VULCAN MATERIALS CO, 10-Q filed on 11/4/2015
Quarterly Report
Document and Entity Information
9 Months Ended
Sep. 30, 2015
Oct. 30, 2015
Document and Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Sep. 30, 2015 
 
Document Fiscal Year Focus
2015 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
VMC 
 
Entity Registrant Name
Vulcan Materials CO 
 
Entity Central Index Key
0001396009 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
133,318,991 
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Assets
 
 
 
Cash and cash equivalents
$ 168,681 
$ 141,273 
$ 91,868 
Accounts and notes receivable
 
 
 
Accounts and notes receivable, gross
558,755 
378,947 
485,176 
Less: Allowance for doubtful accounts
(5,770)
(5,105)
(5,428)
Accounts and notes receivable, net
552,985 
373,842 
479,748 
Inventories
 
 
 
Finished products
275,717 
275,172 
254,931 
Raw materials
21,680 
19,741 
22,987 
Products in process
1,161 
1,250 
1,331 
Operating supplies and other
28,148 
25,641 
27,335 
Inventories
326,706 
321,804 
306,584 
Current deferred income taxes
39,301 
39,726 
41,745 
Prepaid expenses
56,017 
28,640 
34,673 
Assets held for sale
15,184 
Total current assets
1,143,690 
920,469 
954,618 
Investments and long-term receivables
40,516 
41,650 
42,117 
Property, plant & equipment
 
 
 
Property, plant & equipment, cost
6,803,588 
6,608,842 
6,608,342 
Reserve for depreciation, depletion & amortization
(3,683,961)
(3,537,212)
(3,539,772)
Property, plant & equipment, net
3,119,627 
3,071,630 
3,068,570 
Goodwill
3,094,824 
3,094,824 
3,095,317 
Other intangible assets, net
766,695 
758,243 
758,863 
Other noncurrent assets
151,514 
154,281 
150,160 
Total assets
8,316,866 
8,041,097 
8,069,645 
Liabilities
 
 
 
Current maturities of long-term debt
130 
150,137 
145 
Trade payables and accruals
195,536 
145,148 
167,837 
Other current liabilities
216,411 
156,073 
196,830 
Liabilities of assets held for sale
520 
Total current liabilities
412,077 
451,878 
364,812 
Long-term debt
1,979,493 
1,834,642 
1,984,075 
Noncurrent deferred income taxes
692,643 
691,137 
733,613 
Deferred revenue
209,651 
213,968 
216,205 
Other noncurrent liabilities
659,725 
672,773 
569,841 
Total liabilities
3,953,589 
3,864,398 
3,868,546 
Other commitments and contingencies (Note 8)
   
   
   
Equity
 
 
 
Common stock, $1 par value, Authorized 480,000 shares, Issued 133,315, 131,907 and 131,703 shares, respectively
133,315 
131,907 
131,703 
Capital in excess of par value
2,812,593 
2,734,661 
2,719,169 
Retained earnings
1,564,215 
1,471,845 
1,441,742 
Accumulated other comprehensive loss
(146,846)
(161,714)
(91,515)
Total equity
4,363,277 
4,176,699 
4,201,099 
Total liabilities and equity
$ 8,316,866 
$ 8,041,097 
$ 8,069,645 
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
CONDENSED CONSOLIDATED BALANCE SHEETS [Abstract]
 
 
 
Common stock, par value
$ 1 
$ 1 
$ 1 
Common stock, shares authorized
480,000,000 
480,000,000 
480,000,000 
Common stock, shares outstanding
133,315,000 
131,907,000 
131,703,000 
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)
Share data in Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
 
 
 
 
Total revenues
$ 1,038,460,000 
$ 873,579,000 
$ 2,564,896,000 
$ 2,239,142,000 
Cost of revenues
747,170,000 
664,537,000 
1,961,292,000 
1,821,220,000 
Gross profit
291,290,000 
209,042,000 
603,604,000 
417,922,000 
Selling, administrative and general expenses
71,390,000 
66,074,000 
207,350,000 
199,808,000 
Gain on sale of property, plant & equipment and businesses
799,000 
1,002,000 
7,423,000 
238,527,000 
Restructuring charges
(448,000)
(750,000)
(4,546,000)
(750,000)
Other operating expense, net
(8,045,000)
(2,889,000)
(22,391,000)
(17,645,000)
Operating earnings
212,206,000 
140,331,000 
376,740,000 
438,246,000 
Other nonoperating income (expense), net
(2,818,000)
(593,000)
(2,277,000)
4,030,000 
Interest expense, net
37,800,000 
40,891,000 
183,931,000 
201,531,000 
Earnings from continuing operations before income taxes
171,588,000 
98,847,000 
190,532,000 
240,745,000 
Provision for income taxes
45,386,000 
31,066,000 
51,177,000 
71,947,000 
Earnings from continuing operations
126,202,000 
67,781,000 
139,355,000 
168,798,000 
Loss on discontinued operations, net of tax
(2,397,000)
(842,000)
(7,066,000)
(1,896,000)
Net earnings
123,805,000 
66,939,000 
132,289,000 
166,902,000 
Other comprehensive income, net of tax
 
 
 
 
Reclassification adjustment for cash flow hedges
282,000 
598,000 
5,607,000 
4,167,000 
Adjustment for funded status of benefit plans
2,943,000 
Amortization of actuarial loss and prior service cost for benefit plans
3,883,000 
1,114,000 
9,261,000 
1,006,000 
Other comprehensive income
4,165,000 
1,712,000 
14,868,000 
8,116,000 
Comprehensive income
127,970,000 
68,651,000 
147,157,000 
175,018,000 
Basic earnings (loss) per share
 
 
 
 
Continuing operations
$ 0.95 
$ 0.51 
$ 1.05 
$ 1.29 
Discontinued operations
$ (0.02)
$ 0.00 
$ (0.06)
$ (0.02)
Net earnings
$ 0.93 
$ 0.51 
$ 0.99 
$ 1.27 
Diluted earnings (loss) per share
 
 
 
 
Continuing operations
$ 0.93 
$ 0.51 
$ 1.03 
$ 1.27 
Discontinued operations
$ (0.02)
$ (0.01)
$ (0.05)
$ (0.01)
Net earnings (loss)
$ 0.91 
$ 0.50 
$ 0.98 
$ 1.26 
Weighted-average common shares outstanding
 
 
 
 
Basic
133,474 
131,797 
133,082 
131,256 
Assuming dilution
135,558 
133,369 
134,942 
132,759 
Cash dividends per share of common stock
$ 0.10 
$ 0.06 
$ 0.30 
$ 0.16 
Depreciation, depletion, accretion and amortization
$ 69,662,000 
$ 71,157,000 
$ 204,770,000 
$ 208,858,000 
Effective tax rate from continuing operations
26.50% 
31.40% 
26.90% 
29.90% 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Operating Activities
 
 
Net earnings
$ 132,289,000 
$ 166,902,000 
Adjustments to reconcile net earnings to net cash provided by operating activities
 
 
Depreciation, depletion, accretion and amortization
204,770,000 
208,858,000 
Net gain on sale of property, plant & equipment and businesses
(7,423,000)
(238,527,000)
Contributions to pension plans
(11,337,000)
(4,115,000)
Share-based compensation
14,020,000 
18,425,000 
Excess tax benefits from share-based compensation
(16,950,000)
(3,375,000)
Deferred tax provision (benefit)
(7,640,000)
13,158,000 
Cost of debt purchase
67,075,000 
72,949,000 
Changes in assets and liabilities before initial effects of business acquisitions and dispositions
(79,000,000)
(89,888,000)
Other, net
(14,467,000)
5,339,000 
Net cash provided by operating activities
281,337,000 
149,726,000 
Investing Activities
 
 
Purchases of property, plant & equipment
(214,815,000)
(169,220,000)
Proceeds from sale of property, plant & equipment
4,464,000 
21,320,000 
Proceeds from sale of businesses, net of transaction costs
719,089,000 
Payment for businesses acquired, net of acquired cash
(20,801,000)
(268,604,000)
Other, net
(301,000)
Net cash provided by (used for) investing activities
(231,453,000)
302,585,000 
Financing Activities
 
 
Proceeds from line of credit
291,000,000 
70,000,000 
Payment of current maturities, long-term debt and line of credit
(751,056,000)
(649,711,000)
Proceeds from issuance of long-term debt
400,000,000 
Debt and line of credit issuance costs
(7,382,000)
Proceeds from issuance of common stock
30,620,000 
Dividends paid
(39,878,000)
(20,973,000)
Proceeds from exercise of stock options
67,888,000 
12,513,000 
Excess tax benefits from share-based compensation
16,950,000 
3,375,000 
Other, net
2,000 
(5,000)
Net cash used for financing activities
(22,476,000)
(554,181,000)
Net increase (decrease) in cash and cash equivalents
27,408,000 
(101,870,000)
Cash and cash equivalents at beginning of year
141,273,000 
193,738,000 
Cash and cash equivalents at end of period
$ 168,681,000 
$ 91,868,000 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Note 1: summary of significant accounting policies

 

NATURE OF OPERATIONS

 

Vulcan Materials Company (the “Company,” “Vulcan,” “we,” “our”), a New Jersey corporation, is the nation's largest producer of construction aggregates (primarily crushed stone, sand and gravel) and a major producer of asphalt mix and ready-mixed concrete.

 

BASIS OF PRESENTATION

 

Our accompanying unaudited condensed consolidated financial statements were prepared in compliance with the instructions to Form 10-Q and Article 10 of Regulation S-X and thus do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. Our Condensed Consolidated Balance Sheet as of December 31, 2014 was derived from the audited financial statement at that date. In the opinion of our management, the statements reflect all adjustments, including those of a normal recurring nature, necessary to present fairly the results of the reported interim periods. Operating results for the three and nine month periods ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ended December 31, 2015. For further information, refer to the consolidated financial statements and footnotes included in our most recent Annual Report on Form 10-K.

 

Due to the 2005 sale of our Chemicals business as presented in Note 2, the operating results of the Chemicals business are presented as discontinued operations in the accompanying Condensed Consolidated Statements of Comprehensive Income.

 

RECLASSIFICATIONS

 

Certain items previously reported in specific financial statement captions have been reclassified to conform with the 2015 presentation. We early adopted Accounting Standards Update (ASU) No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” resulting in adjustments to our prior financial statements. See Note 17 for additional information.

 

RESTRUCTURING CHARGES

 

In 2014, we announced changes to our executive management team, and a new divisional organization structure that was effective January 1, 2015. During the three and nine months ended September 30, 2015, we incurred $448,000 and $4,546,000, respectively, of costs related to these initiatives. During the three and nine months ended September 30, 2014, we incurred $750,000 of costs related to these initiatives. Future related charges for these initiatives are estimated to be immaterial.

 

EARNINGS PER SHARE (EPS)

 

Earnings per share are computed by dividing net earnings by the weighted-average common shares outstanding (basic EPS) or weighted-average common shares outstanding assuming dilution (diluted EPS), as set forth below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding

133,474 

 

 

131,797 

 

 

133,082 

 

 

131,256 

 

Dilutive effect of

 

 

 

 

 

 

 

 

 

 

 

  Stock options/SOSARs 1

919 

 

 

661 

 

 

1,024 

 

 

671 

 

  Other stock compensation plans

1,165 

 

 

911 

 

 

836 

 

 

832 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding, assuming dilution

135,558 

 

 

133,369 

 

 

134,942 

 

 

132,759 

 

 

 

 

Stock-Only Stock Appreciation Rights (SOSARs)

 

All dilutive common stock equivalents are reflected in our earnings per share calculations. Antidilutive common stock equivalents are not included in our earnings per share calculations. In periods of loss, shares that otherwise would have been included in our diluted weighted-average common shares outstanding computation are excluded. There were no excluded shares for the periods presented.

 

The number of antidilutive common stock equivalents for which the exercise price exceeds the weighted-average market price is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Antidilutive common stock equivalents

545 

 

 

2,355 

 

 

555 

 

 

2,355 

 

 

 

DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS

Note 2: Discontinued Operations

 

In 2005, we sold substantially all the assets of our Chemicals business to Basic Chemicals, a subsidiary of Occidental Chemical Corporation. The financial results of the Chemicals business are classified as discontinued operations in the accompanying Condensed Consolidated Statements of Comprehensive Income for all periods presented. There were no revenues from discontinued operations for the periods presented. Results from discontinued operations are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

Pretax loss

$       (3,974)

 

 

$       (1,393)

 

 

$    (11,627)

 

 

$       (3,132)

 

Income tax benefit

1,577 

 

 

551 

 

 

4,561 

 

 

1,236 

 

Loss on discontinued operations,

 

 

 

 

 

 

 

 

 

 

 

 net of income taxes

$       (2,397)

 

 

$          (842)

 

 

$       (7,066)

 

 

$       (1,896)

 

 

The losses from discontinued operations noted above include charges related to general and product liability costs, including legal defense costs, and environmental remediation costs associated with our former Chemicals business. The current year’s increased losses resulted primarily from charges associated with the Lower Passaic and Texas Brine matters as further discussed in Note 8.

 

 

INCOME TAXES
INCOME TAXES

 

Note 3: Income Taxes

 

Our estimated annual effective tax rate (EAETR) is based on full year expectations of pretax book earnings, statutory tax rates, permanent differences between book and tax accounting such as percentage depletion, and tax planning alternatives available in the various jurisdictions in which we operate. For interim financial reporting, we calculate our quarterly income tax provision in accordance with the EAETR. Each quarter, we update our EAETR based on our revised full year expectation of pretax book earnings and calculate the income tax provision so that the year-to-date income tax provision reflects the EAETR. Significant judgment is required in determining our EAETR.

 

In the third quarter of 2015, we recorded an income tax expense from continuing operations of $45,386,000 compared to $31,066,000 in the third quarter of 2014. The change in our income tax expense for the quarter resulted largely from applying the statutory rate to the increase in our pretax book earnings.

 

For the nine months ended September 30, 2015, we recorded an income tax expense from continuing operations of $51,177,000 compared to $71,947,000 for the nine months ended September 30, 2014. The change in our income tax expense for the nine month period resulted largely from applying the statutory rate to the decrease in our pretax book earnings.

 

We recognize deferred tax assets and liabilities based on the differences between the financial statement carrying amounts of assets and liabilities and the amounts used for income tax purposes. Deferred tax assets represent items to be used as a tax deduction or credit in future tax returns. Realization of the deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character in either the carryback or carryforward period.

 

Each quarter we analyze the likelihood that our deferred tax assets will be realized. A valuation allowance is recorded if, based on the weight of all available positive and negative evidence, it is more likely than not (a likelihood of more than 50%) that some portion, or all, of a deferred tax asset will not be realized.

 

Based on our third quarter 2015 analysis, we believe it is more likely than not that we will realize the benefit of all our deferred tax assets with the exception of certain state net operating loss carryforwards. For 2015, we project deferred tax assets related to state net operating loss carryforwards of $62,170,000, of which $59,354,000 relates to Alabama. Through the second quarter of 2015, we maintained a full valuation allowance against the Alabama net operating loss carryforward.

 

As disclosed in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, we restructured our legal entities during the second quarter of 2015. We communicated then that this restructuring might allow for utilization of some or all of our Alabama net operating loss carryforward prior to its expiration.

 

At the end of the third quarter, our cumulative three-year Alabama adjusted income turned positive. This development, in conjunction with all other available positive and negative evidence, has led us to conclude that it is more likely than not that $4,655,000 of the Alabama net operating loss carryforward is realizable. As such, a deferred tax benefit of $4,655,000 was recorded in the third quarter to reflect such reduction in the valuation allowance. Each quarter, we will reassess all positive and negative evidence to determine the appropriate amount of the valuation allowance.

 

We recognize a tax benefit associated with a tax position when, in our judgment, it is more likely than not that the position will be sustained based upon the technical merits of the position. For a tax position that meets the more likely than not recognition threshold, we measure the income tax benefit as the largest amount that we judge to have a greater than 50% likelihood of being realized. A liability is established for the unrecognized portion of any tax benefit. Our liability for unrecognized tax benefits is adjusted periodically due to changing circumstances, such as the progress of tax audits, case law developments and new or emerging legislation.

 

A summary of our deferred tax assets is included in Note 9 “Income Taxes” in our Annual Report on Form 10-K for the year ended December 31, 2014.

 

 

DEFERRED REVENUE
DEFERRED REVENUE

Note 4: deferred revenue

 

We entered into two transactions (September 2013 and December 2012) through which we sold a percentage of the future production from aggregates reserves at eight quarries (seven owned and one leased). These sales were structured as volumetric production payments (VPPs). We received net cash proceeds of $153,282,000 and $73,644,000 for the 2013 and 2012 transactions, respectively. These proceeds were recorded as deferred revenue on the balance sheet and are amortized on a unit-of-sales basis to revenue over the terms of the VPPs. Concurrently, we entered into marketing agreements with the purchaser through which we are designated the exclusive sales agent for the purchaser’s percentage of future production. Acting as the purchaser’s agent, our consolidated total revenues exclude these sales.

