Q2 2025 Eagle Materials Inc Earnings Call
Speaker Change: Good day everyone and welcome to Evil Materials 2nd Quarter of fiscal 2025 or in the conference call.
Speaker Change: This call is being recorded.
Speaker Change: At this time I'd like to turn the floor over to Eagles, President and Chief Executive Officer, Mr. Michael Haack. Mr. Haack, please go ahead.
Speaker Change: Thank you, Jamie. Good morning. Welcome to Eagle Materials Conference Call for our second quarter of fiscal year 2025. This is Michael Haack.
Speaker Change: Joining me today are Craig Kessler, our Chief Financial Officer and Altshadeck Senior Vice President of Investor Relations, Strategy and Corporate Development.
Speaker Change: There will be a Slack presentation made in connection with this call. To access it, please go to EagleMaterials.com and click on the link to the webcast.
Speaker Change: 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.
Speaker Change: For further information, please refer to this disclosure which is also included at the end of our press release.
Speaker Change: Let me start my comments by highlighting a very important meeting conducted a few weeks ago at Eagle Materials. That being our annual health safety and environment conference for what we term HSC.
Speaker Change: Each year I have the pleasure of spending two days with approximately 90 liters in our organizations across the US to discuss health safety and environmental items facing Eagle materials.
Speaker Change: We get to share best practices across the organization discuss how we strengthen our safety culture and how we make a difference in our operations for all employees.
Speaker Change: We always prefer to look at leading indicators to eliminate items before they happen, but is also a time to reflect on the progress we have made in our lagging indicators.
Speaker Change: This progress is highlighted in our sustained below industry average TRIR rate per safety.
Speaker Change: Our enhanced sustainability report we released last year showing
Speaker Change: Our continued progress and reduced CO2 emissions per ton of cementitious product and highlights investments in projects that not only financially return, but environmentally return benefits to Eagle.
Speaker Change: Some of the projects highlighted in this conference.
Speaker Change: Include.
Speaker Change: We started commissioning our joint venture Texas Lee High Slack Granting Facility in Houston. This plant will provide the local market with over 500,000 tons of low carbon and 10-speed slack. We have commissioned an additional alternative fuel feeder and expanded another facility feeder to reduce our use of coal and coke at these facilities.
Speaker Change: We reduced the water usage at our Republic Paper Board facility by approximately 40% through engineering, redesign of an on-site water facility.
Speaker Change: Our blended cement production surpass 90% of our sales.
Speaker Change: These items would not happen if we did not have the best people in the industry. I want to thank all Eagle employees who contributed to the success of another great HSC conference and to their continued leadership on safety, efficiency and sustainability.
Speaker Change: Now let me move on to the financial results for the quarter and our...
Speaker Change: In our fiscal second quarter of 2025, we again achieved record revenue reaching $624 million and increased in cash flow from operations by 35%.
Speaker Change: Craig will go through the financial results in his comments, but I wanted to specifically address a few items in my comments.
Speaker Change: Our heavy side of the business was down 5% on a volumetric basis while our concrete and aggregates locations had a larger volume impact during this quarter across the our network, but most dramatically in two locations Denver and Kansas City.
Speaker Change: Denver was impacted from reduced demand across the board, but more dramatically impacted via aggregate supplied oil-filled services customers.
Speaker Change: This demand has not recovered, so the team has been diligently working on cost control measures and securing new customers.
Speaker Change: and Kansas City, our concrete union operation has been in a work-stoppage situation as we were negotiating the current contract. This has been resolved, but in fact, our volume sold during the quarter.
Speaker Change: Our drivers in this operation are no longer union, so this operation will be right-sized in the focus on the non-union market in the future.
Speaker Change: If you items I want to mention for the upcoming quarter are we currently are in process of replacing our clinker cooler at Texas Lehigh.
