Vulcan raised aggregates prices 3.9% on 1% more volume, but diesel-driven cost inflation absorbed most of the gain; EPS rose 1.6% to $2.47 on a lower tax rate and buybacks while full-year EBITDA guidance of $2.4–2.6B was reaffirmed.
Revenue
$2.2B
+2.5% YoY
Net income
$323M
+0.8% YoY
Diluted EPS
$2.47
+1.6% YoY
Operating margin
21.1%
How VMC compares with Materials peers
Figure
VMC
Peer median
Rank
Revenue growth (YoY)
+2.5%
+9.5%
16th of 22
Operating margin
21.1%
16.8%
6th of 21
EPS growth (YoY)
+1.6%
+10.8%
13th of 19
Rank 1 = fastest revenue growth, highest operating margin, fastest EPS growth. Peers are the other Materials companies with a 2026 report on this site, each at its latest period we've analyzed; fiscal calendars differ, so periods are not always the same months.
Vulcan Materials, the largest US producer of crushed stone, sand and gravel, raised prices faster than its costs in the second quarter of 2026, but only just. Revenue rose 2.5% to $2,155.8 million and diluted EPS from continuing operations rose 1.6% to $2.47. Aggregates prices climbed 3.9% while volumes grew 1%. A diesel-driven 7% jump in cash cost per ton absorbed most of the price gain, and heavy May–June rain in Texas and the Southeast held back shipments. Management reaffirmed its full-year outlook of $2.4–2.6 billion in Adjusted EBITDA. Meeting it now depends on a stronger second half.
At a glance
Price +$0.86/ton, cash cost +$0.72/ton. Vulcan charged 3.9% more per ton of aggregates, but higher diesel pushed cash cost per ton up 7%. Cash gross profit per ton rose only $0.14, to $12.02.
Pre-tax profit fell 2.3% while EPS rose 1.6%. Pre-tax earnings dropped to $404.5 million. EPS still grew because the tax rate fell to 20.1% from 22.0% and the diluted share count shrank about 2% after buybacks.
H1 Adjusted EBITDA +2.9% vs. a guide that implies roughly +12% in H2. First-half Adjusted EBITDA was $1,101.1 million. Reaching the $2.5 billion midpoint requires about $1.4 billion in the second half, up about 12% from the $1,253 million earned in the second half of 2025.
The quarter in numbers
Metric
Q2 2026
Q2 2025
YoY Change
Total revenues
$2,155.8M
$2,102.4M
+2.5%
Gross profit
$625.5M
$625.2M
+0.0%
Operating earnings
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Operating margin is operating earnings as a share of revenue: what remains after running the business, before interest and tax. The "freight-adjusted" price excludes delivery charges that Vulcan passes through to customers at cost, so it measures what Vulcan earns for the stone itself. Cash gross profit per ton is gross profit plus depreciation and depletion, divided by tons shipped, and is the unit-profit measure Vulcan emphasizes most.
Aggregates: price did the work, diesel took most of it
Aggregates (crushed stone, sand and gravel) produce about 90% of Vulcan's gross profit: $567.3 million of the $625.5 million total this quarter. The segment's gross profit rose 1% to $567.3 million, and cash gross profit rose 2% to $720.1 million.
Volume: shipments rose 1% to 59.9 million tons. The 10-Q says volumes "continued to benefit from healthy public construction activity and large projects." It also says "shipments in Texas and certain Southeastern markets were impacted by significant rainfall, particularly in May and June." The filing does not quantify private residential or nonresidential demand for the quarter. Its only stated demand drivers are public work and large projects.
Price: the freight-adjusted price rose 3.9% (+$0.86) to $22.97 a ton, or 4.7% "mix-adjusted." That figure removes the effect of selling relatively more low-priced product or selling in cheaper markets. Management describes pricing as "widespread growth across the Company's footprint."
Cost: freight-adjusted cash cost of sales rose 7% (+$0.72) to $10.95 a ton. Without higher diesel costs, the increase would have been 3%. Fuel therefore accounts for more than half of the cost increase. That fits the release's reference to "significant energy inflation."
Freight-adjusted revenue grew 5.1% to $1,376.4 million. Almost four-fifths of that growth came from price and one-fifth from volume. Vulcan's model depends on raising prices every year. This quarter that worked, but most of the gain went to higher fuel costs rather than wider unit margins.
Takeaway: Vulcan kept pricing ahead of cost. Diesel inflation cut the per-ton benefit of a $0.86 price increase to $0.14 of extra cash profit, and pre-tax earnings fell 2.3%. The EPS gain came from a lower tax rate and fewer shares, not from the operating business. The second half has to deliver volume growth or cost relief to hit the reaffirmed EBITDA range.
Asphalt and concrete: a smaller, deliberately shrinking business
The downstream businesses turn aggregates into finished products. Together they earned $58.2 million of gross profit, 11% less than a year ago. Part of the decline is by design, because Vulcan is selling non-core operations to focus on aggregates.