 

The common key terms of both VPP transactions are:

 

§

the purchaser has a nonoperating interest in future production entitling them to a percentage of future production

§

there is no minimum annual or cumulative production or sales volume, nor any minimum sales price guarantee

§

the purchaser has the right to take its percentage of future production in physical product, or receive the cash proceeds from the sale of its percentage of future production under the terms of the aforementioned marketing agreement

§

the purchaser's percentage of future production is conveyed free and clear of all future costs

§

we retain full operational and marketing control of the specified quarries

§

we retain fee simple interest in the land as well as any residual values that may be realized upon the conclusion of mining

 

The key terms specific to the 2013 VPP transaction are:

 

§

terminates at the earlier to occur of September 30, 2051 or the sale of 250.8 million tons of aggregates from the specified quarries; based on historical and projected volumes from the specified quarries, it is expected that 250.8 million tons will be sold prior to September 30, 2051

§

the purchaser's percentage of the maximum 250.8 million tons of future production is estimated to be 11.5% (approximately 29 million tons); the actual percentage may vary

 

The key terms specific to the 2012 VPP transaction are:

 

§

terminates at the earlier to occur of December 31, 2052 or the sale of 143.2 million tons of aggregates from the specified quarries; based on historical and projected volumes from the specified quarries, it is expected that 143.2 million tons will be sold prior to December 31, 2052

§

the purchaser's percentage of the maximum 143.2 million tons of future production is estimated to be 10.5% (approximately 15 million tons); the actual percentage may vary

 

Reconciliation of the deferred revenue balances (current and noncurrent) is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Deferred Revenue

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

$     217,429 

 

 

$     222,589 

 

 

$     219,968 

 

 

$     224,743 

 

 Cash received and revenue deferred

 

 

 

 

 

 

187 

 

 Amortization of deferred revenue

(1,778)

 

 

(1,384)

 

 

(4,317)

 

 

(3,725)

 

Balance at end of period

$     215,651 

 

 

$     221,205 

 

 

$     215,651 

 

 

$     221,205 

 

 

Based on expected aggregates sales from the specified quarries, we anticipate recognizing an estimated $6,000,000 of deferred revenue (reflected in other current liabilities in our 2015 Condensed Consolidated Balance Sheet) during the 12-month period ending September 30, 2016.

 

 

FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS

Note 5: Fair Value Measurements

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as described below:

 

Level 1: Quoted prices in active markets for identical assets or liabilities

Level 2: Inputs that are derived principally from or corroborated by observable market data

Level 3: Inputs that are unobservable and significant to the overall fair value measurement

 

Our assets subject to fair value measurement on a recurring basis are summarized below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

Fair Value Recurring

 

 

 

 

 

 

 

 

Rabbi Trust

 

 

 

 

 

 

 

 

 Mutual funds

$       12,081 

 

 

$       15,532 

 

 

$       14,986 

 

 Equities

8,778 

 

 

11,248 

 

 

12,838 

 

Total

$       20,859 

 

 

$       26,780 

 

 

$       27,824 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 2

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

Fair Value Recurring

 

 

 

 

 

 

 

 

Rabbi Trust

 

 

 

 

 

 

 

 

 Common/collective trust funds

$        1,464 

 

 

$        1,415 

 

 

$        1,367 

 

Total

$        1,464 

 

 

$        1,415 

 

 

$        1,367 

 

 

We have established two Rabbi Trusts for the purpose of providing a level of security for the employee nonqualified retirement and deferred compensation plans and for the directors' nonqualified deferred compensation plans. The fair values of these investments are estimated using a market approach. The Level 1 investments include mutual funds and equity securities for which quoted prices in active markets are available. Level 2 investments are stated at estimated fair value based on the underlying investments in those funds (short-term, highly liquid assets in commercial paper, short-term bonds and certificates of deposit).

 

Net gains (losses) of the Rabbi Trust investments were $(1,964,000) and $2,571,000 for the nine months ended September 30, 2015 and 2014, respectively. The portions of the net gains (losses) related to investments still held by the Rabbi Trusts at September 30, 2015 and 2014 were $(2,068,000) and $369,000, respectively.

 

The carrying values of our cash equivalents, restricted cash, accounts and notes receivable, short-term debt, trade payables and accruals, and other current liabilities approximate their fair values because of the short-term nature of these instruments. Additional disclosures for derivative instruments and interest-bearing debt are presented in Notes 6 and 7, respectively.

 

Assets that were subject to fair value measurement on a nonrecurring basis are summarized below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period ending September 30, 2015

 

 

Period ending September 30, 2014

 

 

 

 

 

Impairment

 

 

 

 

 

Impairment

 

in thousands

Level 2 

 

 

Charges

 

 

Level 2

 

 

Charges

 

Fair Value Nonrecurring

 

 

 

 

 

 

 

 

 

 

 

Property, plant & equipment, net

$              0 

 

 

$       2,176 

 

 

$       2,280 

 

 

$       2,987 

 

Other intangible assets, net

 

 

2,858 

 

 

 

 

 

Other assets

 

 

156 

 

 

 

 

 

Total

$              0 

 

 

$       5,190 

 

 

$       2,280 

 

 

$       2,987 

 

 

We recorded $5,190,000 and $2,987,000 of losses on impairment of long-lived assets (reported within other operating expense, net in our accompanying Condensed Consolidated Statements of Comprehensive Income) for the nine months ended September 30, 2015 and 2014, respectively, reducing the carrying value of these assets to their estimated fair values of $0 and $2,280,000. Fair value was estimated using a market approach (observed transactions involving comparable assets in similar locations).

 

 

DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS

Note 6: Derivative Instruments

 

During the normal course of operations, we are exposed to market risks including interest rates, foreign currency exchange rates and commodity prices. From time to time, and consistent with our risk management policies, we use derivative instruments to balance the cost and risk of such expenses. We do not utilize derivative instruments for trading or other speculative purposes.

 

The accounting for gains and losses that result from changes in the fair value of derivative instruments depends on whether the derivatives have been designated and qualify as hedging instruments and the type of hedging relationship. The interest rate swap agreements described below were designated as either cash flow hedges or fair value hedges. The changes in fair value of our interest rate swap cash flow hedges are recorded in accumulated other comprehensive income (AOCI) and are reclassified into interest expense in the same period the hedged items affect earnings. The changes in fair value of our interest rate swap fair value hedges are recorded as interest expense consistent with the change in the fair value of the hedged items attributable to the risk being hedged.

 

CASH FLOW HEDGES

 

During 2007, we entered into fifteen forward starting interest rate locks on $1,500,000,000 of future debt issuances in order to hedge the risk of higher interest rates. Upon the 2007 and 2008 issuances of the related fixed-rate debt, underlying interest rates were lower than the rate locks and we terminated and settled these forward starting locks for cash payments of $89,777,000.  This amount was booked to AOCI and is being amortized to interest expense over the term of the related debt.

 

This amortization was reflected in the accompanying Condensed Consolidated Statements of Comprehensive Income as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

Location on

 

September 30

 

 

September 30

 

in thousands

Statement

 

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Cash Flow Hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss reclassified from AOCI

Interest

 

 

 

 

 

 

 

 

 

 

 

 

 (effective portion)

expense

 

$          (467)

 

 

$          (989)

 

 

$       (9,282)

 

 

$       (6,892)

 

 

The loss reclassified from AOCI for the nine months ended September 30, 2015 and 2014 includes the acceleration of a proportional amount of the deferred loss in the amount of $7,208,000 and $3,762,000, respectively, referable to the debt purchases as described in Note 7.

 

For the 12-month period ending September 30, 2016, we estimate that $1,967,000 of the pretax loss in AOCI will be reclassified to earnings.

 

FAIR VALUE HEDGES

In June 2011, we issued $500,000,000 of 6.50% fixed-rate notes due in 2016 to refinance near term floating-rate debt. Concurrently, we entered into interest rate swap agreements in the stated amount of $500,000,000 to reestablish the pre-refinancing mix of fixed- and floating-rate debt. Under these agreements, we paid 6-month London Interbank Offered Rate (LIBOR) plus a spread of 4.05% and received a fixed interest rate of 6.50%. Additionally, in June 2011, we entered into interest rate swap agreements on our $150,000,000 of 10.125% fixed-rate notes due in 2015. Under these agreements, we paid 6-month LIBOR plus a spread of 8.03% and received a fixed interest rate of 10.125%. In August 2011, we terminated and settled these interest rate swap agreements for $25,382,000 of cash proceeds. The $23,387,000 gain component of the settlement (cash proceeds less $1,995,000 of accrued interest) was added to the carrying value of the related debt and is being amortized as a reduction to interest expense over the terms of the related debt using the effective interest method.

 

This deferred gain amortization was reflected in the accompanying Condensed Consolidated Statements of Comprehensive Income as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

 

September 30

 

 

September 30

 

in thousands

 

 

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Deferred Gain on Settlement

 

 

 

 

 

 

 

 

 

 

 

 

Amortized to earnings as a reduction

 

 

 

 

 

 

 

 

 

 

 

 

 to interest expense

 

$           282 

 

 

$           493 

 

 

$        2,795 

 

 

$      10,171 

 

 

The amortized deferred gain for the nine months ended September 30, 2015 and 2014 includes the acceleration of a proportional amount of the deferred gain in the amount of $1,642,000 and $8,032,000, respectively, referable to the debt purchases as described in Note 7. The deferred gain will be fully amortized in December 2015, concurrent with the retirement of the 10.125% notes due 2015.

 

 

DEBT
DEBT

 

Note 7: Debt

 

Debt is detailed as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effective

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

Interest Rates

 

2015 

 

 

2014 

 

 

2014 

 

Short-term Debt

 

 

 

 

 

 

 

 

 

 

Bank line of credit expires 2020 1, 2

n/a

 

$                  0 

 

 

$                0 

 

 

$                0 

 

Total short-term debt

 

 

$                  0 

 

 

$                0 

 

 

$                0 

 

Long-term Debt

 

 

 

 

 

 

 

 

 

 

Bank line of credit expires 2020 1, 2, 3

1.75% 

 

$         85,000 

 

 

$                0 

 

 

$                0 

 

10.125% notes due 2015 4

9.58% 

 

150,000 

 

 

150,000 

 

 

150,000 

 

6.50% notes due 2016

n/a

 

 

 

125,001 

 

 

125,001 

 

6.40% notes due 2017

n/a

 

 

 

218,633 

 

 

218,633 

 

7.00% notes due 2018

7.87% 

 

272,512 

 

 

400,000 

 

 

400,000 

 

10.375% notes due 2018

10.63% 

 

250,000 

 

 

250,000 

 

 

250,000 

 

7.50% notes due 2021

7.75% 

 

600,000 

 

 

600,000 

 

 

600,000 

 

8.85% notes due 2021 

8.88% 

 

6,000 

 

 

6,000 

 

 

6,000 

 

Industrial revenue bond due 2022

n/a

 

 

 

14,000 

 

 

14,000 

 

4.50% notes due 2025

4.65% 

 

400,000 

 

 

 

 

 

7.15% notes due 2037

8.05% 

 

240,188 

 

 

240,188 

 

 

240,188 

 

Other notes 2

6.25% 

 

503 

 

 

637 

 

 

753 

 

Unamortized discounts and debt issuance costs

n/a

 

(24,821)

 

 

(22,716)

 

 

(23,893)

 

Unamortized deferred interest rate swap gain 5

n/a

 

241 

 

 

3,036 

 

 

3,538 

 

Total long-term debt including current maturities 6

 

 

$    1,979,623 

 

 

$  1,984,779 

 

 

$  1,984,220 

 

Less current maturities

 

 

130 

 

 

150,137 

 

 

145 

 

Total long-term debt

 

 

$    1,979,493 

 

 

$  1,834,642 

 

 

$  1,984,075 

 

Total debt 7

 

 

$    1,979,623 

 

 

$  1,984,779 

 

 

$  1,984,220 

 

Estimated fair value of long-term debt

 

 

$    2,191,361 

 

 

$  2,092,673 

 

 

$  2,237,325 

 

 

 

 

 

Borrowings on the bank line of credit are classified as short-term debt if we intend to repay within twelve months and as long-term debt otherwise.

Non-publicly traded debt.

The effective interest rate is the current credit spread over LIBOR.

The 10.125% notes due 2015 are classified as long-term debt (not current maturities) as of September 30, 2015 due to our intent and ability to refinance these notes at maturity (December 15, 2015) using our line of credit.

The unamortized deferred gain was realized upon the August 2011 settlement of interest rate swaps as discussed in Note 6.

The debt balances as of December 31, 2014 and September 30, 2014 have been adjusted to reflect our early adoption of ASU 2015-03 and related election as discussed in Note 17.

Face value of our debt is equal to total debt less unamortized discounts and debt issuance costs, and unamortized deferred interest rate swap gain, as follows: September 30, 2015$2,004,203 thousand, December 31, 2014$2,004,459 thousand and September 30, 2014$2,004,575 thousand.

 

Our total debt is presented in the table above net of unamortized discounts from par, unamortized deferred debt issuance costs and unamortized deferred interest rate swap settlement gain. Discounts, deferred debt issuance costs and deferred swap settlement gains are amortized using the effective interest method over the terms of the respective notes.

 

The estimated fair value of our debt presented in the table above was determined by: (1) averaging several asking price quotes for the publicly traded notes and (2) assuming par value for the remainder of the debt. The fair value estimates for the publicly traded notes were based on Level 2 information (as defined in Note 5) as of their respective balance sheet dates.

 

 

LINE OF CREDIT

 

In June 2015, we cancelled our secured $500,000,000 line of credit and entered into an unsecured $750,000,000 line of credit (incurring $2,589,000 of transaction fees) that expires in June 2020.

 

The line of credit contains affirmative, negative and financial covenants customary for an unsecured facility. The primary negative covenant limits our ability to incur secured debt. The financial covenants are: (1) a maximum ratio of debt to EBITDA of 3.5:1 through September 2016 and 3.25:1 thereafter,  and (2) a minimum ratio of EBITDA to net cash interest expense of 3.0:1. As of September 30, 2015, we were in compliance with the line of credit covenants.

 

Borrowings on our line of credit are classified as short-term debt if we intend to repay within twelve months and as long-term debt if we have the intent and ability to extend payment beyond twelve months.  Borrowings bear interest, at our option, at either LIBOR plus a credit margin ranging from 1.00% to 2.00%, or SunTrust Bank’s base rate (generally, its prime rate) plus a credit margin ranging from 0.00% to 1.00%. The credit margin for both LIBOR and base rate borrowings is determined by either our ratio of debt to EBITDA or our credit ratings, based on the metric that produces the lower credit spread. Standby letters of credit, which are issued under the line of credit and reduce availability, are charged a fee equal to the credit margin for LIBOR borrowings plus 0.175%. We also pay a commitment fee on the daily average unused amount of the line of credit that ranges from 0.10% to 0.35% based on either our ratio of debt to EBITDA or our credit ratings, based on the metric that produces the lower fee. As of September 30, 2015, the credit margin for LIBOR borrowings was 1.75%, the credit margin for base rate borrowings was 0.75%, and the commitment fee for the unused amount was 0.25%.

 

As of September 30, 2015, our available borrowing capacity was $626,136,000. Utilization of the borrowing capacity was as follows:

 

§

$85,000,000 was borrowed

§

$38,864,000 was used to provide support for outstanding standby letters of credit

 

 

TERM DEBT

 

All of our term debt is unsecured. All such debt, other than the $503,000 of other notes, is governed by two essentially identical indentures that contain customary investment-grade type covenants. The primary covenant in both indentures limits the amount of secured debt we may incur without ratably securing such debt. As of September 30, 2015, we were in compliance with all of the term debt covenants.

 

In August 2015, we repaid our $14,000,000 industrial revenue bond due 2022 (such repayment did not incur any prepayment penalties) via borrowing on our line of credit.

 

In March 2015, we issued $400,000,000 of 4.50% senior notes due 2025. Proceeds (net of underwriter fees and other transaction costs) of $395,207,000 were partially used to fund the March 30, 2015 purchase, via tender offer, of $127,303,000 principal amount (32%) of the 7.00% notes due 2018. The March 2015 debt purchase cost $145,899,000, including an $18,140,000 premium above the principal amount of the notes and transaction costs of $456,000. The premium primarily reflects the trading price of the notes relative to par prior to the tender offer commencement. Additionally, we recognized $3,138,000 of net noncash expense associated with the acceleration of a proportional amount of unamortized discounts, deferred debt issuance costs, and deferred interest rate derivative settlement gains and losses. The combined first quarter charge of $21,734,000 is presented in the accompanying Condensed Consolidated Statement of Comprehensive Income as a component of interest expense for the nine month period ended September 30, 2015.