Speaker Change: As I mentioned in several previous earnings calls, we have some maintenance to do at this facility and it was planned for this timeframe. We are currently wrapping up a 40-plus day outage to do this extensive work.
Speaker Change: We'll have further work at this facility in a few months as we address our mills. All the work is going as planned.
Speaker Change: We also have a planned outage at our Tulsa cement facility to address an issue we add with our kill. This work is going well and will be completed ahead of schedule.
Speaker Change: Both projects will add additional maintenance costs to our upcoming quarter. We have been working with our customers to minimize the impact of sales volumes during these outages.
Speaker Change: It also should be noted that both projects are one off the nature and will make the plants more reliable after completion.
Speaker Change: Starting now to what we see ahead for our businesses and the demand outlook more broadly. I'll start with the infrastructure where we've been talking for a couple years about the demand visibility afforded by us by both the trillion dollar federal infrastructure bill, I-I-J-A, and the health of state and local budgets.
Speaker Change: For a variety of reasons, from weather-related days to labor constraints, the level of IIA A spending has been slower to materialize and previously anticipated.
Speaker Change: Nearly 75% of IIA funding remains to be spent. However, we believe it will continue to be spent beyond the bill's expiration date in 2020.
Speaker Change: Turning the non-residential construction demand has varied depending on the sub-sector.
Speaker Change: Well, certain subtexts sectors such as warehousing have been softer. We remain optimistic that announced large scale manufacturing and industrial projects will continue to be strong as they are still benefiting from federal government bills.
Speaker Change: Last week, residential construction has held up relatively well in a type of housing starts environment and several factors suggest it should rebound.
Speaker Change: Underlying Builder, Demand and Lower rates as the US Federal Reserve moves toward more accommodative monetary policy are just a couple of factors that support a favorable residential construction landscape.
Speaker Change: Against this end market backdrop, let me provide some observations on our specific businesses.
Speaker Change: and our heavy materials business, project delays and weather continue to affect both cement and concrete and aggregate volumes.
Speaker Change: In calendar 2024, our heavy materials volumes have not played out in the way we anticipated when we began the year.
Speaker Change: and in fact industry association forecast originally projected cement volumes in calendar 2020 for to be up by one to two percent and are now forecasting a year over a year decline across the industry.
Speaker Change: While that view is consistent with what we're seeing within our own footprint, we believe the demand tailwinds will bounce back, given the high level of I.I.J.A. funds, yet to be spent in the anticipated rebound in non-residential and residential construction.
Speaker Change: Our strong position in the U.S. Heartland markets supports our outlook to an even greater extent. As these markets currently have higher demand than the national average in our generally insulated from imports.
Speaker Change: Considering these favorable conditions, we announced a price increase for early January 2025 across most of our markets and look forward to speaking more about them in the next quarters call.
Speaker Change: Turning to our light material segment, residential construction and more specifically, single family building activity is, as you know, the most important driver of wallboard demand.
Speaker Change: As you can see from our sales volumes, the Wal-Bored Business has kept its consistent demand pace despite one of the most more restrictive rate environments we've seen in quite some time.
Speaker Change: In some ways, current demand levels have played out as expected since decades of underbuilding have created the need for new housing construction to keep pace with household formations.
Speaker Change: Also, homeowners with low mortgage rates are attending to stay in their homes longer, which in turn created better than expected new home construction, resulting in better than expected World War demand.
Speaker Change: What has not been a surprise to us is the overall steadiness of our margins, given significant cost pressures and constraint capacity brought about by the synthetic chipsome shortage for the rest of the industry.
Speaker Change: When demand turns higher, these pressures will become increasingly difficult for others to manage, and we feel Eagle is well positioned to capture future opportunities for a well-bored businesses.
Speaker Change: With these supplied demand dynamics, we have announced a wallboard pricing increase for early November. But most likely this increase will be delayed to the first part of 2025.
Speaker Change: All in all, we're excited about what to head, especially given our history of executing win and wear it matters.
