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Executives

Mr. Bradley E. Larson - Chief Executive Officer and Executive Director

Mr. Robert R. Morris - President and Executive Director

Mr. Clint Tryon - Chief Financial Officer

Analysts

Unidentified Analyst

Ready Mix, Inc. (RMX) Q4 2007 Earnings Call March 13, 2008 10:00 AM ET

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Ready Mix Fourth Quarter Year End Results Conference Call. (Operator Instructions) I would like now to turn the conference over to Brad Larson, Chief Executive Officer. Please go ahead sir.

Bradley E. Larson

Thank you, operator, and thank you all for joining us this morning for Ready Mix Inc.’s Fourth Quarter and 2007 Results Conference Call. The President of our company, Bob Morris, and our Chief Financial Officer, Clint Tryon, are also on the call with me today. We’ll all be available answering any of your questions following the prepared remarks.

Please note that this conference call will include forward-looking statements. These statements are based on current expectations, estimates, and projections about our business based in part on assumptions made by management. These statements are not guarantees of future performance, and actual results may differ materially. A more detailed discussion of these risks and uncertainties is contained in this morning’s press release and Ready Mix Inc.’s various filings with the SEC including our annual report filed on Form 10-K for the year ended December 31, 2007. The statements made during this call are made only as of the date of the call, March 13, 2008, and we undertake no obligation to update these statements.

For the 12 months ended December 31, 2007, revenue decreased 7.4% to $77.4 million from $83.6 million for 2006 as total cubic yards of concrete sold decreased 10.1%, and while average unit sales price increased 3.2% for the year due to a shift in the mix of Ready Mix products sold toward more expensive, higher strength materials typically used in non-residential applications, on a product by product basis, prices decreased across the board in 2007 compared to 2006.

The primary reason for these declines was weakness in residential construction throughout the year in both the Las Vegas and Phoenix metropolitan markets. To give you some perspective on how tough it has been, new housing permits declined by approximately 30% in these two markets in 2007. The good news is that even though the residential sector was off sharply for the second consecutive year and has remained weak so far in 2008, non-residential construction has remained relatively strong which helped prevent an even more significant decline in RMI’s performance in 2007.

Gross margin decreased to 8% of revenue for 2007 from 11% for 2006. Partly this reflected the under-utilization of equipment associated with lower unit volume. In addition, higher costs associated with our expansion initiatives during the year contributed to the decrease in gross margin. As I’ve reported to you on previous conference calls, in 2007 we completed our 2-year program to expand production capacity and aggregate reserves with the opening of our Lee Canyon Sand and Gravel Plant near Las Vegas. On the other side of the equation, we recently also made the decision to seize operations at our Detrital Wash, Sand, and Gravel location both because of weak demand and due to higher transportation costs resulting from traffic restrictions associated with the ongoing highway improvements over Hoover Dam.

Net income for 2007 decreased to $1.4 million or 36 cents per diluted share. This compares to net income for 2006 of $3.3 million or 87 cents per diluted share. The impact of these negative trends was particularly acute in the fourth quarter.

For the three months ended December 31, 2007, revenue decreased 18.3% to $15.4 million compared to $18.9 million for the fourth quarter of 2006. Gross margin was 3.8% compared to 9.4% a year ago, and we reported a net loss of $0.2 million or 5 cents per diluted share. This compares to net income for the fourth quarter of 2006 of $0.6 million or 16 cents per diluted share.

On the balance sheet, at December 31, 2007, Ready Mix Inc. reported working capital of approximately $11.8 million including cash and cash equivalents of $9.2 million, a current ratio of approximately 2.5, and total stockholders’ equity of $29.2 million or approximately $7.67 per outstanding share. At December 31, 2006, working capital was approximately $10.4 million including cash and cash equivalents of $8.4 million. The current ratio then was approximately 2.1, and stockholders’ equity was $27.5 million.

We responded to the difficult environment we faced in 2007 by keeping our costs as low as possible even as we developed our access to raw materials, increased our production and distribution capacity, and focused our sales and marketing capabilities on acquiring more non-residential work. We remain bullish about the long-term growth prospects in our markets, but the business environment for Ready Mix, Inc., is likely to remain quite challenging until this housing cycle runs its course. With that, operator, we are ready to field the first question.

Question-and-Answer Session

Operator

Ladies and gentlemen, if you’d like to register for a question, please press 1 followed by 4 on your telephone. You will hear a three-tone prompt acknowledging your request. If your question has been answered and you’d like to withdraw your registration, please press 1 followed by 3. If you’re using a speaker phone, please lift your handset before entering your request. One moment please for our first question.

And our first question comes from the line of Walter [inaudible]. Please proceed with your question.

Unidentified Analyst

Close enough. Hi Brad.

Bradley E. Larson

Good morning Walter.

Unidentified Analyst

A couple of questions – first, to what extent has Ready Mix been able to generate some volume from Meadow Valley’s relatively strong, as you also reported, business environment from the non-residential area, i.e., synergies of having the two businesses?

Bradley E. Larson

Well, as has been the case in past years, there has not been a great deal of work between the two companies, and currently, we only have one project which is now being concluded here in Phoenix that Ready Mix, Inc., is supplying concrete to – so we anticipate that based on the amount of work that is coming up for bid during 2007 that there are good chances that Ready Mix, Inc., may compete favorably with additional work, but at the current moment, there is very little work going on between the two companies.

Unidentified Analyst

Okay, and secondly, in an effort to control costs on the Ready Mix side, we actually dispose of the equipment, primarily rolling stock or we just idle it?

Bradley E. Larson

That is correct, we just idle it. The only equipment that we have disposed of lately is equipment that may be related to the Detrital Wash Sand and Gravel operation that we are shutting down.

Unidentified Analyst

Okay. From a pricing standpoint, the industry in part due to its consolidation has had some pretty good price leadership historically. Could you just update sort of a sense on the current pricing environment and pricing environment from your ability to sell the product?

Bradley E. Larson

Well, the pricing environment has been extremely competitive and has been that way for about the last 8 months or so.

Unidentified Analyst

Okay.

Bradley E. Larson

And the price as far as leadership goes, even the largest producers are leading the charge downward.

Unidentified Analyst

And last question – the consolidation of Rinker and Cemex – has it had any material effect on you in your markets or is it pretty much the same as it was?

Bradley E. Larson

It’s pretty much the same as it was. There has not been really any noticeable difference in the market. Cemex and Rinker are obviously working out the kinks that come with such a large consolidation and integration, but it has not really affected our business.

Unidentified Analyst

Okay, thanks a lot Brad.

Bradley E. Larson

Alright, thank you Walter.

Operator

Ladies and gentlemen, as a reminder, if you’d like to register for a question, please press 1 followed by 4 on your telephone, and our next question comes from the line of David Gorman. Please proceed with your question.

(Pause)

And Mr. Gorman has disconnected his line. Ladies and gentlemen, as a reminder if you’d like to register for a question, please press 1 followed by 4.

Mr. Larson there appears to be no further questions at this time.

Bradley E. Larson

Thank you, operator, and thank you all for joining us. We look forward to speaking with you again next quarter. Thanks.

Operator

Ladies and gentlemen, that concludes the conference call for today. We thank you for your participation and ask you to please disconnect your lines.

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