Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL COMMENTS

Overview

We provide the basic materials for the infrastructure needed to maintain and expand the U.S. economy. We operate primarily in the U.S. and are the nation's largest supplier of construction aggregates (primarily crushed stone, sand and gravel), a major producer of asphalt mix and ready-mixed concrete, and a supplier of asphalt construction paving services. Our strategy and competitive advantage are based on our strength in aggregates which are used in most types of construction and in the production of asphalt mix and ready-mixed concrete.

Demand for our products is dependent on construction activity and correlates positively with changes in population growth, household formation and employment. End uses include public construction (e.g., highways, bridges, buildings, airports, schools, prisons, sewer and waste disposal systems, water supply systems, dams, reservoirs and other public construction projects), private nonresidential construction (e.g., manufacturing, retail, offices, industrial and institutional) and private residential construction (e.g., single-family houses, duplexes, apartment buildings and condominiums).

Aggregates have a very high weight-to-value ratio and, in most cases, must be produced near where they are used; if not, transportation can cost more than the materials, rendering them uncompetitive compared to locally produced materials. Exceptions to this typical market structure include areas along the U.S. Gulf Coast and the Eastern Seaboard where there are limited supplies of locally available, high-quality aggregates. We serve these markets from quarries that have access to cost-effective long-haul transportation — shipping by barge and rail — and from our quarries in Quintana Roo, Mexico (see Note 8, NAFTA Arbitration) and Puerto Cortés, Honduras (acquired in 2022) with our fleet of Panamax-class, self-unloading ships. Additionally, as a result of our 2021 acquisition of U.S. Concrete, we serve markets in California and Hawaii from our quarry in British Columbia, Canada by means of a long-term marine shipping agreement with CSL Americas.

There are limited substitutes for quality aggregates. Due to zoning and permitting regulation and high transportation costs relative to the value of the product, the location of reserves is a critical factor to our long-term success.

No material part of our business depends upon any single customer whose loss would have a significant adverse effect on our business. In 2022, our five largest customers accounted for 7% of our total revenues, and no single customer accounted for more than 2% of our total revenues. Although approximately 40% to 55% of our aggregates shipments have historically been used in publicly-funded construction, such as highways, airports and government buildings, a relatively small portion of our sales are made directly to federal, state, county or municipal governments/agencies. Therefore, although reductions in state and federal funding can curtail publicly-funded construction, the vast majority of our business is not directly subject to renegotiation of profits or termination of contracts with local, state or federal governments. In addition, our sales to government entities span several hundred entities coast-to-coast, ensuring that negative changes to various government budgets would have a muted impact across such a diversified set of government customers.

While aggregates is our focus and primary business, we believe vertical integration between aggregates and downstream products, such as asphalt mix and ready-mixed concrete, can be managed effectively in certain markets to generate attractive financial returns and enhance financial returns in our core Aggregates segment. We produce and sell asphalt mix and/or ready-mixed concrete primarily in our Alabama, Arizona, California, Maryland, New Mexico, Oklahoma, Tennessee, Texas, Virginia, the U.S. Virgin Islands and Washington D.C. markets. Aggregates comprise approximately 95% of asphalt mix by weight and 80% of ready-mixed concrete by weight. In both of these downstream businesses, aggregates are primarily supplied from our operations.

Seasonality and cyclical nature of our business

Almost all of our products are produced and consumed outdoors. Seasonal changes and other weather-related conditions can affect the production and sales volume of our products. Therefore, the financial results for any quarter do not necessarily indicate the results expected for the year. Normally, the highest sales and earnings are in the third quarter, and the lowest are in the first quarter. Furthermore, our sales and earnings are sensitive to national, regional and local economic conditions, demographic and population fluctuations, and particularly to cyclical swings in construction spending, primarily in the private sector.

EXECUTIVE SUMMARY

Financial highlights for SECOND Quarter 2023

Compared to second quarter of 2022:

Total revenues increased $158.6 million, or 8%, to $2,112.9 million

Gross profit increased $137.1 million, or 31%, to $583.3 million

Aggregates segment sales increased $176.6 million, or 13%, to $1,578.4 million

Aggregates segment freight-adjusted revenues increased $147.8 million, or 14%, to $1,184.4 million

Shipments decreased 1%, or 0.4 million tons, to 63.4 million tons

Freight-adjusted sales price increased 15.0%, or $2.44 per ton to $18.69

Aggregates segment gross profit increased $96.2 million, or 24%, to $498.6 million

Unit profitability (as measured by gross profit per ton) increased 25% to $7.87 per ton

Asphalt, Concrete and Calcium segment gross profit increased $40.9 million, or 93%, to $84.7 million, collectively

Selling, administrative and general (SAG) expenses increased $4.7 million but decreased 30 basis points as a percentage of total revenues

Operating earnings increased $143.5 million, or 47%, to $451.1 million

Earnings attributable to Vulcan from continuing operations were $2.33 per diluted share compared to $1.50 per diluted share

Adjusted earnings attributable to Vulcan from continuing operations were $2.29 per diluted share, compared to $1.53 per diluted share

Net earnings attributable to Vulcan increased $121.3 million, or 65%, to $308.6 million

Adjusted EBITDA increased $145.1 million, or 32%, to $595.3 million

Returned capital to shareholders via dividends of $57.2 million at $0.43 per share versus $53.2 million at $0.40 per share

Returned capital to shareholders via share repurchases of $49.9 million at $206.82 average price per share compared to none in the prior quarter

Our earnings growth through the first half of 2023 reflects the compounding benefits of the consistent execution of our strategic disciplines and the strength of our aggregates-led business. Aggregates gross profit margin has expanded 230 basis points, gross profit per ton has improved 26% to $6.96 and cash gross profit per ton has improved 23% to $8.98 per ton. Strong sales and operating momentum across our business is expected to carry through the rest of the year. Shipments have benefited from large industrial projects, and residential construction activity has been better than expected. As a result, we now expect to deliver full-year Adjusted EBITDA of $1,900 million to $2,000 million, an increase of $150 million compared to our initial expectations communicated in February.

Through the first half of the year, cash provided by operating activities was $507.5 million, a 56% increase from the comparable prior year period. Capital expenditures in the second quarter were $157.4 million, including $44.4 million for growth projects (year-to-date $270.2 million and $77.9 million, respectively). As planned, we expect to spend $600 million to $650 million for maintenance and growth projects in 2023. Additionally, we now expect to spend approximately $200 million on opportunistic land purchases for strategic reserves in California, North Carolina and Texas.