 

The remaining net proceeds from the March 2015 debt issuance, together with cash on hand and borrowings under our line of credit, funded: (1) the April 2015 redemption of $218,633,000 principal amount (100%) of the 6.40% notes due 2017, (2) the April 2015 redemption of $125,001,000 principal amount (100%) of the 6.50% notes due 2016 and (3) the April 2015 purchase, via the tender offer commenced in March 2015 of  $185,000 principal amount (less than 1%) of the 7.00% notes due 2018. The April 2015 debt purchases cost $385,024,000, including a $41,153,000 premium above the principal amount of the notes and transaction costs of $52,000. The premium primarily reflects the make-whole value of the 2016 notes and the 2017 notes. Additionally, we recognized $4,136,000 of net noncash expense associated with the acceleration of unamortized discounts, deferred debt issuance costs, and deferred interest rate derivative settlement gains and losses. The combined second quarter charge of $45,341,000 is presented in the accompanying Condensed Consolidated Statement of Comprehensive Income as a component of interest expense for the nine month period ended September 30, 2015.

 

Consistent with our intent and ability to refinance the 10.125% notes due 2015 via borrowing on our line of credit, such notes are classified as long-term debt in the accompanying Condensed Consolidated Balance Sheet as of September 30, 2015.

 

In March 2014, we purchased $506,366,000 principal amount of debt through a tender offer as follows: $374,999,000 of 6.50% notes due in 2016 and $131,367,000 of 6.40% notes due in 2017. This debt purchase was funded by the sale of our cement and concrete businesses in the Florida area as described in Note 16. The March 2014 debt purchases cost $579,659,000, including a $71,829,000 premium above the principal amount of the notes and transaction costs of $1,464,000. The premium primarily reflects the trading price of the notes relative to par prior to the tender offer commencement. Additionally, we recognized a net noncash benefit of $344,000 associated with the acceleration of a proportional amount of unamortized discounts, deferred debt issuance costs, and deferred interest rate derivative settlement gains and losses. The combined charge of $72,949,000 is presented in the accompanying Condensed Consolidated Statement of Comprehensive Income as a component of interest expense for the nine month period ended September 30, 2014.

 

 

STANDBY LETTERS OF CREDIT

 

We provide, in the normal course of business, certain third-party beneficiaries standby letters of credit to support our obligations to pay or perform according to the requirements of an underlying agreement. Such letters of credit typically have an initial term of one year, typically renew automatically, and can only be modified or cancelled with the approval of the beneficiary. All of our standby letters of credit are issued by banks that participate in our $750,000,000 line of credit, and reduce the borrowing capacity thereunder. Our standby letters of credit as of September 30, 2015 are summarized by purpose in the table below:

 

 

 

 

 

 

 

 

in thousands

 

 

Standby Letters of Credit

 

 

Risk management insurance

$       33,111 

 

Reclamation/restoration requirements

5,753 

 

Total

$       38,864 

 

 

 

COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES

Note 8: Commitments and Contingencies

 

As summarized by purpose in Note 7, our standby letters of credit totaled $38,864,000 as of September 30, 2015.

 

LITIGATION AND ENVIRONMENTAL MATTERS

 

We are a defendant in various lawsuits in the ordinary course of business. It is not possible to determine with precision the outcome, or the amount of liability, if any, under these lawsuits, especially where the cases involve possible jury trials with as yet undetermined jury panels.

 

In addition to these lawsuits in which we are involved in the ordinary course of business, certain other material legal proceedings are more specifically described below.

 

§

Lower Passaic River Study Area (Superfund Site) — The Lower Passaic River Study Area is part of the Diamond Shamrock Superfund Site in New Jersey. Vulcan and approximately 70 other companies are parties (collectively the “Cooperating Parties Group”) to a May 2007 Administrative Order on Consent (AOC) with the U.S. Environmental Protection Agency (EPA) to perform a Remedial Investigation/Feasibility Study (draft RI/FS) of the lower 17 miles of the Passaic River (River). On April 11, 2014, the EPA issued a proposed Focused Feasibility Study (FFS) that calls for a bank-to-bank dredging remedy for the lower 8 miles of the River. The EPA estimates that the cost of implementing this proposal is approximately $950 million to $1.73 billion. The period for public comment on the proposed FFS is closed and it is anticipated that the EPA will issue its final record of decision sometime in 2015. The Cooperating Parties Group draft RI/FS estimates the preferred remedial action presented therein to cost in the range of approximately $475 million to $725 million (including $93 million in operations and maintenance costs for a 30-year period).

 

The AOC does not obligate us to fund or perform the remedial action contemplated by either the draft RI/FS or the FFS. Vulcan formerly owned a chemicals operation near River Mile 0.1, which was sold in 1974. The Company has found no evidence that its former chemicals operation contributed any of the primary contaminants of concern to the River.

 

Neither the ultimate remedial approach, nor the parties who will participate in funding the remediation and their respective allocations, have been determined. However, we recorded an immaterial loss for this matter in the first quarter of 2015 based on the cost estimate of the preferred remedial action supported by the Cooperating Parties Group’s draft RI/FS.

 

§

TEXAS BRINE MATTER — During the operation of its former Chemicals Division, Vulcan was the lessee to a salt lease from 1976 – 2005 in an underground salt dome formation in Assumption Parish, Louisiana. The Texas Brine Company (Texas Brine) operated this salt mine for the account of Vulcan. Vulcan sold its Chemicals Division in 2005 and assigned the lease to the purchaser, and Vulcan has had no association with the leased premises or Texas Brine since that time. In August 2012, a sinkhole developed near the salt dome and numerous lawsuits were filed in state court in Assumption Parish, Louisiana. Other lawsuits, including class action litigation, were also filed in August 2012 in federal court in the Eastern District of Louisiana in New Orleans.

 

There are numerous defendants to the litigation in state and federal court. Vulcan was first brought into the litigation as a third-party defendant in August 2013 by Texas Brine. Vulcan has since been added as a direct and third-party defendant by other parties, including a direct claim by the state of Louisiana. The damages alleged in the litigation range from individual plaintiffs’ claims for property damage, to the state of Louisiana’s claim for response costs, to claims for physical damages to oil pipelines, to business interruption claims. In addition to the plaintiffs’ claims, Vulcan has also been sued for contractual indemnity and comparative fault by both Texas Brine and Occidental Chemical Co. (Occidental).  The total amount of damages claimed is in excess of $500 million. It is alleged that the sinkhole was caused, in whole or in part, by Vulcan’s negligent actions or failure to act. It is also alleged that Vulcan breached the salt lease, as well as an operating  agreement and a drilling agreement with Texas Brine; and that Vulcan is strictly liable for certain property damages in its capacity as a former assignee of the salt lease; and that Vulcan violated certain covenants and conditions in the agreement under which it sold its Chemicals Division in 2005. Vulcan has made claims for contractual indemnity, comparative fault, and breach of contract against Texas Brine, as well as claims for contractual indemnity and comparative fault against Occidental. Discovery is ongoing and the first trial date in any of these cases has been set for April 2016. At this time, we cannot reasonably estimate a range of liability pertaining to this matter.

 

§

HEWITT LANDFILL MATTER — On September 8, 2015, the Los Angeles Regional Water Quality Control Board (RWQCB) issued a Cleanup and Abatement Order (CAO) directing Vulcan to assess, monitor, cleanup and abate wastes that have been discharged to soil, soil vapor, and/or groundwater at Vulcan’s former Hewitt Landfill in Los Angeles. The CAO follows a 2014 Investigative Order from RWQCB that sought data and a technical evaluation regarding the Hewitt Landfill, and a subsequent amendment to the Investigative Order requiring Vulcan to provide groundwater monitoring results to RWQCB and to create and implement a work plan for further investigation of the Hewitt Landfill. Vulcan is engaged in performing site investigation work required by the CAO.

 

Vulcan is also engaged in an ongoing dialogue with the U.S. Environmental Protection Agency, the Los Angeles Department of Water and Power, and other stakeholders regarding the potential contribution of the Hewitt Landfill to groundwater contamination in the San Fernando Valley. We are gathering and analyzing data and developing technical information to determine the extent of possible contribution by the Hewitt Landfill to the groundwater contamination in the area. This work is also intended to assist in identification of other sources of contamination. At this time, we cannot reasonably estimate a range of liability pertaining to this matter.

 

It is not possible to predict with certainty the ultimate outcome of these and other legal proceedings in which we are involved, and a number of factors, including developments in ongoing discovery or adverse rulings, or the verdict of a particular jury, could cause actual losses to differ materially from accrued costs. No liability was recorded for claims and litigation for which a loss was determined to be only reasonably possible or for which a loss could not be reasonably estimated. Legal costs incurred in defense of lawsuits are expensed as incurred. In addition, losses on certain claims and litigation described above may be subject to limitations on a per occurrence basis by excess insurance, as described in our most recent Annual Report on Form 10-K.

 

 

ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS

Note 9: Asset Retirement Obligations

 

Asset retirement obligations (AROs) are legal obligations associated with the retirement of long-lived assets resulting from the acquisition, construction, development and/or normal use of the underlying assets.

 

Recognition of a liability for an ARO is required in the period in which it is incurred at its estimated fair value. The associated asset retirement costs are capitalized as part of the carrying amount of the underlying asset and depreciated over the estimated useful life of the asset. The liability is accreted through charges to operating expenses. If the ARO is settled for other than the carrying amount of the liability, we recognize a gain or loss on settlement.

 

We record all AROs for which we have legal obligations for land reclamation at estimated fair value. Essentially all these AROs relate to our underlying land parcels, including both owned properties and mineral leases. For the three and nine month periods ended September 30, we recognized ARO operating costs related to accretion of the liabilities and depreciation of the assets as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

ARO Operating Costs

 

 

 

 

 

 

 

 

 

 

 

Accretion

$        2,766 

 

 

$        2,892 

 

 

$        8,553 

 

 

$        8,745 

 

Depreciation

1,681 

 

 

1,080 

 

 

4,683 

 

 

3,060 

 

Total

$        4,447 

 

 

$        3,972 

 

 

$      13,236 

 

 

$      11,805 

 

 

ARO operating costs are reported in cost of revenues. AROs are reported within other noncurrent liabilities in our accompanying Condensed Consolidated Balance Sheets.

 

Reconciliations of the carrying amounts of our AROs are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Asset Retirement Obligations

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

$     234,919 

 

 

$     225,117 

 

 

$     226,565 

 

 

$     228,234 

 

  Liabilities incurred

 

 

3,604 

 

 

6,159 

 

 

3,604 

 

  Liabilities settled

(5,318)

 

 

(7,684)

 

 

(13,318)

 

 

(20,527)

 

  Accretion expense

2,766 

 

 

2,892 

 

 

8,553 

 

 

8,745 

 

  Revisions up, net

2,313 

 

 

4,539 

 

 

6,721 

 

 

8,412 

 

Balance at end of period

$     234,680 

 

 

$     228,468 

 

 

$     234,680 

 

 

$     228,468 

 

 

The net revisions relate to revised cost estimates and spending patterns for several quarries located primarily in California.

 

 

BENEFIT PLANS
BENEFIT PLANS

Note 10: Benefit Plans

 

We sponsor three funded, noncontributory defined benefit pension plans. These plans cover substantially all employees hired prior to July 2007, other than those covered by union-administered plans. Normal retirement age is 65, but the plans contain provisions for earlier retirement. Benefits for the Salaried Plan and the Chemicals Hourly Plan are generally based on salaries or wages and years of service; the Construction Materials Hourly Plan provides benefits equal to a flat dollar amount for each year of service. In addition to these qualified plans, we sponsor three unfunded, nonqualified pension plans.

 

Effective July 2007, we amended our defined benefit pension plans to no longer accept new participants. In December 2013, we amended our defined benefit pension plans so that future service accruals for salaried pension participants ceased effective December 31, 2013. This change included a special transition provision which will allow covered compensation through December 31, 2015 to be considered in the participants’ benefit calculations.

 

The following table sets forth the components of net periodic pension benefit cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PENSION BENEFITS

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Components of Net Periodic Benefit Cost

 

 

 

 

 

 

 

 

 

 

 

Service cost

$        1,213 

 

 

$        1,039 

 

 

$        3,638 

 

 

$        3,118 

 

Interest cost

11,004 

 

 

11,098 

 

 

33,077 

 

 

33,294 

 

Expected return on plan assets

(13,683)

 

 

(12,701)

 

 

(41,051)

 

 

(38,102)

 

Settlement charge

2,031 

 

 

 

 

2,031 

 

 

 

Amortization of prior service cost

12 

 

 

47 

 

 

36 

 

 

141 

 

Amortization of actuarial loss

5,383 

 

 

2,806 

 

 

16,292 

 

 

8,416 

 

Net periodic pension benefit cost

$        5,960 

 

 

$        2,289 

 

 

$      14,023 

 

 

$        6,867 

 

Pretax reclassifications from AOCI included in

 

 

 

 

 

 

 

 

 

 

 

 net periodic pension benefit cost

$        7,426 

 

 

$        2,853 

 

 

$      18,359 

 

 

$        8,557 

 

 

The reclassifications from AOCI noted in the table above are related to a settlement charge, amortization of prior service costs and actuarial losses as shown in Note 11. The settlement charge noted above relates to a lump sum payment to a former employee from the nonqualified plan. This $2,031,000 charge is reflected within both cost of revenues, and selling, administrative and general expenses in our accompanying Condensed Consolidated Statement of Comprehensive Income for the three and nine months ended September 30, 2015.

 

Prior contributions, along with the existing funding credits, are expected to be sufficient to cover required contributions to the qualified plans through 2015.

 

In addition to pension benefits, we provide certain healthcare and life insurance benefits for some retired employees. In 2012, we amended our postretirement healthcare plan to cap our portion of the medical coverage cost at the 2015 level. Substantially all of our salaried employees and, where applicable, certain of our hourly employees may become eligible for these benefits if they reach a qualifying age and meet certain service requirements. Generally, Company-provided healthcare benefits terminate when covered individuals become eligible for Medicare benefits, become eligible for other group insurance coverage or reach age 65, whichever occurs first.

 

The following table sets forth the components of net periodic postretirement benefit cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER POSTRETIREMENT BENEFITS

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Components of Net Periodic Benefit Cost

 

 

 

 

 

 

 

 

 

 

 

Service cost

$           473 

 

 

$           536 

 

 

$        1,420 

 

 

$        1,609 

 

Interest cost

621 

 

 

824 

 

 

1,864 

 

 

2,473 

 

Curtailment gain

 

 

 

 

 

 

(3,832)

 

Amortization of prior service credit

(1,058)

 

 

(1,081)

 

 

(3,174)

 

 

(3,245)

 

Amortization of actuarial loss

 

 

57 

 

 

28 

 

 

170 

 

Net periodic postretirement benefit cost (credit)

$             45 

 

 

$           336 

 

 

$           138 

 

 

$       (2,825)

 

Pretax reclassifications from AOCI included in

 

 

 

 

 

 

 

 

 

 

 

 net periodic postretirement benefit credit

$       (1,049)

 

 

$       (1,024)

 

 

$       (3,146)

 

 

$       (6,907)

 

 

The reclassifications from AOCI noted in the table above are related to a curtailment gain, amortization of prior service credits and actuarial losses as shown in Note 11. The March 2014 sale of our cement and concrete businesses in the Florida area (see Note 16) significantly reduced total expected future service of our postretirement plans resulting in a one-time curtailment gain of $3,832,000. This gain is reflected within gain on sale of property, plant & equipment and businesses in our accompanying Condensed Consolidated Statement of Comprehensive Income for the nine months ended September 30, 2014.

 

 

OTHER COMPREHENSIVE INCOME
OTHER COMPREHENSIVE INCOME

 

Note 11: other Comprehensive Income

 

Comprehensive income comprises two subsets: net earnings and other comprehensive income (OCI). The components of other comprehensive income are presented in the accompanying Condensed Consolidated Statements of Comprehensive Income, net of applicable taxes.

 

Amounts in accumulated other comprehensive income (AOCI), net of tax, are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

AOCI

 

 

 

 

 

 

 

 

Cash flow hedges

$       (14,715)

 

 

$       (20,322)

 

 

$       (21,011)

 

Pension and postretirement benefit plans

(132,131)

 

 

(141,392)

 

 

(70,504)

 

Total

$     (146,846)

 

 

$     (161,714)

 

 

$       (91,515)

 

 

Changes in AOCI, net of tax, for the nine months ended September 30, 2015 are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension and 

 

 

 

 

 

Cash Flow

 

 

Postretirement

 

 

 

 

in thousands

Hedges

 

 

Benefit Plans

 

 

Total

 

AOCI

 

 

 

 

 

 

 

 

Balance as of December 31, 2014

$       (20,322)

 

 

$     (141,392)

 

 

$     (161,714)

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 before reclassifications

 

 

 

 

 

Amounts reclassified from AOCI

5,607 

 

 

9,261 

 

 

14,868 

 

Net current period OCI changes

5,607 

 

 

9,261 

 

 

14,868 

 

Balance as of September 30, 2015

$       (14,715)

 

 

$     (132,131)

 

 

$     (146,846)

 

 

Amounts reclassified from AOCI to earnings, are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Reclassification Adjustment for Cash Flow

 

 

 

 

 

 

 

 

 

 

 

 Hedge Losses

 

 

 

 

 

 

 

 

 

 

 

Interest expense

$            467 

 

 

$            989 

 

 

$         9,282 

 

 

$         6,892 

 

(Benefit from) provision for income taxes

(185)

 

 

(391)

 

 

(3,675)

 

 

(2,725)

 

Total 1 

$            282 

 

 

$            598 

 

 

$         5,607 

 

 

$         4,167 

 

Amortization of Pension and Postretirement

 

 

 

 

 

 

 

 

 

 

 

 Plan Actuarial Loss and Prior Service Cost

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

$         5,242 

 

 

$         1,465 

 

 

$       12,417 

 

 

$         1,324 

 

Selling, administrative and general expenses

1,136 

 

 

362 

 

 

2,796 

 

 

326 

 

(Benefit from) provision for income taxes

(2,495)

 

 

(713)

 

 

(5,952)

 

 

(644)

 

Total 2 

$         3,883 

 

 

$         1,114 

 

 

$         9,261 

 

 

$         1,006 

 

Total reclassifications from AOCI to earnings

$         4,165 

 

 

$         1,712 

 

 

$       14,868 

 

 

$         5,173 

 

 

 

 

Nine months ended September 30, 2015 and 2014 include the acceleration of a proportional amount of deferred interest rate derivatives (see Note 6) referable to debt purchases (see Note 7).

