Welcome, everyone, to Martin Marietta's Second Quarter 2025 Earnings Conference Call. [Operator Instructions]. As a reminder, today's call is being recorded and will be available for replay on the company's website. I will now turn the call over to your host, Ms. Jacklyn Rooker, Martin Marietta's Vice President of Investor Relations. Jacklyn, you may begin.

Good morning, and thank you for joining Martin Marietta's Second Quarter 2025 Earnings Call. With me today are Ward Nye, Chair and Chief Executive Officer; and Michael Petro, Senior Vice President and Chief Financial Officer. As a reminder, today's discussion may include forward-looking statements as defined by United States securities laws in connection with future events, future operating results or financial performance. Like other businesses, Martin Marietta is subject to risks and uncertainties that could cause actual results to differ materially. We undertake no obligation, except as legally required, to publicly update or revise any forward-looking statements, whether resulting from new information, future developments or otherwise. Please refer to the legal disclaimers contained in today's earnings release and other public filings, which are available on both our own and the Securities and Exchange Commission's websites. We have made available during this webcast and on the Investors section of our website supplemental information that summarizes our financial results and trends. Non-GAAP measures are defined and reconciled to the most directly comparable GAAP measure in the appendix to the supplemental information as well as our filings with the SEC and are also available on our website. Today's earnings call will begin with Ward Nye, whose remarks will focus on our second quarter operating performance, continued portfolio transformation, 2025 outlook and related market trends. Michael Petro will then review our financial results and capital allocation, after which Ward will provide closing comments. A question-and-answer session follow. [Operator Instructions]. I will now turn the call over to Ward.

Thank you, Jacklyn. Good morning, and thank you for joining today's teleconference. I'm pleased to report Martin Marietta delivered outstanding operational and financial results in the second quarter despite weather headwinds and subdued residential demand. In addition to record financial performance in the first half of 2025, we also achieved our safest 6-month start to the year in our company's history, as measured by total reportable instant rates, which continue to exceed world-class safety levels. Together, these results are a tribute to our team's steadfast dedication and focus and reaffirm the strategic advantages of our company's geographic footprint, the resiliency of our differentiated business model and our company's unwavering commitment to safety. Subsequent to the quarter end, on August 3, we entered into a definitive agreement with Quikrete Holdings for the exchange of certain assets. Specifically, Martin Marietta will receive aggregate operations producing approximately 20 million tons annually in Virginia, Missouri, Kansas and Vancouver, British Columbia, as well as $450 million of cash. In exchange, Quikrete will receive our Midlothian cement plant, related cement terminals and North Texas ready mix concrete assets. This transaction is expected to close in the first quarter of 2026, subject to regulatory approvals and other customary closing conditions. Consistent with the priorities outlined in our strategic operating analysis and review, or SOAR, 2025 plan, our focus remains on shaping a higher-margin enterprise that is increasingly aggregates-led, which possesses a more durable and resilient earnings profile through cycles. The strategic exchange of our remaining cement plant and related ready mix concrete operations for core aggregates achieves this objective, enhancing the product mix of our portfolio while preserving balance sheet flexibility for continued strategic plan execution. As highlighted in this morning's release, Martin Marietta established new records for the second quarter with key metrics showing gains year-over-year…