As of June 30, 2023, the ratio of total debt to trailing-twelve months Adjusted EBITDA was 2.1 times (2.0 times on a net debt basis). We remain committed to our stated long-term target leverage range of 2.0 to 2.5 times total debt to trailing-twelve months Adjusted EBITDA.

Interest expense, net of interest income, was $46.7 million in the second quarter compared with $38.7 million in the prior year.

On a trailing-twelve months basis, return on invested capital was 14.7%, a 110 basis points improvement from the comparable prior year period. We are focused on continuing to drive improvement through solid operating earnings growth coupled with disciplined capital management.

OUTLOOK

We are increasing our full-year earnings expectations to reflect shipment trends and the earnings momentum in our Asphalt segment. Through the first half of the year, aggregates shipments have been in line with the upper end of our original expectations. Private non-residential construction activity has remained healthy and should partially offset declines in residential activity which have been more moderate than anticipated. As a result, we are updating our volume outlook to reflect shipment levels through the first half. As always, we remain focused on the things we can control, and we are well positioned to navigate shifts in demand and deliver attractive earnings growth in 2023.

Management expectations for 2023 include the following updates:

Aggregates shipments down 1% to 4% (236.3 million tons in 2022)

Total Asphalt, Concrete and Calcium segment cash gross profit of approximately $295 million

Asphalt expected to contribute 50% to 55% of non-aggregates cash gross profit with mid-single digit growth in both volume and price

Concrete expected to contribute 45% to 50% of non-aggregates cash gross profit reflecting the impact of the weather-challenged first quarter

Net earnings attributable to Vulcan of between $855 million and $935 million

Adjusted EBITDA of between $1,900 million and $2,000 million

All other aspects of our expectations for 2023 remain unchanged

RESULTS OF OPERATIONS

Total revenues are primarily derived from our product sales of aggregates, asphalt mix and ready-mixed concrete, and include freight & delivery costs that we pass along to our customers to deliver these products. We also generate service revenues from our asphalt construction paving business and services related to our aggregates business. We present separately our discontinued operations, which consist of our former Chemicals business.

The following table highlights significant components of our consolidated operating results including EBITDA and Adjusted EBITDA.

consolidated operating ResultS highlights

	Three Months Ended						Six Months Ended
	June 30						June 30
in millions, except per share and per unit data	2023			2022			2023			2022
Total revenues	$ 2,112.9			$ 1,954.3			$ 3,761.8			$ 3,495.0
Cost of revenues	(1,529.6)			(1,508.1)			(2,876.5)			(2,780.1)
Gross profit	583.3			446.2			885.3			714.9
Gross profit margin	27.6%			22.8%			23.5%			20.5%
Selling, administrative and general (SAG)	(139.1)			(134.4)			(256.5)			(253.4)
SAG as a percentage of total revenues	6.6%			6.9%			6.8%			7.3%
Gain on sale of property, plant &
equipment and businesses	16.7			2.0			18.5			4.6
Operating earnings	451.1			307.6			638.3			454.5
Interest expense, net	(46.7)			(38.7)			(95.7)			(74.7)
Earnings from continuing operations
before income taxes	404.3			264.2			543.9			376.8
Income tax expense	(92.0)			(63.7)			(108.6)			(82.4)
Effective tax rate from continuing operations	22.8%			24.1%			20.0%			21.9%
Earnings from continuing operations	312.3			200.5			435.3			294.4
Loss on discontinued operations,
net of income taxes	(3.7)			(13.1)			(5.8)			(14.9)
Earnings attributable to noncontrolling interest	0.0			(0.1)			(0.2)			(0.4)
Net earnings attributable to Vulcan	$ 308.6			$ 187.3			$ 429.3			$ 279.1
Diluted earnings (loss) per share attributable to Vulcan
Continuing operations	$ 2.33			$ 1.50			$ 3.25			$ 2.20
Discontinued operations	(0.02)			(0.10)			(0.04)			(0.11)
Diluted net earnings per share attributable to Vulcan	$ 2.31			$ 1.40			$ 3.21			$ 2.09
EBITDA 1	$ 601.0			$ 428.2			$ 934.8			$ 715.0
Adjusted EBITDA 1	$ 595.3			$ 450.2			$ 932.9			$ 744.1
Average Sales Price and Unit Shipments
Aggregates
Tons	63.4			63.8			115.1			116.8
Freight-adjusted sales price	$ 18.69			$ 16.25			$ 18.68			$ 15.91
Asphalt Mix
Tons	4.0			3.4			6.1			5.7
Average sales price	$ 75.52			$ 69.42			$ 74.80			$ 67.25
Ready-mixed concrete
Cubic yards	2.1			2.8			3.9			5.3
Average sales price	$ 163.82			$ 148.75			$ 162.64			$ 146.43

1	Non-GAAP measures are defined and reconciled within this Item 2 under the caption Reconciliation of Non-GAAP Financial Measures.

SECOND quarter 2023 Compared to SECOND Quarter 2022

Second quarter 2023 total revenues were $2,112.9 million, up 8% from the second quarter of 2022. Shipments decreased in aggregates (-1%) and ready-mixed concrete (-26%) and increased in asphalt mix (+16%). Gross profit increased in the Aggregates (+$96.2 million or 24%) and Asphalt (+$43.0 million or 318%) segments. Conversely, gross profit decreased in the Concrete segment (-$3.0 million or 10%) as a result of the divestiture of our operations in New Jersey, New York and Pennsylvania in November 2022 (see Note 16).

Net earnings attributable to Vulcan for the second quarter of 2023 were $308.6 million, or $2.31 per diluted share, compared to $187.3 million, or $1.40 per diluted share in the second quarter of 2022. Each period’s results were impacted by discrete items, as follows:

Net earnings attributable to Vulcan for the second quarter of 2023 include:

pretax net gain of $15.2 million related to the sale of real estate in Illinois

pretax charges of $4.3 million associated with divested operations

pretax charges of $0.3 million associated with non-routine acquisitions

pretax loss on discontinued operations of $4.9 million

$2.6 million of tax charges related to a Calica NOL carryforward valuation allowance

Net earnings attributable to Vulcan for the second quarter of 2022 include:

pretax charges of $0.4 million associated with divested operations

pretax charges of $4.0 million associated with non-routine acquisitions

pretax loss on discontinued operations of $17.6 million

Adjusted for these discrete items, earnings attributable to Vulcan from continuing operations (Adjusted Diluted EPS) was $2.29 per diluted share for the second quarter of 2023 compared to $1.53 per diluted share for the second quarter of 2022.

