Eagle Materials Inc Q4 FY2024 Earnings Call

Good day, everyone, and welcome to Eagle Materials Fourth Quarter and Fiscal 2024 Earnings Conference Call. This call is being recorded. At this time, I'd like to turn the call over to Eagle's President and Chief Executive Officer, Mr. Michael Haack. Mr. Haack, please go ahead, sir.

Thank you, Jamie. Good morning. Welcome to Eagle Materials conference call for our fourth quarter and fiscal year 2024. This is Michael Haack. Joining me today are Craig Kesler, our Chief Financial Officer, and Alex Haddock, Senior Vice President of Investor Relations, Strategy and Corporate Development. There will be a slide presentation made in connection with this call. To access it, please go to eaglematerials.com and click on the link to the webcast. While you're accessing the slides, please note that the first slide covers our cautionary disclosure regarding forward-looking statements made during this call. These statements are subject to risks and uncertainties that could cause results to differ from those discussed during the call. For further information, please refer to this disclosure, which is also included at the end of our press release. Let me start out today by simply saying thank you. More specifically, thank you to our employees who made fiscal year 2024 a safe, productive year, working diligently to produce industry-leading quality products for our customers. Thank you to our customers who support our local operations daily and use the materials we produce to make America better. Thank you to our investors that believe in the value that Eagle Materials brings to society. Without each of you, I would not be able to report on yet another year of record financials, benchmark safety statistics, and excellent operational performance at Eagle Materials. First, let me take a minute to comment on our most valuable asset, our people. Our results are dependent on our employees. At Eagle, we are dedicated to continuously developing our people and ensuring they understand their role with respect to health, safety, and the environment. In this regard, I'm happy to report that we were able to sustain our below-industry total recordable and lost time incident rates across all four of our businesses. Our work on safety will not be complete until we achieve zero. We will continue to focus on leading indicators, as highlighted by our 35% increase in near-miss and hazard observations since 2021 to drive change and create an even safer workplace. With regards to environmental stewardship, we made meaningful headway this year, as demonstrated in our updated corporate sustainability report, which we released earlier this quarter. I'd like to highlight a few items from this report. Our transition from traditional cement to Portland Limestone Cement and other blended products brought us close to achieving our 2030 aspiration for reduced carbon intensity early. We will continue to find ways to reduce this intensity level over the coming years to exceed our 2030 goal. We reduced our water consumption by 23% company-wide and we will continue to find ways to be more water efficient. In terms of how we report our progress, we have incorporated new disclosures in our sustainability report, including data around our Scope 1 and Scope 2 emissions, and we started to align with SASB and TCFD reporting frameworks. Turning now to our financial results for the year and the quarter. We achieved a third consecutive year of record financial results despite some weaknesses in the heavy businesses in Q4 due to adverse weather and increased cement maintenance costs. Let me mention just some of the financial highlights for the fiscal year. During fiscal 2024, we reported record revenue of $2.3 billion and record diluted EPS of $13.61. We expanded gross margins by 50 basis points to 30.3% and we generated operating cash flow of $564 million. As always, these results are a testament to the soundness of our strategy, the consistency of our execution, and the deep talent and commitment of our employees, each of whom contributes to the ongoing success of our company. Thank you and congratulations to every one of you. I'd be remiss if I did not take a few minutes to discuss our fourth quarter results. The weather did affect the demand side picture and had a knock-on effect regarding costs due to several equipment failures and frozen feed systems. However, the larger part of the cost impact was driven from the fact that we chose to do some maintenance when we had an open window to do so. Customer demand was reduced and we have run these plants very hard over the past several years. It was a great time to do some work that normally would have happened later in the year during a heavy shipping window and completed early. We always want our production systems in like-new condition, especially when we see the favorable demand picture in front of us for the coming years. Let me turn to the market environment that drove our financial performance this past year. Our markets mirror many of the dynamics in the broader economy, dynamics that will continue to follow the overall US macro conditions and the path of the US monetary policy. This is most true for the light side of our business. Last fiscal year, the strength of the US consumer and the continued limited supply of existing home inventory supported the single-family market, while