Summit Materials Reports Significant Revenue Growth, Net Income Decline in Latest Quarter

Summit Materials, Inc. reported significant financial developments in its latest 10-Q filing for the period ending September 28, 2024. The company achieved total revenue of $1,171.1 million for the three months ended September 28, 2024, a substantial increase from $794.8 million in the same period of 2023. For the nine months, revenue rose to $3,094.4 million, up from $1,959.3 million year-over-year. This growth was primarily driven by the acquisition of Argos USA, which contributed $415.2 million to the consolidated results.

Despite the revenue increase, net income for the three months ended September 28, 2024, was $105.2 million, a decrease from $232.7 million in the prior year. For the nine-month period, net income fell to $144.0 million from $286.2 million in 2023. The decline in net income was attributed to higher transaction and integration costs related to the Argos acquisition, which amounted to $86.1 million for the nine months.

The company’s operating income for the three months increased to $194.7 million, compared to $128.0 million in the same period last year, while for the nine months, it rose to $322.7 million from $242.1 million. Adjusted EBITDA also saw a significant increase, reaching $314.7 million for the three months and $732.1 million for the nine months, reflecting growth of 50.9% and 65.8%, respectively.

Summit’s total assets increased to $8.4 billion as of September 28, 2024, up from $5.1 billion at the end of 2023. This growth was driven by a rise in property, plant, and equipment, which reached $4.3 billion, and goodwill, which increased to $2.1 billion following the Argos acquisition. The company’s cash and cash equivalents also improved, totaling $737.5 million compared to $374.2 million at the end of 2023.

In terms of strategic developments, Summit completed the acquisition of Argos North America Corp. on January 12, 2024, for approximately $3.1 billion, funded through a combination of cash and debt. The acquisition included four integrated cement plants and significantly expanded Summit's operational capacity in the cement segment, which reported a revenue increase of 202.8% for the three months and 262.1% for the nine months ended September 28, 2024.

The company also divested four businesses during the nine months, generating proceeds of $98.9 million. This strategic move was part of a broader effort to streamline operations and focus on core segments. Overall, while revenue surged due to acquisitions, profitability faced challenges from increased costs and integration efforts.