Good day, ladies and gentlemen, and welcome to the Second Quarter 2014 Eagle Materials Incorporated Earnings Conference Call. My name is Twanda, and I will be your coordinator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference over to Mr. Steve Rowley, President and Chief Executive Officer. Please proceed, sir.

Thank you, and welcome to Eagle Materials Conference Call for the Second Quarter of Fiscal Year 2014. Joining me today are Craig Kesler, our Chief Financial Officer; and Bob Stewart, Executive Vice President, Strategy, Corporate Development & Communications. There will be a slide presentation made in connection with this call. To access it, please go to www.eaglematerials.com and click on the link to the webcast. While you're accessing the slides, please note that the first slide covers our cautionary disclosure regarding forward-looking statements made during this call. These statements are subject to risks and uncertainties that could cause results to differ from those discussed during the call. For further information, please refer to this disclosure, which is also included at the end of our press release. Eagle's second quarter revenues increased 53%, and the earnings per diluted share doubled as a result of much improved pricing across nearly all of our businesses, strong improvement in sales volumes across all of our business lines and the successful integration of the recently acquired cement, concrete, aggregate and [indiscernible] operations in Kansas City and Tulsa. Record Cement sales volumes increased concrete and aggregate sales volumes and improved pricing were the primary drivers of the increase in Eagle's quarterly comparative of Cement, Concrete and Aggregate revenues. Sales volume improvement occurred in all of our cement markets. We continue to see strong demand from the energy sector for oil well cement, which we expect will continue. Year-over-year prices increased in each market and our average net cement price increased 3% for the quarter, reflecting price increases successfully implemented this spring. The quarter-to-quarter change in our average net cement sales price reflects changes in regional mix of our cement sales volumes. We have announced additional cement price increases for early 2014 in most of our markets. Increased wallboard average sale prices and increased sales volumes drove a 24% increase in our quarterly comparative of wallboard and paperboard revenues. Operating earnings in our wallboard and paperboard business improved to $36.8 million for the second quarter versus $24.2 million a year ago. Additionally, our paper mill continues to perform exceptionally well and remained sold out. Now let me turn this over to Craig for more details on the financials.

Thank you, Steve. Operating cash flow during the first half of fiscal 2014 improved to $79.3 million. Capital spending of approximately $31.6 million was used primarily towards the build out our frac sand mine in Northern Illinois and maintenance capital. Interest expense increased to $4.8 million during the second quarter, reflecting higher borrowing levels resulting from the acquisition of assets in Missouri and Oklahoma last year. Our effective tax rate for the quarter was 32%. As this last slide reflects, our solid low-cost competitive position allowed Eagle to generate meaningful cash flow from operations, which we have primarily used to reduce debt and improve our financial flexibility. Our net debt to total cap ratio was 37% at September 30, 2013. Thank you for attending today's call. We will now move to the question-and-answer session. Operator?

[Operator Instructions] Your first question comes from the line of Trey Grooms with Stephens.

Steve, could you update us on -- in regards to the frac sand rollout, number one, kind of an update on the permitting process and kind of the timing of that and then also kind of the timing of when you now expect to kind of start shipping internally produced material? And then I guess, secondly, if you can just comment on the third-party sand you guys are utilizing now, it seems like it has similar logistics to what you will be doing once you're shipping out of your own mine. If you could just kind of comment on how that is working out relative to your initial expectations and how that's going.

Sure. Let me respond to the first part of that question, Trey, with a brief discussion regarding the permitting process and the current status. All permits to mine and operate our frac sand in Illinois are in hand with the exception of 1 permit and that's our water discharge permit. We have submitted our application to comply with all regulations to the state. The state has deemed the application substantially complete, and the state has issued a draft permit based on our application. So we are currently in a very normal and very appropriate part of the permitting process where the public has a chance to comment on the draft permit. Legitimate comments concerning the water discharge will be addressed by the state and ourselves before a final permit is issued. So we had an open public comment period late last summer where people could write in comments. We had a permit. We had a public meeting early October and where the public was again allowed to make any comments with regards to the water discharge permit. Now we're in a 30-day period post that meeting where written comments can be submitted as well. So once that period is over, all comments and any concerns will be addressed before a final permit is issued. And in respect to the rollout, it is -- once that process is complete, we'll finish construction of the facility and would expect that would take a couple of months and then start the process up. And in respect to your last question, we continue to really just stick our toe in the water as far as operating the drying plant down in Corpus Christi, but are very pleased with the operation and pleased with the -- our ability to produce a quality sand and get it into the marketplace.

And your next question comes from the line of Todd Vencil with Sterne Agee. L. Todd Vencil - Sterne Agee & Leach Inc., Research Division: Steve, you mentioned the cement price increases that you've announced for early 2014 in most of your markets. Can you talk about the magnitude of those? And can you talk about where you may not have -- not be planning on getting increases?

