Page 4 - 2019 Annual Report
P. 4
LETTER TO SHAREHOLDERS
Building Our Future on a Strong and Sustainable Foundation
Dear Fellow Shareholders and Stakeholders:
For Martin Marietta, 2019 marked another productive and successful year,
both financially and operationally. This year also brought two significant
milestones for our Company – our 25th year as a publicly traded company
and the five-year anniversary of the latest iteration of our Strategic Operating
Analysis and Review plan (SOAR). As we turn the page to 2020 and reflect on
our accomplishments, it is also an opportune time to consider what we can
achieve for Martin Marietta shareholders and stakeholders over the next five
and 25 years.
Our strategic plan is focused on five-year intervals because a shorter time-
frame might only provide a snapshot, while a longer timeframe might allow
for extraneous events to cloud the overall picture. In our view, five years is the
ideal yardstick to revisit past initiatives like SOAR, measure tangible results and
highlight meaningful, long-term progress. If we look at 2019 as the capstone of
our last five years, it is clear that Martin Marietta has performed exceptionally
well and has further positioned itself for long-term growth.
Notably, during this five-year timeframe, Martin Marietta shareholders
enjoyed a total return on their investment of 165 percent, well ahead of our
sector and more than twice the return generated by the S&P 500.
Not bad for five years’ work.
The performance summaries on the following page quantify what we
accomplished in 2019 and over the past five years. In brief, 2019 was an
outstanding year – one in which we established new records across an array
of key financial metrics. In addition to strong financial results, we prudently
deployed some of the operating cash flow generated to reduce the Company’s
outstanding debt by $350 million; invested $394 million in capital improve-
ments to keep our plants, property and equipment in the sound condition
that you rightfully expect; contributed $50 million to our employees’ qualified
defined benefit plan (which increased its funded status to nearly 100 percent);
increased the dividend by 15 percent; and repurchased nearly $100 million of
Martin Marietta shares. As a result, shareholders were rewarded with a total
return on their investment in 2019 of 64 percent, more than twice the return
for the S&P 500.
Not bad for a year’s work.
Behind all of the headline numbers and statistics of what we did are the
details of how we did it. As we reflect on the last five years and prepare for the
future, I want to focus on the how – how these record results and accomplish-
ments came to fruition.
The how starts with the thoughtfully developed and successful execution of
C. Howard Nye
SOAR, the principles of which stem from our corporate vision to build a world-
class organization committed to the sustainable, long-term value and success Chairman, President and Chief Executive Officer
Page 2 Annual Report Celebrating 25 Years as a Public Company