Earnings call transcript: Commercial Metals Q4 2025 beats earnings forecast, stock dips

Commercial Metals Company (CMC) reported its fourth-quarter earnings for fiscal year 2025, revealing a slight beat in earnings per share (EPS) compared to forecasts. The company posted an EPS of $1.37, surpassing the expected $1.35. Despite this, the stock saw a pre-market decline of 3.85%, closing at $57.38, down from $59.68. Revenue also exceeded expectations, reaching $2.1 billion against a forecast of $2.09 billion.

Key Takeaways

• Commercial Metals’ Q4 2025 EPS and revenue both surpassed forecasts.
• Stock price decreased by 3.85% in pre-market trading following the earnings release.
• The company achieved a significant year-over-year increase in consolidated core EBITDA.
• Strategic acquisitions and market expansion are driving growth.
• Forward guidance suggests consistent results with Q4 2025.

Company Performance

Commercial Metals Company demonstrated strong performance in Q4 2025, with net earnings of $151.8 million, translating to an EPS of $1.35 per diluted share. The consolidated core EBITDA showed a notable year-over-year increase of 33%, reaching $291.4 million. The company’s strategic focus on expanding its precast platform and operational excellence initiatives contributed to this growth. The North American Steel Group and Europe Steel Group both reported positive EBITDA figures, underscoring the company’s robust market position.

Financial Highlights

• Revenue: $2.1 billion, exceeding the forecast of $2.09 billion.
• Earnings per share: $1.37, surpassing the forecast of $1.35.
• Consolidated core EBITDA: $291.4 million, a 33% increase year-over-year.
• North American Steel Group adjusted EBITDA: $239.4 million.
• Emerging Businesses Group net sales: $221.8 million, a 13.4% increase.

Earnings vs. Forecast

Commercial Metals reported an EPS of $1.37, beating the forecast of $1.35 by $0.02. The revenue of $2.1 billion also surpassed expectations by $10 million. This performance marks a positive deviation from forecasts, reflecting the company’s successful execution of its strategic initiatives and operational improvements.

Market Reaction

Despite the earnings beat, Commercial Metals’ stock experienced a decline of 3.85% in pre-market trading, closing at $57.38. This movement contrasts with the broader market trend, as the stock had previously reached a 52-week high of $64.53. The decline may reflect investor caution regarding future growth prospects or market volatility.

Outlook & Guidance

Looking ahead, Commercial Metals anticipates that its fiscal year 2026 consolidated results will be consistent with Q4 2025. The company expects a sequential increase in steel product margins and has set a capital spending guidance of $600 million. The effective tax rate for FY2026 is projected to be between 4% and 8%. The company’s strategic initiatives, including its precast platform expansion, aim to drive several hundred million in EBITDA.

Executive Commentary

CEO Peter Matt emphasized the company’s strategic focus, stating, "We are executing on several strategic initiatives, which we believe will deliver meaningful and sustained enhancements to our margins, earnings, cash flow, and return on capital." CFO Paul Lawrence highlighted the impact of recent acquisitions, noting, "The addition of Foley and CP and P would have increased CMC’s core EBITDA margin by more than two percentage points."

Risks and Challenges

• Supply chain disruptions could impact production and delivery timelines.
• Fluctuations in steel prices may affect profitability.
• Increasing competition in the construction materials market.
• Economic downturns could reduce demand for construction projects.
• Regulatory changes in environmental standards may increase compliance costs.

Q&A

During the earnings call, analysts inquired about the company’s construction market segmentation and precast acquisition strategy. Executives detailed opportunities for margin improvement and clarified capital allocation priorities, emphasizing the company’s focus on expanding its national footprint in the precast market.

Full transcript - Commercial Metals Comp (CMC) Q4 2025:

Moderator/Operator, CMC: Hello, and welcome, everyone, to the Fiscal twenty twenty five Fourth Quarter and Year End Earnings Call for CMC. Joining me on today’s call are Peter Matt, CMC’s President and Chief Executive Officer and Paul Lawrence, Senior Vice President and Chief Financial Officer. Today’s materials, including the press releases and supplemental slides that accompany this call can be found on CMC’s Investor Relations website. Today’s call is being recorded. After the company’s remarks, we will have a question and answer session and we’ll have a few instructions at that time.

I would like to remind all participants that today’s discussion contains forward looking statements, including with respect to economic conditions, effects of legislations and trade actions, U. S. Steel import levels, construction activity, demand for finished steel products, the expected capabilities, benefits, costs and timeline for construction of new facilities the benefits and impact of the pending acquisitions of Foley Products Company and Concrete Pipe and Precast the company’s operations the company’s strategic growth plan and its anticipated benefit legal proceedings, the company’s future results of operations, financial measures and capital spending. These statements reflect the company’s beliefs based on current conditions, but are subject to risks and uncertainties, the company’s earnings release, most recent annual report on Form 10 ks and other filings with the U. S.

Securities and Exchange Commission contain additional information concerning factors that could cause actual results to differ materially from those projected in forward looking statements. Except as required by law, CMC does not assume any obligation to update, amend or clarify these statements. Some numbers presented will be non GAAP financial measures and reconciliations for such numbers can be found in the company’s earnings release, supplemental slide presentation or on the company’s website. In addition, today’s presentation includes financial information that gives effect to the consummation of pending acquisitions. Pro form a financial information is presented for illustrative purposes only and is based on available information and certain assumptions and estimates that the company believes are reasonable.

The pro form a financial information may not necessarily reflect what the company’s result of operations and financial position would have been had the transactions occurred during the periods discussed or what the company’s results of operations and financial position will be in the future. Unless stated otherwise, all references made to year or quarter end are references to the company’s fiscal year or fiscal quarter. And now for opening remarks and introductions, I will turn the call over to Peter.

Peter Matt, President and Chief Executive Officer, CMC: Good morning, everyone, and thank you for joining our conference call. As you’ve likely already seen, we have a lot of ground to cover today. First, we are excited to share more about CMC’s agreement to acquire Foley Products Company, after which we will cover our fourth quarter performance, fiscal twenty twenty five strategic progress and our outlook before opening the call to questions. To supplement today’s commentary, we have posted two presentations to our IR website, one for the Foley acquisition and one detailing our fourth quarter and fiscal twenty twenty five results. Starting with Foley, we are thrilled to add a best in class business with industry leading margins to CMC’s portfolio.