Continuing Operations — Changes in earnings from continuing operations before income taxes for the second quarter of 2023 versus the second quarter of 2022 are summarized below:

earnings from continuing operations before income taxes

in millions
Second quarter 2022	$ 264.2
Higher aggregates gross profit	96.2
Higher asphalt gross profit	43.0
Lower concrete gross profit	(3.0)
Higher calcium gross profit	0.9
Higher selling, administrative and general expenses	(4.7)
Higher gain on sale of property, plant & equipment and businesses	14.7
Higher interest expense, net	(8.0)
All other	1.0
Second quarter 2023	$ 404.3

Second quarter Aggregates segment sales increased 13%, while gross profit increased $96.2 million, or 24%, to $498.6 million ($7.87 per ton). Cash gross profit per ton was $9.76 in the quarter compared to $7.99 in the prior year quarter, an increase of 22%. Gross profit margin increased 290 basis points due to strong pricing growth and improving efficiencies from our operating disciplines. Earnings improvement was widespread across our footprint.

Total aggregates shipments were 63.4 million tons versus 63.8 million in last year’s second quarter, a decrease of 1% with variations across geographies. Shipment activity in California was particularly strong, following the weather impacted first quarter. Certain markets in the Southeast benefited from healthy shipment activity to industrial projects.

The pricing environment remains positive across our footprint. Freight-adjusted pricing was $18.69 per ton, an increase of 15.0% ($2.44 per ton), with all markets realizing year-over-year improvement.

Consistent with expectations, Aggregates freight-adjusted unit cost of sales increased 9%, or $0.88 per ton, and cash cost of sales increased 8%, or $0.67 per ton, as compared to the prior year’s second quarter. Persistent inflationary pressures for parts and supplies offset the benefit of lower diesel prices. We remain focused on compounding improvements in unit profitability throughout the cycle through fixed cost leverage, price growth and operating efficiencies.

Overall, non-aggregates segments gross profit of $84.7 million was $40.9 million higher than the prior year’s second quarter.

Asphalt segment gross profit of $56.6 million was up $43.0 million from the prior year’s second quarter, and gross profit margin continued to expand. Cash gross profit was $65.5 million compared to $22.1 million in the prior year. The year-over-year improvement in earnings was driven by a combination of strong shipment growth, continued pricing momentum and lower liquid asphalt costs. Asphalt shipments increased 16%, benefiting from solid growth in Arizona and California, our largest asphalt markets. Asphalt pricing increased 8.8%, or $6.10 per ton, with improvements across all markets.

Concrete segment gross profit was $27.0 million for the second quarter, down $3.0 million from the prior year. Cash gross profit was $46.5 million compared to $50.7 million in the prior year. Average selling prices increased 10.1%, and unit gross profit improved 22%, or $2.35 per cubic yard, despite lower shipments. Current year results were impacted by the divestiture of our concrete operations in New Jersey, New York and Pennsylvania in November 2022 and the slowdown in residential construction activity.

Calcium segment gross profit was $1.1 million compared to $0.2 million in the prior year’s second quarter.

SAG expenses were $139.1 million in the quarter, or 6.6% of total revenues, a 30 basis points improvement from the prior year. Trailing-twelve months SAG expense was 6.8% of total revenues, a 50 basis points improvement from the prior year. We remain focused on further leveraging our overhead cost structure.

For the three months ended June 30, 2023, we sold real estate associated with a former recycled concrete facility in Illinois resulting in a pretax net gain of $15.2 million. There were no similar gains in the prior comparable period.

Other operating income (expense), which is composed primarily of idle facilities expense, environmental remediation costs, gain (loss) on settlement of AROs, finance charges collected and net rental income (expense), was $9.8 million of expense for the second quarter of 2023 compared to $6.2 million of expense in the second quarter of 2022.

Other nonoperating income (expense), net was $0.1 million of expense for the second quarter of 2023 compared to $4.7 million of expense in the second quarter of 2022.

Net interest expense was $46.7 million in the second quarter of 2023 compared to $38.7 million in the second quarter of 2022.

Income tax expense from continuing operations was $92.0 million in the second quarter of 2023 compared to $63.7 million in the second quarter of 2022. The increase in tax expense was due to higher pretax earnings.

Earnings attributable to Vulcan from continuing operations were $2.33 per diluted share in the second quarter of 2023 compared to $1.50 per diluted share in the second quarter of 2022.

Discontinued Operations — Second quarter pretax loss from discontinued operations was $4.9 million in 2023 compared with a pretax loss of $17.6 million in 2022. Both periods include charges related to general and product liability costs, including legal defense costs, and environmental remediation costs associated with our former Chemicals business while the second quarter of 2022 includes a $15.3 million charge for a litigation matter. For additional details, see Note 1 to the condensed consolidated financial statements under the caption Discontinued Operations.

YEAR-TO-DATE June 30, 2023 Compared to year-to-date june 30, 2022

Total revenues for the first six months of 2023 were $3,761.8 million, up 8% from the first six months of 2022. Shipments decreased in aggregates (-1%) and ready-mixed concrete (-28%) and increased in asphalt mix (+5%). Gross profit increased in the Aggregates (+$156.1 million or 24%) and Asphalt (+$46.7 million or 438%) segments. Conversely, gross profit decreased in the Concrete segment (-$33.5 million or 58%) as a result of the divestiture of our operations in New Jersey, New York and Pennsylvania in November 2022 (see Note 16).

Net earnings attributable to Vulcan for the first six months of 2023 were $429.3 million, or $3.21 per diluted share, compared to $279.1 million, or $2.09 per diluted share, in the first six months of 2022. Each period’s results were impacted by discrete items, as follows:

Net earnings attributable to Vulcan for the first six months of 2023 include:

pretax net gain of $15.2 million related to the sale of real estate in Illinois

pretax charges of $4.7 million associated with divested operations

pretax charges of $0.8 million associated with non-routine acquisitions

pretax loss on discontinued operations of $7.9 million

$6.2 million of tax charges related to a Calica NOL carryforward valuation allowance

Net earnings attributable to Vulcan for the first six months of 2022 include:

pretax charges of $0.7 million associated with divested operations

pretax charges of $8.4 million associated with non-routine acquisitions

pretax loss on discontinued operations of $20.0 million

Adjusted for these discrete items, earnings attributable to Vulcan from continuing operations (Adjusted Diluted EPS) was $3.25 per diluted share for the first half of 2023 compared to $2.25 per diluted share for the first half of 2022.

