Good day, and welcome to Martin Marietta's third quarter 2023 earnings conference call. All participants are now in listen-only mode. A question-and-answer session will follow the company's prepared remarks. As a reminder, today's call is being recorded and will be available for replay on the company's website. I will now turn the call over to your host, Ms. Jacklyn Rooker, Martin Marietta's Director of Investor Relations. Jacklyn, you may begin. Thank you. It's my pleasure to welcome you to our third quarter 2023 earnings call. Joining me today are Ward Nye, Chairman and Chief Executive Officer, and Jim Nickolas, Executive Vice President and Chief Financial Officer. Today's discussion may include forward-looking statements as defined by United States securities laws in connection with future events, future operating results, or financial performance. Like other businesses, Martin Marietta is subject to risks and uncertainties that could cause actual results to differ materially. We undertake no obligation, except as legally required, to publicly update or revise any forward-looking statements, whether resulting from new information, future developments, or otherwise. Please refer to the legal disclaimers contained in today's earnings release and other public filings, which are available on both our own and the Securities and Exchange Commission's website. We have made available during this webcast, and on the Investors section of our website, supplemental information that summarizes our financial results and trends. As a reminder, all financial and operating results discussed today are for continuing operations. In addition, non-GAAP measures are defined and reconciled to the most directly comparable GAAP measure in the appendix to the supplemental information, as well as our filings with the SEC and are also available on our website. Ward and I will begin today's earnings call with a discussion of our operating performance and the outlook for the remainder of 2023. Jim Nickolas will then review our financial results and capital allocation, after which Ward will conclude with end market trends and our preliminary view for 2024. A question-and-answer session will follow. Please limit your Q&A participation to one question. I will now turn the call over to Ward. Thank you, Jacklyn. Welcome, everyone, and thank you for joining today's teleconference. Martin Marietta once again delivered record results across nearly every financial and operational measure, extending our long track record of industry-leading performance and responsible, profitable growth. Thanks to the dedication of our colleagues across the enterprise, we achieved a company milestone by exceeding $2 billion in trailing twelve months Adjusted EBITDA for the first time. Our exceptional third quarter is highlighted by a 42% improvement in aggregates gross profit per ton, despite lower shipments, further validating the benefits of our Value Over Volume commercial strategy and our commitment to operating with excellence while meeting and exceeding our customers' needs. Importantly, while our work in continuous safety improvement is never done, I'm proud to report the company concluded our safest third quarter on record, with total and lost time incident rates surpassing world-class levels. While not a third quarter event, it's notable that just yesterday, on October 31st, we finalized the sale of our Tehachapi, California, cement plant, substantially completing the planned asset sales from the 2021 Lehigh Hanson West acquisition. Consistent with our SOAR 2025 initiatives, this divestiture of a non-strategic asset provides us with additional balance sheet flexibility to advance our well-articulated path of quality aggregates-led growth. As detailed in today's earnings release, we raised our full year 2023 Adjusted EBITDA guidance to a range of $2.05 billion-$2.15 billion, as pricing momentum will more than offset lower shipments and recently increased energy and related costs. Turning now to Martin Marietta's third quarter financial performance, we established all-time quarterly records across a number of areas, including consolidated total revenues of $2 billion, a 10.1% increase, consolidated gross profit of $676 million, a 38.6% increase, earnings per diluted share from continuing operations of $6.94, a 48.6% increase. Adjusted EBITDA of $705.2 million, a 32.3% increase, and aggregates gross profit per ton of $7.89, a 42.4% increase. These results reinforce the durability of our aggregates-led business, which is strategically situated in well-curated geographies. These record results also reflect our team's focus on what we can control, despite heightened geopolitical tensions and persistent macroeconomic headwinds, including growth-restrictive monetary policy and continued inflation. Shifting now to our third quarter shipment and pricing results, aggregate shipments declined 7.3%. Our Value Over Volume strategy is clearly an unapologetic component of that result, as is softening demand in certain Midwest and Southwest markets, which was partially offset by continued strength in key Southeast markets. Aggregates pricing fundamentals remain very attractive, with pricing increasing 20% or 17.2% on a mix-adjusted basis as we continue to expect fair value for our depleting resources. Near sold-out Texas cement conditions, particularly in the Dallas-Fort Worth metroplex, continue to drive strong product demand in a favorable commercial environment. Third quarter cement shipments of 1.1 million tons were flat to last year's comparable period, and pricing grew 