In combination with our recently announced acquisition of CPMP, the addition of Foley will create a high quality, large scale platform in the strategically attractive pre industry, greatly enhancing CMC’s financial profile and growth over the long term. I am confident that the acquisition of Foley will increase our value proposition for customers and shareholders alike, extending our growth runway and marking another major milestone as we execute our strategy. Slide four of the acquisition presentation provides a brief overview of Foley. Since its founding by Frank Foley over forty years ago, the company has grown into the largest regional precast producer in The United States with five eighty employees in 18 plants across nine states. Foley has a strong track record of growth and best in class margin performance, which is a testament to their talented management team and the industry leading practices they have developed.

We are very excited to welcome them to the CMC family and look forward to collaborating on Foley’s continued success. As you can see on Slide seven, the addition of Foley in combination with our recently announced acquisition of CPMP creates immediate scale for CMC’s Precast platform. Upon closing both transactions, CMC will be the third largest Precast player in The U. S. And a leader across the Mid Atlantic and Southeast, supported by 35 facilities across 14 states.

Our strategic entry into Precast will broaden our commercial portfolio to support our customers, enhance our exposure to powerful structural trends in construction, offer new capabilities to address construction industry challenges and establish a new platform with a significant future runway. Slide eight helps illustrate Foley’s best in class operations, which will support our ability to build a broader Precast platform and unlock further synergies with CPMP. The left side of the page outlines Foley’s industry leading margin and cash flow profile, which has been consistent over time and is enabled by a highly efficient low operating model. The company has achieved sustained cost advantages through a combination of centralized production planning, automation, best in class manufacturing practices, low cost support functions and optimized logistics. Foley has also developed a winning commercial formula with leading design and engineering capabilities, lead times and product quality, With the most comprehensive product portfolio of any precast supplier within its core regions, Foley is a true one stop shop for many construction applications.

These capabilities have given the company enduring competitive advantages, which CMC will seek to preserve and strengthen. As highlighted on Slide nine, Foley and CP and P have highly complementary footprints, and we see many meaningful synergy opportunities between We expect the acquisition of Foley to generate annual run rate synergies of approximately 25,000,000 to $30,000,000 of EBITDA by year three, in addition to the 5,000,000 to $10,000,000 of EBITDA we originally identified for CPMP. The majority of this benefit will be driven by applying best practices across our platform, including optimized production planning, manufacturing efficiencies and a simplified structure for support functions. The expected improvement equates to roughly 35% to 40% of CP and P’s forecasted 2025 EBITDA, consistent with our previous commentary that synergies would become more significant as our Precast platform gains scale. It is worth pointing out that meaningful commercial synergies are likely to emerge, but have not been included in our initial synergy estimate.

On Slide 10, we illustrate Foley’s highly complementary proximity to both CMC and CPMP networks, which we believe will facilitate optimal coordination to achieve operational synergies and over the longer term substantial commercial opportunities. As you can see, every precast site in the Eastern And Western U. S. Is located near a CMC rebar mill or fabrication plant, allowing us to maximize value over time through close coordination across commercial, operational and support functions. In particular, we are excited by the increased value we can bring to customers in these regions by providing CMC’s full suite of early stage construction solutions from site preparation to structural erection.

Our offering will be unique in the marketplace and will grow more compelling over time as we integrate our portfolio and offer attractive turnkey solutions. While a vast majority of the acquired Precast facilities are located within one of CMC’s densest geographic regions, we will also operate one satellite location in Louisiana and three satellite locations in the Western U. S, which will provide beachheads in those regions and offer the opportunity for profitable bolt on growth in the future. To conclude my comments on Foley, when we began our study of the precast space nearly two years ago, we immediately identified Foley as a best in class operator based on its reputation, its standing among customers and its top tier financial profile in the construction material sector. Our due diligence confirm Foley’s attractiveness as a strong business and drove us to execute on this unique opportunity.

I am incredibly excited about both of these announcements and I am confident that the additions of Foley and CPMP will unlock further upside as the cornerstones of our newly created Precast platform. Both businesses together will position us to drive significant value for our customers and shareholders alike. With that summary of the deal rationale, I’ll turn the call over to Paul to discuss the financial details. Paul?

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Thank you, Peter, and good morning to everyone on the call. I will start by saying I share the excitement and optimism both about this transaction and the strategic momentum we have achieved at CMC over the last year. The acquisition of Foley in combination with CP and P is transformative to CMC’s financial profile. As shown on Slide 11, the creation of the new Precast platform meaningfully shifts the composition of CMC earnings, increases margin levels and free cash flow capabilities and importantly, should reduce earnings and cash flow volatility in our business. The sum of CP and P and Foley representing our Precast platform is expected to generate approximately $250,000,000 of adjusted EBITDA in calendar twenty twenty five before growth and synergies with EBITDA margins in excess of 34%.

This compares to CMC’s core EBITDA margin of 10.7% and the North American Steel Group adjusted EBITDA margin of 12.2% in fiscal twenty twenty five. The addition of these levels of earnings by the Precast operations will significantly shift the composition of CMC’s earnings, increasing the combined contribution from our EBG segment platform to over 32% of total operating segment adjusted EBITDA. Upon completion of the acquisitions, we expect nearly a third of our profitability will be generated by high value added solutions with attractive market penetration potential, strong margins and cash flow conversion. The lower capital intensity of these businesses also means they require less reinvestment to maintain operations and less capital commitment to grow organically, enhancing free cash flows. Margin levels and normalized free cash flow conversion are both expected to increase meaningfully.

Based on Foley and CP and P’s forecasted results for 2025, the addition of Foley and CP and P would have increased CMC’s core EBITDA margin by more than two percentage points. And given the stability of these businesses, we anticipate this improvement to be sustained over time. In fiscal twenty twenty five alone, the platform would have improved normalized free cash flow conversion by over four percentage points. Now I will cover the major terms related to the transaction. Total consideration will be paid at closing and is subject to customary working capital adjustments.

This valuation represents a 10.3 times multiple on Foley’s expected calendar 2025 EBITDA. Importantly, the effective multiple is reduced to approximately 9.2 times when cash tax savings are considered as CMC will benefit from a tax step up on assets. We believe this is a fair valuation for a fantastic asset and the multiple reflects Foley’s best in class margin profile and business characteristics previously discussed by Peter. It’s worth noting Foley’s EBITDA margins are five to 10 percentage points higher than those of many blue chip building product and construction material companies that routinely trade at 10 to 16 times forward EBITDA. Importantly, we anticipate the transaction to be immediately accretive to earnings and cash flow per share.

The combined total consideration of approximately $2,500,000,000 related to the purchases of Foley and CP and P will be funded through a combination of cash on hand and committed bank financing. As soon as feasible, we will seek to raise permanent debt financing in the form of corporate bond offerings. Immediately following the completion of both transactions, which is expected by the 2025, CMC’s net debt is expected to increase to approximately 2.7 times trailing twelve month adjusted combined EBITDA. As we have stated in the past, we are comfortable with temporarily increasing net leverage above our long term target of two times for the right strategic opportunity, as we did with the highly successful acquisition of Gerdau’s U. S.