Continuing Operations — Changes in earnings from continuing operations before income taxes for year-to-date June 30, 2023 versus year-to-date June 30, 2022 are summarized below:

earnings from continuing operations before income taxes

in millions
Year-to-date June 30, 2022	$ 376.8
Higher aggregates gross profit	156.1
Higher asphalt gross profit	46.7
Lower concrete gross profit	(33.5)
Higher calcium gross profit	1.1
Higher selling, administrative and general expenses	(3.1)
Higher gain on sale of property, plant & equipment and businesses	13.9
Higher interest expense, net	(21.0)
All other	6.9
Year-to-date June 30, 2023	$ 543.9

Aggregates segment sales for the first six months of 2023 were $2,872.8 million (up 14%) while aggregates shipments decreased 1%, or 1.7 million tons, compared to the prior year. Freight-adjusted average sales price increased 17.4%, or $2.77 per ton, versus the first six months of 2022.

Aggregates segment gross profit was $801.3 million ($6.96 per ton) versus $645.2 million ($5.52 per ton) in the first half of 2022. Cash gross profit per ton increased 23% from the prior year’s first six months to $8.98 per ton. Freight-adjusted unit cost of sales for the first half of 2023 increased 13%, or $1.33 per ton, versus the prior year.

Asphalt segment gross profit of $57.4 million was up $46.7 million from the first six months of 2022. Asphalt mix shipments increased 5% while average unit selling prices increased 11.2%, or $7.55 per ton. Compared to the prior year’s first half, asphalt mix unit material margins increased 47% as a result of continued pricing momentum and lower liquid asphalt costs.

Concrete segment gross profit was $24.7 million for the first half of 2023, a decrease of $33.5 million from the prior year period. Ready-mixed concrete shipments decreased 28% while the average sales price increased 11.1% and unit material margins increased 7%. Current year results were impacted by the divestiture of our concrete operations in New Jersey, New York and Pennsylvania in November 2022.

Calcium segment gross profit of $1.9 million was up $1.1 million compared to the first half of 2022.

SAG expenses were $256.5 million versus $253.4 million in the prior year’s first half reflecting a 50 basis points improvement from the prior year. We remain focused on further leveraging our overhead cost structure.

Gain on sale of property, plant & equipment and businesses was $18.5 million in the first half of 2023 versus $4.6 million in the first half of 2022. The 2023 amount includes the aforementioned net pretax gain of $15.2 million from the sale of real estate associated with a former recycled concrete facility in Illinois.

Other operating income (expense), which is composed primarily of idle facilities expense, environmental remediation costs, gain (loss) on settlement of AROs, finance charges collected and net rental income (expense), was $9.0 million of expense for the first half of 2023 compared to $11.6 million of expense in the first half of 2022.

Other nonoperating income (expense), net was $1.3 million of income for the first half of 2023 compared to $3.0 million of expense in the first half of 2022.

Net interest expense was $95.7 million in the first half of 2023 compared to $74.7 million in the first half of 2022.

Income tax expense from continuing operations was $108.6 million in the first half of 2023 compared to $82.4 million in the first half of 2022. The increase in tax expense was due to higher pretax earnings partially offset by a tax benefit from a prior year business disposition recorded in the first quarter.

Earnings attributable to Vulcan from continuing operations were $3.25 per diluted share in the first half of 2023 compared to $2.20 per diluted share in the first half of 2022.

Discontinued Operations — First half pretax loss from discontinued operations was $7.9 million in 2023 compared with a pretax loss of $20.0 million in 2022. Both periods include charges related to general and product liability costs, including legal defense costs, and environmental remediation costs associated with our former Chemicals business while 2022 includes a $15.3 million charge for a litigation matter. For additional details, see Note 1 to the condensed consolidated financial statements under the caption Discontinued Operations.

KNOWN TRENDS OR UNCERTAINTIES

Inflationary pressures and labor constraints are trends continuing to impact our operations in 2023. Although inflationary pressures can create short- to medium-term headwinds, the combination of inflation and improving visibility of demand has created and may continue to create a favorable environment for price increases. Additionally, labor constraints (especially truck drivers) have caused delays and inefficiencies in our operations as well as those of our customers. If labor constraints continue and demand remains strong, our operations may proceed at a slower pace, which may effectively extend the recovery while allowing us the opportunity to compound price, control costs and grow earnings.

Further, the Mexican government has taken actions adverse to our property and operations in Mexico. On May 5, 2022, Mexican government officials presented employees at our Calica operations in Quintana Roo, Mexico with arbitrary shutdown orders to immediately cease underwater quarrying and extraction operations. On May 13, 2022, the Mexican government suspended the three-year customs permit granted in March 2022 to Calica and began a proceeding that could result in the revocation of that permit. We strongly believe that the actions taken by Mexico are arbitrary and illegal, and we intend to vigorously pursue all lawful avenues available to us in order to protect our rights, under both Mexican and international law. For additional information regarding our Calica operations, see Note 8, NAFTA Arbitration.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Aggregates segment FREIGHT-ADJUSTED REVENUES

Aggregates segment freight-adjusted revenues is not a Generally Accepted Accounting Principle (GAAP) measure and should not be considered as an alternative to metrics defined by GAAP. We present this measure as it is consistent with the basis by which we review our operating results. We believe that this presentation is consistent with our competitors and meaningful to our investors as it excludes revenues associated with freight & delivery, which are pass-through activities. It also excludes other revenues related to services, such as landfill tipping fees, that are derived from our aggregates business. Additionally, we use this metric as the basis for calculating the average sales price of our aggregates products. Reconciliation of this metric to its nearest GAAP measure is presented below:

	Three Months Ended						Six Months Ended
	June 30						June 30
in millions, except per ton data	2023			2022			2023			2022
Aggregates segment
Segment sales	$ 1,578.4			$ 1,401.8			$ 2,872.8			$ 2,523.0
Less
Freight & delivery revenues 1	364.7			336.0			674.5			608.3
Other revenues	29.3			29.2			48.0			55.4
Freight-adjusted revenues	$ 1,184.4			$ 1,036.6			$ 2,150.3			$ 1,859.3
Unit shipments - tons	63.4			63.8			115.1			116.8
Freight-adjusted sales price	$ 18.69			$ 16.25			$ 18.68			$ 15.91