18.9% as we continue to largely sell as much as we can produce. We expect favorable Texas cement pricing dynamics will continue and accordingly announced a $15 per ton price increase, effective January first. Turning to our targeted downstream businesses, ready-mix concrete shipments increased 3.6%, while pricing improved a solid 20.9%. Asphalt shipments increased 5.7%, and pricing increased 6.7%. Before providing our outlook for the remainder of 2023 and a preliminary view of 2024, I'll turn the call over to Jim to conclude our third quarter discussion with a review of the company's financial results. Jim? Thank you, Ward, and good morning, everyone. The building materials business posted record quarterly revenue of $1.92 billion, a 10.5% increase over last year's third quarter, and record quarterly gross profit of $649.5 million, a year-over-year increase of 38.4%. Aggregates gross profit improved 32.1% relative to the prior year period, to a record $440.6 million, as pricing growth more than offset lower shipments and higher production costs, underscoring the strength and effectiveness of our value over volume commercial strategy as a distinguishing hallmark to grow profitability through economic cycles. The business also achieved an aggregates gross profit margin of 36.2%, setting a new all-time profitability record despite the shipment decline. Our Texas cement business also extended its track record of outstanding performance. Revenues increased 18.3%- $199.1 million, while gross profit increased 61.5%- $108.7 million. Pricing growth and lower energy costs more than offset higher raw materials and maintenance costs. Domestic production capacity constraints and robust demand continue to drive extremely tight supply, particularly in North Texas. As a reminder, Martin Marietta has taken two notable steps to increase our Texas cement production capacity to capitalize on these supply-demand dynamics. First, we've wholly converted our construction cement customers from Type 1, Type 2 cement to a less carbon-intensive Portland Limestone Cement, also known as Type 1L, at both our Midlothian and Hunter, Texas, plants. This conversion not only reduces our carbon footprint, but also expanded our production capacity by approximately 10%. Second, our Midlothian, Texas, plant is installing a new finish mill, providing 450,000 tons of incremental high-margin annual production capacity. This project should be fully operational in the third quarter of 2024. As previously discussed, we began utilizing the new silos to load customer trucks in July. In addition to increasing cement storage capacity by over 60%, these silos have considerably enhanced the customer experience by reducing loadout cycle times and are saving our customers up to an hour at peak shipping times each day. Our concrete revenues increased 25.3%- $285.2 million, and gross profit increased 81.8%- $34.1 million, driven primarily by steady volume growth, pricing gains, and mega-project contributions, which more than offset higher upstream raw material and delivery costs. Our asphalt and paving revenues increased 14.6%- $359.9 million, and gross profit increased 33%- $66.1 million, reflecting higher selling prices and lower bitumen costs. Magnesia Specialties revenues totaled $75.5 million in the third quarter, in line with the prior period, and gross profit increased 3.6%- $21.4 million. Softening demand in certain magnesia end markets, including TPO Roofing and metal mining, was more than offset by commercial and operational excellence initiatives and energy tailwinds. We expect demand to soften due to labor unrest in the automotive sector and magnesia end markets remaining weak in the fourth quarter, and as such, have reduced our Magnesia Specialties full-year gross profit guidance. During the quarter, our board of directors approved a 12% increase to our quarterly cash dividend paid in September, demonstrating its confidence in the durability and sustainability of our company's future growth and free cash flow generation. Our annualized cash dividend rate is now $2.96. Since our repurchase authorization announcement in February 2015, we've returned a total of $2.6 billion to shareholders through a combination of meaningful and stable dividends, as well as share repurchases. Our net debt to EBITDA ratio was 1.8x as of September 30, representing balance sheet strength and flexibility to responsibly grow through quality acquisitions and prudent capital investments while returning capital to Martin Marietta shareholders. To conclude my prepared remarks, I want to emphasize that the record-breaking financial performance of this quarter and year to date has demonstrated that disciplined execution of our Value Over Volume commercial strategy yields higher margins, higher profits, and higher cash flow without the benefit of growing volumes. With that, I'll turn the call back to Ward. Thanks, Jim. Looking ahead to the remainder of the year and into 2024, we remain confident Martin Marietta is well positioned to capitalize on attractive market fundamentals across our coast-to-coast footprint. Specifically, infrastructure demand from increased federal and state level investments in heavy industrial projects of scale should counterbalance headwinds in the light, non-residential and historically underbuilt residential sectors, which are more sensitive to tightening credit conditions and higher for longer interest rate expectations. In the third quarter, infrastructure accounted for 39% of total shipments, predictably building to a higher and more normalized portion of our