multifamily construction remains elevated. As we move into our new fiscal year, even with the recent uptick in mortgage rates, there are positive signs for the single-family residential market, while multifamily is likely to be a drag on the overall housing market. Because single-family units are two to three times more wallboard-intensive than multifamily units, the industry could see a net increase in consumption if this dynamic does indeed materialize. Additionally, recent data suggests that the repair and remodel market could bottom out as we exit this calendar year, possibly further increasing demand on our light side. The supply/demand picture for the heavy side of our business is more clearly defined and is less sensitive to the uncertainties around interest rates. While volume in our heavy business was down in the fourth quarter of fiscal 2024, the underlying fundamentals in the sector remain positive. We expect federal infrastructure spending to increase this year and into 2025, adding to already healthy public spending at the state and local levels. Non-residential construction, while moderating somewhat, should also continue to grow as the unprecedented manufacturing construction cycle offsets some of the weaker pockets of non-residential spending. As mentioned earlier, residential construction is also showing signs of recovery, although much of the picture there will likely not become clear until the back half of calendar 2024 and early 2025. In the face of our nation's demand needs, adding meaningful capacity to the overall cement and wallboard industries will remain difficult and we believe the constrained supply picture will not change meaningfully over the medium term. As we look to the year ahead, we remain optimistic about the midterm demand profile for all of our businesses, and we believe all of our businesses will benefit from structural long-term demand trends as well. Now, let me spend a little time on capital allocation. As a reminder, our capital allocation priorities revolve around three main pillars. First, growth through acquisitions organically. Second, keeping our facilities in like-new condition. And third, returning cash to shareholders, primarily through stock repurchases. Let me start off with our first priority of growth organically or through acquisition, where the growth meets our strict financial return criteria. This past quarter, we made two exciting announcements in this regard. First, the startup of the new slag grinding facility through our Texas Lehigh Cement JV. Once fully operational later this summer, the facility will have an annual manufacturing capacity of 500,000 tons of slag. This is incremental to the manufacturing capacity of Texas Lehigh's Buda, Texas cement plant and our import terminal in Houston. Slag cement will be crucial to meeting the needs of a fast-growing market like Texas, especially given the decreasing availability of other cementitious alternatives like fly ash. The facility is another step in transitioning our cement portfolio to less carbon-intensive blended products. The second organic growth investment is a $430 million project to modernize and expand our Mountain Cement plant in Laramie, Wyoming and includes an additional distribution facility in Northern Colorado. Our investment in Mountain Cement checks all the boxes of Eagle's strategy. It increases capacity by approximately 50% in a high growth market, it lowers manufacturing costs by approximately 25%, enhancing our low-cost position, and reduces the carbon intensity of that business by 20%. These growth investments, the new slag facility in Texas, the Laramie, Wyoming Cement plant expansion, combined with Stockton, California cement terminal acquisition completed at the beginning of the year, meaningfully advanced our strategy and should generate high returns. Moving on to our second pillar of keeping our assets in like-new condition, we were able to become more efficient, optimize our network, and be prepared for any downcycle economic conditions by integrating our Battletown, Kentucky aggregates business, which we took full ownership of this year. Battletown extends our aggregate network at a site complementary to our existing cement footprint. Our operating efficiency investments also include our decades-old decisions to ensure our raw materials are next to our plants in an abundant reserve, helping us control our own raw material supply and lower transportation costs. We are also dedicated to ongoing targeted maintenance to keep the plants in like-new condition. This leads me to the third pillar of capital management, returning excess cash flow to shareholders. Our consistent operational performance and financial discipline produced strong enterprise cash flows, putting us in an enviable position of returning excess capital to shareholders even as we capitalize on growth initiatives and invest in the sustainability of our businesses. This past fiscal year, we returned $343 million to shareholders through share repurchases and dividends. Over the last five years, our share buyback program has reduced the overall stock flow by nearly 30%. Our balance sheet is healthy with our net leverage ratio staying at 1.3 times, giving us substantial financial flexibility to execute our disciplined capital allocation strategy in varying market conditions. With that, I'll turn it over to Craig for more comments.

