Page 62 - 2019 Annual Report

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
Geography is critically important as products are sourced and sold locally.
The Company’s geographic footprint is primarily in attractive markets with strong, underlying growth characteristics,
including population growth and/or population density and business and economic diversity, both of which generate demand
for construction and the Company’s Building Materials products. The Company has a presence in most of the megaregions of
the United States, notably: Texas Triangle, Gulf Coast, Piedmont Atlantic, Front Range and Florida, each of which is discussed
below. Additionally, Iowa is discussed below as a top five revenue-generating state and, while not part of a megaregion, is an
attractive market that has diversified its economy over the past several years. Further, South Carolina is a top ten revenue-
generating state and is discussed as part of the Piedmont Atlantic megaregion.

Texas Triangle and Gulf Coast
The Texas Triangle is primarily defined by the anchoring metropolises of Dallas/Fort Worth, San Antonio and Houston. As of
2018, the Texas Triangle’s population was estimated at more than 17 million residents, and is expected to exceed 21.5 million
by 2030, representing approximately 62% of the population in Texas at that time. Growth in the Texas Triangle is not limited
to residents as 53 Fortune 500 companies have headquarters in this megaregion. The Texas Triangle represents a diverse
economy, including the finance, technology, transportation and goods and services sectors.
Uniquely, Houston, which has represented over 25% of Texas’ gross domestic product (GDP) for the past eighteen years, is
considered part of both the Gulf Coast and the Texas Triangle megaregions. In addition to Houston, cities in the Gulf Coast
megaregion include New Orleans and Baton Rouge, Louisiana. The Gulf Coast megaregion’s population is expected to exceed
16 million in 2025 and 23 million in 2050. The economy is driven by the energy, chemical and transportation sectors.

The Texas market remains one of the strongest in the United States, and according to the Bureau of Economic Analysis, as of
2018, the state’s GDP comprised 9% of the nation’s $18.6 trillion GDP. Forbes recognized Dallas, Fort Worth and Houston as
the second, 20 and 34 best metros for business and careers, respectively. Texas continues to lead the nation in population
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growth, and its population is estimated to increase 35% from 2020 to 2040. Houston, San Antonio and Dallas are ranked
fourth, seventh and ninth, respectively, as the most populous cities in the United States and have experienced employment
growth of 26%, 29% and 33%, respectively, over the ten-year period ended November 2019. Supported by population
growth, Texas leads the country in total housing permits for the twelve months ended December 31, 2019.

Annual Report ♦ Page 60 Celebrating 25 Years as a Public Company