Thank you, Ward, and good morning, everyone. The Building Materials business posted revenues of $1.7 billion, a 2% increase. Gross profit increased 3% to $517 million and gross margin of 30% improved modestly. [Audio Gap] 6% over the prior year quarter and second quarter records for gross profit, gross margin and unit profitability of $430 million, 33% and $8.16 per ton, respectively. We are pleased to report that momentum is building as we enter the second half of the year. And as a result, we revised our full year guidance to reflect stronger aggregates pricing and effective cost management. Specifically, we now anticipate a full year price/cost spread of 340 basis points and a 14% year-over-year improvement in gross profit per ton at the midpoint, both well ahead of historical levels. Cement and Concrete revenues decreased 6% and gross profit decreased 25% to $245 million and $54 million, respectively, due to lower operating leverage and higher ready mix raw material costs. Pursuant to the asset exchange with Quikrete, the results of operations for our Cement and Texas ready mix concrete assets will be classified as discontinued operations beginning in the third quarter of 2025. Asphalt and paving revenues decreased 7% to $228 million and gross profit decreased 8% to $33 million due to lower shipments and higher costs. As Ward indicated, Magnesia Specialties achieved all-time quarterly record revenues of $90 million and second quarter records for gross profit and gross margin of $36 million and 40%, respectively, driven by strong pricing, improved lime shipments and efficiency gains. Turning now to capital allocation and liquidity. Martin Marietta has a well-balanced capital allocation strategy, which allows us to responsibly grow the business while maintaining a healthy balance sheet and preserving financial flexibility to further enhance shareholder value. Our focus remains on value-enhancing acquisitions, prudent organic capital investment and the consistent return of capital to shareholders, while maintaining the company's investment-grade credit rating profile. Full year capital expenditures are now expected in the range of $820 million to $850 million, an upward revision from the previous guidance of $725 million to $775 million. This increase is due to attractive and opportunistic land purchases. That said, following several years of capital expenditures above sustaining levels, we expect 2026 capital expenditures to return to more normalized amounts resulting in increased free cash flow conversion. Importantly, with $1.4 billion of total liquidity, strong free cash flow generation and a net debt-to-EBITDA ratio of 2.4x as of June 30, we have ample balance sheet flexibility to capitalize on what remains an active M&A pipeline. With that, I will turn the call back over to Ward.

Thank you, Michael. Our first half performance highlights the competitive advantage of our aggregates platform and the disciplined execution of our SOAR 2025 strategic plan. These strengths, combined with a solid financial foundation and track record of navigating complex market environments, reinforces our confidence in achieving our full year adjusted EBITDA guidance. Looking ahead, Martin Marietta's attractive underlying fundamentals and long targeted runway for transformative growth offer compelling horizon of future shareholder value creation. If the operator will provide the required instructions, we'll turn our attention to addressing your questions.

[Operator Instructions]. The first question will come from Kathryn Thompson, Thompson Research Group.

As you noted and as so many of your peers have also noted that Q2 was marked by some pretty tough weather conditions. And as we look forward into the back half of the year not to be looking too close to near-term trends, it's still nonetheless helpful to get more color in terms of what you're seeing in July and in particular getting some assurance that you're seeing fundamental increases in demand and just getting a better read of what the market is doing now and really what that means not just for the quarter but for the remainder of the year and into 2026?

Kathryn, thank you. Good to hear your voice and thanks for the question. I would say several things. One, I've read some of the commentary that others have had relative to July. And I will tell you, our commentary is broadly the same, maybe even a little bit better because I'm not going to limit it to any one geography. What we saw in July was actually nice double-digit volume up across the enterprise. And I think that's really important. It's notable, Kathryn. Obviously, we're trying to look really carefully at the guide, and I think we've given what has been a really measured guide all year. And I said as much when we came out with our guide in February, particularly relative to pricing. And now what you've seen is pricing has trended toward the high end of the guide. As I'm looking at volume through July, frankly, we're above the midpoint of the previous guide. So frankly, I'm hoping that as we look at this guide relative to volume for the rest of the year, I hope that looks like pricing has looked. And the fact is we as an industry have not been great at calling the volume. I'm tired of being on the wrong side of that call. So again, I think we've taken a very measured view of that. But July looked good on both sides. It looked good from a volume perspective. It looked good across the enterprise, and it looked good commercially as well. So I'd like to see a whole lot of Julys.

Next up is Adam Thalhimer from Thompson, Davis.

Nice quarter. Ward, just following up on what you just said, given the fact that you don't want to be on the wrong side of calling the volumes, what gave you the confidence to increase the annual guidance?

I guess several things, Adam. First, thanks for your question. Look, if we're looking at what we're calling on EBITDA for the full year at the midpoint, that's up 2% over where we were before. But that's really on good, strong first half results through a pretty challenging weather period. If we're looking at the third quarter to date shipment trends, that helped a lot. If we're looking at where we see things working commercially, that looked awfully good as well. The other piece of it that I think is worth noting, and I said public is looking nice and resilient and growing. I said private was a bit mixed. I'm actually liking what I'm seeing relative to nonres, and particularly on the heavy side of it. I'll just give you a few examples in markets that matter a lot to us. So in Greensboro, we're seeing a Walmart distribution center come in there, and we're seeing Microsoft come in, and we're seeing Ross distribution centers, all in and around Greensboro, the Triad, which frankly has not been a volume leader for us over the last several years, but it's a very attractive part of our footprint. Similarly, if we go to places like Charlotte, we're seeing big jobs at the airport. We're seeing Highway 74, which is a Shelby bypass taking material product as well, Scout production center in South Carolina and some nice jobs here in the Raleigh area. Novo Nordisk manufacturing plant has a big job underway. I mentioned before that we're now seeing nice green shoots relative to Amazon, in particular, in Wilmington, North Carolina, we're seeing a nice fulfillment center there. So when we're seeing good, steady public, and we're seeing that portion of nonres, and we continue to see the commercial environment working well in our business, that's really powerful for Martin Marietta. And if you think about what made this quarter look good, I mean this was an aggregates and magnesia-driven quarter. And our headwinds were primarily around what was happening in the quarter on cement and what was happening relative to ready mix. So as we were looking at the way the quarter finished up, at the way the end users were evolving, at the way pricing continued to evolve, you take all those together, again, I think we're in a very sensible place on raising the guide, but I hope those comments gives you a better sense of where the levers were within that movement.