Thank you, Michael. Fiscal year 2024 revenue was a record $2.3 billion, up 5% from the prior year. The increase primarily reflects higher cement sales prices and contribution from the Stockton Import Terminal we acquired in our first fiscal quarter, partially offset by lower wallboard sales volume. Excluding the contribution from the Stockton Import Terminal, revenue was up 3%. As Michael mentioned, underlying fundamentals remained strong across our businesses, which supported our price increases, drove margin expansion and, ultimately, helped us achieve record annual EPS. Revenue for the fourth quarter was up 1% to $477 million, primarily reflecting increased cement sales prices. Diluted earnings per share for the full fiscal year increased 9% to $13.61. In addition to margin expansion, the increase reflects the reduced share count resulting from our share repurchase program. Fully diluted shares are down 5% from the prior year and are down nearly 30% in the last five. Fourth quarter EPS was down 20%, largely because of heavy materials results in the quarter when the cement and concrete and aggregates businesses were affected by adverse weather conditions and increased maintenance costs in the cement business. Turning now to segment performance, highlighted on the next slide. In our heavy materials sector, which includes our cement and concrete and aggregates segments, annual revenue increased 12% to $1.5 billion. The increase reflects higher cement sales prices and the contribution from the Stockton Import Terminal. As Michael mentioned, we faced adverse weather conditions during the fourth quarter across most of our markets, including the coldest January in 17 years in Austin with record rainfall and an extreme cold snap in Kansas City during January that caused disruption not only to sales, but also to operations. We estimate the impact on earnings from lower sales volume due to weather delays was $3 million to $4 million, the operational impact from equipment downtime to be another $3 million to $4 million, and increased maintenance cost was approximately $7 million. One last comment on the weather is the impact was also felt in our concrete businesses, which we largely operate in the same markets as our cement plants. Annual operating earnings increased 18% to $351 million, again reflecting higher cement prices, partially offset by higher operating costs. Our fourth quarter cement price was up 5% as a result of price increases we implemented in January. Flipping to our light materials sector on the next slide. Annual revenue in our light materials sector declined 4% to $941 million, reflecting lower wallboard sales volume. Annual operating earnings declined 3% to $366 million, also because of lower wallboard sales volume, partially offset by record paperboard shipments and lower recycled fiber costs. In the fourth quarter, industry wallboard shipments increased for the first time in five quarters. In response to the favorable outlook for residential construction, we implemented a wallboard price increase during the fourth quarter, the full effect of which is not completely reflected in our quarterly average wallboard price. Looking now at our cash flow. We continued to generate very strong cash flow and allocate capital in a disciplined way throughout fiscal 2024. Operating cash flow was up 4% year-over-year to $564 million. Capital spending increased to $120 million as we continue to invest in and improve our operations. During the year, we also acquired the Stockton Cement Import Terminal for approximately $55 million. We paid $35 million in dividends and repurchased approximately 1.9 million shares of our common stock, or 5% of the outstanding, for $343 million, returning a total of $378 million to shareholders over the course of the year. We have 5.9 million shares remaining under the current repurchase authorization. As we announced last week and Michael discussed earlier, we are investing $430 million to modernize and expand our Mountain Cement plant, which serves the growing Northern Colorado market. The plant will be upgraded from the existing two long-dry kilns to a single modern pre-calciner kiln line, which will significantly improve energy efficiency and simplify maintenance programs. The existing plant will continue to operate until construction is complete in the latter half of calendar 2026. Construction is expected to begin this summer, and as a result, we expect total company capital spending in fiscal 2025 to increase to a range of $310 million to $340 million. Finally, a look at our capital structure. At March 31, 2024, our net debt-to-cap ratio was 45% and our net debt-to-EBITDA leverage ratio was 1.3 times. We ended the year with $35 million of cash on hand, and total liquidity at the end of the fiscal year was approximately $607 million. And we have no meaningful near-term debt maturity, giving us substantial financial flexibility.

Our first question today comes from Trey Grooms from Stephens. Please go ahead with your question.