Nine months ended September 30, 2015 includes a one-time settlement loss resulting from a lump sum payment to a former employee (see Note 10). Nine months ended September 30, 2014 includes a one-time curtailment gain (see Note 10) resulting from the sale of our cement and concrete businesses in the Florida area (see Note 16).

 

 

 

EQUITY
EQUITY

 

Note 12: Equity

 

Our capital stock consists solely of common stock, par value $1.00 per share. Holders of our common stock are entitled to one vote per share. Our Certificate of Incorporation also authorizes preferred stock of which no shares have been issued. The terms and provisions of such shares will be determined by our Board of Directors upon any issuance of preferred shares in accordance with our Certificate of Incorporation.

 

In 2014, we issued 715,004 shares of common stock in connection with a business acquisition as described in Note 16.

 

Under a program that was discontinued in the fourth quarter of 2014, we occasionally sold shares of common stock to the trustee of our 401(k) retirement plans to satisfy the plan participants’ elections to invest in our common stock. Under this arrangement, the stock issuances and resulting cash proceeds were as follows:

 

§

twelve months ended December 31, 2014 — issued 485,306 shares for cash proceeds of $30,620,000

§

nine months ended September 30, 2014 — issued 485,306 shares for cash proceeds of $30,620,000

 

Changes in total equity for the nine months ended September 30, 2015 are summarized below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

in thousands

 

 

 

Equity

 

Balance at December 31, 2014

 

 

$    4,176,699 

 

Net earnings

 

 

132,289 

 

Common stock issued

 

 

 

 

  Share-based compensation plans

 

 

48,329 

 

Share-based compensation expense

 

 

14,020 

 

Excess tax benefits from share-based compensation

 

 

16,950 

 

Cash dividends on common stock ($0.30 per share)

 

 

(39,878)

 

Other comprehensive income

 

 

14,868 

 

Other

 

 

 

Balance at September 30, 2015

 

 

$    4,363,277 

 

 

There were no shares held in treasury as of September 30, 2015, December 31, 2014 and September 30, 2014. As of September 30, 2015, 3,411,416 shares may be repurchased under the current purchase authorization of our Board of Directors.

 

 

SEGMENT REPORTING
SEGMENT REPORTING

 

Note 13: Segment Reporting

 

We have four operating (and reportable) segments organized around our principal product lines: Aggregates, Asphalt Mix, Concrete and Calcium. The vast majority of our activities are domestic. We sell a relatively small amount of construction aggregates outside the United States. Intersegment sales are made at local market prices for the particular grade and quality of product utilized in the production of asphalt mix and ready-mixed concrete. Management reviews earnings from the product line reporting segments principally at the gross profit level.

 

 

segment financial disclosure

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in millions

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Total Revenues

 

 

 

 

 

 

 

 

 

 

 

Aggregates 1

$        830.8 

 

 

$        688.9 

 

 

$     2,067.7 

 

 

$     1,752.6 

 

Asphalt Mix 2

178.9 

 

 

136.4 

 

 

410.9 

 

 

330.0 

 

Concrete 2, 3

88.0 

 

 

99.0 

 

 

226.4 

 

 

288.8 

 

Calcium 4

2.2 

 

 

2.3 

 

 

6.5 

 

 

22.6 

 

 Segment sales

1,099.9 

 

 

926.6 

 

 

2,711.5 

 

 

2,394.0 

 

Aggregates intersegment sales

(61.4)

 

 

(53.0)

 

 

(146.6)

 

 

(145.7)

 

Calcium intersegment sales

0.0 

 

 

0.0 

 

 

0.0 

 

 

(9.2)

 

Total revenues

$     1,038.5 

 

 

$        873.6 

 

 

$     2,564.9 

 

 

$     2,239.1 

 

Gross Profit

 

 

 

 

 

 

 

 

 

 

 

Aggregates

$        250.9 

 

 

$        188.0 

 

 

$        525.8 

 

 

$        388.1 

 

Asphalt Mix 2

30.0 

 

 

14.5 

 

 

60.0 

 

 

28.3 

 

Concrete 2, 3

9.6 

 

 

5.5 

 

 

15.3 

 

 

(0.5)

 

Calcium 4

0.8 

 

 

1.0 

 

 

2.5 

 

 

2.0 

 

Total

$        291.3 

 

 

$        209.0 

 

 

$        603.6 

 

 

$        417.9 

 

Depreciation, Depletion, Accretion

 

 

 

 

 

 

 

 

 

 

 

 and Amortization (DDA&A)

 

 

 

 

 

 

 

 

 

 

 

Aggregates

$          57.7 

 

 

$          58.5 

 

 

$        170.3 

 

 

$        169.2 

 

Asphalt Mix 2

4.1 

 

 

2.6 

 

 

12.1 

 

 

7.5 

 

Concrete 2, 3

3.0 

 

 

5.0 

 

 

8.5 

 

 

15.7 

 

Calcium 4

0.2 

 

 

0.2 

 

 

0.5 

 

 

1.4 

 

Other

4.7 

 

 

4.9 

 

 

13.4 

 

 

15.1 

 

Total

$          69.7 

 

 

$          71.2 

 

 

$        204.8 

 

 

$        208.9 

 

Identifiable Assets 5

 

 

 

 

 

 

 

 

 

 

 

Aggregates

 

 

 

 

 

 

$     7,533.2 

 

 

$     7,409.1 

 

Asphalt Mix 2

 

 

 

 

 

 

315.0 

 

 

238.2 

 

Concrete 2, 3

 

 

 

 

 

 

188.3 

 

 

235.6 

 

Calcium 4

 

 

 

 

 

 

5.6 

 

 

5.9 

 

Total identifiable assets

 

 

 

 

 

 

$     8,042.1 

 

 

$     7,888.8 

 

General corporate assets

 

 

 

 

 

 

106.1 

 

 

88.9 

 

Cash items

 

 

 

 

 

 

168.7 

 

 

91.9 

 

Total

 

 

 

 

 

 

$     8,316.9 

 

 

$     8,069.6 

 

 

 

 

 

Includes crushed stone, sand and gravel, sand, other aggregates, as well as freight, delivery and transportation revenues, and other revenues related to services.

In January 2015, we exchanged our California ready-mixed concrete operations for 13 asphalt mix plants, primarily in Arizona (see Note 16).

Includes ready-mixed concrete. In March 2014, we sold our concrete business in the Florida area (see Note 16) which in addition to ready-mixed concrete, included concrete block, precast concrete, as well as building materials purchased for resale.

Includes cement and calcium products. In March 2014, we sold our cement business (see Note 16).

Certain temporarily idled assets are included within a segment's Identifiable Assets but the associated DDA&A is shown within Other in the DDA&A section above as the related DDA&A is excluded from segment gross profit.

 

 

SUPPLEMENTAL CASH FLOW INFORMATION
SUPPLEMENTAL CASH FLOW INFORMATION

Note 14: Supplemental Cash Flow Information

 

Supplemental information referable to our Condensed Consolidated Statements of Cash Flows is summarized below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

Cash Payments

 

 

 

 

 

Interest (exclusive of amount capitalized)

$     136,123 

 

 

$     163,593 

 

Income taxes

46,271 

 

 

64,539 

 

Noncash Investing and Financing Activities

 

 

 

 

 

Accrued liabilities for purchases of property, plant & equipment

$       11,941 

 

 

$         5,777 

 

Amounts referable to business acquisitions

 

 

 

 

 

 Liabilities assumed

2,645 

 

 

24,881 

 

 Fair value of noncash assets and liabilities exchanged

20,000 

 

 

4,914 

 

 Fair value of equity consideration

 

 

45,185 

 

 

 

GOODWILL
GOODWILL

Note 15: Goodwill

 

Goodwill is recognized when the consideration paid for a business exceeds the fair value of the tangible and identifiable intangible assets acquired. Goodwill is allocated to reporting units for purposes of testing goodwill for impairment. There were no charges for goodwill impairment in the nine month periods ended September 30, 2015 and 2014.

 

We have four reportable segments organized around our principal product lines: Aggregates, Asphalt Mix, Concrete and Calcium. Changes in the carrying amount of goodwill by reportable segment from December 31, 2014 to September 30, 2015 are summarized below:

 

GOODWILL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in thousands

Aggregates

 

 

Asphalt Mix

 

 

Concrete

 

 

Calcium

 

 

Total

 

Goodwill

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total as of December 31, 2014

$  3,003,191 

 

 

$     91,633 

 

 

$              0 

 

 

$              0 

 

 

$    3,094,824 

 

Goodwill of acquired businesses

 

 

 

 

 

 

 

 

 

Goodwill of divested businesses

 

 

 

 

 

 

 

 

 

Total as of September 30, 2015

$  3,003,191 

 

 

$     91,633 

 

 

$              0 

 

 

$              0 

 

 

$    3,094,824 

 

 

We test goodwill for impairment on an annual basis or more frequently if events or circumstances change in a manner that would more likely than not reduce the fair value of a reporting unit below its carrying value. A decrease in the estimated fair value of one or more of our reporting units could result in the recognition of a material, noncash write-down of goodwill.

 

 

ACQUISITIONS AND DIVESTITURES
ACQUISITIONS AND DIVESTITURES

 

Note 16: Acquisitions and Divestitures

 

ACQUISITIONS

 

Through the nine months ended September 30, 2015, we purchased the following for $40,801,000 of consideration ($20,801,000 cash and $20,000,000 exchanges of real property and businesses (twelve California ready-mixed concrete operations)):

 

§

three aggregates facilities and seven ready-mixed concrete operations in Arizona and New Mexico

§

thirteen asphalt mix plants, primarily in Arizona

 

As a result, we recognized $16,176,000 of amortizable intangible assets (contractual rights in place). The contractual rights in place will be amortized against earnings ($7,168,000 - straight-line over 20 years and $9,008,000 - units of production over an estimated 50 years) and deductible for income tax purposes over 15 years. The purchase price allocation is preliminary pending appraisals of contractual rights in place and property, plant & equipment.

 

For the full year 2014, we purchased the following for total consideration of $331,836,000  ($284,237,000 cash; $2,414,000 exchanges of real property and businesses; and $45,185,000 of our common stock (715,004 shares)):

 

§

two portable asphalt plants and an aggregates facility in southern California

§

five aggregates facilities and associated downstream assets in Arizona and New Mexico

§

two aggregates facilities in Delaware, serving northern Virginia and Washington, D.C.

§

four aggregates facilities in the San Francisco Bay Area

§

a rail-connected aggregates operation and two distribution yards that serve the greater Dallas/Fort Worth market

§

a permitted aggregates quarry in Alabama

 

 

DIVESTITURES AND PENDING DIVESTITURES

 

As noted above, in the first quarter of 2015, we exchanged twelve ready-mixed concrete operations in California (representing all of our California concrete operations) for thirteen asphalt mix plants (primarily in Arizona) resulting in a pretax gain of $5,886,000.

 

For the full year 2014, we sold:

 

§

First quarter — our cement and concrete businesses in the Florida area for net pretax cash proceeds of $721,359,000 resulting in a pretax gain of $227,910,000. We retained all of our Florida aggregates operations, our former Cement segment’s calcium operation in Brooksville, Florida and real estate associated with certain former ready-mixed concrete facilities. Under a separate supply agreement, we will continue to provide aggregates to the divested concrete facilities, at market prices, for a period of 20 years. As a result of the continuing cash flows (generated via the supply agreement and the retained operation and assets), the disposition is not reported as discontinued operations

§

First quarter — a previously mined and subsequently reclaimed tract of land in Maryland (Aggregates segment) for net pretax cash proceeds of $10,727,000 resulting in a pretax gain of $168,000

§

First quarter — unimproved land in Tennessee previously containing a sales yard (Aggregates segment) for net pretax cash proceeds of $5,820,000 resulting in a pretax gain of $5,790,000

 

Effective land management is both a business strategy and a social responsibility. We strive to achieve value through our mining activities as well as incremental value through effective post-mining land management. Our land management strategy includes routinely reclaiming and selling our previously mined land. Additionally, this strategy includes developing conservation banks by preserving land as a suitable habitat for endangered or sensitive species. These conservation banks have received approval from the United States Fish and Wildlife Service to offer mitigation credits for sale to third parties who may be required to compensate for the loss of habitats of endangered or sensitive species.

 

No assets met the criteria for held for sale at September 30, 2015 or 2014. As of December 31, 2014, twelve ready-mixed concrete facilities in California are presented in the accompanying Condensed Consolidated Balance Sheet as assets held for sale and liabilities of assets held for sale. During the first quarter of 2015, we swapped these ready-mixed concrete facilities for thirteen asphalt mix operations, primarily in Arizona (as noted above). The major classes of assets and liabilities of assets classified as held for sale are as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30

 

December 31

 

September 30

 

in thousands

 

 

 

2015 

 

 

2014 

 

 

2014 

 

Held for Sale

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

$              0 

 

 

$       1,773 

 

 

$              0 

 

Property, plant & equipment, net

 

 

 

 

 

12,764 

 

 

 

Other intangible assets, net

 

 

 

 

 

647 

 

 

 

Total assets held for sale

 

 

 

$              0 

 

 

$     15,184 

 

 

$              0 

 

Asset retirement obligations

 

 

 

$              0 

 

 

$          520 

 

 

$              0 

 

Total liabilities of assets held for sale

 

 

 

$              0 

 

 

$          520 

 

 

$              0 

 

 

 

NEW ACCOUNTING STANDARDS
NEW ACCOUNTING STANDARDS

Note 17: New Accounting Standards

 

ACCOUNTING STANDARDS RECENTLY ADOPTED

 

DEBT ISSUANCE COSTS  As of and for the interim period ended June 30, 2015, we early adopted Accounting Standards Update (ASU) 2015-03, “Simplifying the Presentation of Debt Issuance Costs.” Under ASU 2015-03, debt issuance costs related to a note are presented in the balance sheet as a deduction from the related debt liability rather than as a prepaid expense (the amortization of such costs continues to be reported as interest expense). However, this ASU did not address the balance sheet presentation of debt issuance cost: (1) incurred before a debt liability is recognized or (2) associated with revolving debt arrangements, such as our line of credit. Accordingly, we elected an accounting policy to present these debt issuance costs as a deduction from the total debt liability. This ASU and related election are retrospectively applied to the beginning of the earliest period presented in the financial statements. As a result of the retrospective application of this change in accounting principle, we adjusted our Condensed Consolidated Balance Sheets for all prior periods presented. Debt issuance costs of $20,805,000 and $21,893,000 previously reported as other noncurrent assets on the Condensed Consolidated Balance Sheets as of December 31, 2014 and September 30, 2014, respectively, have been reclassified as a deduction from the principal amount of the total debt liability.

 

SHARE-BASED AWARDS  As of and for the interim period ended March 31, 2015, we adopted ASU 2014-12, “Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period.” This ASU clarified the proper method of accounting for share-based awards when the terms of an award provide that a performance target could be achieved after the requisite service period. Under prior guidance, there was a lack of consistency in the measurement of the grant-date fair values of awards with these types of performance targets. Under ASU 2014-12, a performance target that affects vesting and could be achieved after completion of the service period should be treated as a performance condition and, as a result, should not be included in the estimation of the grant-date fair value. Rather, an entity should recognize compensation cost for the award when it becomes probable that the performance target will be achieved. Previously, we accounted for share-based awards with these types of performance targets in accordance with ASU 2014-12. Our adoption of this standard had no material impact on our financial position, results of operations or liquidity.

 

DISCONTINUED OPERATIONS REPORTING  As of and for the interim period ended March 31, 2015, we adopted ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.” This ASU changed the definition of and expanded the disclosure requirements for discontinued operations. Under the new definition, discontinued operations reporting is limited to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results. The expanded disclosures for discontinued operations are meant to provide users of financial statements with more information about the assets, liabilities, revenues, and expenses of discontinued operations. Additionally, this ASU requires an entity to disclose the pretax profit or loss of an individually significant component of an entity that does not qualify for discontinued operations reporting. Our adoption of this standard had no material impact on our financial position, results of operations or liquidity.