Speaker Change: At Eagle, we're always looking for ways to improve our businesses and ensure they are sustainable for multiple generations of employees and investors. This can be demonstrated by several facts that makes us different.
Speaker Change: We have a long-fanty low-cost producer in our industry because of the long-track record of strategic decisions that has created structural advantages that are hard to replicate.
Speaker Change: We are relentless in our operational focus to consistently improve our assets in footprint. Our businesses have high barriers to entry, our products are necessities for the growth in a renewal of America.
Speaker Change: Our healthy balance sheet gives us the flexibility to invest in growing our core businesses and finding in organic growth opportunities.
Speaker Change: Our acquisitions and internal investments, our design to strengthen our current network, extend our healthy reserves position, and to continuously refresh our infrastructure to keep it like new.
Speaker Change: For example, this quarter-weight quarter, a small bolt on Agget's business to help extend the customer reach for our battle town materials, Agget business in Louisville, Kentucky.
Speaker Change: Our cash flow generation also means we can execute on these opportunities whilst we'll return the excess cash to flow to shareholders.
Speaker Change: We have a long-term horizon when we think about where best to invest our capital. Our businesses have been in some communities for nearly 100 years, and our investments are designed to help us maintain the viability of our assets for another 50 years or more.
Speaker Change: This can be best seen with our recently announced upgrade to our mountain cement plan. I'm pleased to say that we broke ground on this project with several foundations being put in place before the winter hits us.
Speaker Change: Our pipeline of M&A opportunities remains robust and are commitment to continuously upgrading our current asset base remains resolute.
Speaker Change: As such, I'm confident we can sustain industry-leading margins and investor cash flows to create value for our shareholders.
Speaker Change: With that I'll turn it over to Craig for some more details on our financial performance last quarter.
Craig Kessler: Thank you Michael.
Craig Kessler: According to Revenue was a record 624 million dollars a slide up tick from the prior year.
Craig Kessler: The increase was driven by higher cement sales prices and higher wallboard sales prices and sales volume. Partly offset by lower cement sales volume.
Craig Kessler: Second order earnings per share was $4.26 even with the prior year.
Craig Kessler: The quarterly EPS reflects lower earnings, offset by 5% reduction in fully included shares to our Share-BiBi program.
Craig Kessler: As we highlighted in the press release, we had two non-routine expense items during the quarter. First, $1.6 million of costs associated with selling acquired inventory after its markup to Fair Value as a part of acquisition accounting, plus related business development costs.
Craig Kessler: and second, a litigation loss of 700,000.
Craig Kessler: Dirty Nautos are segment performance highlighted on the next slide.
Craig Kessler: And our heavy material sector, which includes our cement and concrete and aggregate segments, revenue decline 2%. Primarily because of lower cement sales volume, partially offset by cement sales price increases we implemented earlier this year.
Craig Kessler: Operating earnings were down 9% primarily because of the lower cement sales volume in addition to higher maintenance costs.
Craig Kessler: Moving to the Light Material sector on the next slide.
Craig Kessler: Revenue in the Secretary of the House of Representatives, reflecting higher wall board and recycled paper board sales volume, and a 1% increase in wall board sales prices.
Craig Kessler: operating earnings in the sector were also up 5% to 98 million dollars driven by the higher wall board and recycled paper board sales volume and higher wall board sales prices.
Craig Kessler: Looking at our cast world.
Craig Kessler: We continue to generate strong cash flow and allocate capital in a discipline way, in line with our strategic priorities and rigorous financial return criteria.
Craig Kessler: During the second quarter, operating cash flow increased 35% to 233 million dollars.
Craig Kessler: Replacing strong working capital management.
Craig Kessler: Capital spending increased to $66 million. As Michael mentioned, during the quarter we began construction on our modernization and expansion project at our Lairmy Wyoming cement plan.
Craig Kessler: This construction project accounted for approximately $27 million of the total capital spending this quarter.