1	At the segment level, freight & delivery revenues include intersegment freight & delivery (which are eliminated at the consolidated level) and freight to remote distribution sites.

cash gross profit

GAAP does not define “cash gross profit,” and it should not be considered as an alternative to earnings measures defined by GAAP. We and the investment community use this metric to assess the operating performance of our business. Additionally, we present this metric as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. Cash gross profit adds back noncash charges for depreciation, depletion, accretion and amortization to gross profit. Segment cash gross profit per unit is computed by dividing segment cash gross profit by units shipped. Segment cash cost of sales per unit is computed by subtracting segment cash gross profit per unit from segment freight-adjusted sales price. Segment freight-adjusted sales price is calculated by dividing revenues generated from the shipment of product (excluding service revenues generated by the segments) by the total units of the product shipped. Reconciliation of these metrics to their nearest GAAP measures are presented below:

	Three Months Ended						Six Months Ended
	June 30						June 30
in millions, except per ton data	2023			2022			2023			2022
Aggregates segment
Gross profit	$ 498.6			$ 402.4			$ 801.3			$ 645.2
Depreciation, depletion, accretion and amortization	119.6			107.3			231.9			210.9
Aggregates segment cash gross profit	$ 618.2			$ 509.7			$ 1,033.2			$ 856.1
Unit shipments - tons	63.4			63.8			115.1			116.8
Aggregates segment gross profit per ton	$ 7.87			$ 6.31			$ 6.96			$ 5.52
Aggregates segment cash gross profit per ton	$ 9.76			$ 7.99			$ 8.98			$ 7.33
Aggregates segment freight-adjusted sales price	$ 18.69			$ 16.25			$ 18.68			$ 15.91
Aggregates segment freight-adjusted cash cost of
sales per ton	$ 8.93			$ 8.26			$ 9.70			$ 8.58
Asphalt segment
Gross profit	$ 56.6			$ 13.6			$ 57.4			$ 10.7
Depreciation, depletion, accretion and amortization	8.9			8.5			17.8			17.1
Asphalt segment cash gross profit	$ 65.5			$ 22.1			$ 75.2			$ 27.8
Unit shipments - tons	4.0			3.4			6.1			5.7
Asphalt segment gross profit per ton	$ 14.24			$ 3.95			$ 9.49			$ 1.86
Asphalt segment cash gross profit per ton	$ 16.48			$ 6.44			$ 12.44			$ 4.84
Asphalt segment average sales price	$ 75.52			$ 69.42			$ 74.80			$ 67.25
Asphalt segment cash cost of sales per ton	$ 59.04			$ 62.98			$ 62.36			$ 62.41
Concrete segment
Gross profit	$ 27.0			$ 30.0			$ 24.7			$ 58.2
Depreciation, depletion, accretion and amortization	19.5			20.7			39.9			41.8
Concrete segment cash gross profit	$ 46.5			$ 50.7			$ 64.6			$ 100.0
Unit shipments - cubic yards	2.1			2.8			3.9			5.3
Concrete segment gross profit per cubic yard	$ 12.95			$ 10.60			$ 6.40			$ 10.92
Concrete segment cash gross profit per cubic yard	$ 22.27			$ 17.93			$ 16.76			$ 18.76
Concrete segment average sales price	$ 163.82			$ 148.75			$ 162.64			$ 146.43
Concrete segment cash cost of sales per cubic yard	$ 141.55			$ 130.82			$ 145.88			$ 127.67
Calcium segment
Gross profit	$ 1.1			$ 0.2			$ 1.9			$ 0.8
Depreciation, depletion, accretion and amortization	0.0			0.1			0.1			0.1
Calcium segment cash gross profit	$ 1.1			$ 0.3			$ 2.0			$ 0.9

EBITDA and adjusted ebitda

GAAP does not define “Earnings Before Interest, Taxes, Depreciation and Amortization” (EBITDA), and it should not be considered as an alternative to earnings measures defined by GAAP. We use this metric to assess the operating performance of our business and as a basis for strategic planning and forecasting as we believe that it closely correlates to long-term shareholder value. We do not use this metric as a measure to allocate resources. We adjust EBITDA for certain items to provide a more consistent comparison of earnings performance from period to period. Reconciliation of this metric to its nearest GAAP measure is presented below (numbers may not foot due to rounding):

	Three Months Ended						Six Months Ended						Trailing-Twelve Months
	June 30						June 30						June 30
in millions	2023			2022			2023			2022			2023			2022
Net earnings attributable to Vulcan	$ 308.6			$ 187.3			$ 429.3			$ 279.1			$ 725.7			$ 594.0
Income tax expense	90.8			59.2			106.6			77.2			215.8			159.2
Interest expense, net of interest income	46.7			38.7			95.7			74.7			189.3			147.6
Depreciation, depletion, accretion and amortization	154.9			143.0			303.3			284.0			606.8			543.5
EBITDA	$ 601.0			$ 428.2			$ 934.8			$ 715.0			$ 1,737.7			$ 1,444.2
Loss on discontinued operations	$ 4.9			$ 17.6			$ 7.9			$ 20.0			$ 13.0			$ 21.2
Gain on sale of real estate and businesses, net	(15.2)			0.0			(15.2)			0.0			(21.3)			0.0
Loss on impairments	0.0			0.0			0.0			0.0			67.8			0.0
Charges associated with divested operations	4.3			0.4			4.7			0.7			7.8			1.5
Acquisition related charges 1	0.3			4.0			0.8			8.4			9.5			56.4
COVID-19 direct incremental costs	0.0			0.0			0.0			0.0			0.0			9.6
Pension settlement charge	0.0			0.0			0.0			0.0			0.0			12.1
Adjusted EBITDA	$ 595.3			$ 450.2			$ 932.9			$ 744.1			$ 1,814.5			$ 1,545.1

1

Represents charges associated with acquisitions requiring clearance under federal antitrust laws. Costs for trailing-twelve months ended June 30, 2022 include U.S. Concrete acquisition related expenses of $21.8 million, the cost impact of purchase accounting inventory valuations of $14.8 million and change in control severance and retention charges of $16.0 million (see Note 16 for additional information).