Rebar business in 2019. We will prioritize delevering in the quarters ahead with a goal of returning below two times net leverage within eighteen months. This effort will be aided by strong free cash flow generation from the Precast platform itself, the wind down of capital expenditures for the construction of Steel West Virginia and significant cash tax savings related to the 48C program and the One Big Beautiful Bill. Based on these supportive factors and the positive outlook for our existing business, we are confident in our ability to delever quickly. That concludes my remarks, and I’ll turn

Peter Matt, President and Chief Executive Officer, CMC: it back to Peter to cover fourth quarter and fiscal year. Thank you, Paul. I will now turn to our earnings presentation. The goal of our strategy is to drive meaningful and sustainable improvements to CMC’s margins, earnings, cash flow and returns on capital, while reducing volatility in our business. As you can see on Slide five, we are executing against this objective along three paths.

First, by investing in our people and pursuing excellence in all we do second, by investing in value accretive organic growth and third, by driving capability enhancing inorganic growth as we just discussed in detail. Each of these objectives represents a significant opportunity for CMC and taken together will be game changing for our returns, scale and ultimately the value we create for investors. We made tremendous progress across each of these strategic paths over the last year and Slide six outlines some of our most notable accomplishments. I’ll start with investing in our people and pursuing excellence. As I’ve said before, the most important investment we can make in our people is to keep them safe on the job.

And I am proud to report that fiscal twenty twenty five was the safest year in our company’s history and marked the third consecutive year of record safety performance. The job of improving safety is never done, but we are in an excellent position to maintain our momentum and cement our position as truly world class. During the year, we also invested in the leadership, talent and resources that will support strategic execution across our organization. Within our emerging businesses group, we now have in place a group of veteran leaders who are poised to drive EBG segment performance to new heights. We are already seeing early dividends in our CMC construction services and performance reinforcing steel divisions as new sales and margin initiatives take hold.

Late in fiscal twenty twenty five, we also streamlined reporting structures in our North America Steel Group to facilitate decision making and provide optimal coordination in supporting key initiatives, including our TAG program efforts. On the topic of TAG, we began execution of our operational and commercial excellence program in fiscal twenty twenty five. And I could not be prouder of the progress the CMC team achieved during the year. Not only did we generate $50,000,000 in EBITDA benefits, well in excess of the $40,000,000 we expected, but we also successfully identified additional opportunities to reduce costs, increase efficiencies, cut waste and drive profitable sales in the future. Looking ahead, I am more confident than ever in this program’s ability to drive meaningful and sustained improvement to CMC’s financial profile.

By the end of fiscal twenty twenty six, we now expect to generate a run rate annualized EBITDA benefit of more than $150,000,000 with virtually no related capital investment. The next strategic path is value accretive organic growth, which we anticipate will represent a meaningful source of new earnings and cash flow over the next several years, particularly as our Arizona II and Steel West Virginia mill investments reach full operations. I am pleased to report that we made significant progress on both projects during fiscal twenty twenty five. Notably, we achieved a full quarter of positive EBITDA at Arizona two, for which I would like to congratulate our team out West. I would also like to highlight CMC’s attainment of an approximately $80,000,000 net tax credit related to Steel West Virginia under the 48C program, which we will realize in fiscal twenty twenty six and effectively reduces our capital investment in this project.

Finally, turning to capability enhancing inorganic growth. As I’ve already discussed at length, we have created a large scale precast platform with the announced acquisitions of Foley and CPMP. We believe this platform will greatly enhance CMC’s financial profile, increase our value to customers and provide an avenue for meaningful long term growth. Paul will cover the financials, but before this, I would like to briefly reflect on our markets. First, in North America, a combination of resilient construction activity and a balanced supply landscape resulted in favorable conditions for both volumes and margins during the quarter.

Shipments of finished steel increased year over year and were unchanged from the prior quarter’s strong level. Downstream bid volumes, our best gauge of the construction pipeline remained healthy and were consistent with recent quarters as we continue to see strength across a number of key market segments including public works, highway and bridge, institutional buildings and data centers. As we have indicated previously, we see substantial pent up demand, particularly within non residential markets. This view is supported by historic strength in the Dodge Momentum Index or DMI as well as recent conversations with many of our largest customers. The DMI leads construction activity by twelve to eighteen months and reached a record high in September, driven by growth that was broad based across several market segments.

Additionally, our customers are increasingly bullish as they experience a large inflow of projects into the pipeline related to energy generation, reshoring, advanced manufacturing and LNG infrastructure. When we look beyond the current environment, we remain confident that the emerging structural drivers will support construction activity over a multiyear period. These trends include investment in our nation’s infrastructure, reshoring industrial capacity, growth in energy generation and transmission, the build out of AI infrastructure as well as addressing a U. S. Housing shortage of 2,000,000 to 4,000,000 units.

As noted on Slide 10 of the earnings presentation, over $2,000,000,000,000 of corporate investments across AI, manufacturing, shipping and logistics and energy have been announced in calendar twenty twenty five. Commencement of even a handful of related mega projects could provide a meaningful demand catalyst for CMC’s products in the quarters ahead. Moving on to profitability in this segment, we experienced a strong sequential expansion in North American steel product margins during the quarter, achieving the highest level in two years. Years. The improvement only partially reflects the impact of the June and July price announcements.

Realized pricing increased steadily throughout the quarter and we exited at a much higher level than the period average, positioning us to further expand margins in the first quarter. Within our downstream business, we have seen price levels on new bids rise in tandem with the mill rebar price, which should support average backlog pricing in the future as these higher priced bids are converted into new contract awards. On the topic of backlog, I would note that average pricing stabilized in the fourth quarter following more than two years of sequential quarterly declines from the post COVID peak. Before I move on to our other segments, I would like to briefly update you on the status of the rebar trade case filed with the International Trade Commission or ITC back in June. The petition alleges exporters located in Algeria, Bulgaria, Egypt and Vietnam are guilty of dumping material into The U.

S. Market and should be subject to corrective duties ranging up to 160%. In mid July, the ITC ruled that the case has merit and has passed it to the Department of Commerce for further investigation. Based on the current case schedule, we expect a preliminary ruling on the antidumping claim sometime in late calendar twenty twenty five or early twenty twenty six. It is worth noting that since filing the case, price levels have increased markedly on several rebar sizes often sourced from the subject countries.