Yes. So they're $6 to $8 that have been announced in most of the markets. Where there's a little delay is we had some fall price increases announced in some of the markets. And generally, there was not as much traction as we anticipated. So you're seeing those fall prices kind of be kicked down the road as well for about the same amount into next year, with the exception of we have found some traction in a few of our markets, and primarily those are Central and South Texas.

Your next question comes from the line of Garik Shmois with Longbow Research.

Steve, just wondering if you can comment on wallboard and if you're thinking of managing the business any differently here ahead of the January price increase. Is there a thought to how you would manage inventories or distribution, or will you continue to run the business full out to meet customer demand should it continue to materialize?

Yes. We have been running as hard as we can really for the last couple of years. And as demand increases, we have been adding people to maybe run some extra overtime or add an extra shift. We might add an extra day of production with the existing facilities. The -- but it really has been a careful balance to try to make sure that we're able to service the customers really for the -- for this -- for the majority of this year, but especially the last 2 or 3 months has been a little bit of a difficult balance for us. We've been happy to maybe shift sales from 1 plant to a different plant to make sure that we don't have too much delay in getting the product into the marketplace. So what we've seen is, at the present time, our backlog of orders is stronger than it was a year ago at this time, which indicates some prebuying. So we have, ahead of this, added a few more bodies at our plants where we can to maximize our production capabilities and to service our customers appropriately.

Is that the reason why wallboard prices tricked down a couple of percent sequentially is that you are just -- maybe some geographic mix was involved there?

So you're going to have some product mix and some extra freight when you're doing that. And then some of it is just a function of the products that you're selling.

Your next question comes from the line of Jerry Revich of Goldman Sachs.

Steve, can you talk about -- based on the visibility you have in cement, when you expect to reach a sold-out position in Kansas City, Illinois and Nevada? And I'm wondering, Craig, if you could just give us a sense for the earnings performance of the core Eagle business excluding the Lafarge assets in the quarter? How did the 2 pieces perform?

So we are steadily marching forward to selling out the new businesses. I think things are still somewhat weak in Northern California, Northern Nevada. So that maybe the last piece that we end up being sold-out, but what's happening now is demand is so strong in the neighboring states. And as we mentioned a year ago, one of the nice part of buying these assets was that they neighbored our existing operations which would have allowed us to waterfall cement from these plants into other markets, when those markets were strong. And in fact that's occurring, which makes that comparison a little complicated because now you're taking cement from a plant in a neighboring market and putting that into a sister company's marketplace. So we can give you a guess at that comparison, but it's not an apples and apples comparison. So I'll let Craig finish the answer to that.

Sure. Jerry, and this information will be in the 10-Q that we'll file here shortly. But for the quarter, the new assets produced about $12 million in pretax profit and a vast majority of that being in the Cement business.

Your next question comes from the line of Kathryn Thompson with Thompson Research Group.

Questions on cement and somewhat related to frac sand. On the cement volumes, how much of the volume increase in the wholly-owned was due to catch-up, due to wet weather in the previous quarter versus core demand and how much -- how did higher utilization versus any other factor affect margins? And if you could also comment or give more color on the market demand for frac sand and any change in the actual frac-ing process that might increase the demand for the volume of sand?

In cement, really kind of hard to tell, certainly there was some delay. The majority of that was in the first calendar quarter last year where there was some weather maybe in the -- in our first quarter. The second calendar quarter was not that significant for us. And so we really saw a kind of a more normal pattern this year. However, sales were very, very strong this quarter and probably you run up against some capacity issues associated with the finished grinding, which limits your sales capability during this -- the very strong shipping season, which is the summer and fall quarters. So we may have had some impact just associated with our ability to produce cement, not the kiln process but the cement grinding process during this quarter. As far as development, yes, it appears that as the process for getting oil out of the ground through this frac-ing process matures, it does appear that more and more sand is being consumed as these methods are refined. So it's very exciting to see that the demand for frac sand is on an upward trend.

Your next question comes from the line of Jack Kasprzak with BB&T. John F. Kasprzak - BB&T Capital Markets, Research Division: The wallboard volumes in the quarter were up about 11%, that was a little less than the June quarter, which was up 16-or-so percent, what's -- can you to talk about what's going on there? Have you seen a little slowdown in housing or anything else?

Yes, that's a pretty nice increase. The industry was up, I think, about 6.5%. So I think we've been saying that we've really been blessed with strong markets where our wallboard plants are. So we're really up a little bit ahead of the industry, but I think it's really part of our geographic diversity and where the trends have been. So in our markets, we really haven't seen a real slowdown.