Adjusted Diluted EPS attributable to vulcan from continuing Operations

Similar to our presentation of Adjusted EBITDA, we present Adjusted diluted earnings per share (EPS) attributable to Vulcan from continuing operations to provide a more consistent comparison of earnings performance from period to period. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:

	Three Months Ended						Six Months Ended
	June 30						June 30
	2023			2022			2023			2022
Diluted Earnings Per Share
Net earnings attributable to Vulcan	$ 2.31			$ 1.40			$ 3.21			$ 2.09
Less: Discontinued operations	(0.02)			(0.10)			(0.04)			(0.11)
Diluted EPS attributable to Vulcan from continuing
operations	$ 2.33			$ 1.50			$ 3.25			$ 2.20
Items included in Adjusted EBITDA above, net of tax	$ (0.06)			$ 0.03			$ (0.05)			$ 0.05
NOL carryforward valuation allowance	0.02			0.00			0.05			0.00
Adjusted diluted EPS attributable to Vulcan from
continuing operations	$ 2.29			$ 1.53			$ 3.25			$ 2.25

NET DEBT TO ADJUSTED EBITDA

Net debt to Adjusted EBITDA is not a GAAP measure and should not be considered as an alternative to metrics defined by GAAP. We, the investment community and credit rating agencies use this metric to assess our leverage. Net debt subtracts cash and cash equivalents and restricted cash from total debt. Reconciliation of this metric to its nearest GAAP measure is presented below:

							June 30
in millions							2023			2022
Debt
Current maturities of long-term debt							$ 0.5			$ 0.5
Short-term debt							0.0			176.0
Long-term debt							3,873.2			3,873.7
Total debt							$ 3,873.7			$ 4,050.2
Less: Cash and cash equivalents and restricted cash							168.2			123.7
Net debt							$ 3,705.5			$ 3,926.5
Trailing-Twelve Months (TTM) Adjusted EBITDA							$ 1,814.5			$ 1,545.1
Total debt to TTM Adjusted EBITDA							2.1x			2.6x
Net debt to TTM Adjusted EBITDA							2.0x			2.5x

RETURN ON INVESTED CAPITAL

We define “Return on Invested Capital” (ROIC) as Adjusted EBITDA for the trailing-twelve months divided by average invested capital (as illustrated below) during the trailing-five quarters. Our calculation of ROIC is considered a non-GAAP financial measure because we calculate ROIC using the non-GAAP metric EBITDA. We believe that our ROIC metric is meaningful because it helps investors assess how effectively we are deploying our assets. Although ROIC is a standard financial metric, numerous methods exist for calculating a company’s ROIC. As a result, the method we use to calculate our ROIC may differ from the methods used by other companies. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below (numbers may not foot due to rounding):

				Trailing-Twelve Months
				June 30			June 30
dollars in millions				2023			2022
Adjusted EBITDA				$ 1,814.5			$ 1,545.1
Average invested capital
Property, plant & equipment, net				$ 5,986.1			$ 5,385.6
Goodwill				3,703.1			3,599.0
Other intangible assets				1,703.7			1,640.0
Fixed and intangible assets				$ 11,392.9			$ 10,624.6
Current assets				$ 1,994.5			$ 1,835.5
Less: Cash and cash equivalents				148.1			320.6
Less: Current tax				52.6			46.2
Adjusted current assets				1,793.8			1,468.7
Current liabilities				980.0			833.5
Less: Current maturities of long-term debt				0.5			7.5
Less: Short-term debt				117.6			55.2
Adjusted current liabilities				861.9			770.8
Adjusted net working capital				$ 931.9			$ 697.9
Average invested capital				$ 12,324.8			$ 11,322.5
Return on invested capital				14.7%			13.6%

2023 projected ebitda

The following reconciliation to the mid-point of the range of 2023 Projected EBITDA excludes adjustments (as noted in Adjusted EBITDA above) as they are difficult to forecast (timing or amount). Due to the difficulty in forecasting such adjustments, we are unable to estimate their significance. This metric is not defined by GAAP and should not be considered as an alternative to earnings measures defined by GAAP. Reconciliation of this metric to its nearest GAAP measure is presented below:

			2023 Projected
in millions			Mid-point
Net earnings attributable to Vulcan				$ 895
Income tax expense				250
Interest expense, net of interest income				195
Depreciation, depletion, accretion and amortization				610
Projected EBITDA				$ 1,950

Because GAAP financial measures on a forward-looking basis are not accessible, and reconciling information is not available without unreasonable effort, we have not provided reconciliations for forward-looking non-GAAP measures, other than the reconciliation of Projected EBITDA as noted above. For the same reasons, we are unable to address the probable significance of the unavailable information, which could be material to future results.

LIQUIDITY AND FINANCIAL RESOURCES

Our primary sources of liquidity are cash provided by our operating activities, a substantial, committed bank line of credit and our commercial paper program. Additional sources of capital include access to the capital markets, the sale of surplus real estate and dispositions of nonstrategic operating assets. We believe these financial resources are sufficient to fund our business requirements for 2023 including:

contractual obligations

capital expenditures

debt service obligations

dividend payments

potential acquisitions

potential share repurchases

Our balanced approach to capital deployment remains unchanged. We intend to balance reinvestment in our business, growth through acquisitions and return of capital to shareholders, while sustaining financial strength and flexibility.

We actively manage our capital structure and resources in order to balance the cost of capital and the risk of financial stress. We seek to meet these objectives by adhering to the following principles:

maintain substantial bank line of credit borrowing capacity

proactively manage our debt maturity schedule such that repayment/refinancing risk in any single year is low

maintain an appropriate balance of fixed-rate and floating-rate debt

minimize financial and other covenants that limit our operating and financial flexibility

Cash

Included in our June 30, 2023 cash and cash equivalents and restricted cash balances of $168.2 million is $2.2 million of restricted cash as described in Note 1 under the caption Restricted Cash.

cash from operating activities

	Six Months Ended
	June 30
in millions	2023			2022
Net earnings	$ 429.5			$ 279.5
Depreciation, depletion, accretion and amortization (DDA&A)	303.3			284.0
Noncash operating lease expense	27.3			31.3
Net gain on sale of property, plant & equipment and businesses	(18.5)			(4.6)
Contributions to pension plans	(3.8)			(3.9)
Deferred tax provision (benefit)	(4.7)			6.6
Other operating cash flows, net 1	(225.6)			(267.4)
Net cash provided by operating activities	$ 507.5			$ 325.5

1	Primarily reflects changes to working capital balances.

Net cash provided by operating activities was $507.5 million during the six months ended June 30, 2023, a $182.0 million increase compared to the same period of 2022. The increase was primarily attributable to a $150.0 million increase in net earnings and changes in working capital balances.