Next up, Anthony Pettinari from Citi.

Ward, the Quikrete exchange is going to give you some assets in Virginia, Missouri, Kansas and I guess, British Columbia. Just wondering if you could talk more about sort of strategic fit, asset quality maybe how long you've been looking at these assets? And then I think with BC that would be kind of an entry point maybe in the Pacific Northwest. Just generally, if you can talk about the attractiveness of those assets and the potential fit?

Anthony, thank you for that. So I'd say several things. One, let's begin with the notion. It's about 1.3 billion tons, I mean, so it's a very nice transaction, a lot of tonnage that's coming in. And by the way, most of it crush done. You know I always break down puts sand and gravel, I have a natural bias toward crush done because I just view it as the higher quality product. So number one, I like it from that perspective. Number two, to your point, the geographies line up very much with what we were talking about in February of 2021 when we outlined what we wanted to do in SOAR 2025. As you may recall, we put a slide up on that day and that hour and we outlined geographies across the United States that we were going to be particularly focused on during that 5-year period. And one of the areas in which we had not yet been able to put a check in the box was in Virginia. This does that very elegantly. And the other was in the Pacific Northwest. And if you think about it, Anthony, really, there are 2 ways to drive that market in a meaningful way, either coming in through Seattle or coming in through Vancouver. This gave us a nice opportunity to come in through Vancouver. From how long had we been looking at the assets? Look, we've long admired portions of those assets that Quikrete acquired in the transaction with Summit. And Quikrete did a nice transaction there. Anne Noonan and her team did a magnificent job managing that business as well. So these are some very attractive markets, including those that we're picking up in the Central division. So what we're picking up in Kansas and what we're picking up in Missouri are often, in my view, overlooked markets relative to their attractiveness in overall Martin Marietta. So again, if we're looking at the geographies, we think we landed in the right place. As we look at the overall transaction, from a tax efficiency perspective, it was really quite compelling. is a great facility. And we've got a team there that is incredibly talented. And the toughest part of this transaction is being in a position that we won't have that team and that asset with us. But we've long said we're in an aggregates-led organization. This is our core and this gave us the opportunity to do a transaction and redeploy the funds and do it in a tax-efficient transaction, all very consistent with our SOAR plan. One of the things that we tried to do is never surprise people. If people listen to us, we won't surprise them. And again, I think if you go back and look at what we said in February of 2021 and what we've announced earlier this week, it actually ties a nice bow around what we indicated would happen over a 5-year period.

The next question is from Philip Ng, Jefferies.

Strong momentum in pricing quarter on the aggregate side. Ward, one of your bigger competitors actually called out given the strength in infrastructure, there could be some mix headwind from base pricing. One, are you seeing that? And then two, how is midyear is kind of progressing? And lastly, when we think about '26, how is the price momentum kind of playing out just given what you're seeing out there?

So I'd say several things. No, on the mix thing, we haven't seen a lot that's been a mix driver so far for us this year. So I mean, I think what you're seeing is just good solid year-over-year pricing. So no big surprises there. Secondly, relative to the mid-years, they played out about like we thought they would. We got them primarily in areas where we've been more acquisitive over the past several years because as we've indicated, Phil, those ASPs don't tend to be where heritage ASPs are. With respect to 2026, it's a little bit early for me to lean in. I thought I was leaning in a little bit when I just talked about July. So I'm not going to go too much into 2026, but I appreciate you putting the bait out there for me. We'll talk more about that, but my take is this, Phil: we're just in a different place relative to the way pricing is going to work. I think you've seen that play out this year. I think you'll continue to see it play out in varying degrees again next year. And keep in mind, the midyears that we've gotten this year really aren't so much a 2025 event, they're really something that builds as we go into 2026. So Phil, I hope I gave you all I can.