Craig Kessler: We also acquired a small IREA to business for $25 million. The acquired operation is complementary to our existing IREA to business and Kentucky.
Craig Kessler: Finally, we repurchased 253,000 shares of our common stock for $61 million in addition to paying our quarterly dividend.
Craig Kessler: returning a total of $69 million to shareholders during the quarter.
Craig Kessler: We have approximately 5.3 million shares remaining under our current repurchase authorization.
Craig Kessler: Finally, a look at our capital structure.
Craig Kessler: which continues to give us significant financial flexibility.
Craig Kessler: That's September 30th. Our net debt to cap ratio was 41% and our net debt to EBITDA levered ratio was 1.2 times.
Craig Kessler: We ended the quarter with $94 million of cash on hand.
Craig Kessler: Total committed liquidity, committed liquidity at the end of the quarter was approximately $679 million. And we have no meaningful near-term debt maturitys giving us substantial financial flexibility.
Speaker Change: Thank you all for attending today's call. Jamie will now move to the question and answer session.
Jamie: Ladies and gentlemen, at this time we'll begin that question and answer session to ask a question you may press star and then one using a touched on telephone to withdraw your questions you may press star in two.
Jamie: If you are using a speaker phone, we do ask the police to come to handset prior to pressing the keys to ensure the best sound quality.
Jamie: Once again, that is Star and then one, you join the question queue.
Speaker Change: Our first question today comes from Trade Grings from Stevens. Please go ahead with your question.
Speaker Change: Hey good morning everyone. So...
Trade Grings: Obviously whether impacted cement and agargets in September quarter. So first off was there any negative impact from the hurricane earlier this month on either the wall board or the heavy business and then you know how has volume been turning over the last.
Trade Grings: I don't know two or three weeks maybe or so since the weather has been cooperating particularly in the heavy business.
Speaker Change: Thanks, Tray. Fortunately, there are things that impact our operations in terms of any of the equipment. Certainly, some of the heavy rainfall even in Southeast did impact volumes.
Speaker Change: some of our Eastern markets even really and that's the case for cement and wall who are doing a certain degree. But you know, and then in terms of...
Speaker Change: You know, post the quarter october's been a little bit drier across certainly the middle of the country and been very happy with the volumes here in October.
Speaker Change: Good, good. That's encouraging.
Speaker Change: So on the the Wal board pricing it was it was up slightly year or year down just a little bit sequentially it seems like we can have these small fluctuations like this.
Speaker Change: You know, product mix, geographic mix, those types of things moving around, but you also push that new November increase out. So, are you seeing any real like for like pricing, pressure, or anything like that in wall board?
Speaker Change: You know, I guess what's the status there and maybe outlook for the near-term pricing there and while board maybe until the man gets a little bit better.
Speaker Change: Yes, as we talked, we did implement a pricing increase in March, which is really driving this year over year improvement in pricing.
Speaker Change: As you said sequentially, I think pricing is down less than 1% so you have product mix, you have regional changes, those type of things, you know, been very happy with.
Speaker Change: the performance of that business, the resilience of pricing.
Speaker Change: and what for the last 24 months has been a pretty tepid housing environment.
Speaker Change: and so as we look forward.
Speaker Change: As we mentioned, you know, should be a more accommodative monetary policy, which should help continue to spur some single family construction activity. And that's generally, you know, the formula for future pricing.
Speaker Change: Yep, got it. Just got a couple of questions about it. I wanted to make sure that we were all in the same page there, but that's what I fully expected. So thank you for that crack and I'll pass it on. Thank you.
Speaker Change: Thanks for watching.
Speaker Change: Our next question comes from Brent Deelman from DA Davidson. Please go ahead with your question
Brent Deelman: Hey, thanks for the morning. I just want to follow up on that just the comment around the wall board price increased most likely delayed in the next year is it?
Brent Deelman: is your sense, some of that.