 

ACCOUNTING STANDARDS PENDING ADOPTION

 

MEASUREMENT-PERIOD ADJUSTMENTS  In September 2015, the Financial Accounting Standards Board (FASB) issued ASU 2015-16, “Simplifying the Accounting for Measurement-Period Adjustments,” which requires an acquirer to recognize measurement-period adjustments to provisional amounts in the reporting period in which the adjustments are determined. Previously, measurement-period adjustments were retrospectively applied. As an alternative to restating the prior periods for the measurement-period adjustments, the ASU requires acquirers to present separately on the face of the earnings statement, or disclose in the notes, the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustments to the provisional amounts had been recognized as of the acquisition date. This ASU is to be applied prospectively to adjustments to provisional amounts that occur after December 15, 2015. Early adoption is permitted. We will adopt this standard as of and for the interim period ending March 31, 2016. While we are still evaluating the impact of ASU 2015-16, we do not expect the adoption of this standard to have a material impact on our consolidated financial statements.

 

INVENTORY MEASUREMENT  In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory,” which changes the measurement principle for inventory from the lower of cost or market principle to the lower of cost and net realizable value principle. The guidance applies to inventories that are measured using the first-in, first-out (FIFO) or average cost method, but does not apply to inventories that are measured by using the last-in, first-out (LIFO) or retail inventory method. We use the LIFO method for approximately 70% of our inventory (based on the December 31, 2014 balances); therefore, this ASU will not apply to the majority of our inventory. This ASU is effective prospectively for annual reporting periods beginning after December 15, 2016, and interim reporting periods within those annual reporting periods. Early adoption is permitted. We will adopt this standard as of and for the interim period ending March 31, 2017. While we are still evaluating the impact of ASU 2015-11, we do not expect the adoption of this standard to have a material impact on our consolidated financial statements.

 

NET ASSET VALUE PER SHARE INVESTMENTS  In May 2015, the FASB issued ASU 2015-07, “Disclosures for Investment in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent),” which removes the requirement to categorize investments within the fair value hierarchy when their fair value is measured using the net asset value per share practical expedient. This ASU also removes the requirement to make certain disclosures for investments that are eligible to be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures would be limited to investments for which the entity has elected to measure the fair value using that practical expedient. This ASU is effective for annual reporting periods beginning after December 15, 2015, and interim reporting periods within those annual reporting periods. This ASU is to be applied retrospectively to all periods presented. Early adoption is permitted. We will adopt this standard as of and for the interim period ending March 31, 2016. While we are still evaluating the impact of ASU 2015-07, it will not impact our consolidated financial statements as it only affects disclosure. Thus, it will impact the notes to our consolidated financial statements, specifically, our pension plan fair value disclosures.

 

CONSOLIDATION  In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis,” which amends existing consolidation guidance for reporting entities that are required to evaluate whether they should consolidate certain legal entities. This ASU is effective for annual reporting periods beginning after December 15, 2015, and interim reporting periods within those annual reporting periods. Early adoption is permitted. We will adopt this standard as of and for the interim period ending March 31, 2016. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements.

 

GOING CONCERN  In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern,” which requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern (meet its obligations as they become due) within one year after the date that the financial statements are issued. If conditions or events raise substantial doubt about the entity’s ability to continue as a going concern, certain disclosures are required. This ASU is effective for annual reporting periods ending after December 15, 2016, and interim reporting periods thereafter. Early adoption is permitted. We will adopt this standard as of and for the annual period ending December 31, 2016. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements.

 

REVENUE RECOGNITION  In May 2014, the FASB issued ASU 2014-09, “Revenue From Contracts With Customers,” which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. This ASU provides a more robust framework for addressing revenue issues and expands required revenue recognition disclosures. This ASU (as later amended) is effective for annual reporting periods beginning after December 15, 2017, and interim reporting periods within those annual reporting periods. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. We are currently evaluating the impact of adoption of this ASU on our consolidated financial statements.

 

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policy)

NATURE OF OPERATIONS

 

Vulcan Materials Company (the “Company,” “Vulcan,” “we,” “our”), a New Jersey corporation, is the nation's largest producer of construction aggregates (primarily crushed stone, sand and gravel) and a major producer of asphalt mix and ready-mixed concrete.

BASIS OF PRESENTATION

 

Our accompanying unaudited condensed consolidated financial statements were prepared in compliance with the instructions to Form 10-Q and Article 10 of Regulation S-X and thus do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. Our Condensed Consolidated Balance Sheet as of December 31, 2014 was derived from the audited financial statement at that date. In the opinion of our management, the statements reflect all adjustments, including those of a normal recurring nature, necessary to present fairly the results of the reported interim periods. Operating results for the three and nine month periods ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ended December 31, 2015. For further information, refer to the consolidated financial statements and footnotes included in our most recent Annual Report on Form 10-K.

 

Due to the 2005 sale of our Chemicals business as presented in Note 2, the operating results of the Chemicals business are presented as discontinued operations in the accompanying Condensed Consolidated Statements of Comprehensive Income.

RECLASSIFICATIONS

 

Certain items previously reported in specific financial statement captions have been reclassified to conform with the 2015 presentation. We early adopted Accounting Standards Update (ASU) No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs,” resulting in adjustments to our prior financial statements. See Note 17 for additional information.

RESTRUCTURING CHARGES

 

In 2014, we announced changes to our executive management team, and a new divisional organization structure that was effective January 1, 2015. During the three and nine months ended September 30, 2015, we incurred $448,000 and $4,546,000, respectively, of costs related to these initiatives. During the three and nine months ended September 30, 2014, we incurred $750,000 of costs related to these initiatives. Future related charges for these initiatives are estimated to be immaterial.

 

EARNINGS PER SHARE (EPS)

 

Earnings per share are computed by dividing net earnings by the weighted-average common shares outstanding (basic EPS) or weighted-average common shares outstanding assuming dilution (diluted EPS), as set forth below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding

133,474 

 

 

131,797 

 

 

133,082 

 

 

131,256 

 

Dilutive effect of

 

 

 

 

 

 

 

 

 

 

 

  Stock options/SOSARs 1

919 

 

 

661 

 

 

1,024 

 

 

671 

 

  Other stock compensation plans

1,165 

 

 

911 

 

 

836 

 

 

832 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding, assuming dilution

135,558 

 

 

133,369 

 

 

134,942 

 

 

132,759 

 

 

 

 

Stock-Only Stock Appreciation Rights (SOSARs)

 

All dilutive common stock equivalents are reflected in our earnings per share calculations. Antidilutive common stock equivalents are not included in our earnings per share calculations. In periods of loss, shares that otherwise would have been included in our diluted weighted-average common shares outstanding computation are excluded. There were no excluded shares for the periods presented.

 

The number of antidilutive common stock equivalents for which the exercise price exceeds the weighted-average market price is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Antidilutive common stock equivalents

545 

 

 

2,355 

 

 

555 

 

 

2,355 

 

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding

133,474 

 

 

131,797 

 

 

133,082 

 

 

131,256 

 

Dilutive effect of

 

 

 

 

 

 

 

 

 

 

 

  Stock options/SOSARs 1

919 

 

 

661 

 

 

1,024 

 

 

671 

 

  Other stock compensation plans

1,165 

 

 

911 

 

 

836 

 

 

832 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

 

 

 outstanding, assuming dilution

135,558 

 

 

133,369 

 

 

134,942 

 

 

132,759 

 

 

 

 

Stock-Only Stock Appreciation Rights (SOSARs)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Antidilutive common stock equivalents

545 

 

 

2,355 

 

 

555 

 

 

2,355 

 

 

DISCONTINUED OPERATIONS (Tables)
Results from Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Discontinued Operations

 

 

 

 

 

 

 

 

 

 

 

Pretax loss

$       (3,974)

 

 

$       (1,393)

 

 

$    (11,627)

 

 

$       (3,132)

 

Income tax benefit

1,577 

 

 

551 

 

 

4,561 

 

 

1,236 

 

Loss on discontinued operations,

 

 

 

 

 

 

 

 

 

 

 

 net of income taxes

$       (2,397)

 

 

$          (842)

 

 

$       (7,066)

 

 

$       (1,896)

 

 

DEFERRED REVENUE (Tables)
Summary Of Recognized Deferred Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Deferred Revenue

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

$     217,429 

 

 

$     222,589 

 

 

$     219,968 

 

 

$     224,743 

 

 Cash received and revenue deferred

 

 

 

 

 

 

187 

 

 Amortization of deferred revenue

(1,778)

 

 

(1,384)

 

 

(4,317)

 

 

(3,725)

 

Balance at end of period

$     215,651 

 

 

$     221,205 

 

 

$     215,651 

 

 

$     221,205 

 

 

FAIR VALUE MEASUREMENTS (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 1

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

Fair Value Recurring

 

 

 

 

 

 

 

 

Rabbi Trust

 

 

 

 

 

 

 

 

 Mutual funds

$       12,081 

 

 

$       15,532 

 

 

$       14,986 

 

 Equities

8,778 

 

 

11,248 

 

 

12,838 

 

Total

$       20,859 

 

 

$       26,780 

 

 

$       27,824 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Level 2

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

Fair Value Recurring

 

 

 

 

 

 

 

 

Rabbi Trust

 

 

 

 

 

 

 

 

 Common/collective trust funds

$        1,464 

 

 

$        1,415 

 

 

$        1,367 

 

Total

$        1,464 

 

 

$        1,415 

 

 

$        1,367 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period ending September 30, 2015

 

 

Period ending September 30, 2014

 

 

 

 

 

Impairment

 

 

 

 

 

Impairment

 

in thousands

Level 2 

 

 

Charges

 

 

Level 2

 

 

Charges

 

Fair Value Nonrecurring

 

 

 

 

 

 

 

 

 

 

 

Property, plant & equipment, net

$              0 

 

 

$       2,176 

 

 

$       2,280 

 

 

$       2,987 

 

Other intangible assets, net

 

 

2,858 

 

 

 

 

 

Other assets

 

 

156 

 

 

 

 

 

Total

$              0 

 

 

$       5,190 

 

 

$       2,280 

 

 

$       2,987 

 

 

DERIVATIVE INSTRUMENTS (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

Location on

 

September 30

 

 

September 30

 

in thousands

Statement

 

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Cash Flow Hedges

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss reclassified from AOCI

Interest

 

 

 

 

 

 

 

 

 

 

 

 

 (effective portion)

expense

 

$          (467)

 

 

$          (989)

 

 

$       (9,282)

 

 

$       (6,892)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

 

September 30

 

 

September 30

 

in thousands

 

 

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Deferred Gain on Settlement

 

 

 

 

 

 

 

 

 

 

 

 

Amortized to earnings as a reduction

 

 

 

 

 

 

 

 

 

 

 

 

 to interest expense

 

$           282 

 

 

$           493 

 

 

$        2,795 

 

 

$      10,171 

 

 

DEBT (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effective

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

Interest Rates

 

2015 

 

 

2014 

 

 

2014 

 

Short-term Debt

 

 

 

 

 

 

 

 

 

 

Bank line of credit expires 2020 1, 2

n/a

 

$                  0 

 

 

$                0 

 

 

$                0 

 

Total short-term debt

 

 

$                  0 

 

 

$                0 

 

 

$                0 

 

Long-term Debt

 

 

 

 

 

 

 

 

 

 

Bank line of credit expires 2020 1, 2, 3

1.75% 

 

$         85,000 

 

 

$                0 

 

 

$                0 

 

10.125% notes due 2015 4

9.58% 

 

150,000 

 

 

150,000 

 

 

150,000 

 

6.50% notes due 2016

n/a

 

 

 

125,001 

 

 

125,001 

 

6.40% notes due 2017

n/a

 

 

 

218,633 

 

 

218,633 

 

7.00% notes due 2018

7.87% 

 

272,512 

 

 

400,000 

 

 

400,000 

 

10.375% notes due 2018

10.63% 

 

250,000 

 

 

250,000 

 

 

250,000 

 

7.50% notes due 2021

7.75% 

 

600,000 

 

 

600,000 

 

 

600,000 

 

8.85% notes due 2021 

8.88% 

 

6,000 

 

 

6,000 

 

 

6,000 

 

Industrial revenue bond due 2022

n/a

 

 

 

14,000 

 

 

14,000 

 

4.50% notes due 2025

4.65% 

 

400,000 

 

 

 

 

 

7.15% notes due 2037

8.05% 

 

240,188 

 

 

240,188 

 

 

240,188 

 

Other notes 2

6.25% 

 

503 

 

 

637 

 

 

753 

 

Unamortized discounts and debt issuance costs

n/a

 

(24,821)

 

 

(22,716)

 

 

(23,893)

 

Unamortized deferred interest rate swap gain 5

n/a

 

241 

 

 

3,036 

 

 

3,538 

 

Total long-term debt including current maturities 6

 

 

$    1,979,623 

 

 

$  1,984,779 

 

 

$  1,984,220 

 

Less current maturities

 

 

130 

 

 

150,137 

 

 

145 

 

Total long-term debt

 

 

$    1,979,493 

 

 

$  1,834,642 

 

 

$  1,984,075 

 

Total debt 7

 

 

$    1,979,623 

 

 

$  1,984,779 

 

 

$  1,984,220 

 

Estimated fair value of long-term debt

 

 

$    2,191,361 

 

 

$  2,092,673 

 

 

$  2,237,325 

 

 

 

 

 

Borrowings on the bank line of credit are classified as short-term debt if we intend to repay within twelve months and as long-term debt otherwise.

Non-publicly traded debt.

The effective interest rate is the current credit spread over LIBOR.

The 10.125% notes due 2015 are classified as long-term debt (not current maturities) as of September 30, 2015 due to our intent and ability to refinance these notes at maturity (December 15, 2015) using our line of credit.

The unamortized deferred gain was realized upon the August 2011 settlement of interest rate swaps as discussed in Note 6.

The debt balances as of December 31, 2014 and September 30, 2014 have been adjusted to reflect our early adoption of ASU 2015-03 and related election as discussed in Note 17.

Face value of our debt is equal to total debt less unamortized discounts and debt issuance costs, and unamortized deferred interest rate swap gain, as follows: September 30, 2015$2,004,203 thousand, December 31, 2014$2,004,459 thousand and September 30, 2014$2,004,575 thousand.

 

 

 

 

 

 

 

in thousands

 

 

Standby Letters of Credit

 

 

Risk management insurance

$       33,111 

 

Reclamation/restoration requirements

5,753 

 

Total

$       38,864 

 

 

ASSET RETIREMENT OBLIGATIONS (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

ARO Operating Costs

 

 

 

 

 

 

 

 

 

 

 

Accretion

$        2,766 

 

 

$        2,892 

 

 

$        8,553 

 

 

$        8,745 

 

Depreciation

1,681 

 

 

1,080 

 

 

4,683 

 

 

3,060 

 

Total

$        4,447 

 

 

$        3,972 

 

 

$      13,236 

 

 

$      11,805 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Asset Retirement Obligations

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

$     234,919 

 

 

$     225,117 

 

 

$     226,565 

 

 

$     228,234 

 

  Liabilities incurred

 

 

3,604 

 

 

6,159 

 

 

3,604 

 

  Liabilities settled

(5,318)

 

 

(7,684)

 

 

(13,318)

 

 

(20,527)

 

  Accretion expense

2,766 

 

 

2,892 

 

 

8,553 

 

 

8,745 

 

  Revisions up, net

2,313 

 

 

4,539 

 

 

6,721 

 

 

8,412 

 

Balance at end of period

$     234,680 

 

 

$     228,468 

 

 

$     234,680 

 

 

$     228,468 

 

 

BENEFIT PLANS (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PENSION BENEFITS

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Components of Net Periodic Benefit Cost

 

 

 

 

 

 

 

 

 

 

 

Service cost

$        1,213 

 

 

$        1,039 

 

 

$        3,638 

 

 

$        3,118 

 

Interest cost

11,004 

 

 

11,098 

 

 

33,077 

 

 

33,294 

 

Expected return on plan assets

(13,683)

 

 

(12,701)

 

 

(41,051)

 

 

(38,102)

 

Settlement charge

2,031 

 

 

 

 

2,031 

 

 

 

Amortization of prior service cost

12 

 

 

47 

 

 

36 

 

 

141 

 

Amortization of actuarial loss

5,383 

 

 

2,806 

 

 

16,292 

 

 

8,416 

 

Net periodic pension benefit cost

$        5,960 

 

 

$        2,289 

 

 

$      14,023 

 

 

$        6,867 

 

Pretax reclassifications from AOCI included in

 

 

 

 

 

 

 

 

 

 

 

 net periodic pension benefit cost

$        7,426 

 

 

$        2,853 

 

 

$      18,359 

 

 

$        8,557 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER POSTRETIREMENT BENEFITS

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Components of Net Periodic Benefit Cost

 

 

 

 

 