Turning to our emerging businesses group on Slide 11, current conditions are supportive and we see encouraging signals regarding future activity, specifically solid quoting levels, busy engineering firms and improved velocity of quote conversion into backlog. One attractive element of the EBG segment is the fact that our current solutions are underpenetrated in the market, which provides significant opportunities for growth as we drive product adoption in addition to market expansion. In our key proprietary products, we are winning share through the strong value proposition while maintaining solid margins. This dynamic helped us achieve record segment profitability during the quarter as shipments of core solutions such as Interx Geogrid, Galvabar and Chromax all increased from the prior year. We have outlined the unique capabilities of these products on prior calls and we continue to expect that they along with EBG’s other high value added offerings position the segment to achieve a consistent organic growth rate in the mid to high single digits and EBITDA margins in the high teens.

Finally, for our Europe Steel Group, conditions improved modestly from the third quarter. Demand continued to normalize as a result of solid Polish economic growth, while on the supply side, import flows ticked up slightly from recent quarters, but remain below the disruptive levels of a year ago. During the fourth quarter, we saw metal margins recover to their highest mark in over two years, aided by an improved price environment for merchant bar and wire rod. The green shoots that we have noted on recent earnings calls continue to mature. We are encouraged by recent developments that the EU is looking to bolster its trade legislation with the implementation of a long term mechanism that will reduce existing quotas for foreign steel by nearly half and imports beyond those quotas would be subject to new higher tariffs, which are currently proposed at 50%.

Before turning the call over to Paul, I would like to recognize the efforts of our world class employees. We have asked a lot of the team as we execute on our ambitious vision for the future. And I am truly inspired by all that they have accomplished so far. Their efforts have been instrumental in laying the groundwork for years of success ahead. And I look forward to maintaining that momentum in the new fiscal year.

With that, I’ll turn the call over to Paul to provide more color on

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: the quarter. Paul? Thank you, Peter. We reported fiscal fourth quarter twenty twenty five net earnings of $151,800,000 or $1.35 per diluted share compared to net earnings of $103,900,000 and net earnings per diluted share of $0.90 in the prior year period. Excluding estimated net after tax charges of approximately $3,200,000 adjusted earnings for the quarter totaled $155,000,000 or $1.37 per diluted share compared to $97,400,000 and $0.84 per diluted share respectively in the prior year period.

These adjustments consisted of a $3,800,000 pretax expense for interest on the judgment amount associated with the previously disclosed litigation, an impairment charge of $3,400,000 and a $2,900,000 unrealized gain on undesignated commodity hedges. During the 2025, we modified our method of calculating adjusted EBITDA to exclude impact of unrealized gains and losses from undesignated commodity derivatives. This change was primarily driven by heightened volatility in copper forward markets, which introduced significant non cash fluctuations unrelated to our core operations. The relevant financial figures, including historical numbers have been adjusted to reflect this change impacting consolidated adjusted earnings, adjusted earnings per diluted share, adjusted EBITDA, core EBITDA and core EBITDA margin, as well as North American Steel Group adjusted segment EBITDA. Given the prominence of these metrics, we have published recast quarterly figures dating back to fiscal twenty nineteen in a Form eight ks filing accompanying our earnings release this morning.

We believe this change in reporting will provide a more representative view of our operating performance and cash generating capability. Consolidated core EBITDA was $291,400,000 for the 2025, representing a 33% increase from the $219,000,000 generated during the prior year period. Slide 14 of the supplemental presentation illustrates the year to year changes in CMC’s quarterly financial performance. Segment level adjusted EBITDA increased by $87,400,000 in total, with our North American Steel Group contributing $36,600,000 of improvement, EVG providing $8,100,000 and the Europe Steel Group delivering $42,700,000 The consolidated core EBITDA margin of 13.8% compared to 11% in the prior year period. CMC’s North American Steel Group generated adjusted EBITDA of $239,400,000 for the quarter, to $2.00 $7 per ton of finished steel shipped.

Segment adjusted EBITDA increased 18% compared to the prior year period, driven primarily by higher margin over scrap cost on steel products and contributions from our TAG operational excellence efforts. In particular, scrap optimization, alloy consumption reduction, process yield improvements and logistics optimization. North American Steel Group adjusted EBITDA margin of 14.8% compares to 13% in the 2024. Segment results also improved sequentially as steel product margins continued the expansion that began early in the third quarter. As Peter noted, we exited the fourth quarter with steel prices on an upward trajectory and steel product metal margins $31 per ton above the period average, setting the stage for us to generate strong margins in the 2026.

As indicated earlier, demand for long steel products was resilient during the quarter. Finished steel shipments increased by 3% compared to a year ago, while rebar shipments from CMC’s mills and downstream operations grew at a similar rate. Emerging Business Group fourth quarter net sales of $221,800,000 increased by 13.4% on a year over year basis, while adjusted EBITDA of $50,600,000 increased by 19.1%. The improvement was largely driven by three factors: strong demand for geogrids and proprietary products within CMC’s Performance Reinforcing Steel division improved TENSAR cost performance and the impact of commercial initiatives within our CMC Construction Services division. Turning to Slide 17 of the earnings presentation, Our Europe Steel Group reported adjusted EBITDA of $39,100,000 for the 2025 compared to a loss of $3,600,000 in the prior year period.

Segment adjusted EBITDA margin of 14.8% increased from negative 1.6% a year ago. The biggest driver of improved profitability was the receipt of a $31,000,000 CO2 credit, which was the first of two payments that will be received this calendar year as part of the government energy cost reimbursement program in place through 02/1930. Excluding this, operational results improved by $11,700,000 driven by higher margins, a 17% increase in shipment volumes and ongoing cost management efforts. Similar to recent quarters, the team in Poland continued to drive efficiency gains with success in nearly every major cost category, including labor, consumable usage, alloys and overhead. Most of these improvements are permanent in nature and set us up well to capitalize on market recovery.

As Peter mentioned, during the quarter, we saw continued demand growth and a somewhat moderated levels of long steel imports into Poland. The combination of these factors provided CMC the opportunity to achieve improved shipping volumes. CMC’s effective tax rate was 21.5% in the fourth quarter and 21.3% for the full year. Looking ahead, we anticipate a full year effective tax rate between 48% for fiscal twenty twenty six. As a result of several factors, we do not anticipate paying any significant U.

S. Federal cash taxes in fiscal twenty twenty six and for much of fiscal twenty twenty seven. During fiscal twenty twenty six, we will benefit from our 48C tax credit, bonus depreciation on our West Virginia mill investment as well as accelerated depreciation from the assets acquired in CMC’s acquisition of Foley and CP and P, which will significantly increase our free cash flow generation. Turning to CMC’s fiscal twenty twenty six capital spending outlook. We expect to invest approximately $600,000,000 in total.

