update)	Directional lower
Effective Tax Rate (%)	FY 2025	22–23	No change expected; cash tax benefit could approach $100M	Maintained; added cash benefit
Asphalt & Concrete Cash GP ($M)	FY 2025	~$360	Back-half constructive commentary (no numeric change)	Maintained
Dividend (Quarterly) ($/share)	Q2 2025	$0.49 (May declaration)	$0.49 (July declaration)	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024, Q1 2025)	Current Period (Q2 2025)	Trend
Public infrastructure (IIJA, state funding)	Expect strong public construction; 2025 shipments +3–5% supported by public activity	Highway awards in Vulcan-served states up ~22%; >60% IIJA dollars yet to be spent	Strengthening
Private non-residential demand	Anticipated recovery, pricing tailwinds	Green shoots in warehouses/light non-res; data centers accelerating	Improving
Data centers exposure	Not highlighted in Q1 PR	Actively serving projects; $35B green-lit pipeline; 80% within 30 miles of operations	Expanding focus
Residential (single vs multi)	Not a focus in Q1 PR	Single-family weak; multifamily starts turning positive in >50% of markets	Mixed; multi improving
Pricing discipline & mix	Pricing remained positive; freight-adjusted price +5–7% guide	Mid-year increases selective; strong acquisition pricing (NC/CA); mix headwinds from highway/base and weather	Underlying momentum intact; mix headwinds near-term
Capex outlook	$750–$800M FY 2025	Lowered to ~$700M due to project timing/weather	Reduced
Tax legislation	N/A	Bonus depreciation and R&D expensing → cash tax benefit >$40M YTD; full-year could approach $100M	Positive cash impact
Backlog/bookings conversion	Bids delaying bookings (Q1 commentary)	Turned positive; accelerating bookings/backlogs across end markets (ex-single-family)	Improving

Management Commentary

“Price discipline and cost performance drive continued earnings growth and margin expansion… cash gross profit per ton increased 13%… Adjusted EBITDA margin expansion of 260 basis points through the first half of the year.” — Tom Hill, Chairman & CEO .
“Free cash flow on a trailing 12-month basis surpassed $1 billion… ROIC at June 30 was 15.9%… net debt to trailing 12-month adjusted EBITDA leverage was 2.1x.” — Mary Andrews Carlisle, CFO .
“Trailing 12-month highway contract awards in Vulcan markets… were up over 20% at the end of June… We continue to expect to deliver between $2.35B and $2.55B of adjusted EBITDA.” — Tom Hill .

Q&A Highlights

Weather and volume catch-up: Estimated 2–3M tons delayed in Q2; July shipments up double-digit as weather normalized; management expects spread-out recovery across H2 .
Pricing and margins: Strong operating execution captured ~$0.95 of ~$1.11/ton price increases into cash gross profit per ton; volume leverage should further lift unit margins as shipments rise .
Public infrastructure visibility: Highway awards up ~22% in Vulcan-served states; funding visibility supports 2026 pricing confidence; minimal impact expected from proposed UP–NS rail merger .
Capex and capital allocation: FY 2025 capex trimmed to ~$700M; likely shareholder returns in H2 contingent on ongoing M&A discussions .
Tax changes: 100% bonus depreciation and domestic R&D expensing driving cash tax benefit (> $40M YTD; full-year could approach $100M); no material change expected to effective tax rate .

Estimates Context

Metric (Q2 2025)	Actual	Consensus*	Result
Revenue ($MM)	$2,102.4	$2,195.99*	Bold miss
Adjusted EBITDA ($MM)	$659.5	$695.0*	Bold miss
Primary EPS ($)	$2.45	$2.5210*	Bold miss

Consensus values marked with an asterisk; Values retrieved from S&P Global.

Implications: Despite YoY margin gains, volume/mix headwinds and weather drove a three-metric miss; estimate revisions may skew toward H2 back-half weighting with revenue and EBITDA timing shifts, while maintained annual EBITDA guide could limit full-year downward revisions .

Key Takeaways for Investors

Q2 showed resilient margin execution amid adverse weather, but it was a clean miss versus Street on revenue/EPS/EBITDA; back-half volume recovery and visible public funding are pivotal to the annual EBITDA target .
Aggregates price-cost spread remains favorable; mix-adjusted pricing +8% and strong operating discipline support continued per-ton profitability expansion as shipments normalize .
Reaffirmed FY 2025 adjusted EBITDA ($2.35–$2.55B) and lowered capex (~$700M) improve cash dynamics; TTM ROIC at 15.9% and leverage ~2.1x net debt/EBITDA provide flexibility for shareholder returns/M&A .
Public infrastructure is a clear tailwind (contract awards +~22% in served states); data center pipeline ($35B) and improving private non-res indicators suggest 2026–2027 demand visibility .
Downstream ready-mix softness reflects private demand; asphalt outlook aided by lower liquid costs and accelerating public activity—watch H2 margin progression and mix effects .
Tax legislation boosts 2025 cash taxes (benefit could approach $100M) without affecting effective tax rate—incremental FCF support to capital returns and debt paydown .
Near-term trading: Monitor monthly shipment cadence, pricing realization vs highway/base mix, and any updates to full-year EBITDA or interest expense outlook post CP repayment; affirmation of guide plus accelerating bookings/backlog are catalysts for sentiment .

Vulcan Materials CO (VMC)·Q2 2025 Earnings Summary