Brent Deelman: is also due to some of the disruptions from weather seen so far this year and I guess sort of continuing to mark it or is it just simply the fact the industry is awaiting a little more momentum in new home construction in the next spring.
Brent Deelman: Look there's lots of infactors at influence, pricing and timing and magnitude. And so as we look at our wallboard business and pricing going forward.
Brent Deelman: You know, it is driven by single-family construction activity that's by far and away the largest.
Brent Deelman: Driver of activity there, you know, interest rates have moved around over the last several months.
Brent Deelman: So we have clarity on the demand side. But again, over a broader time period, we think there's some structural reasons why pricing and therefore our margins should remain higher. You know, just the matter of timing is the only question.
Speaker Change: Okay, and then maybe just on taking all your opening comments around this cement side, you know, we haven't seen you know, the full sex supply IJA yet here.
Speaker Change: Can you talk around?
Speaker Change: You're qualitatively, you're backlugs and visibility across your cement platform as it been any worse than it was six months ago. Is it better? I mean, how does it look? Is your head meant to kind of calendar 20, 25? Any sort of comments there would be helpful just to terms of how that's evolved?
Speaker Change: Yeah, yeah.
Speaker Change: Yeah, with looking at our backup, we really don't carry back log as much on the cement side. We know it's projects.
Speaker Change: and discussions with customer service and stuff.
Speaker Change: Nothing has fundamentally changed there. We still have, as I mentioned in the opening comments, a lot of heavy industrial projects going on. We have the IIA that should be hidden. Overall we see a very positive demand picture across every market that we operate in.
Speaker Change: You know we're down you know a few percentage points mostly affected by as we said weather and some delays in these projects but these projects are going to go so we think that you know over this next
Speaker Change: Time horizon be at six months be at nine months with it. These projects are queued up to start off.
Speaker Change: There's no doubt the 2024 construction season got off to a very slow start across.
Speaker Change: Much of the country, and then we continue to face some of these weather headwinds, even into summer and fall. And it's a relative comparison from the prior year.
Speaker Change: I give you point to the Portland Semen Association's mother industry views they continue to seek growth not only next year but in several years post that as these projects get going in earnest.
Speaker Change: I got it. Appreciate that. This last one on Texas Lehigh.
Speaker Change: Should the investments, I guess the big outage and the investments you're making here, lack of a better word for a cover you here for a while meaning we should get back to your normal maintenance cycle after this quarter.
Speaker Change: Yes, you know, this is a project we talked about for quite some time that the timing was always a little bit of question when equipment showed up and when contractors could be on site, but as Michael mentioned, that's been done here in October.
Speaker Change: So yeah, these are this the fifth year old plant. This is a fifth year old project. You're going to replace a clink or cooler, you know, once every 50 years. And so, you know, these are the investment that you make into a facility of that age and then, you know, reliability should significantly improve.
Speaker Change: Got it. Okay. Thank you.
Speaker Change: Our next question comes from Anthony Petnary from City Group. Please go ahead with your question.
Speaker Change: Hi, this is Asherson and on Frantan. Thanks for taking my questions. Is there a way to think about the magnitude of increased maintenance costs that you're expecting in the upcoming quarter and then just generally?
Speaker Change: the Cate and Submit margins over the BALS of the year and then stepping back kind of maybe what could be cement business margins kind of look like fit in a long term.
Speaker Change: Yeah, it's a good question. I'll handle the last part of that first.
Speaker Change: Good evening talking about for many quarters and years now. The Smith industry has fundamentally changed over the last decade or more with.
Speaker Change: Some of the regulations that have been put in place that has really restricted new capacity from being added. It's been over a decade, well over a decade since really the last green field cement plan was built in the U.S. and so you have...
Speaker Change: Some significant supply constraints, you know, in today's demand environment is maturely below where we've been in prior peaks.
Speaker Change: and so as we think about this industry over a cycle and over.