Hey, good morning, everyone. Craig, you mentioned several things on the cement side, some maintenance, a few other things you called out there. And I'm sure the lower organic volume didn't help. Clearly, it's a seasonally slower quarter as well. So, that can amplify things. But it sounds like a lot of these things are transitory. And if I did my math right, I think the margin would have been closer to 22.4% kind of range, which would have been up about 300 basis points. Am I in the neighborhood with that? And, I guess, also as you kind of look at those things you called out, are any of those going to be kind of trickling into the 1Q or anything like that?

I believe you're on the right track, Trey. In January, we faced some challenging weather conditions that impacted demand, which extended into early February. However, the projects are still there; they are just delayed. During the quarter, we took advantage of the slower activity to conduct maintenance that we hadn't been able to do for several years since our facilities have been operating at full capacity. Additionally, the weather affected our operations, causing issues like frozen fuel bins and raw material bins, which led to downtime at the plant. So, there were both sales volume and operational impacts. The $3 million to $4 million decrease in sales volume mirrors the operational downtime we experienced. We also noted the $7 million in maintenance costs that were specific to the quarter. Maintenance costs are contained within this quarter, but we have encountered some rain in April and May across many areas, which has further pushed out projects. Nonetheless, I am optimistic about the demand in the heavy side as we move forward. Customers have communicated that they expect to be very busy this year and in the years ahead.

Thanks for the information. Regarding the cement margin, I understand you anticipate some reduction in energy costs for the cement business in fiscal '25. Is that still accurate? Additionally, with any further price increases in April, we should expect some recovery in cement margins during the first quarter of fiscal year, provided that weather conditions do not significantly interfere.

Yeah. Look, as always, say, you've got to look at the cement business on a trailing 12-month basis. And I know you know this, the June quarter is when we perform the majority of our kiln maintenance. So, the June quarter is always our lowest margin quarter for the year. But as you said, you look out over the broader year for fiscal '25, we've got some benefits on the energy side, more specifically in the solid fuels. That should help margins. And as we remain at full utilization and these price increases, we would expect to see margin improvement as we move forward.

Okay. Thanks for that, Craig. I'll pass it on, and best of luck.

Our next question comes from Stanley Elliott from Stifel. Please go ahead with your question.

Good morning, Michael, Craig, and Alex. Thank you for the question. Could you elaborate on the Laramie expansion? It seems quite interesting, especially regarding the timing. Are we to interpret this as a sign that the M&A markets may have been overly optimistic compared to your evaluations, or is it more about your confidence in the opportunities available in the Salt Lake and Denver markets?

Yes, Stanley, that's a great question. There are two parts to consider. First, regarding the project itself, it's an older facility that currently runs two long dry kilns, which utilize older technology. We will be upgrading it to a single kiln line with a pre-calciner for cement production. This change is crucial as it significantly lowers energy consumption, increases energy efficiency, and simplifies maintenance. Transitioning from two kilns to one with modern technology is a key benefit. Additionally, the facility is located in a growing market. While it's based in Laramie, Wyoming, its main market extends south to Denver, where we hold advantages in terms of existing terminals and those we plan to build, all included in the capital cost. That market is supply constrained, particularly given its central location in the country. This project reminds me of a successful modernization we undertook at our Illinois Cement facility years ago. The costs are low today, with a similar margin profile as those facilities, and that previous project generated a high return that exceeded our internal requirements, which is what we hope to achieve here. In terms of capital allocation, we're fortunate to have our balance sheet positioned at below 1.5 times, along with strong free cash flow. This allows us to invest in significant projects like the Mountain Cement expansion while still having the capacity to consider inorganic growth or merger and acquisition opportunities. If those don’t materialize, we can continue with our share repurchase program. This project represents one investment opportunity among many, and we are still positioned to explore other options.

Perfect. Thanks. That's great color. And I guess, just one on the wallboard. You mentioned some of the pricing kind of not fully realized. Could you help us maybe with the exit rate on that wallboard pricing or where we think the pricing would be?

Yeah. Our price was up about $5 sequentially in the quarter, as you saw from December to March, and there's about another $5 that wasn't in the quarterly average that still has yet to flow through.