 

 

 

 

 

 

Service cost

$           473 

 

 

$           536 

 

 

$        1,420 

 

 

$        1,609 

 

Interest cost

621 

 

 

824 

 

 

1,864 

 

 

2,473 

 

Curtailment gain

 

 

 

 

 

 

(3,832)

 

Amortization of prior service credit

(1,058)

 

 

(1,081)

 

 

(3,174)

 

 

(3,245)

 

Amortization of actuarial loss

 

 

57 

 

 

28 

 

 

170 

 

Net periodic postretirement benefit cost (credit)

$             45 

 

 

$           336 

 

 

$           138 

 

 

$       (2,825)

 

Pretax reclassifications from AOCI included in

 

 

 

 

 

 

 

 

 

 

 

 net periodic postretirement benefit credit

$       (1,049)

 

 

$       (1,024)

 

 

$       (3,146)

 

 

$       (6,907)

 

 

OTHER COMPREHENSIVE INCOME (Tables)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30

 

 

December 31

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2014 

 

AOCI

 

 

 

 

 

 

 

 

Cash flow hedges

$       (14,715)

 

 

$       (20,322)

 

 

$       (21,011)

 

Pension and postretirement benefit plans

(132,131)

 

 

(141,392)

 

 

(70,504)

 

Total

$     (146,846)

 

 

$     (161,714)

 

 

$       (91,515)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension and 

 

 

 

 

 

Cash Flow

 

 

Postretirement

 

 

 

 

in thousands

Hedges

 

 

Benefit Plans

 

 

Total

 

AOCI

 

 

 

 

 

 

 

 

Balance as of December 31, 2014

$       (20,322)

 

 

$     (141,392)

 

 

$     (161,714)

 

Other comprehensive income (loss)

 

 

 

 

 

 

 

 

 before reclassifications

 

 

 

 

 

Amounts reclassified from AOCI

5,607 

 

 

9,261 

 

 

14,868 

 

Net current period OCI changes

5,607 

 

 

9,261 

 

 

14,868 

 

Balance as of September 30, 2015

$       (14,715)

 

 

$     (132,131)

 

 

$     (146,846)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

 

September 30

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Reclassification Adjustment for Cash Flow

 

 

 

 

 

 

 

 

 

 

 

 Hedge Losses

 

 

 

 

 

 

 

 

 

 

 

Interest expense

$            467 

 

 

$            989 

 

 

$         9,282 

 

 

$         6,892 

 

(Benefit from) provision for income taxes

(185)

 

 

(391)

 

 

(3,675)

 

 

(2,725)

 

Total 1 

$            282 

 

 

$            598 

 

 

$         5,607 

 

 

$         4,167 

 

Amortization of Pension and Postretirement

 

 

 

 

 

 

 

 

 

 

 

 Plan Actuarial Loss and Prior Service Cost

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

$         5,242 

 

 

$         1,465 

 

 

$       12,417 

 

 

$         1,324 

 

Selling, administrative and general expenses

1,136 

 

 

362 

 

 

2,796 

 

 

326 

 

(Benefit from) provision for income taxes

(2,495)

 

 

(713)

 

 

(5,952)

 

 

(644)

 

Total 2 

$         3,883 

 

 

$         1,114 

 

 

$         9,261 

 

 

$         1,006 

 

Total reclassifications from AOCI to earnings

$         4,165 

 

 

$         1,712 

 

 

$       14,868 

 

 

$         5,173 

 

 

 

 

Nine months ended September 30, 2015 and 2014 include the acceleration of a proportional amount of deferred interest rate derivatives (see Note 6) referable to debt purchases (see Note 7).

Nine months ended September 30, 2015 includes a one-time settlement loss resulting from a lump sum payment to a former employee (see Note 10). Nine months ended September 30, 2014 includes a one-time curtailment gain (see Note 10) resulting from the sale of our cement and concrete businesses in the Florida area (see Note 16).

 

EQUITY (Tables)
Change In Total Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

in thousands

 

 

 

Equity

 

Balance at December 31, 2014

 

 

$    4,176,699 

 

Net earnings

 

 

132,289 

 

Common stock issued

 

 

 

 

  Share-based compensation plans

 

 

48,329 

 

Share-based compensation expense

 

 

14,020 

 

Excess tax benefits from share-based compensation

 

 

16,950 

 

Cash dividends on common stock ($0.30 per share)

 

 

(39,878)

 

Other comprehensive income

 

 

14,868 

 

Other

 

 

 

Balance at September 30, 2015

 

 

$    4,363,277 

 

 

SEGMENT REPORTING (Tables)
Segment Financial Disclosure

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30

 

 

September 30

 

in millions

2015 

 

 

2014 

 

 

2015 

 

 

2014 

 

Total Revenues

 

 

 

 

 

 

 

 

 

 

 

Aggregates 1

$        830.8 

 

 

$        688.9 

 

 

$     2,067.7 

 

 

$     1,752.6 

 

Asphalt Mix 2

178.9 

 

 

136.4 

 

 

410.9 

 

 

330.0 

 

Concrete 2, 3

88.0 

 

 

99.0 

 

 

226.4 

 

 

288.8 

 

Calcium 4

2.2 

 

 

2.3 

 

 

6.5 

 

 

22.6 

 

 Segment sales

1,099.9 

 

 

926.6 

 

 

2,711.5 

 

 

2,394.0 

 

Aggregates intersegment sales

(61.4)

 

 

(53.0)

 

 

(146.6)

 

 

(145.7)

 

Calcium intersegment sales

0.0 

 

 

0.0 

 

 

0.0 

 

 

(9.2)

 

Total revenues

$     1,038.5 

 

 

$        873.6 

 

 

$     2,564.9 

 

 

$     2,239.1 

 

Gross Profit

 

 

 

 

 

 

 

 

 

 

 

Aggregates

$        250.9 

 

 

$        188.0 

 

 

$        525.8 

 

 

$        388.1 

 

Asphalt Mix 2

30.0 

 

 

14.5 

 

 

60.0 

 

 

28.3 

 

Concrete 2, 3

9.6 

 

 

5.5 

 

 

15.3 

 

 

(0.5)

 

Calcium 4

0.8 

 

 

1.0 

 

 

2.5 

 

 

2.0 

 

Total

$        291.3 

 

 

$        209.0 

 

 

$        603.6 

 

 

$        417.9 

 

Depreciation, Depletion, Accretion

 

 

 

 

 

 

 

 

 

 

 

 and Amortization (DDA&A)

 

 

 

 

 

 

 

 

 

 

 

Aggregates

$          57.7 

 

 

$          58.5 

 

 

$        170.3 

 

 

$        169.2 

 

Asphalt Mix 2

4.1 

 

 

2.6 

 

 

12.1 

 

 

7.5 

 

Concrete 2, 3

3.0 

 

 

5.0 

 

 

8.5 

 

 

15.7 

 

Calcium 4

0.2 

 

 

0.2 

 

 

0.5 

 

 

1.4 

 

Other

4.7 

 

 

4.9 

 

 

13.4 

 

 

15.1 

 

Total

$          69.7 

 

 

$          71.2 

 

 

$        204.8 

 

 

$        208.9 

 

Identifiable Assets 5

 

 

 

 

 

 

 

 

 

 

 

Aggregates

 

 

 

 

 

 

$     7,533.2 

 

 

$     7,409.1 

 

Asphalt Mix 2

 

 

 

 

 

 

315.0 

 

 

238.2 

 

Concrete 2, 3

 

 

 

 

 

 

188.3 

 

 

235.6 

 

Calcium 4

 

 

 

 

 

 

5.6 

 

 

5.9 

 

Total identifiable assets

 

 

 

 

 

 

$     8,042.1 

 

 

$     7,888.8 

 

General corporate assets

 

 

 

 

 

 

106.1 

 

 

88.9 

 

Cash items

 

 

 

 

 

 

168.7 

 

 

91.9 

 

Total

 

 

 

 

 

 

$     8,316.9 

 

 

$     8,069.6 

 

 

 

 

 

Includes crushed stone, sand and gravel, sand, other aggregates, as well as freight, delivery and transportation revenues, and other revenues related to services.

In January 2015, we exchanged our California ready-mixed concrete operations for 13 asphalt mix plants, primarily in Arizona (see Note 16).

Includes ready-mixed concrete. In March 2014, we sold our concrete business in the Florida area (see Note 16) which in addition to ready-mixed concrete, included concrete block, precast concrete, as well as building materials purchased for resale.

Includes cement and calcium products. In March 2014, we sold our cement business (see Note 16).

Certain temporarily idled assets are included within a segment's Identifiable Assets but the associated DDA&A is shown within Other in the DDA&A section above as the related DDA&A is excluded from segment gross profit.

 

SUPPLEMENTAL CASH FLOW INFORMATION (Tables)
Supplemental Information Referable to Consolidated Statements of Cash Flows

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

 

September 30

 

in thousands

2015 

 

 

2014 

 

Cash Payments

 

 

 

 

 

Interest (exclusive of amount capitalized)

$     136,123 

 

 

$     163,593 

 

Income taxes

46,271 

 

 

64,539 

 

Noncash Investing and Financing Activities

 

 

 

 

 

Accrued liabilities for purchases of property, plant & equipment

$       11,941 

 

 

$         5,777 

 

Amounts referable to business acquisitions

 

 

 

 

 

 Liabilities assumed

2,645 

 

 

24,881 

 

 Fair value of noncash assets and liabilities exchanged

20,000 

 

 

4,914 

 

 Fair value of equity consideration

 

 

45,185 

 

 

GOODWILL (Tables)
Changes in Carrying Amount of Goodwill by Reportable Segment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

in thousands

Aggregates

 

 

Asphalt Mix

 

 

Concrete

 

 

Calcium

 

 

Total

 

Goodwill

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total as of December 31, 2014

$  3,003,191 

 

 

$     91,633 

 

 

$              0 

 

 

$              0 

 

 

$    3,094,824 

 

Goodwill of acquired businesses

 

 

 

 

 

 

 

 

 

Goodwill of divested businesses

 

 

 

 

 

 

 

 

 

Total as of September 30, 2015

$  3,003,191 

 

 

$     91,633 

 

 

$              0 

 

 

$              0 

 

 

$    3,094,824 

 

 

ACQUISITIONS AND DIVESTITURES (Tables)
Classification of Assets and Liabilities Held for Sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30

 

December 31

 

September 30

 

in thousands

 

 

 

2015 

 

 

2014 

 

 

2014 

 

Held for Sale

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

 

 

$              0 

 

 

$       1,773 

 

 

$              0 

 

Property, plant & equipment, net

 

 

 

 

 

12,764 

 

 

 

Other intangible assets, net

 

 

 

 

 

647 

 

 

 

Total assets held for sale

 

 

 

$              0 

 

 

$     15,184 

 

 

$              0 

 

Asset retirement obligations

 

 

 

$              0 

 

 

$          520 

 

 

$              0 

 

Total liabilities of assets held for sale

 

 

 

$              0 

 

 

$          520 

 

 

$              0 

 

 

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]
 
 
 
 
Restructuring charges
$ 448,000 
$ 750,000 
$ 4,546,000 
$ 750,000 
Antidilutive weighted-average common stock equivalents
 
 
 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Weighted-Average Common Shares Outstanding) (Details)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Weighted Average Number Of Shares Outstanding
 
 
 
 
Weighted-average common shares outstanding
133,474 
131,797 
133,082 
131,256 
Dilutive effect of
 
 
 
 
Stock options/SOSARs
919 1
661 1
1,024 1
671 1
Other stock compensation plans
1,165 
911 
836 
832 
Weighted-average common shares outstanding, assuming dilution
135,558 
133,369 
134,942 
132,759 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Antidilutive Common Stock Equivalents) (Details)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]
 
 
 
 
Antidilutive common stock equivalents
545 
2,355 
555 
2,355 
DISCONTINUED OPERATIONS (Results from Discontinued Operations) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Discontinued Operations
 
 
 
 
Pretax loss
$ (3,974)
$ (1,393)
$ (11,627)
$ (3,132)
Income tax benefit
1,577 
551 
4,561 
1,236 
Loss on discontinued operations, net of income taxes
$ (2,397)
$ (842)
$ (7,066)
$ (1,896)
INCOME TAXES (Narrative) (Details) (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Income Taxes [Line Items]
 
 
 
 
Provision for income taxes
$ 45,386,000 
$ 31,066,000 
$ 51,177,000 
$ 71,947,000 
State net operating loss carryforwards, Deferred Tax Asset
62,170,000 
 
62,170,000 
 
Decrease in valuation allowance
 
 
4,655,000 
 
Alabama [Member]
 
 
 
 
Income Taxes [Line Items]
 
 
 
 
State net operating loss carryforwards, Deferred Tax Asset
$ 59,354,000 
 
$ 59,354,000 
 
DEFERRED REVENUE (Narrative) (Details) (USD $)
1 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2013
T
Dec. 31, 2012
T
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
agreement
property
Sep. 30, 2014
Sep. 30, 2013
Maximum [Member]
T
Dec. 31, 2012
Maximum [Member]
T
Sep. 30, 2016
Scenario, Forecast [Member]
Deferred Revenue Arrangement [Line Items]
 
 
 
 
 
 
 
 
 
Number of volumetric production payment transactions
 
 
 
 
 
 
 
 
Number of facilities
 
 
 
 
 
 
 
 
Owned quarries
 
 
 
 
 
 
 
 
Leased quarries
 
 
 
 
 
 
 
 
Proceeds from sale of production
$ 153,282,000 
$ 73,644,000 
$ 0 
$ 0 
$ 0 
$ 187,000 
 
 
 
Volumetric production payment termination date
Sep. 30, 2051 
Dec. 31, 2052 
 
 
 
 
 
 
 
Tons subject to volumetric production payment
 
 
 
 
 
 
250,800,000 
143,200,000 
 
Volumetric production payment estimated percentage sold
11.50% 
10.50% 
 
 
 
 
 
 
 
Volumetric production payment estimated tons to be delivered
29,000,000 
15,000,000 
 
 
 
 
 
 
 
Estimated deferred revenue to be recognized in the next 12 months
 
 
 
 
 
 
 
 
$ 6,000,000 
DEFERRED REVENUE (Summary Of Recognized Deferred Revenue) (Details) (USD $)
1 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2013
Dec. 31, 2012
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
DEFERRED REVENUE [Abstract]
 
 
 
 
 
 
Balance at beginning of period
 
 
$ 217,429,000 
$ 222,589,000 
$ 219,968,000 
$ 224,743,000 
Cash received and revenue deferred
153,282,000 
73,644,000 
187,000 
Amortization of deferred revenue
 
 
(1,778,000)
(1,384,000)
(4,317,000)
(3,725,000)
Balance at end of period
 
 
$ 215,651,000 
$ 221,205,000 
$ 215,651,000 
$ 221,205,000 
FAIR VALUE MEASUREMENTS (Narrative) (Details) (USD $)
9 Months Ended
Sep. 30, 2015
item
Sep. 30, 2014
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
 
 
Number of Rabbi Trust established
 
Total gain of the Rabbi Trust investment
$ (1,964,000)
$ 2,571,000 
Unrealized gains (losses)
(2,068,000)
369,000 
Fair Value, Measurements, Nonrecurring [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
 
 
Loss on impairment of long-lived assets
5,190,000 
2,987,000 
Fair Value, Measurements, Nonrecurring [Member] |
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
 
 
Assets subject to fair value measurement on a nonrecurring basis
$ 0 
$ 2,280,000 
FAIR VALUE MEASUREMENTS (Fair Value Measurement of Assets on Recurring Basis) (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Fair Value, Inputs, Level 1 [Member]
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
Assets fair value, recurring
$ 20,859 
$ 26,780 
$ 27,824 
Fair Value, Inputs, Level 1 [Member] |
Mutual Funds [Member]
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
Assets fair value, recurring
12,081 
15,532 
14,986 
Fair Value, Inputs, Level 1 [Member] |
Equities [Member]
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
Assets fair value, recurring
8,778 
11,248 
12,838 
Fair Value, Inputs, Level 2 [Member]
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
Assets fair value, recurring
1,464 
1,415 
1,367 
Fair Value, Inputs, Level 2 [Member] |
Common/Collective Trust Funds [Member]
 
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
Assets fair value, recurring
$ 1,464 
$ 1,415 
$ 1,367 
FAIR VALUE MEASUREMENTS (Assets Subject to Fair Value Measurement on Nonrecurring Basis) (Details) (Fair Value, Measurements, Nonrecurring [Member], USD $)
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Fair Value Nonrecurring
 
 
Property, plant & equipment, Impairment Charges
$ 2,176,000 
$ 2,987,000 
Other intangible assets net, Impairment Charges
2,858,000 
Other Asset Impairment Charges
156,000 
Loss on impairment of long-lived assets
5,190,000 
2,987,000 
Fair Value, Inputs, Level 2 [Member]
 