Speaker Change: Several cycles. We think the...
Speaker Change: and the Resiliency of those margins should be much higher than what we've seen in prior cycles. And more specifically to our footprint, we've more than tripled our cement capacity over the last decade plus. And so the quality of the assets that we operate today are in a much higher position.
Speaker Change: You think about the investment we're making at our mount's meant facility again that will lower the cost structure of that facility Make it more resilient so we position the business very well in the industry a large I think from a
Speaker Change: is the supply and demand dynamics, you know, with favor of their margin business over the next, over the cycle.
Speaker Change: And then it's as you think about just this next quarter, you know, look the between what Michael mentioned, the text-free high facility and then the Tulsa facility that we're also working on the kiln. You know, that'll have a six to eight million dollar type of impact here in the third quarter, but then those projects will be complete.
Speaker Change: Okay, great thanks that's really helpful and then just a second one on cement
Speaker Change: I'm you know it sounds like last quarter basically mid years were kind of taken off the table So just you know looking forward to 2025 from the timing of potential cement high is that do you think that's more of a January or an April just kind of have those conversations are going so far
Speaker Change: We've put out pricing creases and most of our markets for early 2025 in January.
Speaker Change: Thank you.
Speaker Change: And our next question comes from Jerry Revitch from Goldman Sachs. Please go ahead with your question.
Speaker Change: You're so good morning everyone.
Jerry Revitch: I'm going to follow up on the disclosure about this lag capacity addition and in Texas Can you just pick us up back for us and just update us on cement additive makes across your footprint, where do we stand now and as you look at.
Jerry Revitch: Another potential added is anything else that we should be on the lookout from an E-E-L standpoint. Over the next three to five years in terms of other cement added, that could make sense.
Speaker Change: Good, great question, Jerry. You know, we announced the Slack cement facility in early 24.
Speaker Change: I'm a earlier this year. It's through our joint venture.
Speaker Change: [inaudible]
Speaker Change: And we continue to explore those opportunities. We announced, you know, again, several months ago, a partnership with Terra CO2 as it relates to some alternative cementitious materials as well. You know, that's a little more out in front of us in terms of the opportunity, whereas the slag cement facility in Texas is, you know, being commissioned here in October. But we continue to look to ways to grow our footprint and excited about that.
Speaker Change: In other cases, jobs get pushed for other reasons.
Speaker Change: I would say I wouldn't
Speaker Change: And I think that's pretty much in line with what the Portland Cement Association has seen for calendar 24 as well as you think about a national average.
Speaker Change: Yeah, that's super. And, you know, if we were just to apply normal seasonality to December volumes...
Speaker Change: I think that would yield December cement shipments that are down something like 10-11% year-over-year. Is that where we should be thinking about the cadence based on what you're seeing so far? Just trying to understand, you know, that makes Craig in terms of, you know, what's push out versus weather.
Speaker Change: do it
Speaker Change: As you think about the rest of the second half of our fiscal year, we also faced some pretty unique headwinds in our fourth quarter last year, especially in the Midwest. So there is some adverse weather that was faced last year. Assuming we don't face that, you should have a better result this year.
Speaker Change: I appreciate the discussion. Thank you.
Speaker Change: And our next question comes from
Speaker Change: Adam Thelmeyer from Thompson Davis. Please go ahead with your question.
Adam Thelmeyer: Hey, good morning guys just a
Adam Thelmeyer: A couple quick ones that haven't been asked, the aggregates acquisition you did, can you give a little more color on that, should we bake anything into volumes or is that more long term positioning?
Adam Thelmeyer: to the business on the aggregate side with volume.
Speaker Change: I think in the quarter, revenue from that business was about $1.7 million, so it didn't close until the middle of the quarter, and so we should see a better benefit as we go forward.
Speaker Change: Right
Speaker Change: And then, um...