Of this amount, approximately $350,000,000 is associated with completing the construction of our West Virginia micro mill as well as a handful of high return growth investments within our EBG segment. This concludes my remarks, and I’ll now turn it

Peter Matt, President and Chief Executive Officer, CMC: back to Peter for additional comments on CMC’s financial outlook. Thank you, Paul. We expect consolidated financial results in the 2026 to be generally consistent with those of the fourth quarter. Finished steel shipments within the North America Steel Group are anticipated to follow normal seasonal trends, while our adjusted EBITDA margin is expected to increase sequentially on higher steel product margins over scrap. While we expect financial results in the Emerging Businesses Group to decline on a sequential basis due to normal seasonality, we believe they will improve year over year.

Our Europe Steel Group will receive the second tranche of the annual CO2 credit in an amount of approximately $15,000,000 during the first quarter. Excluding this credit, adjusted EBITDA for our Europe Steel Group is likely to be around breakeven as seasonal factors and scheduled maintenance outages weigh on profitability. I am confident in CMC’s long term outlook and continue to believe in our ability to generate significant value for our shareholders. We are executing on several strategic initiatives, which we believe will deliver meaningful and sustained enhancements to our margins, earnings, cash flow and return on capital. We will achieve this by leveraging our TAG, operational and commercial excellence program to get more out of our existing enterprise, completing value accretive organic projects and adding complementary early stage construction solutions that provide attractive new growth lanes.

Taken together, we believe these efforts will position our company to take full advantage of the powerful structural trends in the domestic construction market for years to come. I would like to conclude by thanking our customers for their trust and confidence in CMC and all of our employees for delivering yet another quarter of very solid safety and operational performance.

Moderator/Operator, CMC: Thank you. And at this time, we will now open the call to questions. And your first question today will come from Mike Harris with Goldman Sachs. Please go ahead.

Cecilia Tang, Analyst, Goldman Sachs: Hi, good morning. This is Cecilia Tang on for Mike Harris. You mentioned strong growth in the construction industry. So I was wondering how much of that demand is coming from infrastructure, residential, industrial and energy?

Peter Matt, President and Chief Executive Officer, CMC: Yes, thank you very much for the questions, Cecilia. Infrastructure has been very strong. It has been for the past several years really on the back of the IIJA. And we expect it’s going to continue to be strong. And I would say that we expect there to be a follow on bill so that this should be a multiyear trend.

On nonresidential construction, it’s been a bit mixed. There have been certain areas that are very strong, areas like energy, as you cite, that’s been very strong data centers, obviously, very strong Institutional spending on hospitals, so that type of thing has been also very strong. But then there have been other areas that are kind of weaker, and I’m thinking about kind of commercial buildings. Retail has been weaker. The thing that’s exciting about the nonresidential space is that there is a huge backlog of potential projects coming down the pike.

And I’m thinking about, and we’ve said this before, there are something like $2,000,000,000,000 of potential projects that are out there that have been announced. And then there’s still a huge pipeline of potential projects that come behind that in some of these trade deals if and when they get negotiated. So we’re very bullish about a turn in nonresidential spending, and we’ll see that move from kind of what’s been flattish to something that’s growing again. And then lastly, residential markets. Residential markets have been lackluster, I would say, and a lot of that is tied to interest rates.

Those markets tend to be more sensitive to interest rates. But as we see interest rates start to come down, we have confidence that we’re going to see a turn in that market. And remember that we have a deficit of 2,000,000 to 4,000,000 homes in this country. So there’s absolutely a demand backdrop that warrants the residential spending. And we just have to get to a place where the economics support that.

But we think we’re going to see that as rates continue to drift down. So in total, we are we remain very bullish about the level of spending over the next several years. Each of these sectors, it’s a multiyear trend.

Cecilia Tang, Analyst, Goldman Sachs: Thank you. That’s very helpful. And I was wondering, given the bullish outlook, why is it that the first quarter outlook is not more positive, especially given the positive performance in the current quarter?

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Cecilia, there’s a few moving pieces to our outlook for the first quarter. You’re correct. As far as North America Steel Group is concerned, we’re going to have a very strong quarter in the first quarter. We often measure the North American Steel Group as a EBITDA per ton. And it was great to see in the fourth quarter that the EBITDA per ton of that segment was over $200 a ton.

And as we said in our stated remarks that we exited the quarter with a metal margin over $30 a ton higher than average for the quarter. So North America Steel Group will have a great quarter. However, if we look at our Europe Steel Group, two aspects to that. We talked about the reduction in the CO2 credits. We will get another credit in the first quarter, but it will be roughly half of what we received in the fourth quarter.

So that’ll be a $15,000,000 impact. And then we have our typical seasonal planned maintenance outage that will reduce the operating performance, excluding the CO2 credits to near breakeven. And the other piece is within the EBG group, because TENSAR means a significant portion to that business and it’s really involved in site prep, The seasonality of that business is quite a bit more significant than our other businesses. So as we guided towards improvement over last year, but a similar type of transition from fourth quarter to first quarter, Those are the major factors which drive us towards a fairly consistent overall quarter over quarter, but many different moving pieces within the portfolio.

Cecilia Tang, Analyst, Goldman Sachs: That makes sense. Thank you.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Thank you, Surya.

Moderator/Operator, CMC: And your next question today will come from Satish Kathanasan with Bank of America. Please go ahead.

Satish Kathanasan, Analyst, Bank of America: Yes. Hi, good morning, Peter and Paul. Congrats on a strong quarter and the announced acquisition. You, With Foley and CP and P now, I mean, like, I think you now have strong scale in the precast concrete market. With this kind of size, do you think the focus over the next couple of years will be to just integrate the assets and reduce debt?

Or given the fragmented market, would you continue to look for additional inorganic growth opportunities?

Peter Matt, President and Chief Executive Officer, CMC: Yes. So that’s a great question. So thank you very much. The as we kind of look forward with these two transactions, I’d say it’s fair to say we are done for now. We have quite a bit of integration to do with these transactions, and we’re very happy with the platform that we’ve built.

As we look a little bit further forward, once we bring our leverage down to into our acceptable range,

Peter Matt, President and Chief Executive Officer, CMC: then

Peter Matt, President and Chief Executive Officer, CMC: we would start to look at other transactions. We think this is a big market. Again, precast overall, as we said on the last call when we introduced CP and P, this is a $30,000,000,000 market and it’s fragmented and we think they’re going to likely be opportunities for us over time. Bolt ons will be super attractive because they typically are cheaper, they come with synergies and they strengthen our core, which is kind of part of the message that we are consistently trying to reinforce. And bigger transactions will likely be more episodic.