Your next question comes from the line of Brent Thielman with D.A. Davidson. Brent Thielman - D.A. Davidson & Co., Research Division: Yes. In cement, you mentioned there was some change in geographic mix that may have impacted comparisons and the average price maybe quarter-to-quarter, could you identify sort of what shifts you saw in those markets? And then, I thought I heard you say that the fall price increases had trouble sticking, just sort of any thoughts as to why on that end?

Yes. So pricing has increased year-over-year in all of our cement markets. However, when all of a sudden, you have seasonal businesses and one market starts shipping more than it had relative to the last or, in this case, where we have new businesses versus last year, there's an impact on -- of the actual price in those markets versus a year ago. So it's still, for us, some pretty tough comparatives when last year we did not have the new assets in the price mix. And as far as the fall price increase, yes, there was some price increases announced in Texas. And as I mentioned, we're not too successful in the larger metropolitan markets of DFW to Houston. Somewhat successful in Central and South Texas markets. There were also some price increases announced in Northern California, which did not have any traction at all.

Your next question comes from the line of Kevin Money with Cleveland Research.

I want to get your thoughts on the pace of the non-res construction recovery. It seems like you, Steve, uniquely positioned, having your exposure to some of the heavy materials earlier in the cycle, as well as the later cycle wallboard play, I just want to get your thoughts on what you're seeing within the different buckets within non-res?

Yes. So again, this is a case where we're very fortunate to have a lot of our cement and wallboard near where energy plays are occurring. And so demand for commercial, as well as housing, is up where you see a lot of infrastructure needed to extract the energy out of the ground. So for example, Texas is very strong and Colorado was very strong as far as the commercial as well. So it's really associated with what's going on in the energy sector in those regions.

Your next question comes from the line of Glenn Wortman with Sidoti & Company. Glenn Wortman - Sidoti & Company, LLC: If you have it, what was your organic volume growth in cement in the quarter? And then do you anticipate any major maintenance expense for cement in the current quarter?

There's a fair amount of market overlaps. So I'm going to again caution you, it's not exactly apples and apples, but we do count those numbers. So, Craig, why don't you respond to that?

Sure. Glenn, so it's -- again, just on a like-for-like basis, this year to last year, cement volumes in those markets would be up about 15%, if you are on a like-for-like basis. And pricing, you didn't ask about it, but would be up 4% year-over-year as well.

Your next question comes from the line of Ivan Sachs [ph], private investor.

The question that I have is, obviously we've got a large demand for concrete given the fact that asphalt and concrete has a much longer life. Do you see much happening in that area where we could see concrete and aggregate showing a better profitability?

Certainly as -- this has been a shift over the last year or 2 to where the concrete roads are gaining more traction than they have in the past versus asphalt. Simply because the cost to put a concrete road down versus the cost to put an asphalt road down has changed dramatically. So -- and I wish I could say that concrete road costs have gone down, but they really haven't. It's that the cost of putting asphalt roads have gone up with the price of oil and with the fact that refineries then have switched their process over to add cokers, which limits the amount of asphalted material that they have available to lay down for roads.

Your next question comes from the line of Jim Barrett with CL King. James Barrett - CL King & Associates, Inc., Research Division: Steve, will expanding your frac sand infrastructure absorb the majority of your anticipated free cash flow over the next few years? Or do you foresee other uses for that free cash flow?

So we have a fair amount of free cash flow and probably certainly more free cash flow than is anticipated for frac sand alone. So we clearly are looking for other opportunities to grow our major businesses and are chasing a few. And usually those are very lumpy and they come in, in big sizes, not small sizes. But in some cases, for aggregates, they could be in a little smaller bite-size acquisition. So we continue to look for those opportunities and, hopefully, we'll find one. But for example, this year, for the first 6 months, we spent about $31 million or $32 million in capital. Of that, about $20 million of it is associated with frac sand, and the rest is just sustaining CapEx for our other businesses. So clearly, the vast majority of the CapEx is -- has gone to frac sand development.

Your next question comes from the line of John Baugh with Stifel. John A. Baugh - Stifel, Nicolaus & Co., Inc., Research Division: I'm wondering if you have any insights, and I know it's out in the future, but what are you thinking in terms of wallboard demand in your markets, not necessarily a national number, for '14?

This is a very, very difficult thing to follow, and if you look at -- what we present is usually a couple of the major economists' view and will -- and when we put out information, it'll follow either Mark Zandi or Ivy Zelman or some combination of them. That stuff continues to be pushed out each quarter a little bit before you actually see a spike, but everybody realizes that the longer we go building houses below household formations that the bigger the eventual spike will be and we don't feel that it's too far away.

And at this time, there are no further questions in the queue. I would now like to hand the conference back over to Mr. Steve Rowley for closing remarks.

Thank you very much. We look forward to another great call at the end of our third quarter.

Thank you for joining today's conference. That concludes the presentation. You may now disconnect and have a great day.