Speaker Change: The 6 to 8 million impact from Texas and Tulsa, was that an all-in number for Q3, Craig?
Craig Kessler: It was just incremental relative to those two projects.
Speaker Change: Gotcha. Okay, great. Thank you.
Speaker Change: And our next question comes from Philling from Jefferies. Please go ahead with your question.
Speaker Change: Hey, good morning guys. It's Jesse Barone on for Phil. Just two quick ones for me. First, could you give us kind of just an update on the cost structure for both the cement and wallboard business, specifically on the energy side, kind of what you're hedged out, and then I have a quick follow-up.
Speaker Change: Yeah, so on the cost structure within WallBoard, you know, again for us, we're very fortunate that we either own or control our gypsum sources, so that's not a significant cost component for us.
Speaker Change: In terms of the hedge position across all of EGLE for natural gas, we're right around 50% for the year, and that's at about today's levels. So feel good about where we are from that perspective. I haven't seen a lot of volatility in natural gas prices recently.
Speaker Change: On the cement side, you know, the larger components for costs or maintenance and energy.
Speaker Change: And then you do have the electricity costs which are subject to to market fluctuations
Speaker Change: Got it, thanks. And then just last follow-up, just anything more that you can give on kind of the impact from the KC and Denver issues that you had in the quarter?
Speaker Change: I'm sorry, you broke up on the second part of that question.
Speaker Change: Just anything more that you can give on kind of the Denver and Casey issues that you guys call it out in the quarter.
Speaker Change: So, when that sector went down, we had to pivot and move to other sectors. And there are more residential and some other consumers of aggregates. So, we're in the process of doing that now. We're setting up that business to be a little bit more diverse than the previous owners had it.
Speaker Change: working to right size that business and get that business back up and running with more volume here as we speak.
Speaker Change: Thanks, I'll turn it over.
Speaker Change: And we have an additional question from Tyler Brown from Raymond James. Please go ahead with your question.
Speaker Change: Hey, good morning, guys.
Tyler Brown: Hey, Craig, can you just talk a little bit more about the wallboard unit cost and maybe specifically about OCC?
Tyler Brown: tailwind again or just any color there.
Speaker Change: You're right, OCC has been elevated, it's really the first half of this year, and so we've talked about that. It does take a little bit of time to flow through into the wall board business.
Craig Kessler: I will tell you here in October, OCC prices were down. Again, the market was down. Now, that benefit takes a little bit of time to also flow through the business. But, yeah, I would say it's relatively elevated. But it hasn't changed a whole lot over the last several months.
Craig Kessler: Okay
Speaker Change: Okay, well that's helpful. This is my last one here. Just any update on CapEx for 25? And I know 26 is still a ways away, but with Laramie, I mean, should we think about CapEx being north of 300 million again in 26, just maybe for a placeholder?
Speaker Change: Yeah that's that's not a bad place to be. So we have previously given some guidance that was north of 300 million for FY 25.
Speaker Change: Just based on, you know, timing and flowing of payments, my guess is that number is somewhere between 280 to 310 million for fiscal 25.
Speaker Change: Obviously, that increase from the prior year is associated with the investment we're making in Laramie for that modernization project.
Speaker Change: So, a good place to start is something, and that is a multi-year construction project that will continue through fiscal 26. And so, a good place to start is a pretty similar number. We can refine that as we get down the road, but that's not a bad place to start.
Speaker Change: And in showing no additional questions at this time we'll conclude today's question and answer session. I'd like to turn the floor back over to Michael Haack for any closing remarks.
Michael Haack: Thank you, Jamie. Thanks to everyone who joined us on the call today. This past quarter continued to highlight the strength of our operational execution and our ability to capitalize on opportunities for our businesses.
Michael Haack: It was great to showcase our operational initiatives on today's call and at our annual HSE conference.
Michael Haack: Thank you again to every Eagle employee for their contribution to our success. We look forward to discussing our results again with everyone next quarter.