Days sales outstanding, a measurement of the time it takes to collect receivables, were 43.8 days at June 30, 2023 compared to 46.5 days at June 30, 2022. Additionally, our over 90 day receivables balance was $36.5 million at June 30, 2023, a decrease of $2.6 million from the $39.1 million balance at June 30, 2022. All customer accounts are actively managed, and no losses in excess of amounts reserved are currently expected.

cash from investing activities

Net cash used for investing activities was $203.2 million during the first six months of 2023, a $265.5 million decrease compared to cash used of $468.7 million in the same period of 2022. This decrease was primarily attributable to a $189.0 million decrease in payments for businesses acquired in the current period compared to the prior period. During the first six months of 2022, we acquired businesses for $188.1 million (see Note 16 to the condensed consolidated financial statements). Additionally, during the first six months of 2023, we received $130.0 million in proceeds from the collection of a note receivable related to the sale of concrete operations in New Jersey, New York and Pennsylvania in November 2022. Furthermore, during the first six months of 2023, we invested $354.6 million in our existing operations (includes changes in accruals for property, plant & equipment) compared to $290.6 million in the prior year period. Of this $354.6 million, $77.9 million was invested in internal growth projects to enhance our distribution capabilities, develop new production sites and enhance existing production facilities.

cash from financing activities

Net cash used for financing activities in the first six months of 2023 was $297.6 million, compared to cash provided of $25.4 million in the same period of 2022. The current year includes a $100.0 million net payment on our line of credit, whereas the prior year includes a $176.0 million net draw on our line of credit. Additionally, we increased the capital returned to our shareholders by $58.0 million via higher dividends of $8.1 million ($0.43 per share compared to $0.40 per share) and higher share repurchases of $49.9 million (241,363 shares repurchased at $206.82 average price per share compared to none in the first half of 2022).

debt

Certain debt measures are presented below:

			June 30			December 31			June 30
dollars in millions			2023			2022			2022
Debt
Current maturities of long-term debt			$ 0.5			$ 0.5			$ 0.5
Short-term debt			0.0			100.0			176.0
Long-term debt			3,873.2			3,875.2			3,873.7
Total debt			$ 3,873.7			$ 3,975.7			$ 4,050.2
Capital
Total debt			$ 3,873.7			$ 3,975.7			$ 4,050.2
Total equity			7,226.4			6,952.2			6,744.2
Total capital			$ 11,100.1			$ 10,927.9			$ 10,794.4
Total Debt as a Percentage of Total Capital			34.9%			36.4%			37.5%
Weighted-average Effective Interest Rates
Line of credit 1			1.13%			1.13%			1.13%
Commercial paper			5.43%			4.79%			N/A
Term debt			4.78%			4.75%			4.05%
Fixed versus Floating Interest Rate Debt
Fixed-rate debt			72.1%			70.3%			69.0%
Floating-rate debt			27.9%			29.7%			31.0%

1		Reflects the margin above SOFR for SOFR-based borrowings; we also paid upfront fees that are amortized to interest expense and pay fees for unused borrowing capacity and standby letters of credit.

At June 30, 2023, total debt to trailing-twelve months Adjusted EBITDA was 2.1 times (2.0 times on a net debt basis reflecting $168.2 million of cash on hand). Our weighted-average debt maturity was 10.4 years.

delayed draw term loan, line of credit AND COMMERICAL PAPER PROGRAM

In June 2021, we entered into a $1,600.0 million unsecured delayed draw term loan which was fully drawn in August 2021 upon the acquisition of U.S. Concrete. The delayed draw term loan was paid down to $1,100.0 million in September 2021 with cash on hand, paid down to $550.0 million in August 2022 using the proceeds from the issuance of commercial paper as described below and fully repaid in March 2023 using proceeds from the issuance of 5.80% senior notes as described below.

Our unsecured line of credit was amended in August 2022 to increase the borrowing capacity from $1,000.0 million to $1,600.0 million and extend the maturity date from September 2026 to August 2027. Our line of credit contains covenants customary for an unsecured investment-grade facility. Covenants, borrowings, cost ranges and other details are described in Note 7 to the condensed consolidated financial statements. As of June 30, 2023, we were in compliance with the covenants, the margin for the Secured Overnight Financing Rate (SOFR) borrowings was 1.125%, the margin for base rate borrowings was 0.125% and the commitment fee for the unused amount was 0.100%.

In August 2022, we established a $1,600.0 million commercial paper program through which we borrowed $550.0 million that was used to partially repay the delayed draw term loan. Commercial paper borrowings bear interest at rates determined at the time of borrowing and as agreed between us and the commercial paper investors.

As of June 30, 2023, our available borrowing capacity under the line of credit was $1,516.8 million. Utilization of the borrowing capacity was as follows:

None was borrowed

$83.2 million was used to support standby letters of credit

TERM DEBT

All of our $3,941.6 million (face value) of term debt (which includes the $550.0 million commercial paper) is unsecured. All of the covenants in the debt agreements are customary for investment-grade facilities. As of June 30, 2023, we were in compliance with all term debt covenants.

In March 2023, we issued $550.0 million of 5.80% senior notes due 2026. Total proceeds of $546.6 million (net of discounts and transaction costs), together with cash on hand, were used to repay the $550.0 million delayed draw term loan.

CURRENT MATURITIES of long-term debt

The $0.5 million of current maturities of long-term debt as of June 30, 2023 is due as follows:

	Current
in millions	Maturities
Third quarter 2023	$0.0
Fourth quarter 2023	0.0
First quarter 2024	0.5
Second quarter 2024	0.0

debt ratings

Our debt ratings and outlooks as of June 30, 2023 are as follows:

			Short-term		Long-term		Outlook
Fitch			F2		BBB		Stable
Moody's			P-2		Baa2		Stable
Standard & Poor's			A-2		BBB+		Stable

Equity

The number of our common stock issuances and purchases for the year-to-date periods ended are as follows:

	June 30			December 31			June 30
in millions	2023			2022			2022
Common stock shares at January 1,
issued and outstanding	132.9			132.7			132.7
Common Stock Issuances
Share-based compensation plans	0.2			0.2			0.2
Common Stock Purchases
Purchased and retired	(0.2)			0.0			0.0
Common stock shares at end of period,
issued and outstanding	132.9			132.9			132.9

As of June 30, 2023, there were 7,823,488 shares remaining under the February 2017 share purchase authorization by our Board of Directors. Depending upon market, business, legal and other conditions, we may purchase shares from time to time through the open market (including plans designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934) and/or privately negotiated transactions. The authorization has no time limit, does not obligate us to purchase any specific number of shares and may be suspended or discontinued at any time.