But our goal for this platform is ultimately to create one of national scale that looks a little bit like our rebar business. Again, and that’s to do that, we’re going to build a platform that’s several $100,000,000 of EBITDA. But we’re going to do it in a measured base on a measured basis. And remember, we’ve always said from the beginning, we’re going to be super disciplined about M and A and making sure that we deliver the returns on the M and A that we do. And integrating these assets successfully is absolutely critical to ensuring the success of that going forward.

So very excited about the opportunity. And these two businesses could not fit together better. So anyway, super excited about what we have so far.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Satish, I would just add, as we’ve been talking with the investment community probably for two years, we’ve been looking at the early stage construction and really honing in on this precast market. And the one thing that came up repeatedly was the these are the two leaders in the space. And so obviously, we don’t dictate timing of when the assets become available. But when they became available, it was imperative that we took a look and tried to build the portfolio that made sense.

Satish Kathanasan, Analyst, Bank of America: Yes, that’s great to hear. Just on Foley, it is clear like the that the margin profile is one of the best today. But can you maybe share the historical growth rate portfolio like over the past two, three years? And looking ahead, do you see potential for this business to continue to like grow or gain market share and grow above the 5% to 7% market growth?

Peter Matt, President and Chief Executive Officer, CMC: Yes. I think if you look at the growth over the of the business over the last couple of years, I think we should assume there’s a base level of growth that’s kind of GDP related. And then on top of that, there’s growth related to kind of share expansions that the businesses are that the business makes. And in the case of Foley, it has a number of expansions that it’s in progress on in its territory today that or in its territories today that will provide opportunities for future growth. So we would expect to grow at a level in excess of GDP over the next couple of years from a volume standpoint.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: And I would just add, Satish, the margin level that we described in the material, the business has generated that consistently over, the last handful of years. So very consistent performer.

Satish Kathanasan, Analyst, Bank of America: Okay. Thank you. I’ll jump back in queue. Thank you.

Moderator/Operator, CMC: And your next question today will come from Alex Hacking with Citi. Please go ahead.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Yes. Thanks. Good morning and congrats on the deal. I guess just following up on the margin question, Foley’s margins look like they’re almost double CP and P. Could you maybe give a little more color on kind of what’s driving that?

And is there a potential opportunity to increase margins at CP and P from learning from Foley? Thanks.

Peter Matt, President and Chief Executive Officer, CMC: Yes. Thanks, Alex. Appreciate the question. So a couple of things that I would point to. And again, I think as we look at these businesses, we of the things we really like about this is we’ve and as Paul said, we spent a lot of time looking at these businesses, is that they both bring strength to the table.

There are certain things that Foley does really well, and there are certain things that CP and P does really well. And I think the combination of those two companies is going to build a really formidable company for in our portfolio. If we look at Foley specifically relative to CP and P and try to articulate the margin differentials, one of the things Foley has a different operating model than CP and P and so that’s a factor. And the other thing that I would say on the CP and P side is that CP and P has made a number of acquisitions recently where they are kind of works in process and so are works in progress. And so as a consequence, the margins in some of those businesses are lower and they bring down the overall margin.

So if you look at Precast in general, it is the case that Foley’s margins stand out. But CP and P does, if you look at the plants that are kind of the more mature plants, they have very attractive margins there as well.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Okay. And then just following up, I guess, the cash conversion side, of the $600,000,000 CapEx next year estimate, how much of that would be for Precast? And within that, how much would be kind of sustaining versus growth? Yes.

Peter Matt, President and Chief Executive Officer, CMC: There’s well, for Precast, it’s the maintenance CapEx on these businesses is much lower. We talked about in the case of CP and P, you may remember, we talked about 8,000,000 to $10,000,000 of maintenance CapEx. In the case of Foley, it’s probably like a kind of 10,000,000 to 15,000,000 type of number. In the case of CP and P for the reason that I just explained to you, they’ve got these businesses that they’ve acquired where there’s some investment that we think we can support. Their spending is probably going to be a little bit higher over the first couple of years of our ownership as we kind of

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: bring together the investments that they’ve made. And again, those are all all of that CapEx beyond maintenance is maintenance or is spending that has very attractive returns tied to it. The only thing, Alex, I’d add is Peter’s talking about annual numbers. And as we talked about, really, we expect the transaction to close in by the end of the calendar year. So the numbers in our fiscal will be a lot lower than those.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Thanks for the clarification.

Peter Matt, President and Chief Executive Officer, CMC: Thank you.

Moderator/Operator, CMC: And your next question today will come from Carlos De Alba with Morgan Stanley. Please go ahead.

Peter Matt, President and Chief Executive Officer, CMC: Yes. Thank you very much. Good morning. And maybe a follow-up on the prior question. How quickly do you think that the margins in CPP, like and particularly in those recent acquisitions could bring to the bring up or come to the levels that Foley and maybe the core CPP business is already experiencing?

Is it next

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: year or two years? Great

Peter Matt, President and Chief Executive Officer, CMC: question, Carlos. So the one thing I’d say is, we want to be a little careful. We don’t own these businesses yet. So we need to kind of close on the transactions and better understand what we have. And with that understanding will come more clarity on the timeframe.

But I think the appropriate way to frame it for you at this juncture is that we talk about the synergies as being achievable over a three to five year horizon. And I think that that’s the right horizon to think about for any kind of improvement in the CP and P margins. Obviously, are some things that will be that will come quick and then there’s other things that will take longer. I just mentioned before in response to Alex’s question that we’re going to put some extra capital into in the tune to the tune of kind of $5 ish million in per year into CPMP and that will be to accelerate some of that. And again, that’s all really high return capital that we’ll be deploying.

Peter Matt, President and Chief Executive Officer, CMC: All right. So the 5,000,000 to $10,000,000 incremental EBITDA in CPP that you mentioned, that includes this recent acquisition by the company stepping up their EBITDA generation, right?

Peter Matt, President and Chief Executive Officer, CMC: No. Just to be clear, so when we announced CPMP, we said that there was 5,000,000 to $10,000,000 in that transaction. We maintain that, right? That’s and then in this transaction, we’re bringing another 25,000,000 to 30 over a three to five year period. So it’s a that’s why and you’ll remember in the last conversation that we had when we acquired or when we acquired announced the acquisition of CPMP, we said that, as we have a platform, we would have more synergies with successive moves.

And this is a great example of this. And honestly, you might ask the question about the timing of these two transactions. And obviously, we couldn’t call the timing. But I think when you see that magnitude of synergies, it makes it clear why this was a transaction we had to look at seriously. So it’s yes, it’s an extra 25,000,000 to 30,000,000 in this transaction.