Angel Castillo from Morgan Stanley has the next question.

Congrats on another strong quarter here. Just 2 questions. I wanted to hopefully get your thoughts on. First, on the Quikrete acquisition, you noted Missouri is often overlooked as a geography for MLM. Can you just expand a little bit more, perhaps maybe what the spread is in terms of the price of the Quikrete assets that you're acquiring are at in terms of the aggregate price versus maybe what you think the fair value is in those in those geographies? And then on the data center point about the strength you're seeing there, I was wondering if you could maybe provide a little bit of color there? Because it seems like every week, we get several new announcements of new projects. And yet, when you look at the kind of put in place construction data for data centers, the growth there has been slowing. So it's a little bit confusing. Just curious if you have any kind of visibility here as to what might be holding up construction spend or growth of those projects and anything you're aware of or maybe looked at a different way, is it just a spring and based on what you see in terms of quoting and ordering activity, when should we kind of expect that to start to reaccelerate?

Thanks for your question. I'd say several things. With respect to your pricing observation. Obviously, we have been focused on value in our pricing in the last several years. And I think we will continue to have value journey in which we can meaningfully participate in these different parts of the country relative to the assets that we've acquired. Obviously, putting a spec product on the ground that's there to meet customer needs and do it in a sustainable way is important. It's not easy, and I want to make sure that we're getting good value for those products. So I think the philosophy that you've seen us bring will continue to be the overall philosophy. Relative to part 2 of your question on non-res, I do think probably what you're seeing more than anything else is degrees of land use at work because it's fascinating fastening, Angel. You've heard, and I've heard the same thing. I mean, obviously, for example, Amazon has come out and said, look, we're going to put $100 billion over a decade in this type of investment whether it's warehousing, data or otherwise. And again, we're seeing things, as I mentioned earlier in the prepared commentary and last time in Cleburne, Texas, and Fort Myers, I mentioned Wilmington already in the conversation that I had with Adam. I think part of that cold spring is probably to be found in dialogue like we saw yesterday at White House, where Tim Cook was also announcing a big investment coming from Apple. And part of what's interesting in that is some of that's going to be new and some of that's going to be additive to different markets. So for example, when they discuss adding on to a facility that they have in Maiden, North Carolina. What you probably don't know where Maiden, North Carolina is, but I do because it's in our backyard. And we very clearly have a quarry in Maiden that we call our Maiden Quarry. So the fact is we're going to see those types of projects go. The ones that are basically a new phase will go more quickly. The ones that are going to be brand new, that's where your coiled spring is because they can announce that that's what they're going to do. But in some instances, they're still going to have to get the permitting, they're still going to have to get everything in place, including on occasion utilities, which tells me this is going to be a nice, long, steady climb over multiple years. And selfishly from our company's perspective, that's when we're at our best.

The next question is from Trey Grooms, Stephens.

Michael, congrats on the new role.

Thank you, Trey.

So you've touched on the swap Midlothian for Quikrete, makes a lot of sense. On Premier Magnesia deal, any additional color you could give us there? Sorry if I missed it, but understanding the impact is going to be limited this year due to purchase accounting, but any additional color you could give us on the size, expected impact there, how it fits into and compares to the existing Mag Specialties business, which is clearly performing really well?

Trey, thank you for the question. I'm going to turn that over to Michael to talk about some of the specifics. I'll give you some broad strokes on that. So if you really think about it strategically, we're building, as I've indicated before, an ags and mag business, and it's going to be heavily emphasized on the ags piece of it. If you think about the criticality, though, to your question on magnesia, the business that we've had, very impressive business, high margins, just had a record quarter, and it's primarily synthetic magnesia. If you look at the business that we just acquired, it's more natural magnesia. And what's important to remember is they both begin with varying degrees of And I think it's easy for the uninitiated to look at mag and ag and not have a sense of how tightly they overlap and what the required skills are between the 2 and how they go back and forth. Obviously, Michael drove that process before he started wearing 2 different hats. So I'll ask him to go back and talk a little bit about what that business looks like and what you can expect from a contribution perspective.