Our next question comes from Brent Thielman from D.A. Davidson. Please go ahead with your question.

Hey, thanks. Hey, Craig, just as a follow-up to a previous question, it wasn't quite clear to me. Did you essentially pull forward most or all of that cement maintenance from June to the March quarter?

Well, yes, some of it certainly is that, but I'll tell you, and I think Michael said it well. These plants have been running in full utilization for several years now, as we've discussed. And so, some of this is maintenance that you just haven't had the time to perform over the last couple of years, and you finally had the opportunity to this quarter. So, I don't know that I would necessarily say it's pulling forward as much as it was the opportunity presented itself. And it pulled it forward in the sense that you were going to have to do it eventually, whether that was in fiscal '25 or fiscal '26. It was at some point, needed to be done, and we took the opportunity.

Okay. And Craig, at Texas Lehigh, I think you had some ongoing repairs and plans around that facility. Could you just update us on that, and maybe any sort of cadence we should expect that might create some downtime at that plant, in particular, through this year?

Yeah. We've mentioned we've got a couple of larger projects. They're largely slated for this fall. They'll go through their normal maintenance program here in the June quarter and then they'll have some more additional downtime in the fall. We'll dimensionalize that for everyone. But I'm glad you mentioned the joint venture. Michael mentioned that the other organic investment that we announced during the quarter was a slag-cement facility down in Houston. It will be right there in the ship channel, and that's an incremental 500,000 tons of cementitious product that we'll be able to sell above and beyond the cement manufacturing footprint. That is in the joint venture. So we pick up half of that opportunity. But good investment. We are carrying some costs associated with startup of that facility, call it, $700,000 to $800,000 in the quarter of incremental costs for that facility and as we're staffing that facility up, but that's an exciting opportunity for us later this summer.

Okay. And just one more quick one. I appreciate all the color on the investment at the facility in Wyoming. Is it fair to say that you're evaluating sort of similar capacity improvement or opportunities across the broader portfolio? Was this one somewhat unique? Does it stand out relative to what you might be looking at relative to the other facilities? Just curious, kind of how you're thinking about the broader portfolio here.

No, it's a great question, and I appreciate the question because when we look at our network of cement plants across the nation, we look at every single facility and what value those facilities bring and the age of those facilities, the maintenance cost of those facilities. So, while we chose Mountain to upgrade on this one, we do a strategic analysis on every single one of the facilities and what value that brings to the company. So this is the one that we've chosen to do, and there may be others if they meet our financial return criteria.

Hi, good morning. Hey, I think you said that the CapEx for the year would be $310 million to $340 million. And if Laramie costs $430 million, I'm just wondering if you could help us understand kind of the phasing in of CapEx through '25 and maybe '26, and kind of breaking out sort of maintenance CapEx versus Laramie versus maybe sort of other growth projects?

For the Mountain Cement project, the $430 million will be phased in over fiscal '25, '26, and into fiscal '27, as we expect it to be completed by late 2026. We have budgeted around $150 million for this project in fiscal '25, a bit more in fiscal '26, and the rest in fiscal '27. This means that sustaining capital will return closer to the $150 million to $160 million range, which is typical. It's slightly higher because we have several announced projects, including alternative fuel initiatives at three of our facilities. These projects are progressing, and we are also upgrading finish mill capacity at one facility to support full production of PLC. Overall, we have promising projects in addition to the Mountain Cement expansion.

Got it. Got it. And then thinking about fiscal '25 and cement volumes, I guess volumes in the fourth quarter were down 3% ex M&A on the weather. How should we think about cement volumes for the fiscal year? Is it maybe flat year-over-year, not including the slag facility, or are there some other puts and takes that we should be thinking about as we kind of model up the full year?

Yes, as I mentioned, April and May have experienced wet weather in many parts of the country, which has affected the start of the construction season. I believe we will see volume growth, likely more in the second half of the year than the first half, considering how the year has started. I feel optimistic about fiscal '25 volumes, and looking ahead to fiscal '26 and '27, the PCA has recently released forecasts indicating continued growth in those years. One final point I want to make is about housing starts from last week. If you dive into those numbers, there is significant growth in our primary markets. In the South and Midwest, where our wallboard and cement facilities are located, we observed strong growth in single-family housing starts. The Northeast, however, showed a notable decline, but we don't have much participation in that market. Geographically, we believe we are well positioned, and the data supports that.

