Martin Marietta Materials, Inc. is a leading supplier of aggregates products
(crushed stone, sand, and gravel) used for the construction of infrastructure,
nonresidential, and residential projects. Aggregates products are also used
for railroad ballast and in agricultural, utility and environmental applications.
The Company’s Aggregates business consists primarily of mining, processing,
and selling granite, limestone, sand and gravel. The Aggregates business also
includes aggregates-related downstream product lines (including its heavy building
materials such as asphalt products, ready mixed concrete, and road paving construction
services). The Company is also a leading supplier of cement, ready mixed concrete,
and asphalt and paving services in some regions where being able to supply a
full range of products is important for customer service. The Company’s
Cement business produces Portland and specialty cements. The Company also has
a Magnesia Specialties business that manufactures and markets magnesia-based
chemical products used in industrial, agricultural, and environmental applications,
and dolomitic lime sold primarily to customers in the steel industry.
The Company was formed in 1993 as a North Carolina corporation to serve as
successor to the operations of the materials group of the organization that
is now Lockheed Martin Corporation. An initial public offering of a portion
of the Company’s Common Stock was completed in 1994, followed by a tax-free
exchange transaction in 1996 that resulted in 100% of the Company’s Common
Stock being publicly traded.
The Company completed over 85 smaller acquisitions from the time of its initial
public offering until the present, which allowed the Company to enhance and
expand its presence in the aggregates marketplace. This included an exchange
of certain assets in 2011 with Lafarge North America Inc. (“Lafarge”),
pursuant to which it received aggregates quarry sites, ready mixed concrete
and asphalt plants, and a road paving business in and around the metropolitan
Denver, Colorado, and the I-25 corridor, in exchange for which Lafarge received
properties consisting of quarries, an asphalt plant and distribution yards operated
by the Company along the Mississippi River (called the Company’s “River
District Operations”) and a cash payment. The Company uses its ability
to distribute materials over long distances by rail and water to further expand
its operations.
In addition to the Cement business, the Company acquired as part of the TXI
acquisition nine quarries and six aggregates distribution terminals located
in Texas, Louisiana and Oklahoma. The Company also acquired approximately 120
ready mixed concrete plants, situated primarily in three areas of Texas (the
Dallas/Fort Worth/Denton area of north Texas; the Austin area of central Texas;
and from Beaumont to Texarkana in east Texas), in north and central Louisiana
and in Southwestern Arkansas. As part of an agreement with the United States
Department of Justice’s review of the transaction, the Company divested
of its North Troy Quarry in Oklahoma and two related rail distribution yards
in Dallas and Frisco, Texas.
TXI was also a cement producer in California. In 2015, the Company divested
its California cement business acquired from TXI. These operations were not
in close proximity to other core assets of the Company and, unlike other marketplace
competitors, were not vertically integrated with ready mixed concrete production.
The divestiture primarily included a cement plant, two distribution terminals,
mobile equipment, intangible assets and inventory. The Company also completed
the integration of the TXI operations in 2015, and completed three smaller acquisitions,
which included three aggregates operations and related assets.
In 2016, the Company acquired aggregates, ready mixed concrete and asphalt and
paving operations in southern Colorado that provided more than 500 million tons
of mineral reserves and expanded the Company’s presence along the Front
Range of the Rocky Mountains, home to 80% of Colorado’s population. The
Company also acquired the remaining interest it had not previously owned in
a ready mixed concrete company that serves the I-35 corridor in central Texas
between Dallas and Austin, which enhanced the Company’s position and provided
additional vertical integration benefits with the Company’s Cement business.
Between 2001 and 2016, the Company disposed of or idled a number of underperforming
operations, including aggregates, ready mixed concrete, trucking, and asphalt
and road paving operations of its Aggregates business and the refractories business
of its Magnesia Specialties business. In some of its divestitures, the Company
concurrently entered into supply agreements to provide aggregates at market
rates to certain of these divested businesses. During 2015, the Company disposed
of certain non-core asphalt operations in San Antonio, Texas and divested its
California cement operations of its Cement business. The Company will continue
to evaluate opportunities to divest underperforming assets, if appropriate,
during 2017 in an effort to redeploy capital for other opportunities.
The Company conducts its Aggregates business through three reportable segments:
the Mid-America Group, Southeast Group and West Group. The Company’s Cement
business is reported through the Cement segment. The Company also has the Magnesia
Specialties segment, which includes its magnesia-based chemicals and dolomitic
lime businesses.
2.85% 
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