Yes. No, thank you, Ward. Yes, Trey, just you hit the nail on the head with the guide. We were saying only about $10 million of contribution this year. And what we're saying is that's really 2 months out of 12 given the purchase accounting impacts for the first 3 months as we sell through the inventory that's valued at fair market. So if you just did the quick math, that would imply on an annualized basis, about $50 million, so that's what you can use for now on a pre-synergy basis. We do expect pretty good synergies to come from this, both commercially and operationally, but more to come as we get into integration there.

Next up is Steven Fisher from UBS.

First, just a quick clarification. The $4 million of corporate, was there any special item in there? It seemed a bit low? And then the real question is I just want to make sure I get the volume message, right. The new guidance reflects about 3 million tons lower expectation than what you had in the first quarter. So I was wondering if you could just sort of break that down into the Q2 weather impact versus other factors. Is this somewhat lower guide you -- as you were talking about before, trying not to be on the wrong side of it? In other words, there still could be some upside because it sounds like you're seeing a bit more positive momentum.

You bet, Steven. I'll take the volume piece of it, then Michael will come back. Yes, I think we're being measured and thoughtful on the way that we look at that. Clearly, weather through half 1 was an impediment. I don't want to count on even normal weather through half 2, and I'm not counting on a kind November and December. And the fact is if we've got a warmer and dry November and December and this season is extended, then I could see there would be upside in the volume piece of it. As I indicated, if we're just looking through July right now, we would be above the midpoint of the prior guide. So I don't look at volume and feel in any respect, weak in the knees. Again, I'm tired of being on the wrong side of that. Michael, do you want to address the rest?

Yes. No, I think the question was on corporate expense or SG&A in the quarter and 2 items really impacting the comp to prior. One is the only adjusted metric we report now is adjusted EBITDA, and there was roughly $20 million of acquisition-related expenses that got added back to EBITDA last year, which would be in that corporate expense line item. And then the other piece of the comp is really just effective SG&A cost management. We've been focused on that. So those are really the 2 levers if you're trying to say, well, EBITDA grew at 8% and net earnings grew double digits, that's -- it was that adjustment for the acquisition expenses.

The next question comes from Garik Shmois, Loop Capital.

This is actually Zack Pacheco on for Garik today. Maybe just more on the SG&A reduction. Any more color of what the main driver was? And I guess, how to think about run rating that into the second half?

Yes. No, we would typically say to just run rate right around 7% of sales for a full year. SG&A as a percent of sales, that's a good modeling number. So it may tick back -- between quarters that may ebb and flow a bit, but I think 7% is a good number to keep in your model.

Up next, we'll hear from David MacGregor from Longbow Research.

Congrats and Mike on the transaction for this quarter.

Thanks, David. Good to hear your voice.

Yes. On the tons that you've acquired, the 20 million tons, just how would you characterize the pricing on those tons within the context of their respective markets? Are they underpriced? Are they fairly priced? Is there a future ASP lift opportunity? And then if I could just squeeze in maybe some commentary around the rail mergers and the potential impact there?

Thank you very much, David. I'd say a couple of things. I think where I was before is probably right, and that is I do think we are very focused on value. And I think we're appropriately focused on value. And I think this is a good quarter that demonstrates it, right? You saw pricing outperform. You saw volume probably about where you thought it was going to be, frankly, maybe even a little bit better. And you see very good financial performance that comes from that. I think that opportunity continues to exist as we go forward, particularly in the markets in which you'll see us either entering or just having more business than David. So I think that's a piece of it. Relative to the railroad mergers, I'll say this. One, we move more stone by rail in the United States than any other aggregates producer. And we have good and valued relationships with all of the Class 1 railroads and think well of those businesses, think well of their management. It will be fascinating to watch, provided the UP Norfolk Southern transaction goes forward. Number one, that's a really impressive network that they're going to have in place. We have a lot of experience, obviously, with the UP because we probably send more on UP than any other railroad. Their efficiency has been very good. You're really not changing the structure per se in the Eastern United States because right now, you've got CSX on one hand and Norfolk Southern on the other. And after this, you would still have CSX on one hand and now you'd have UP or the combined organization on the other. So we don't look at it and feel that there's any peril to our business. They are good business partners. They move material for us from producing locations to yards throughout the United States. And keep in mind, we've got nearly 90 yards that are out there. So the quantum of yards that we have either by ship or rail is much more significant than others. But at the end of the day, they're all good customers, too, because they do buy ballast material from us to make sure their rail lines operate as they should. And again, for the uninitiated, when you're driving across a railroad crossing, if you look to your right and look to your left, and you see all the stone on which the rails are sitting, hopefully, that's our stone. So I've tried to answer both your questions, the first one commercially and the second one relative to the proposal between UP and NS. And I hope that helps, David.