Okay. That's very helpful. I'll turn it over.

Our next question comes from Jerry Revich from Goldman Sachs. Please go ahead with your question.

Yes, hi. Good morning, everyone.

Good morning.

In cement, even with the impact discussed in the March quarter, profit per ton for the full year increased by over 20%. The previous year saw an increase of 12%. I'm curious about your thoughts on the potential for double-digit profit per ton growth this fiscal year. You seem to have some advantages from lower energy input costs due to contract timing. Could you share your perspective on the factors influencing the possibility of another year with double-digit profit per ton growth in cement?

Yeah. Jerry, you point out the right way to look at the business. As I mentioned, you've really got to look at a business that has seasonal impacts on a trailing 12-month basis and it's easy to do for the annual period. But very happy with the margin expansion that we've seen over the last several years in the face of some pretty significant inflation headwinds around energy. And as we've talked, those headwinds have turned around, especially on the solid fuels, and that should be a benefit to the margins. And we've continued to see some price appreciation here. So, all in all, we expect margins to continue to expand in the cement business, and I think it's very well positioned.

And then in terms of the alternative fuel upgrade projects and the expansion projects, as you look at your footprint today, how big is the dispersion in margins between your most efficient plants and your least efficient plants post these projects? How much does that gap narrow as you look at your portfolio?

It's interesting, Jerry. On a margin basis, the separation isn't as significant as you might expect. The difference is that the higher-cost plants are usually located in markets with slightly higher margins or prices. In this case, we are modernizing the Mountain Cement facility, which uses older technology. We believe we can continue to enhance the margins of that plant by reducing operational costs, and that represents the largest opportunity for this project.

Okay. And lastly, it's been a really strong track record for you folks in cement profit per ton growth over the past 10 years. Even before COVID, you folks were getting really good unit profitability growth. I'm wondering, looking at the market, what aspects of it would you say have driven the really strong performance that's really been a big uptick versus the pre-financial crisis? How much of that is rising transportation costs versus other factors? How do you think about the sustainability of this level of unit profitability growth in cement?

We have significantly increased our capacity by acquiring several plants, including a slag facility from 2015 and a couple of recent cement plants. Our main focus is on operational improvement, particularly in maximizing utilization rates and throughput. We dedicate considerable effort to ensuring our plants operate efficiently, and that translates into maximizing throughput during operations. This involves diligent maintenance programs, for which we invested a significant amount in the fourth quarter. However, these investments yield long-term benefits by keeping our kilns and finish mills running at higher rates, reducing overall operating costs and allowing us to meet customer demands. The growth stems from ensuring our kilns are operational; some facilities, which were underperforming before our ownership, now operate at over 90% efficiency. This improvement has a substantial impact on per-unit costs and margins. Our operational teams have done an excellent job maintaining plant efficiency throughout the economic cycles. Furthermore, we've enhanced the Eagle network, showing a clear improvement in the average performance of our plants compared to pre-financial crisis times. Projects like the Mountain Cement modernization also help sustain these margins through economic fluctuations.

Hey, good morning, guys. Hey, Craig, can you just comment on cement pricing a little bit? Was the weather an impact of cement pricing as well?

No, it doesn't necessarily impact the price. It does certainly impact volumes, but we had price increases in about half our markets in January, and they went through as they were planned.

Okay. Any for April?

Yes. Some of our markets have activities scheduled in April and scattered throughout early summer, depending on the region. The timing varies somewhat. As I mentioned, the construction season has started off a bit slower due to the significant rain we've experienced. For those markets, activity will pick up later in the year.

Makes sense. How does the slag plant open up at capacity, and how do you see that ramping up over time?

Yes, like most facilities, there will be a startup period. As the plan begins late in the summer, it will have an associated startup time that will continue through the winter. By Q4, you will start to see it contribute more significantly to our overall profile. However, the real benefits from that facility will be realized in fiscal '26.