overall business. The value of state and local government, highway, bridge, and tunnel contract awards, a leading indicator for our future product demand, is meaningfully higher year-over-year. These infrastructure contract awards grew 18% to a record $114 billion for the 12-month period ending September 30, 2023. Collectively, we anticipate that the historic increase in public sector investment from the Infrastructure Investment and Jobs Act, or IIJA, record state departments of transportation budgets, and voter-approved state and local transportation ballot initiatives will provide sustained multi-year demand to this aggregates intensive, often countercyclical end market. Aggregate shipments to the non-residential market accounted for 33% of our third quarter shipments. Heavy side energy and manufacturing projects of scale continued to drive demand in this segment, as warehouse and data center construction continues to moderate from the post-COVID period. Construction spending for manufacturing in the United States continues to trend favorably, with the August seasonally adjusted annual rate of spending for 2023 at $198 billion, a 66% increase from the August 2022 value of $120 billion. The Inflation Reduction Act and CHIPS Act, together with significant private investments, provide funding certainty for these large-scale manufacturing and energy projects that we believe will be disproportionately and positively impactful in Martin Marietta markets. Importantly, we have both the ability and capacity to supply these large projects, and with the successful execution of our commercial and operational excellence strategies, will do so in a manner that is margin accretive. Moving to light non-residential, while third quarter shipments remained resilient, we expect the recent interest rate acceleration, together with tighter commercial lending conditions, may impact future demand. That said, the anticipated softness in this segment should be partially offset by the extended cycle and strength of the more aggregates intensive, heavy non-residential sector. Softening in the residential end market, which accounted for 23% of aggregate shipments this quarter, is expected to continue, driven by current mortgage rates, which are nearing 23-year highs at 8%. While single-family housing starts, a leading indicator of aggregates demand, signaled a near-term bottom and inflection point over the summer. The current higher rates are exacerbating affordability challenges and driving our revised expectations of soft demand in this end market. Nonetheless, we fully expect this current single-family housing slowdown will reverse once home prices and borrowing rates find equilibrium, as demand far exceeds supply across key Martin Marietta markets, the result of significant underbuilding over the last decade, and homeowners' reluctance to abandon low rate mortgages. As we look to 2024, our preliminary view anticipates aggregate shipments will be effectively flat, as increased infrastructure investment, coupled with robust activity from heavy non-residential projects of scale, should help balance expected softness in interest rate sensitive private construction end markets. We remain confident that favorable commercial dynamics, underpinned by our Value Over Volume pricing strategy, will be supported by 2023 exit rates, as well as the realization of our previously announced January 1st, 2024 price increases. Together, we expect this will drive low double-digit growth in aggregates pricing and another year of profitable growth in 2024. To conclude, our team achieved impressive results in nearly every aspect of our business against a challenging macroeconomic and geopolitical backdrop. One of Martin Marietta's enduring qualities is our proven ability to adapt quickly and respond effectively and durably to changing circumstances. Accordingly, we're extremely proud of our company's exceptional safety, operational and financial performance through the first nine months of 2023. Moreover, our record-setting third quarter performance, together with our fourth quarter expectations, reinforce our confidence that we will deliver our full year Adjusted EBITDA guidance midpoint of $2.1 billion, an organic improvement of $500 million or 31% over 2022. Through the disciplined execution of our strategic plan, we intend to continue driving responsible and profitable growth in 2023 and into the future. If the operator will now provide the required instructions, we'll turn our attention to addressing your questions. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the one on your touch tone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be pulled in the order they are received. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Kathryn Thompson with Thompson Research Group. Please go ahead. Hi. Thank you for taking my question today. Just following up on the Value Over Volume, which clearly is showing through with the pricing performance this quarter and throughout the year. But it can have an impact on relative market share because ostensibly, you're willing to give up some volume, for, you know, for secure pricing. So could you discuss how it's working and what it means to relative market share and how it affects your business, not just only now, but a bigger picture over the next several years? Thank you. You bet, Kathryn. Thanks for the question. So several things. Can it affect degrees of tonnage going out the gate? Yeah, it can. So if we're looking at the tonnage, down this quarter versus the prior year quarter, probably a little bit less