The next question is from Michael Dudas from Vertical Research.

Maybe could you just share some thoughts on unit cost performance, again, driving that double digit is quite helpful above that SG&A line, some of the trends you see there. And just on the transaction, net-net of all that's going on, you're going to get $450 million of cash. And is that going to be kind of pointed towards some debt reduction or some other near-term uses that you may have on that?

You know what, I'll take the cost portion, and I'll ask Michael to come back and take the boot portion. So as we look at the cost, I thought the cost was actually in the quarter. Cost could have been better in the quarter, and here was the big issue. It ranked. I mean the fact is it's really difficult to have your cost flow through the way that you would like if you've got a lot of stop start in an outdoor sport that's a heavy industrial use. And that's what we had in Q2. And even with that, I like the overall cost performance. I mean, obviously, what we're seeing is inflation coming down. And we're seeing our costs also come down and we're seeing our ASP go up, and you're seeing that margin continue to grow. So I would expect we would continue to see very good cost behavior. As you may recall, I think Bob Cardin was right in Q1 when he said, "Look, we had a home-run quarter on cost control," but that was actually a quarter because so much of it was January and February that you know exactly what you're having to do and where the levers are. It gets a little bit more complicated when you're in Q2 and you need to be running everywhere. I think that's answer to part 1 of your question. Part 2 of your question was relative to the boot and for that over to Michael.

Yes. Thank you, Ward. Relative to the boot, I think a couple of things. One, capital allocation priorities are going to stay focused on dollar 1 to M&A. That being said, we did close the Premier transaction in July. So you can almost think of that boot as already having a home M&A-wise. We do have -- actually our first 30-year bond ever issued as a public company coming due at the end of this year for it was $125 million bond at a 7% interest rate. So we're going to go ahead and pay that off when it becomes due. That being said, we should end the year well within our leverage range. And as we said in the prepared remarks, M&A pipeline remains active. So hopefully, more to come.

I wish I owned some of those 7% bonds.

You and me, both.

And the next question is from Jonathan Bettenhausen from Truist Securities.

I'm on for Keith this morning. So obviously, aggregates pricing is still really solid. Last quarter was no exception. But given that weather has been a drag on volumes for this many quarters and we know this impacts the pace of price realization. Can you quantify how much or even if weather is set back pricing in the industry? And then so -- like is this a gap that can be closed if we get, say, 12 months of notably below average rainfall?

Go ahead, Michael.

Yes. No, I think that's a good observation. It's certainly more difficult to realize price when volumes are subdued as a result of weather. So yes, no, I think there certainly could be some uptick as a result of that if we get a nice clean dry run like we saw in July. That being said, this pricing environment at 7.5% price is well above historical normal levels. We've been saying we think that there is a new normal in pricing. We said it wasn't going to be double digits forever, but it certainly wasn't going to go back to kind of the 3% to 4% pre-COVID levels either. So we'll see where that ultimately shakes out, but we feel pretty confident in the price guide that we put out for the full year.

Jonathan, activity begets confidence, confidence begets pricing. And I believe the activity could be higher if the weather had permitted. And I think when I go back to the genesis of your question, I think that really does answer it. If we see activity continue to ramp up if contractors continue to see their backlogs grow, I think all of that actually portends quite well for overall ASPs.

Your next question is from Garrett Greenblatt from JPMorgan.

I just wanted to lean in a little more on the magnesia side of the business. How big of a focus is this going forward in terms of acquisitions? And how big do you think this business could become over time?

