Vulcan Materials (NYSE:VMC) reported what CEO Ronnie Pruitt described as a strong 2025 marked by safety performance, earnings growth, and higher cash generation, while also acknowledging weaker-than-expected single-family residential demand that weighed on volumes and pricing versus initial expectations.
2025 results: higher EBITDA, margin expansion, and cash generation
Management said the company delivered $2.3 billion of Adjusted EBITDA in 2025, up 13% from the prior year. Adjusted EBITDA margin expanded 160 basis points to 29.3%. Pruitt highlighted aggregates profitability as a key driver, noting aggregates cash gross profit per ton increased to $11.33, meeting the company’s previously stated $11–$12 target range.
In aggregates, shipments totaled approximately 227 million tons, an increase of 3% for the full year, driven by prior-year acquisitions. Same-store aggregate shipments were “slightly lower” than the prior year. Aggregates mix-adjusted price improved 6% for the full year and 5% in the fourth quarter, while aggregates cash gross profit per ton improved 7% for the year, according to management.
Demand and pricing: public strength offset by residential softness
Pruitt said public demand continued to grow, but single-family residential activity was “weaker than we initially anticipated,” which contributed to full-year volume and price landing at the low end of the company’s initial expectations. Even so, he emphasized that operating and sales teams managed inventories and controlled costs despite “several fourth quarter timing impacts outside of their control.”
The company’s aggregates unit cash cost of sales increased less than 2% in 2025. Management credited this performance to ongoing implementation of the “Vulcan Way of Operating,” including tools and disciplines aimed at controlling costs and improving plant performance.
During the question-and-answer session, Carlisle provided additional context around fourth-quarter pricing, describing a “triple whammy” of mix headwinds that created roughly a 300 basis point gap between reported and mix-adjusted pricing. She said about two-thirds of the impact came from geographic mix, with the remaining one-third split roughly evenly between acquisition mix effects and product mix tied to fast-moving project work.
Fourth-quarter headwinds and comparisons
Management said fourth-quarter results faced difficult comparisons. Pruitt noted aggregate shipments increased 2% year over year in the quarter despite nearly 30% lower shipments in East Tennessee and North Carolina, where the prior-year quarter included elevated “outside shipments” supporting rebuilding after Hurricane Helene.
Carlisle said that, excluding geographic headwinds tied to prior-year hurricane relief activity, fourth-quarter EBITDA was “essentially flat” year over year. She cited three main factors that affected both revenue and costs and drove the gap versus the company’s expectations:
- continued weakening in residential activity;
- weather impacts, including an early winter in seasonal markets and unusually wet conditions in Southern California;
- incremental costs tied to timing on repairs and insurance.
Management also reiterated that quarterly cost performance can be “lumpy” given weather and the timing of plant work, and said fourth-quarter cost impacts were largely timing-related.
2026 outlook: modest demand growth and higher profitability
Looking ahead, management guided to $2.4 billion to $2.6 billion of Adjusted EBITDA in 2026. Pruitt said the company expects continued growth in public demand to be complemented by improving private demand, resulting in “modest overall growth” in 2026.
For aggregates specifically, the company expects:
- shipments to grow 1% to 3% in 2026;
- freight-adjusted average selling prices to rise 4% to 6%;
- unit cash cost of sales to increase by a low single-digit percentage.
Pruitt said these assumptions support “another year of at least high single-digit expansion” in aggregates cash gross profit per ton. Carlisle added that downstream businesses are expected to contribute approximately $290 million in cash gross profit in 2026, with about 85% of downstream earnings expected from asphalt given what she described as a “pruned ready-mix footprint.”
Additional 2026 guidance items provided on the call included:
- SG&A expense of $580 million to $590 million;
- depreciation, depletion, amortization, and accretion of approximately $700 million;
- interest expense of approximately $225 million;
- effective tax rate of 22% to 23%;
- capital expenditures of $750 million to $800 million, including about $50 million of spending shifted from 2025 into 2026 for large plant rebuild projects.
Infrastructure, data centers, and capital allocation
On end markets, Pruitt said highway starts in Vulcan markets are running at three times the growth rate of the U.S. overall, and he emphasized that more than 50% of authorized IIJA funding “is yet to be spent,” which he expects to flow over the next several years. He also pointed to double-digit growth in starts for water, sewer, and other public non-highway infrastructure projects in 2025 as a supportive factor for 2026 shipments.
On private demand, Pruitt said the company expects residential activity to be “limited” in 2026 and will watch for improvement in the second half of the year. He said private non-residential activity varies by category but that the company is encouraged by a potential return to modest growth, led by industrial demand. Data centers were highlighted as a major catalyst, with management noting over 150 million square feet under construction and nearly 450 million square feet announced, with more than 70% of that activity within 30 miles of a Vulcan aggregates facility.
Pruitt also discussed how data center work affects product mix: early phases tend to use more base material, with clean stone and other products shipped later as projects mature. He said base can sell for roughly $8 to $10 below clean stone on average, though he said the margin impact is “not that big.”
On capital allocation, Carlisle said the company returned $260 million to shareholders via dividends and $438 million through share repurchases. She said strong cash generation allowed the company to delever after issuing $2 billion of new long-term notes in the fourth quarter of the prior year, ending 2025 at 1.8x net debt to Adjusted EBITDA. She also noted the company redeemed $400 million of 2025 notes at par in March and paid down $550 million of commercial paper in the second half of the year.
In response to a question on acquisitions, Pruitt said 2025 was focused on integrating two large deals closed at the end of 2024, while market uncertainty contributed to a slowdown in deal activity earlier in 2025. He said the company expects 2026 to be “a very active year” for M&A, remains focused on being aggregates-led and disciplined, and may look beyond its current geography to expand its footprint.
In closing remarks, Pruitt said the company plans to share more on continuous improvement and growth at its upcoming 2026 Investor Day, and he noted that trailing 12-month aggregates cash gross profit per ton reached the targeted long-term range presented at the company’s 2022 Investor Day.
About Vulcan Materials (NYSE:VMC)
Vulcan Materials Company (NYSE: VMC) is a U.S.-based producer of construction materials that supplies the building and infrastructure markets. The company’s primary products include construction aggregates such as crushed stone, sand and gravel, as well as asphalt mixes and ready-mixed concrete. These materials are used in a wide range of projects including highways, commercial and residential construction, and public infrastructure.
Vulcan operates an integrated network of quarries, asphalt plants and concrete facilities to produce and deliver materials to contractors, municipalities and private developers.