Peter Matt, President and Chief Executive Officer, CMC: All right. Fair enough. And my second question is regarding the outlook for dividends and buybacks vis a vis the cash flow generation of the company. You did mention that the acquisitions of both of them are going to be accretive to free cash flow. You’re not going to really pay a lot of cash taxes in the next two years.

How do you see dividends and buybacks in the coming quarters?

Peter Matt, President and Chief Executive Officer, CMC: Yes. So let me just say to answer your question directly, on dividends, we will we have no plan to change our dividend, plan to change our dividend. And I’d say also our long term capital allocation strategy is not changing at all, not at all. What I would say is that we are done with acquisitions for now, and we’re going to focus on big acquisitions for now, and we’re going to focus on integration and making sure that we make these transactions highly successful and great return investments for our business. We will continue the organic growth projects that we’ve started across the company.

As we move past Steel West Virginia, these will be much more capital light investments, but we will continue those. And we will slow down our share repurchase program and probably bring it to a level where we’re offsetting employee share grants in the short term as we get our leverage back down below the two times target. And as we once we get to the two times target or below, we’ll then ramp up share repurchases. Share repurchases are a critical part of our capital allocation strategy, and we intend to resume those as our balance sheet comes into line.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: And Carlos, we’re very confident in both the numerator and the denominator in terms of being able to bring that leverage down. In terms of the you mentioned the cash flow and the lack of U. S. Cash taxes, the reduction in CapEx going forward and the optimism in the current environment in our business, is that cash flow generation is expected to be very strong. And then that also is helping the EBITDA that we expect the business to generate over the coming periods is also expected to be strong.

And therefore, we should both aspects should help us achieve that two times net leverage over the coming quarters.

Moderator/Operator, CMC: Perfect. Thank you.

Peter Matt, President and Chief Executive Officer, CMC: Thank you, Carlos.

Moderator/Operator, CMC: And your next question today will come from Bill Peterson with JPMorgan. Please go ahead.

Carlos De Alba, Analyst, Morgan Stanley: Yes. Hi, good morning. Thanks for taking the questions and congrats on the second transaction here in a few months. Along those lines, I have a longer term question, maybe more suited for a Capital Markets Day. But given these transactions, how would you envision the company looking like in sort of a five plus year time frame in terms of product mix, rebar versus long products, ground stabilization, precast or other materials?

Given the margin structure in these newer businesses and acquired companies, would you consider selling core assets in order to accelerate the transition? Just trying to get a sense on how we should envision this company over the long term.

Peter Matt, President and Chief Executive Officer, CMC: Yes, it’s a great question. If you think about the strategy that we’ve outlined, it’s one of becoming an early stage construction supplier. And if you think about our rebar business, fabrication business, these fit perfectly, and these are early stage construction suppliers. You think about our tensor business, it’s early stage construction. Think about our recently acquired Precast platforms, early stage construction, PRS, Performance Reinforcing Steels, early stage construction and construction services, same thing.

So if you look at the portfolio that we have today, we’ve got a number of interesting assets that we can build on. And that’s one of the things we find so compelling about the portfolio to become a leader in early stage construction. So when we talk about our Precast business, again, as I said response to an earlier question, our goal is to build that into something where we have a national footprint and that’s going to mean kind of several $100,000,000 of EBITDA. With these two transactions, we’re well on the way to doing that. And with the footprint that Foley brings, I think we have a beachhead to examine some of those markets that, by the way, we know well because we’re already in those markets with fabrication and our mills business, right?

So there’s a very natural path that we’re following. As we look at our other EBG businesses, we would love to grow Tenthar. We think that has great potential and it’s still a very underpenetrated market. It could be it will be an important piece of our portfolio. Performance reinforcing steel, the plant that we have today is sold out, so we’re building another one.

And we believe that the demand for kind of corrosion resistant steel in this country, given some of the changes in weather and so forth, is only going to increase. And construction services is a tremendous asset. We talk to customers and the customers tell us the construction services business where we are and it’s really a small segment of our footprint is which is really Texas, Louisiana and Oklahoma, is it’s a great asset to the customers we have. So that’s something that we’re looking at as a potential way to kind of complement the early stage construction portfolio that we’re building. So it’s as we look at the portfolio, again, what we want is we want businesses that can be of scale and that can be of significance to our customers.

We want businesses that bring value to our customers. So it’s difficult to define the portfolio precisely, but the direction that we’re going is we want value added products that have high margins and kind of good returns on invested capital. And I want to just come back sorry, is a long answer, but I think this is important. I want to come back to our steel business and TAG. And the whole mission of TAG is to improve the great platform that we already have in steel.

And it is so critical when we talk to the customers, and I’m talking about big contractors, they tell us, guys are your franchise in the steel market is tremendously valuable to us because you do what you say you’re going to do and you do it when you say you’re going to do it. And TAG is helping us make that business even better. And our goal with that business is to raise the margins through the cycle, so that they start to look like the margins in some of our kind of ultimately some of our EBG businesses. So again, this is a it’s a multiyear journey, but we think we have a lot of opportunity. And the team that’s executing the TAG program within our company is doing a phenomenal job.

So anyway, Bill, I know that’s a long answer to your question, but hopefully, it gives you some color.

Carlos De Alba, Analyst, Morgan Stanley: No, certainly. Thanks for all the details there. My next question is more, I guess, near term focused. And you talked about typical seasonality across several of these sectors. But I guess on North America, if we look back, this would imply something like a down 3% to 7% quarter on quarter, but we’ve seen a lot of variability over the last five years or so.

And I would assume you’re really talking more driven by the downstream versus products. But can you unpack what typical seasonality has really meant here and what that may look like for the various subsectors, subsegments of your business?

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Yes, Bill. The season, September through November, really, is a good construction season similar to our fourth quarter with the exception of the week that we lose for Thanksgiving. So really, we see it’s usually that 2%, 3% reduction in volumes that we see in the first quarter on the North American Steel Group. As I said in an earlier answer, we do see impacts to the other segments a little bit stronger given the more cyclical nature of site preparation, which drives a lot of the EBG business. So that one is a little bit more seasonal as you saw last year.

And then Europe with the outage, it’s less seasonal, but outage season.

Carlos De Alba, Analyst, Morgan Stanley: Thanks for that, Paul. Thanks for all the details. Appreciate it.

Peter Matt, President and Chief Executive Officer, CMC: Thank you, Bill.

Moderator/Operator, CMC: And your next question today will come from Andrew Jones with UBS. Please go ahead.