Fiscal '26, perfect. And then what are you seeing from others? Just kind of a bigger picture question on tightness in the cement market. I mean, what are you seeing from others in terms of capacity additions or expansions?

I would say that there are significant constraints on adding new capacity across the country. There have been a few modernizations, including one completed about a year ago, and I'm aware of one other. However, it's generally difficult to add capacity in the US cement market.

Our next question comes from Phil Ng from Jefferies. Please go ahead with your question.

Hey, Craig. Appreciate some of the color you just gave on cement. Can you provide a little more color where, like, your ASP was for cement as you exited the quarter and what you've kind of realized thus far in May? And a few of your competitors have talked about potentially announcing midyear price increases in cement. Have you announced any? And do you plan on announcing any midyear increases in cement as well?

Yeah, Phil, in terms of the price for the quarter, cement is pretty much you put it in in January, and that's the price for the quarter in the markets that we went forward in. And so, I would say the average was pretty consistent throughout the quarter. We're in the process of implementing some price increases kind of post the quarter, and we'll certainly give you an update on that as we get into the next call. A little early to speculate on additional price increases for the remainder of calendar '24. And certainly, as we've said before, customers will be the first to know about that. But what we're interested, when the sun shines here in April and May, business is good. But we have seen quite a bit of rain here in the first part of the year and so, we'll see about additional timing.

So, Craig, regarding the remaining 50% that wasn't included in January, it seems like the timing is spread throughout the quarter, potentially even into late summer. Can you provide us with more details about those market conditions, specifically how much you have and whether all of it will be accounted for in April? Will half of it come in June? We would appreciate any additional insights to help us properly model the cement price increases.

There are a few markets that went live in April, while some have been delayed until May or June. This is the pacing we're seeing. Consequently, the average for the entire quarter won't accurately reflect the full price increase we've implemented.

Okay. And then I guess, pivoting to perhaps your wallboard business, Michael, you sounded pretty upbeat on single-family new construction, but certainly the outlook's a little more mixed on multifamily and commercial. So, I guess, my question is, have you seen that inflection come through already in single-family and have bidding and orders progressed nicely? Because we've seen, obviously, rates tick back up and the starts data more lately have been a little more choppy. And do you expect volumes to be up this year? Given what your view is on single-family, are there any mix nuances that we need to be mindful of from a margin standpoint as well, just given how these different end markets are kind of progressing?

Sure, I'll take that first. As I mentioned earlier, there's quite a bit of variability in the housing data. We examine the situation on a regional basis, and our markets are performing better than the national average. For instance, last week's data showed a decline in housing starts in the Northeast, a region where we don't have much presence, while the South and Midwest—our key markets—are experiencing solid growth and appreciation. As Michael pointed out, single-family construction is significantly more important than multifamily because it requires two to three times more wallboard than multifamily units. That's why we largely focus on single-family construction activity. Regarding private non-residential demand for wallboard, it makes up the smallest portion of total demand and varies by region. Again, we are not very active in the Northeast or Northwest, which face more challenges, but in the southern parts of the U.S. where we operate, private non-residential demand remains robust. And Craig, just so I understand, there's no real mix margin nuances that we need to be mindful of multifamily versus single-family or commercial? I mean, it sounds like demand is how we should think about it. And then given your end markets, you haven't seen a slowdown in bidding and order activity. It sounds like you're seeing momentum build. Is that the right take? Yeah, that's right in terms of the margin, and we've been very happy with our order intake here as the construction season has begun very nice growth there.

Thank you, Jamie. As we reflect on the third year of record performance across the board for Eagle, we are grateful for the dedication and hard work of our employees and the support of you, our shareholders, through multiple business cycles. We are proud of our team's superior execution at every point in the cycle and we're committed to continuing to execute our strategy with rigorous discipline, the highest safety standards, and respect for our communities, our environment, our employees, our shareholders and all of our stakeholders. Thanks for joining us today. We're looking forward to a good year ahead.

Ladies and gentlemen, with that, we'll be concluding today's conference call and presentation. We thank you for joining. You may now disconnect your lines.