than half of that was due to Value Over Volume. And by the way, we're perfectly okay with that. We've got depleting reserves. That said, on average, we've got 70 years of reserves at current extraction rates, so we've got a long-lived business. But we know the reserves are worth more in the ground tomorrow than they are today. And if we're looking at really where we're ceding some share on, it tends to be lower margin products. In other words, things like base and fines. So part of what we're trying to do is, is we're talking with our customers to make sure that they understand really twice a year is something that we're looking at on revisiting our pricing. The other thing that's important to keep in mind relative to aggregates, and this is different from some other functions as well, it doesn't have to be a 24/7 business. In fact, in most of our locations, it's not. And where you've got 24/7 businesses, incremental volume can give a high degree of operating leverage. That's just not something with which we're encumbered in aggregates. So we shut down each evening and open up each morning, and that gives us an enormous amount of flexibility. And then, probably most importantly, Kathryn, when the volume does come back, and by the way, it typically does, it typically comes back at higher pricing. So you can see the math. I mean, the Value Over Volume strategy works. It protects our reserves, it protects the longevity of our business, and it's something that we've been very clear with our team is important to us, and part of what you can see in the numbers is that it's coming through. So I hope that's responsive, Kathryn. Thank you for the question. Yep, and just one quick follow-up. With the sale of the California cement asset, could you speak to just the general state of your Texas cement operations? How are inventories relative to demand? Have you seen any changes just in terms of that business as you plan for next year? Thanks for the question. As you know, when we went into cement in Texas, we said we viewed that as a strategic cement business, and my prepared comments said we sold a non-strategic asset in California, and we said strategic cement for us meant where we're an aggregates leader, where the market's naturally vertically integrated, where we have a downstream business taking a significant portion of it. In Texas, it's about 30%, and where it cannot be meaningfully interdicted by water. Our Texas cement business is very solid, and part of the reason it's solid is it's in Dallas-Fort Worth, and it's in San Antonio, so it's removed from the vicinities of imports, largely. So what we're seeing in that marketplace and what you saw in the quarter is volumes were largely flat because we're broadly sold out, and we continue to largely sell what we're producing. And part of what we're anticipating and part of what we've announced is a $15 a ton price increase for cement, effective January 1. So I think that those data points give you a good snapshot of where Texas cement is today. Great. Thanks very much. Your next question comes from Trey Grooms with Stephens. Please go ahead. Thanks, and good morning. Hey, Trey. Hey, Ward. So maybe sticking to the pricing thing here, particularly in aggregates, if you could maybe talk through your initial 2024 aggregates pricing outlook of low double digits growth that you've laid out and maybe unpack, you know, how much you have coming from carryover at 2023 mid-year increases and, you know, how you're setting the stage for low double digits price improvement in 2024? Happy to, Trey. Thanks for that. So we're thinking about the 2024 guide similar to the way that we did the 2023 guide. What I mean by that is the guide that we've given, I think this is more to state out immediately, does not include any mid-years. Again, just as we saw in 2023, we think we're gonna have mid-years in 2024, but right now the guide that we've given does not assume that. So I think that's important. Secondly, as I indicated in the previous question, we think mid-years are becoming more and more the norm with our customers, and we think the expectations have been set. The customer letters that have gone out indicate that pricing is largely effective from January 1 to June 30. So in the correspondence that has already gone, people know that we're gonna protect them through mid-year. Now, in fairness, there's a footnote to that, and the notable exception is California, where our pricing letters already include announced mid-years so that our customers can plan for that in that marketplace. We've long talked about what we inherited when we bought the business in California, and we're, we're trying to address that. Just to be clear, California total 2024 increases right now look like that's gonna be about $4 a ton across all products and markets as we continue to implement that strategy, in particular, in what's a relatively new marketplace for Martin Marietta. Now, to your point... if we're thinking about the way carryovers are gonna work, carryovers next year are probably gonna be in the low single digits, so a little bit lower than they were this year. But again, we've got a lot of confidence in what we think we will come out with on January 1. And then again, if we have something that even begins to replicate what we saw in mid-year next year, and frankly, there's probably some upside to that trade. So I think that gives you a good build on the way that we see that working in 2024, based off exit rates in 2023. Yep. Super helpful, Ward. Thank you so much, and good luck. Great. Thanks so much. Your