Asphalt: revenue fell 10.5% to $330.0 million and gross profit fell 13% to $49.8 million. Tons shipped fell 12% to 3.4 million, while the average price rose 5.5% to $85.74. The 10-Q cites weather and higher liquid asphalt costs. The prior-year quarter also included the Houston asphalt and construction business, which was sold in Q4 2025. The gross margin held at about 15%.
Concrete: revenue fell 15.3% to $186.8 million and cubic yards fell 17%. Gross profit was nearly flat at $8.4 million, but only because Vulcan stopped depreciating the California ready-mix assets once they were classified as held for sale. Cash gross profit, which ignores depreciation, fell 55% to $12.3 million. The quarter included only two months of the California business before its sale closed in early June.
What the headline numbers hide
EPS growth came from taxes and buybacks, not operations. Pre-tax earnings from continuing operations fell 2.3% to $404.5 million. The effective tax rate dropped to 20.1% from 22.0%. The 10-Q attributes this to a one-time benefit from remeasuring deferred tax liabilities after the California exit changed Vulcan's state tax profile. At last year's 22% rate, continuing earnings would have been roughly $8 million lower. Diluted shares fell to 130.3 million from 132.9 million (-2%). Vulcan bought back $250.3 million of stock in Q2 at an average of $276.69 a share, after no repurchases a year earlier. Lower net interest expense ($54.7 million vs. $59.2 million) also helped.
Adjusted EPS includes that tax benefit. Adjusted EPS of $2.59 (+5.7%) removes $0.10 of charges net of tax: the $13.2 million loss on the California and US Virgin Islands sales, $4.5 million of costs tied to divested operations, and $0.5 million of acquisition charges. The deferred-tax remeasurement benefit stays in, so adjusted EPS overstates the underlying improvement.
Operating earnings fell despite flat gross profit. Operating earnings declined $15.5 million. A $11.3 million loss on asset and business sales replaced a $1.2 million gain last year, and net other operating expense rose to $17.4 million from $10.9 million, including the $4.5 million of divestiture-related charges.
Cash conversion is fine, free cash flow is lower. First-half operating cash flow was $584.6 million, 1.19 times net earnings of $490.3 million, compared with $593.2 million and 1.32 times a year ago. Capital spending rose to $370.4 million from $270.9 million. Free cash flow (operating cash flow minus capex) was therefore about $214 million, down from about $322 million. Buybacks of $399.8 million and dividends of $135.4 million in the first half exceeded that. The $572.1 million of cash from divestitures covered the gap.
No working-capital warning signs. Gross receivables were $1,111.0 million, up 1.7% from June 2025, in line with revenue. Inventories were down 5% from a year ago at $688.7 million.
One-offs to strip out of the comparison. Downstream results are shrinking because of the Houston and California sales. Concrete gross profit is flattered by suspended depreciation. The California sale also brought a $150.0 million note due December 2027 on top of the cash proceeds, which appears in higher investments and long-term receivables.
Balance sheet and capital allocation
Total debt was $4,364.3 million at June 30, down from $4,909.7 million a year earlier, and $400 million now falls due within 12 months. Debt was 1.9 times trailing Adjusted EBITDA, or 1.7 times net of cash. That is below Vulcan's target range of 2.0–2.5 times, which leaves room for more acquisitions or buybacks. Trailing-12-month return on invested capital, as Vulcan defines it, rose to 16.1% from 15.9%. During the quarter Vulcan also bought a quarry in southern Colorado and a rail yard in Dallas–Fort Worth from Brannan Sand & Gravel. Total acquisition spending was $75.0 million year to date.
On July 27 a NAFTA arbitration tribunal ruled on Vulcan's long-running claim over Mexico's 2022 shutdown of its Calica quarry. The tribunal found that Mexico had violated NAFTA but awarded "negligible" damages. Vulcan says the ruling had no material effect on its financial statements.
Outlook
Management "reiterate[d]" full-year Adjusted EBITDA of $2.4–2.6 billion, the same range given in April. It said large projects and public construction "continue to support our expectation for volume growth in 2026" and that the environment supports "continued aggregates price growth." Its reconciliation of the $2.5 billion midpoint implies about $1,215 million of GAAP net earnings for the year.
Our view: the range is achievable but not assured. First-half Adjusted EBITDA grew 2.9% and second-quarter Adjusted EBITDA fell 0.8%. The low end ($2.4 billion) needs second-half growth of about 4% over 2025's $1,253 million, while the midpoint needs about 12%. The second half also no longer includes the divested Houston and California businesses. Three things to watch in Q3, which is normally Vulcan's strongest quarter:
Whether volume growth picks up once the Texas and Southeast weather disruption passes.
Whether diesel costs ease or keep taking most of the price gain.
Whether the mix-adjusted price increase holds at around 4–5%.
If cash gross profit per ton gains no more than this quarter's $0.14, the upper half of the range looks unlikely.