The detail of our common stock purchases (all of which were open market purchases) for the year-to-date periods ended are as follows:

	June 30			December 31			June 30
in millions, except average cost	2023			2022	2022		2022	2022
Shares Purchased and Retired
Number	0.2			0.0			0.0
Total purchase price	$ 49.9			$ 0.0			$ 0.0
Average cost per share	$ 206.82			$ 0.00			$ 0.00

There were no shares held in treasury as of June 30, 2023, December 31, 2022 and June 30, 2022.

off-balance sheet arrangements

We have no off-balance sheet arrangements such as financing or unconsolidated variable interest entities.

Standby Letters of Credit

For a discussion of our standby letters of credit, see Note 7 to the condensed consolidated financial statements.

CRITICAL ACCOUNTING POLICIES

We follow certain significant accounting policies when preparing our consolidated financial statements. A summary of these policies is included in our Annual Report on Form 10-K for the year ended December 31, 2022 (Form 10-K).

We prepare these financial statements to conform with accounting principles generally accepted in the United States of America. These principles require us to make estimates and judgments that affect our reported amounts of assets, liabilities, revenues and expenses, and the related disclosures of contingent assets and contingent liabilities at the date of the financial statements. We base our estimates on historical experience, current conditions and various other assumptions we believe reasonable under existing circumstances and evaluate these estimates and judgments on an ongoing basis. The results of these estimates form the basis for our judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Our actual results may materially differ from these estimates.

We believe that the accounting policies described in the “Management's Discussion and Analysis of Financial Condition and Results of Operations” section of our Form 10-K require the most significant judgments and estimates used in the preparation of our consolidated financial statements, so we consider these to be our critical accounting policies. There have been no changes to our critical accounting policies during the six months ended June 30, 2023.

new Accounting standards

For a discussion of the accounting standards recently adopted or pending adoption and the effect such accounting changes will have on our results of operations, financial position or liquidity, see Note 17 to the condensed consolidated financial statements.

FORWARD-LOOKING STATEMENTS

Certain matters discussed in this report, including expectations regarding future performance, contain forward-looking statements that are subject to assumptions, risks and uncertainties that could cause actual results to differ materially from those projected. These assumptions, risks and uncertainties include, but are not limited to:

general economic and business conditions

a pandemic, epidemic or other public health emergency, such as the COVID-19 outbreak

our dependence on the construction industry, which is subject to economic cycles

the timing and amount of federal, state and local funding for infrastructure

changes in the level of spending for private residential and private nonresidential construction

changes in our effective tax rate

the increasing reliance on information technology infrastructure, including the risks that the infrastructure does not work as intended, experiences technical difficulties or is subjected to cyber-attacks

the impact of the state of the global economy on our businesses and financial condition and access to capital markets

international business operations and relationships, including recent actions taken by the Mexican government with respect to our property and operations in that country

the highly competitive nature of the construction industry

the impact of future regulatory or legislative actions, including those relating to climate change, biodiversity, land use, wetlands, greenhouse gas emissions, the definition of minerals, tax policy and domestic and international trade

the outcome of pending legal proceedings

pricing of our products

weather and other natural phenomena, including the impact of climate change and availability of water

availability and cost of trucks, railcars, barges and ships, as well as their licensed operators, for transport of our materials

energy costs

costs of hydrocarbon-based raw materials

healthcare costs

labor relations, shortages and constraints

the amount of long-term debt and interest expense we incur

changes in interest rates

volatility in pension plan asset values and liabilities, which may require cash contributions to the pension plans

the impact of environmental cleanup costs and other liabilities relating to existing and/or divested businesses

our ability to secure and permit aggregates reserves in strategically located areas

our ability to manage and successfully integrate acquisitions

the effect of changes in tax laws, guidance and interpretations

significant downturn in the construction industry may result in the impairment of goodwill or long-lived assets

changes in technologies, which could disrupt the way we do business and how our products are distributed

the risks of open pit and underground mining

expectations relating to environmental, social and governance considerations

claims that our products do not meet regulatory requirements or contractual specifications

other assumptions, risks and uncertainties detailed from time to time in our periodic reports filed with the SEC

All forward-looking statements are made as of the date of filing or publication. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law. Investors are cautioned not to rely unduly on such forward-looking statements when evaluating the information presented in our filings, and are advised to consult any of our future disclosures in filings made with the Securities and Exchange Commission (SEC) and our press releases with regard to our business and consolidated financial position, results of operations and cash flows.

INVESTOR information

We make available on our website, www.vulcanmaterials.com, free of charge, copies of our:

Annual Report on Form 10-K

Quarterly Reports on Form 10-Q

Current Reports on Form 8-K

Our website also includes amendments to those reports filed with or furnished to the Securities and Exchange Commission (SEC) pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as well as all Forms 3, 4 and 5 filed with the SEC by our executive officers and directors, as soon as the filings are made publicly available by the SEC on its EDGAR database (www.sec.gov).

In addition to accessing copies of our reports online, you may request a copy of our Annual Report on Form 10-K, including financial statements, by writing to Denson N. Franklin III, Senior Vice President, General Counsel and Secretary, Vulcan Materials Company, 1200 Urban Center Drive, Birmingham, Alabama 35242.

We have a:

Business Conduct Policy applicable to all employees and directors

Code of Ethics for the CEO and Senior Financial Officers

Copies of the Business Conduct Policy and the Code of Ethics are available on our website under the “Investor Relations” tab (“Governance” section). If we make any amendment to, or waiver of, any provision of the Code of Ethics, we will disclose such information on our website as well as through filings with the SEC.

Our Board of Directors has also adopted:

Corporate Governance Guidelines

Charters for its Audit, Compensation, Executive, Finance, Governance and Safety, Health & Environmental Affairs Committees

These documents meet all applicable SEC and New York Stock Exchange regulatory requirements.

The Charters of the Audit, Compensation and Governance Committees are available on our website under the “Investor Relations” tab (“Governance – Committee Composition” section) or you may request a copy of any of these documents by writing to Denson N. Franklin III, Senior Vice President, General Counsel and Secretary, Vulcan Materials Company, 1200 Urban Center Drive, Birmingham, Alabama 35242.

Information included on our website is not incorporated into, or otherwise made a part of, this report.

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