Thank you for the question. Look, it's never going to be a huge part of what we do, but it's going to be an important part of what we do. And it's going to be additive I think, to overall margins, cash flow because they have some of the highest cash flow conversions of any business we've ever seen. And I think it adds that nice differentiating component that's important to us. One of the things that we've long talked about is as we went through the financial crisis, I don't know of any other heavy side company in our space who could say we never cut or suspended a dividend all the way through that time period. And 2 things may that happen. One was Magnesia Specialties and its ability to go through cycles in a very resilient fashion and the other was the Midwestern United States, where we're just adding more quarries today because those are the areas that, as you go through more challenged times, tend to outperform. So do I expect us to continue doing bolt-ons, maybe here or there in mag. I think that's entirely possible, and I think you should look for that. Do I think you're ever going to see a transaction there that you're going to say, boy, that doesn't look like an aggregates-led company? No, I don't think you're going to see that. But I do think it's a nice differentiator. And I think when you look at that, combined with the aggregate operations that are coming in with this transaction with Quikrete and the geography in which that's occurring, it's actually a very nice and very consistent story with what helped us come through a financial downturn very differently than others.

The next question is from Brian Brophy from Stifel.

Just any more color on the land purchases, you mentioned in the prepared comments? Are these related to potential greenfield opportunities? Or are these more adjacent to current operations? .

Brian, nice to hear your voice, and thanks for the question. No, they tend to be more adjacent. And in my view, that's the more constructive way to go about that today because when you're greenfielding -- look, do we have that as a tool in our kit? The answer is yes, we do. But I would rather go to existing operations that we can expand. If you think of it this way, Brian, if you buy the property next door and you already have necessary setbacks, when you buy the property, it's not just that you're buying the property next door on which you'll expand your operation, you're actually opening up some of your own reserves that used to be in a setback that no longer are. So you end up winning multiple times when you're buying adjacent reserves, and that's primarily what we're doing. As a practical matter, when we look at quarries and they have less than 20 years; to us, that's a little bit of a flashing yellow light. We feel like we need to do something there. We -- frankly, we have very little of that. But on occasion point, we have less than 20 or in some places, when we just have the right opportunity to buy property next to a very attractive operation, and typically buy it for numbers that would not be commensurate to the value that it's going to create when it's under our ownership, we move on that. So that's what you're primarily seeing. And as Michael indicated in his prepared remarks, we have been at CapEx numbers over historic in the last several years. We do anticipate that coming back down to more normal metrics next year. But to answer your question directly, no, it's not greenfielding. Yes, it is adjacent, it is reserves, and that's the overall philosophy.

Next up is Ivan Yi from Wolfe Research.

Ward, can you just give us an early preview of the upcoming Capital Markets Day? What should we expect to hear from you all? Will you be providing any long-term guidance on revenues or EBITDA, for example? Just any color would be great.

Ivan, thank you very much. Look, we'll be together early next month at the Mandarin Oriental in New York. As you know, we refresh our SOAR plans every 5 years, part of what we've done in every SOAR plan to date. And Ivan, I'm not saying this is what we're going to say when we're together. But we have been in a position that we have doubled our market cap every 5 years. I think this company has an exciting growth trajectory ahead of it. I want to talk about that. I think this company has exciting geographies in which that will be focused, I want to talk about that. I think there are a lot of new tools that are coming out today, particularly relative to what's going on commercially in the industry and our business, I want to talk about that. I think we've got an outstanding team that I get to see every day. I want to put you in a position that you got to see that in a more granular basis as well. So is this about long-term markets? Yes. Is it about what M&A can look like for this company for the next 5 years and beyond? Absolutely. Will we give you a sense of how we're going to market and the sophistication that's increasingly being brought to bear in that? Of course. And where you going to see what I think -- and I'm not talking about me, I'm talking about the rest of them that I believe is the most talented team in the industry? Absolutely. And I want to make sure you, investors and others get time with them and can affirm my judgment that you're going to like what you see.

And at this time, there are no further questions. I'd like to hand the conference back to Mr. Ward Nye for any additional or closing remarks.

Again, thank you for joining today's earnings conference call. Through deliberate and disciplined execution of our SOAR plans, we fortified our portfolio and aligned our business in structurally advantaged markets that offer both resilience and compelling long-term potential growth. With this durable foundation and a clearly defined differentiated growth strategy underpinned by our strategic framework, we remain well positioned to manage through macroeconomic volatility while continuing to create meaningful long-term shareholder value. As a final reminder, and as we were just discussing with Ivan, we'll be holding our Capital Markets Day on Wednesday, September 3, in New York, where our leadership team will discuss strategic opportunities for long-term value creation through our updated 5-year strategic operating analysis and review plan or SOAR 2030. We look forward to your participation. And as always, we're available for follow-up questions. Thank you for your time and your continued support of Martin Marietta.

Once again, ladies and gentlemen, that does conclude today's conference. Thank you for your participation. You may now disconnect.