 
Fair Value Nonrecurring
 
 
Property, plant & equipment
2,280,000 
Other Intangible Assets, Net
Other Assets, Fair Value Disclosure
Total
$ 0 
$ 2,280,000 
DERIVATIVE INSTRUMENTS (Narrative) (Details) (USD $)
1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended 9 Months Ended
Aug. 31, 2011
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2007
agreement
Dec. 31, 2014
Sep. 30, 2015
6.50% notes due 2016 [Member]
Apr. 30, 2015
6.50% notes due 2016 [Member]
Mar. 31, 2014
6.50% notes due 2016 [Member]
Jun. 30, 2011
6.50% notes due 2016 [Member]
Sep. 30, 2015
10.125% notes due 2015 [Member]
Jun. 30, 2011
10.125% notes due 2015 [Member]
Dec. 31, 2007
Interest Rate Swap Agreements [Member]
Jun. 30, 2011
Interest Rate Swap Agreement One [Member]
Jun. 30, 2011
Interest Rate Swap Agreement Two [Member]
Sep. 30, 2015
Debt [Member]
Sep. 30, 2014
Debt [Member]
Sep. 30, 2016
Scenario, Forecast [Member]
Derivative Disclosure [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of forward starting interest rate swap agreements
 
 
 
 
 
15 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derviative, notional amount
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,500,000,000 
$ 500,000,000 
$ 150,000,000 
 
 
 
Payments for (Proceeds from) settlement of interest rate swap agreements
25,382,000 
 
 
 
 
89,777,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss reclassified from AOCI
 
 
 
7,208,000 
3,762,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Estimated amount of pretax loss in AOCI related to interest rate swap that would be reclassified to earnings within the next 12 months
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,967,000 
Long-term notes issued
 
2,004,203,000 
2,004,575,000 
2,004,203,000 
2,004,575,000 
 
2,004,459,000 
 
 
 
500,000,000 
 
 
 
 
 
 
 
 
Interest rate
 
 
 
 
 
 
 
6.50% 
6.50% 
6.50% 
6.50% 
10.125% 
10.125% 
 
 
 
 
 
 
Interest rate spread above London Interbank Offered Rate (LIBOR)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4.05% 
8.03% 
 
 
 
Fixed interest rate under swap agreement
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6.50% 
10.125% 
 
 
 
Forward component of the settlement
23,387,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accrued interest income
1,995,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized deferred gain
 
$ 282,000 
$ 493,000 
$ 2,795,000 
$ 10,171,000 
 
 
 
 
 
 
 
 
 
 
 
$ 1,642,000 
$ 8,032,000 
 
DERIVATIVE INSTRUMENTS (Effects Of Changes In Fair Values Of Derivatives Designated As Cash Flow Hedges) (Details) (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Loss reclassified from AOCI (effective portion)
 
 
$ (7,208,000)
$ (3,762,000)
Interest Rate Swap [Member] |
Cash Flow Hedging [Member] |
Interest Expense [Member]
 
 
 
 
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
Loss reclassified from AOCI (effective portion)
$ (467,000)
$ (989,000)
$ (9,282,000)
$ (6,892,000)
DERIVATIVE INSTRUMENTS (Reflection of Amortization) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
DERIVATIVE INSTRUMENTS [Abstract]
 
 
 
 
Amortized to earnings as a reduction to interest expense
$ 282 
$ 493 
$ 2,795 
$ 10,171 
DEBT (Narrative) (Details) (USD $)
1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 1 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended
Mar. 31, 2014
Sep. 30, 2015
Mar. 31, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Mar. 31, 2015
4.50% notes due 2025 [Member]
Mar. 31, 2015
4.50% notes due 2025 [Member]
Sep. 30, 2015
4.50% notes due 2025 [Member]
Dec. 31, 2014
4.50% notes due 2025 [Member]
Sep. 30, 2014
4.50% notes due 2025 [Member]
Apr. 30, 2015
7.00% notes due 2018 [Member]
Mar. 31, 2015
7.00% notes due 2018 [Member]
Mar. 31, 2015
7.00% notes due 2018 [Member]
Sep. 30, 2015
7.00% notes due 2018 [Member]
Dec. 31, 2014
7.00% notes due 2018 [Member]
Sep. 30, 2014
7.00% notes due 2018 [Member]
Apr. 30, 2015
6.40% notes due 2017 [Member]
Mar. 31, 2014
6.40% notes due 2017 [Member]
Sep. 30, 2015
6.40% notes due 2017 [Member]
Dec. 31, 2014
6.40% notes due 2017 [Member]
Sep. 30, 2014
6.40% notes due 2017 [Member]
Apr. 30, 2015
6.50% notes due 2016 [Member]
Mar. 31, 2014
6.50% notes due 2016 [Member]
Sep. 30, 2015
6.50% notes due 2016 [Member]
Dec. 31, 2014
6.50% notes due 2016 [Member]
Sep. 30, 2014
6.50% notes due 2016 [Member]
Jun. 30, 2011
6.50% notes due 2016 [Member]
Sep. 30, 2015
8.85% notes due 2021 [Member]
Dec. 31, 2014
8.85% notes due 2021 [Member]
Sep. 30, 2014
8.85% notes due 2021 [Member]
Sep. 30, 2015
10.125% notes due 2015 [Member]
Dec. 31, 2014
10.125% notes due 2015 [Member]
Sep. 30, 2014
10.125% notes due 2015 [Member]
Jun. 30, 2011
10.125% notes due 2015 [Member]
Sep. 30, 2015
Other Notes
Dec. 31, 2014
Other Notes
Sep. 30, 2014
Other Notes
Sep. 30, 2015
Standby Letters of Credit [Member]
Oct. 31, 2016
Scenario, Forecast [Member]
Sep. 30, 2015
Minimum [Member]
Standby Letters of Credit [Member]
Sep. 30, 2015
Maximum [Member]
Standby Letters of Credit [Member]
Sep. 30, 2015
Industrial revenue bonds [Member]
Dec. 31, 2014
Industrial revenue bonds [Member]
Sep. 30, 2014
Industrial revenue bonds [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Dec. 31, 2014
Bank line of Credit [Member]
Sep. 30, 2014
Bank line of Credit [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Dec. 31, 2014
Bank line of Credit [Member]
Sep. 30, 2014
Bank line of Credit [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Cancelled line of Credit [Member]
Sep. 30, 2015
Bank line of Credit [Member]
New line of Credit [Member]
Sep. 30, 2015
Bank line of Credit [Member]
SunTrust Bank [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Minimum [Member]
London Interbank Offered Rate (LIBOR) [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Minimum [Member]
SunTrust Bank [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Maximum [Member]
London Interbank Offered Rate (LIBOR) [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Maximum [Member]
SunTrust Bank [Member]
Sep. 30, 2015
Standby Letters of Credit [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt issued, amount
 
$ 2,004,203,000 
 
$ 2,004,203,000 
$ 2,004,575,000 
$ 2,004,459,000 
$ 400,000,000 
$ 400,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 500,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate
 
 
 
 
 
 
4.50% 
4.50% 
4.50% 
 
 
7.00% 
 
 
7.00% 
 
 
6.40% 
6.40% 
6.40% 
 
 
6.50% 
6.50% 
6.50% 
 
 
6.50% 
8.85% 
 
 
10.125% 
 
 
10.125% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt issued, net proceeds
 
 
 
 
 
 
395,207,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt purchased, redemption date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Apr. 01, 2015 
 
 
 
 
Apr. 01, 2015 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maturity year
 
 
 
 
 
 
 
2025 
2025 
 
 
2018 
 
2018 
2018 
 
 
2017 
2017 
2017 
 
 
2016 
2016 
2016 
 
 
 
2021 
 
 
2015 
 
 
 
 
 
 
 
 
 
 
2022 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt purchased, amount
506,366,000 
 
506,366,000 
 
 
 
 
 
 
 
 
185,000 
127,303,000 
127,303,000 
 
 
 
218,633,000 
131,367,000 
 
 
 
125,001,000 
374,999,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total consideration paid for debt
579,659,000 
385,024,000 
 
751,056,000 
649,711,000 
 
 
 
 
 
 
 
145,899,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium paid for purchase of debt
71,829,000 
41,153,000 
71,829,000 
41,153,000 
 
 
 
 
 
 
 
 
18,140,000 
18,140,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Transaction cost related to termination of debt
 
52,000 
1,464,000 
 
 
 
 
 
 
 
 
 
456,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other cost (benefit) related to debt purchase
 
4,136,000 
(344,000)
 
 
 
 
 
 
 
 
 
3,138,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of debt purchase
 
45,341,000 
72,949,000 
67,075,000 
72,949,000 
 
 
 
 
 
 
 
 
21,734,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Facility expiration date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Jun. 01, 2020 
 
 
 
 
 
 
 
 
 
 
Debt to EBITDA ratio
 
 
 
3.5 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.25 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EBITDA to net cash interest expense ratio
 
 
 
3.0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Borrowing capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
626,136,000 
 
 
 
 
 
 
 
 
 
 
Line Of Credit Facility Maximum Borrowing Capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
750,000,000 
 
 
500,000,000 
750,000,000 
 
 
 
 
 
 
Transaction fees
 
 
 
7,382,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,589,000 
 
 
 
 
 
 
 
 
 
 
Short-term debt (line of credit)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1 2
1 2
1 2
 
 
 
 
 
 
 
 
Applicable margin on borrowing rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.175% 
 
 
 
 
 
 
 
 
 
1.75% 
 
 
 
 
0.75% 
1.00% 
0.00% 
2.00% 
1.00% 
 
Commitment fee
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.25% 
 
0.10% 
0.35% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long term debt
 
1,979,623,000 3
 
1,979,623,000 3
1,984,220,000 3
1,984,779,000 3
 
 
400,000,000 
 
 
 
272,512,000 
400,000,000 
400,000,000 
 
 
218,633,000 
218,633,000 
 
 
125,001,000 
125,001,000 
 
6,000,000 
6,000,000 
6,000,000 
150,000,000 4
150,000,000 4
150,000,000 4
 
503,000 2
637,000 2
753,000 2
 
 
 
 
14,000,000 
14,000,000 
85,000,000 1 2 5
1 2 5
1 2 5
 
 
 
 
 
 
 
 
 
 
 
Principal amount, percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
32.00% 
 
 
 
 
100.00% 
 
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 38,864,000 
Period of letters of credit
 
 
 
1 year 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
DEBT (Summary of Debt) (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Short-term Debt [Abstract]
 
 
 
Total short-term debt
$ 0 
$ 0 
$ 0 
Long Term Debt
 
 
 
Total long-term debt including current maturities
1,979,623 1
1,984,779 1
1,984,220 1
Unamortized discounts and debt issuance cost
(24,821)
(22,716)
(23,893)
Less current maturities
130 
150,137 
145 
Total long-term debt
1,979,493 
1,834,642 
1,984,075 
Total debt
1,979,623 2
1,984,779 2
1,984,220 2
Estimated fair value of long-term debt
2,191,361 
2,092,673 
2,237,325 
10.125% notes due 2015 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
150,000 3
150,000 3
150,000 3
6.50% notes due 2016 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
125,001 
125,001 
6.40% notes due 2017 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
218,633 
218,633 
7.00% notes due 2018 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
272,512 
400,000 
400,000 
10.375% notes due 2018 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
250,000 
250,000 
250,000 
7.50% notes due 2021 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
600,000 
600,000 
600,000 
8.85% notes due 2021 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
6,000 
6,000 
6,000 
4.50% notes due 2025 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
400,000 
7.15% notes due 2037 [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
240,188 
240,188 
240,188 
Other Notes
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
503 4
637 4
753 4
10.125% notes due 2015 and 6.50% notes due 2016 [Member]
 
 
 
Long Term Debt
 
 
 
Unamortized deferred interest rate swap gain
241 5
3,036 5
3,538 5
Bank line of Credit [Member]
 
 
 
Short-term Debt [Abstract]
 
 
 
Total short-term debt
4 6
4 6
4 6
Industrial revenue bonds [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
14,000 
14,000 
Bank line of Credit [Member]
 
 
 
Long Term Debt
 
 
 
Total long-term debt including current maturities
$ 85,000 4 6 7
$ 0 4 6 7
$ 0 4 6 7
DEBT (Summary of Debt Additional Information) (Details) (USD $)
9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Sep. 30, 2015
10.125% notes due 2015 [Member]
Jun. 30, 2011
10.125% notes due 2015 [Member]
Apr. 30, 2015
6.50% notes due 2016 [Member]
Mar. 31, 2014
6.50% notes due 2016 [Member]
Sep. 30, 2015
6.50% notes due 2016 [Member]
Jun. 30, 2011
6.50% notes due 2016 [Member]
Apr. 30, 2015
6.40% notes due 2017 [Member]
Mar. 31, 2014
6.40% notes due 2017 [Member]
Sep. 30, 2015
6.40% notes due 2017 [Member]
Apr. 30, 2015
7.00% notes due 2018 [Member]
Mar. 31, 2015
7.00% notes due 2018 [Member]
Sep. 30, 2015
7.00% notes due 2018 [Member]
Sep. 30, 2015
10.375% notes due 2018 [Member]
Sep. 30, 2015
7.50% notes due 2021 [Member]
Sep. 30, 2015
8.85% notes due 2021 [Member]
Mar. 31, 2015
4.50% notes due 2025 [Member]
Sep. 30, 2015
4.50% notes due 2025 [Member]
Sep. 30, 2015
7.15% notes due 2037 [Member]
Sep. 30, 2015
Other Notes
Sep. 30, 2015
Industrial revenue bonds [Member]
Sep. 30, 2015
Bank line of Credit [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate
 
 
 
10.125% 
10.125% 
6.50% 
6.50% 
6.50% 
6.50% 
6.40% 
6.40% 
6.40% 
7.00% 
 
7.00% 
10.375% 
7.50% 
8.85% 
4.50% 
4.50% 
7.15% 
 
 
 
Maturity year
 
 
 
2015 
 
2016 
2016 
2016 
 
2017 
2017 
2017 
2018 
2018 
2018 
2018 
2021 
2021 
2025 
2025 
2037 
 
2022 
 
Effective interest rate
 
 
 
9.58% 1
 
 
 
 
 
 
 
 
 
 
7.87% 
10.63% 
7.75% 
8.88% 
 
4.65% 
8.05% 
6.25% 2
 
1.75% 2 3 4
Debt Instrument Face Amount
$ 2,004,203,000 
$ 2,004,459,000 
$ 2,004,575,000 
 
 
 
 
 
$ 500,000,000 
 
 
 
 
 
 
 
 
 
$ 400,000,000 
 
 
 
 
 
DEBT (Summary Of Standby Letters Of Credit) (Details) (USD $)
Sep. 30, 2015
Jun. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Dec. 31, 2013
Standby Letters of Credit
 
 
 
 
 
 
Reclamation/restoration requirements
$ 234,680,000 
$ 234,919,000 
$ 226,565,000 
$ 228,468,000 
$ 225,117,000 
$ 228,234,000 
Standby Letters of Credit [Member]
 
 
 
 
 
 
Standby Letters of Credit
 
 
 
 
 
 
Risk management insurance
33,111,000 
 
 
 
 
 
Reclamation/restoration requirements
5,753,000 
 
 
 
 
 
Total
$ 38,864,000 
 
 
 
 
 
COMMITMENTS AND CONTINGENCIES (Narrative) (Details) (USD $)
1 Months Ended 9 Months Ended
May 31, 2007
entity
mi
Sep. 30, 2015
Texas Brine and Occidental Chemical Co [Member]
Sep. 30, 2015
Cooperating Parties Group [Member]
Sep. 30, 2015
Minimum [Member]
EPA [Member]
Sep. 30, 2015
Minimum [Member]
Cooperating Parties Group [Member]
Sep. 30, 2015
Maximum [Member]
EPA [Member]
Sep. 30, 2015
Maximum [Member]
Cooperating Parties Group [Member]
Sep. 30, 2015
Standby Letters of Credit [Member]
Commitments And Contingencies Disclosure [Line Items]
 
 
 
 
 
 
 
 
Other Liabilities
 
 
 
 
 
 
 
$ 38,864,000 
Number of other companies to perform a Remedial Investigation/ Feasibility Study related to the Lower Passaic River Clean-Up lawsuit
70 
 
 
 
 
 
 
 
Number of miles of the River used in the Remedial Investigation/Feasibility Study
17 
 
 
 
 
 
 
 
Estimated implementation costs
 
 
 
950,000,000 
475,000,000 
1,730,000,000 
725,000,000 
 
Estimated operation and maintenance costs
 
 
93,000,000 
 
 
 
 
 
Estimated operation and maintenance costs, Period
 
 
30 years 
 
 
 
 
 
Total amount of damages claimed
 
$ 500,000,000 
 
 
 
 
 
 
ASSET RETIREMENT OBLIGATIONS (Asset Retirement Obligations Operating Costs) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
ARO Operating Costs
 
 
 
 
Accretion
$ 2,766 
$ 2,892 
$ 8,553 
$ 8,745 
Depreciation
1,681 
1,080 
4,683 
3,060 
Total
$ 4,447 
$ 3,972 
$ 13,236 
$ 11,805 
ASSET RETIREMENT OBLIGATIONS (Reconciliations Of Asset Retirement Obligations) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Asset Retirement Obligations
 
