Page 69 - 2019 Annual Report

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
The Company is engaged in certain legal and administrative proceedings incidental to its normal business activities. In the
opinion of management, based upon currently available facts, the likelihood is remote that the ultimate outcome of any
litigation or other proceedings, including those pertaining to environmental matters, relating to the Company and its
subsidiaries, will have a material adverse effect on the overall results of the Company’s operations, cash flows or financial position.

FINANCIAL OVERVIEW
2019 marked record total revenues, gross profit, earnings from operations and Adjusted EBITDA (defined below) for the
Company. Strong underlying demand led to shipment growth in the majority of product lines in the Building Materials
business, resulting in a 210-basis-point increase in consolidated gross margin. The Magnesia Specialties business performed
well despite the impact of several customers rationalizing their inventory levels, which resulted in a short-term headwind.
The Company continues to effectively control costs, as evidenced by the 20-basis-point decline for selling, general and
administrative expenses as a percentage of total revenues.

Results of Operations
The discussion and analysis that follow reflect management’s assessment of the financial condition and results of operations
(MD&A) of the Company and should be read in conjunction with the audited consolidated financial statements. As discussed
in more detail, the Company’s operating results are highly dependent upon activity within the construction marketplace,
economic cycles within the public and private business sectors and seasonal and other weather-related conditions.
Accordingly, financial results for any year presented, or year-to-year comparisons of reported results, may not be indicative
of future operating results. As permitted by the Securities and Exchange Commission (SEC) under the FAST Act Modernization
and Simplification of Regulation S-K, the Company has elected to omit the discussion of the earliest period (2017) presented
as it WAS included in its MD&A in its 2018 Form 10-K filed on February 25, 2019, incorporated by reference from Exhibit
13.01 thereto.
The Company’s Building Materials business generated the majority of consolidated total revenues and earnings from
operations. The following comparative analysis and discussion should be read within this context. Further, sensitivity analysis
and certain other data are provided to enhance the reader’s understanding of MD&A and are not intended to be indicative of
management’s judgment of materiality.

The Company’s two cold mix asphalt plants have been reclassified from the asphalt and paving product line to the aggregates
product line. These operations did not represent a material amount of product revenues and gross profit. 2018 information
has been reclassified to conform to the presentation of the Company’s current reportable product lines.

Celebrating 25 Years as a Public Company Annual Report ♦ Page 67