Bill Peterson, Analyst, JPMorgan: Hi, gents. I just want to better understand the barriers to entry in this business. Mean, to me, it looks like it’s a pretty fragmented business. You obviously called out a few things on the slides, including relatively high capital costs. Mean, could you give us some idea in terms of how to sort of quantify those?

And when you talk about the steep learning curve, can you kind of give us some sort of sense as to how complex this is? Because I just high level, our fragmented business usually means much lower margin than we’re seeing in these numbers. Yes.

Peter Matt, President and Chief Executive Officer, CMC: So again, if we look at what drives this business, it starts with customer relationships, right? And if you look across the portfolio of CPMP or Foley, they’ve got great relationships in the region that connect them and obviously a reputation and the capability to service these the jobs that they’re getting. And I think obviously reputation just like in our rebar fabrication, it’s critical that you deliver the products on time and that you deliver good quality products and that you help the contractor accelerate their job. So those are really important. And the third leg of this is capability.

And when you look at the capabilities of both CP and P and of Foley, they bring a broad based Precast capability. So you can be in the precast business pretty easily if you kind of have a concrete mixer and a mold. But the point is, is that most of these complicated job sites, they need a lot of different forms to be to serve the precast need. And so as a consequence, the capability that both of these companies have across the concrete pipe and precast fronts gives them a differentiating capability to perform in the market on these complicated jobs. And the last thing I would say is and this goes to the speed point is that having some scale helps a lot on these larger jobs because again what the contractors will tell you is when they start a project they want to go fast.

And so they don’t want to wait for material and the party that can have the material available has a real advantage in supplying the product.

Satish Kathanasan, Analyst, Bank of America: In terms of the percentage of it’s thanks very much.

Peter Matt, President and Chief Executive Officer, CMC: So can you Andrew, can you start over because we lost that follow on.

Satish Kathanasan, Analyst, Bank of America: No, no, Just that’s clear. Thank you.

Moderator/Operator, CMC: Your next question today will come from And your next question today come from Katja Jankic with BMO Capital Markets. Please go ahead.

Peter Matt, President and Chief Executive Officer, CMC0: Hi, thank you for taking my question. Maybe just quickly, Peter, did you say earlier on in the call that you would like to grow the Precast business to $700,000,000 in EBITDA. Did I hear that correctly?

Peter Matt, President and Chief Executive Officer, CMC: No, no. Several $100,000,000. $100,000,000. Sorry, go ahead.

Peter Matt, President and Chief Executive Officer, CMC0: No, no. You go. Sorry.

Peter Matt, President and Chief Executive Officer, CMC: No, I was just going to say several 100,000,000. And again, between these two acquisitions, we’re already at $250,000,000. So we were at we’ve got a good start.

Peter Matt, President and Chief Executive Officer, CMC0: And I think before with the announcement of the first acquisition, the commentary was that most of this the growth there is more likely through M and A. Is that correct?

Peter Matt, President and Chief Executive Officer, CMC: It is. It is. I mean, there are organic projects and I noted two of them earlier in this call on the Foley platform and there’s a number of organic growth projects in the CPMP platform. But again, to build scale and the scale that we’re talking about doing, as I said in the last call, it’s likely going to involve M and A. The good news is that now, as I said, we have a real platform that we can build around.

So bolt on acquisitions that come with lots of synergies will be very appealing. And then when they come around, some of these the larger acquisitions, which are not going to be every single day, but when they come around, we’ll be in a position to look at those as well.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Just to supplement that, Katch, I would say the step change comes from inorganic growth. I think as we look at the trends in these businesses, we see above average growth for the adoption and penetration of Precast product. They really solve a labor shortage issue. They solve stormwater management issues. And that has been what really has driven some good sized growth.

And if we look at the regions in which these businesses operate, expectation of construction activity in their geographies is expected to be very attractive over the coming years.

Peter Matt, President and Chief Executive Officer, CMC0: Perfect. Thank you so much.

Peter Matt, President and Chief Executive Officer, CMC: Thank you, Katja.

Moderator/Operator, CMC: And your next question today will come from Phil Gibbs with KeyBanc Capital Markets. Please go ahead.

Satish Kathanasan, Analyst, Bank of America: Hey, good morning.

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Hey, Phil.

Peter Matt, President and Chief Executive Officer, CMC1: Question about the CapEx guidance for this year around $600,000,000 Does that include CapEx related to the businesses that you’re poised to close on? And if not, what’s the typical maintenance level of CapEx associated with those businesses?

Peter Matt, President and Chief Executive Officer, CMC: Yes, it does not. That’s a CMC CapEx number. But Phil, you may have heard us say in response to an earlier question, the maintenance CapEx for these businesses, it’s probably eight to 10 for CPMP and probably 10 to 15 for Foley. So they’re not big CapEx numbers.

Peter Matt, President and Chief Executive Officer, CMC1: That’s a percentage of their revenues?

Peter Matt, President and Chief Executive Officer, CMC: No, that’s $1,000,000

Paul Lawrence, Senior Vice President and Chief Financial Officer, CMC: Yes. So it’s generally 3% to 4% revenue in this precast space is the maintenance CapEx, a very generic number, but that’s it’s very capital light.

Peter Matt, President and Chief Executive Officer, CMC1: Okay. And as you’ve really pivoted and accelerated the strategy to acquire some of these more upstream oriented construction facing businesses in The United States, particularly in the Southeast and Mid Atlantic. Do you think that, that means that there should be a more natural buyer perhaps for your European assets?

Peter Matt, President and Chief Executive Officer, CMC: Well, so again, from a when we look at our European assets, I think I’ve said this in the past, we really, really appreciate those assets for what they bring to the CMC family. And I would just point to the TAG kind of initiative that I mentioned earlier on the call, the team in Europe has done just a phenomenal job on being low cost and there’s a lot that we can extrapolate from what they’ve done to help us in North America. And one of the things that our team in North America is absolutely dead set on is that we will be a low cost producer in our steel business in North America. So we the Polish business brings a lot to the table and it’s absolutely a core part of our portfolio.

Moderator/Operator, CMC: At this time, there appears to be no further questions. Mr. Matt, I’ll turn the call back over to you.

Peter Matt, President and Chief Executive Officer, CMC: Thank you very much. At CMC, we remain confident that our best days are ahead. The combination of the structural demand trends we have noted, operational and commercial excellence initiatives to strengthen our through the cycle performance and value accretive growth opportunities, including our recently announced Precast acquisitions, create an exciting future for our company. Thank you for joining us on today’s conference call. We look forward to speaking with many of you during our investor calls in the coming days and weeks.

Thank you very much, everybody.

Moderator/Operator, CMC: This concludes today’s CMC conference call. You may now disconnect.

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