 
 
 
Balance at beginning of period
$ 234,919 
$ 225,117 
$ 226,565 
$ 228,234 
Liabilities incurred
3,604 
6,159 
3,604 
Liabilities settled
(5,318)
(7,684)
(13,318)
(20,527)
Accretion expense
2,766 
2,892 
8,553 
8,745 
Revisions up, net
2,313 
4,539 
6,721 
8,412 
Balance at end of period
$ 234,680 
$ 228,468 
$ 234,680 
$ 228,468 
BENEFIT PLANS (Narrative) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Number of funded, noncontributory defined benefit pension plans
 
 
Number of unfunded, nonqualified pension plans
 
 
 
Normal retirement age
 
 
65 
 
Pension Plans, Defined Benefit [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Settlement charge
$ (2,031)
$ 0 
$ (2,031)
$ 0 
Other Postretirement Benefit Plans, Defined Benefit [Member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
One-time curtailment gain
$ 0 
$ 0 
$ 0 
$ 3,832 
BENEFIT PLANS (Components of Net Periodic Benefit Cost, Amounts Recognized in Other Comprehensive Income, Weighted-Average Assumptions) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Pension Plans, Defined Benefit [Member]
 
 
 
 
Components of Net Periodic Benefit Cost
 
 
 
 
Service cost
$ 1,213 
$ 1,039 
$ 3,638 
$ 3,118 
Interest cost
11,004 
11,098 
33,077 
33,294 
Expected return on plan assets
(13,683)
(12,701)
(41,051)
(38,102)
Settlement charge
2,031 
2,031 
Amortization of prior service cost (credit)
12 
47 
36 
141 
Amortization of actuarial loss
5,383 
2,806 
16,292 
8,416 
Net periodic pension/postretirement benefit cost
5,960 
2,289 
14,023 
6,867 
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
 
 
 
 
Pretax reclassifications from AOCI included in net periodic postretirement/pension benefit cost
7,426 
2,853 
18,359 
8,557 
Other Postretirement Benefit Plans, Defined Benefit [Member]
 
 
 
 
Components of Net Periodic Benefit Cost
 
 
 
 
Service cost
473 
536 
1,420 
1,609 
Interest cost
621 
824 
1,864 
2,473 
Curtailment gain
(3,832)
Amortization of prior service cost (credit)
(1,058)
(1,081)
(3,174)
(3,245)
Amortization of actuarial loss
57 
28 
170 
Net periodic pension/postretirement benefit cost
45 
336 
138 
(2,825)
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
 
 
 
 
Pretax reclassifications from AOCI included in net periodic postretirement/pension benefit cost
$ (1,049)
$ (1,024)
$ (3,146)
$ (6,907)
OTHER COMPREHENSIVE INCOME (Accumulated Other Comprehensive Income (Loss)) (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
AOCI
 
 
 
Cash Flow Hedges
$ (14,715)
$ (20,322)
$ (21,011)
Pension and Postretirement Benefit Plans
(132,131)
(141,392)
(70,504)
Total
$ (146,846)
$ (161,714)
$ (91,515)
OTHER COMPREHENSIVE INCOME (Changes In AOCI Net Of Tax) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
AOCI, Net of Tax, Beginning Balance
 
 
$ (161,714)
 
Other comprehensive income (loss) before reclassifications
 
 
 
Amounts reclassified from AOCI
 
 
14,868 
 
Other comprehensive income
4,165 
1,712 
14,868 
8,116 
AOCI, Net of Tax, Ending Balance
(146,846)
(91,515)
(146,846)
(91,515)
Reclassification Adjustment for Cash Flow Hedge Losses [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
AOCI, Net of Tax, Beginning Balance
 
 
(20,322)
 
Other comprehensive income (loss) before reclassifications
 
 
 
Amounts reclassified from AOCI
 
 
5,607 
 
Other comprehensive income
 
 
5,607 
 
AOCI, Net of Tax, Ending Balance
(14,715)
 
(14,715)
 
Amortization of Pension and Postretirement Plan Actuarial Loss and Prior Service Cost [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
AOCI, Net of Tax, Beginning Balance
 
 
(141,392)
 
Other comprehensive income (loss) before reclassifications
 
 
 
Amounts reclassified from AOCI
 
 
9,261 
 
Other comprehensive income
 
 
9,261 
 
AOCI, Net of Tax, Ending Balance
$ (132,131)
 
$ (132,131)
 
OTHER COMPREHENSIVE INCOME (Reclassification Of Amounts From Other Comprehensive Income Loss To Earnings) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Interest expense
$ (37,800)
$ (40,891)
$ (183,931)
$ (201,531)
Selling, administrative and general expenses
71,390 
66,074 
207,350 
199,808 
(Benefit from) provision for income taxes
45,386 
31,066 
51,177 
71,947 
Net earnings
123,805 
66,939 
132,289 
166,902 
Reclassification out of Accumulated Other Comprehensive Income [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Net earnings
4,165 
1,712 
14,868 
5,173 
Reclassification Adjustment for Cash Flow Hedge Losses [Member] |
Reclassification out of Accumulated Other Comprehensive Income [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Interest expense
467 
989 
9,282 
6,892 
(Benefit from) provision for income taxes
(185)
(391)
(3,675)
(2,725)
Net earnings
282 1
598 1
5,607 1
4,167 1
Amortization of Pension and Postretirement Plan Actuarial Loss and Prior Service Cost [Member] |
Reclassification out of Accumulated Other Comprehensive Income [Member]
 
 
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
 
 
Cost of revenues
5,242 
1,465 
12,417 
1,324 
Selling, administrative and general expenses
1,136 
362 
2,796 
326 
(Benefit from) provision for income taxes
(2,495)
(713)
(5,952)
(644)
Net earnings
$ 3,883 2
$ 1,114 2
$ 9,261 2
$ 1,006 2
EQUITY (Narrative) (Details) (USD $)
9 Months Ended 12 Months Ended
Sep. 30, 2014
Dec. 31, 2014
Sep. 30, 2015
EQUITY [Abstract]
 
 
 
Common stock, par value
$ 1 
$ 1 
$ 1 
Common stock issued in connection with business acquisitions
 
715,004 
 
Preferred stock issued
 
 
Shares of common stock issued to trustee under 401(k) savings and retirement plan
485,306 
485,306 
 
Net proceeds from issuance of common stock to the trustee under 401(k) savings and retirement plan
$ 30,620,000 
$ 30,620,000 
 
Number of shares held in treasury
Shares remaining under the current authorization repurchase program
 
 
3,411,416 
EQUITY (Change In Total Equity) (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
EQUITY [Abstract]
 
 
 
 
Balance at December 31, 2014
 
 
$ 4,176,699 
 
Net earnings
123,805 
66,939 
132,289 
166,902 
Common stock issued, Share-based compensation plans
 
 
48,329 
 
Share-based compensation expense
 
 
14,020 
 
Excess tax benefits from share-based compensation
 
 
16,950 
 
Cash dividends on common stock ($0.30 per share)
 
 
(39,878)
 
Other comprehensive income
4,165 
1,712 
14,868 
8,116 
Other
 
 
 
Balance at September 30, 2015
$ 4,363,277 
$ 4,201,099 
$ 4,363,277 
$ 4,201,099 
SEGMENT REPORTING (Narrative) (Details)
9 Months Ended
Sep. 30, 2015
segment
SEGMENT REPORTING [Abstract]
 
Number of operating segments
Number of reportable segments
SEGMENT REPORTING (Segment Financial Disclosure) (Details) (USD $)
In Thousands, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended
Jan. 31, 2015
property
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Dec. 31, 2013
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
$ 1,038,460 
$ 873,579 
$ 2,564,896 
$ 2,239,142 
 
 
Gross profit
 
291,290 
209,042 
603,604 
417,922 
 
 
Depreciation, depletion, accretion and amortization
 
69,662 
71,157 
204,770 
208,858 
 
 
Cash items
 
168,681 
91,868 
168,681 
91,868 
141,273 
193,738 
Total assets
 
8,316,866 
8,069,645 
8,316,866 
8,069,645 
8,041,097 
 
Number of asphalt mix plants
13 
 
 
 
 
 
 
Identifiable assets [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
8,042,100 1
7,888,800 1
8,042,100 1
7,888,800 1
 
 
Segment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
1,099,900 
926,600 
2,711,500 
2,394,000 
 
 
Aggregates [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Gross profit
 
250,900 2
188,000 2
525,800 2
388,100 2
 
 
Depreciation, depletion, accretion and amortization
 
57,700 2
58,500 2
170,300 2
169,200 2
 
 
Aggregates [Member] |
Identifiable assets [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
7,533,200 1 2
7,409,100 1 2
7,533,200 1 2
7,409,100 1 2
 
 
Aggregates [Member] |
Segment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
830,800 2
688,900 2
2,067,700 2
1,752,600 2
 
 
Aggregates [Member] |
Intersegment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
(61,400)
(53,000)
(146,600)
(145,700)
 
 
Asphalt Mix [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Gross profit
 
30,000 3
14,500 3
60,000 3
28,300 3
 
 
Depreciation, depletion, accretion and amortization
 
4,100 3
2,600 3
12,100 3
7,500 3
 
 
Asphalt Mix [Member] |
Identifiable assets [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
315,000 1 3
238,200 1 3
315,000 1 3
238,200 1 3
 
 
Asphalt Mix [Member] |
Segment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
178,900 3
136,400 3
410,900 3
330,000 3
 
 
Concrete [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Gross profit
 
9,600 3 4
5,500 3 4
15,300 3 4
(500)3 4
 
 
Depreciation, depletion, accretion and amortization
 
3,000 3 4
5,000 3 4
8,500 3 4
15,700 3 4
 
 
Concrete [Member] |
Identifiable assets [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
188,300 1 3 4
235,600 1 3 4
188,300 1 3 4
235,600 1 3 4
 
 
Concrete [Member] |
Segment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
88,000 3 4
99,000 3 4
226,400 3 4
288,800 3 4
 
 
Calcium [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Gross profit
 
800 5
1,000 5
2,500 5
2,000 5
 
 
Depreciation, depletion, accretion and amortization
 
200 5
200 5
500 5
1,400 5
 
 
Calcium [Member] |
Identifiable assets [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
5,600 1 5
5,900 1 5
5,600 1 5
5,900 1 5
 
 
Calcium [Member] |
Segment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
2,200 5
2,300 5
6,500 5
22,600 5
 
 
Calcium [Member] |
Intersegment sales [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total revenues
 
(9,200)
 
 
Other [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Depreciation, depletion, accretion and amortization
 
4,700 
4,900 
13,400 
15,100 
 
 
Corporate [Member]
 
 
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
 
 
Total assets
 
$ 106,100 
$ 88,900 
$ 106,100 
$ 88,900 
 
 
SUPPLEMENTAL CASH FLOW INFORMATION (Details) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
SUPPLEMENTAL CASH FLOW INFORMATION [Abstract]
 
 
Interest (exclusive of amount capitalized)
$ 136,123 
$ 163,593 
Income taxes
46,271 
64,539 
Accrued liabilities for purchases of property, plant & equipment
11,941 
5,777 
Liabilities assumed
2,645 
24,881 
Fair value of noncash assets and liabilities exchanged
20,000 
4,914 
Fair value of equity consideration
$ 0 
$ 45,185 
GOODWILL (Narrative) (Details) (USD $)
9 Months Ended
Sep. 30, 2015
segment
Sep. 30, 2014
GOODWILL [Abstract]
 
 
Goodwill impairment charges
$ 0 
$ 0 
Number of reportable segments
 
GOODWILL (Changes in Carrying Amount of Goodwill by Reportable Segment) (Details) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Goodwill [Line Items]
 
 
Goodwill, gross carrying amount
$ 3,094,824 
$ 3,094,824 
Goodwill of acquired businesses
 
Goodwill of divested businesses
 
Aggregates [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, gross carrying amount
3,003,191 
3,003,191 
Goodwill of acquired businesses
 
Goodwill of divested businesses
 
Asphalt Mix [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, gross carrying amount
91,633 
91,633 
Goodwill of acquired businesses
 
Goodwill of divested businesses
 
Concrete [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, gross carrying amount
Goodwill of acquired businesses
 
Goodwill of divested businesses
 
Calcium [Member]
 
 
Goodwill [Line Items]
 
 
Goodwill, gross carrying amount
Goodwill of acquired businesses
 
Goodwill of divested businesses
$ 0 
 
ACQUISITIONS AND DIVESTITURES (Narrative) (Details) (USD $)
3 Months Ended 9 Months Ended 12 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Dec. 31, 2014
Dallas/Fort Worth [Member]
property
Mar. 31, 2014
Aggregates [Member]
Sep. 30, 2015
Aggregates [Member]
ARIZONA AND NEW MEXICO [Member]
property
Dec. 31, 2014
Aggregates [Member]
ARIZONA AND NEW MEXICO [Member]
property
Sep. 30, 2015
Concrete [Member]
ARIZONA AND NEW MEXICO [Member]
property
Sep. 30, 2015
Asphalt Mix [Member]
ARIZONA [Member]
property
Mar. 31, 2014
Cement And Concrete [Member]
Sep. 30, 2015
Aggregates and Concrete [Member]
ARIZONA AND NEW MEXICO [Member]
Sep. 30, 2015
Straight Line Method [Member]
Asphalt Mix [Member]
ARIZONA [Member]
Sep. 30, 2015
Unit Of Production Method [Member]
Aggregates and Concrete [Member]
ARIZONA AND NEW MEXICO [Member]
Mar. 31, 2014
Previously mined and subsequently reclaimed tract of land [Member]
Aggregates [Member]
Sep. 30, 2015
California ready-mixed concrete operations [Member]
CALIFORNIA [Member]
property
Dec. 31, 2014
Asphalt plants and Aggregates facilities [Member]
Asphalt And Aggregates [Member]
CALIFORNIA [Member]
property
Dec. 31, 2014
Asphalt plants and Aggregates facilities [Member]
Aggregates [Member]
CALIFORNIA [Member]
property
Dec. 31, 2014
Asphalt plants and Aggregates facilities [Member]
Aggregates [Member]
DELAWARE [Member]
property
Dec. 31, 2014
Rail-connected aggregates operation [Member]
Dallas/Fort Worth [Member]
item
Dec. 31, 2014
Permitted aggregates quarry [Member]
Alabama [Member]
item
Significant Acquisitions and Disposals [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from sale of property, plant & equipment
 
 
$ 4,464,000 
$ 21,320,000 
 
 
$ 5,820,000 
 
 
 
 
 
 
 
 
$ 10,727,000 
 
 
 
 
 
 
Total consideration
 
 
40,801,000 
 
331,836,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of facilities acquired
 
 
 
 
 
 
 
13 
 
 
 
 
 
 
Number of distribution yard acquired
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payment for acquisition of businesses
 
 
20,801,000 
268,604,000 
284,237,000 
 
 
 
 
 
 
 
20,801,000 
 
 
 
 
 
 
 
 
 
Exchanges of real property and businesses
 
 
 
 
2,414,000 
 
 
 
 
 
20,000,000 
 
 
 
 
 
 
 
 
 
 
 
Amortizable intangible assets recognized
 
 
16,176,000 
 
 
 
 
 
 
 
 
 
 
7,168,000 
9,008,000 
 
 
 
 
 
 
 
Estimated weighted-average amortization period of intangible assets
 
 
 
 
 
 
 
 
 
 
 
 
 
20 years 
50 years 
 
 
 
 
 
 
 
Intangible assets amortization period, tax purposes
 
 
15 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gain on sale of properties and businesses
799,000 
1,002,000 
7,423,000 
238,527,000 
 
 
5,790,000 
 
 
 
 
227,910,000 
 
 
 
168,000 
5,886,000 
 
 
 
 
 
Supply agreement period
 
 
20 years 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Purchases of property, plant & equipment
 
 
214,815,000 
169,220,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of facilities divested
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
12 
 
 
 
 
 
Consideration transferred, common stock
 
 
 
 
45,185,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock issued in connection with business acquisitions
 
 
 
 
715,004 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total consideration
 
 
 
 
 
 
 
 
 
 
 
$ 721,359,000 
 
 
 
 
 
 
 
 
 
 
ACQUISITIONS AND DIVESTITURES (Classification Of Assets And Liabilities Held For Sale) (Details) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
ACQUISITIONS AND DIVESTITURES [Abstract]
 
 
 
Current assets
$ 0 
$ 1,773 
$ 0 
Property, plant & equipment, net
12,764 
Other intangible assets, net
647 
Total assets held for sale
15,184 
Asset retirement obligations
520 
Total liabilities of assets held for sale
$ 0 
$ 520 
$ 0 
NEW ACCOUNTING STANDARDS (Details) (USD $)
In Thousands, unless otherwise specified
9 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
NEW ACCOUNTING STANDARDS [Abstract]
 
 
 
Debt Issuance Cost
 
$ 21,893 
$ 20,805 
LIFO method used for percentage of inventory
70.00%