next question comes from Stanley Elliott with Stifel. Please go ahead. Hey, good morning, everyone, and congratulations. Ward, Jim, can you guys talk about what you guys are seeing on the M&A front? I mean, historically, you've done a nice job strategically expanding the footprint, leverage the 1.8, you know, free cash flow, cement sale, even better by year end. What is the M&A, your market looking like these days? Stanley, thanks for the question and for the comments in the quarter. The M&A market is actually looking increasingly attractive. The level of dialogue has amped up in the second half of this year. From my perspective, that wasn't a tremendous surprise. As you know, 2021 was a big year for M&A for us, and part of what we've been doing since then is a lot of what you saw in today's announcements relative to the sale of Tehachapi, making sure we're getting our pricing right in different markets, making sure we're getting our hands around the operations. And now, as we sit here today, several things are apparent. Number one, we're looking at a debt-to-EBITDA ratio of 1.8 times, so that's below our targeted range. Two, you can see from the financials what the cash flow in this organization looks like, that, that can clearly help fuel and will fuel some aggregates-led, frankly, from my perspective, pure aggregate transactions. And then two or three, when we had the proceeds that have just come in from Tehachapi, it puts us in a very attractive place. Do I think we'll have anything to announce here in the rest of this year? Probably not. Do I hope that we'll have some things that we can announce early next year? I think that we will. So more to come on that, Stanley. But again, we like financially where we're sitting, we like strategically where we're sitting. We like what we believe or what we know we can do from a regulatory perspective, because we think that's a differentiator right now. So we believe that we can continue to give you price, we believe we can continue to give you really good cost control, and we believe we can keep giving you good, solid, attractive M&A, and we think that's a hat trick that very few can offer today. Great, guys. Thanks so much, and best of luck. Thank you, Stanley. Your next question comes from Jerry Revich with Goldman Sachs. Please go ahead. Yes, hi. Good morning, everyone. Hi, Jerry. Hi. We're just pulling together, you know, what you shared on your preliminary comments, you know, double-digit pricing growth, flat volumes, you know, embedding, you call it high single digit, COGS per unit growth. I mean, that essentially gets you to roughly $200 million of aggregate profit growth, 2024 versus 2023, which is, you know, I think, broadly consistent with the consensus growth expectations for total company, but, 2024 versus 2023. So I know you're not providing your, full 2024 outlook here, but it does feel like you're giving us the pieces to get to consensus EBITDA numbers with probably higher profitability and lower volumes than what folks expected on a bottom-up basis. Is that fair and any other puts and takes that, that you would add? Yeah, I think that's relatively fair. And if you think about it, Jerry, I think that's what we did in Q2, and I think that's what we've done in Q3. I mean, I think part of what you're seeing is the world can go through different degrees of economic turmoil, and this is a business that continues to be very steady, very durable in all forms of markets. So I don't disagree at all. I'll turn it over to Jim in just a moment so he can add if there are any particular things that, that he wants to make sure he calls out. But one of the things that I think is worth noting, Jerry, I mean, did energy help us this quarter? Absolutely, it did. But I think part of what's so striking to me is, even if we did not have the energy tailwind that we did this quarter, we would have set new records this quarter anyway. And, and I think it's so important because I know what you're looking for, those puts and takes. I wanted to go ahead and address that one upfront, because while in the quarter that was powerful, it would have been a very powerful quarter even without that. Jim, anything you want to add? Yeah, no, it's just, it's just that the cost inflation continues to moderate slightly, still elevated compared to historical levels. But, again, as we've demonstrated this year, we expect it to happen next year, pricing growth exceeds cost inflation, so we do expect margins to expand next year. Super. And can I ask just a follow-up? The downstream businesses, you folks are executing really well. This year, you know, how much of that has been because of a helpful move in diesel and liquid asphalt versus, you know, what's sustainable in the new portfolio, particularly on the ready-mix side post the divestitures? Yeah, Jerry, thanks for the question. I would say several things. One, if you think about our ready-mix business, it's almost uniquely in Texas and Arizona, and those are two very good markets. And one reason that they're good is, look, you're in New York. If you look out your window, you're gonna see asphalt streets, and when you get to the bridges, you'll have concrete bridges. If you're in Texas, you're riding on concrete roads and concrete bridges, and you're building things structurally with concrete as well. So those markets tend to be more durable from a supply perspective, because, again, you've got that really non-cyclical or often countercyclical infrastructure market that we'll play so meaningfully in, in our ready-mix business there. Now, clearly, ASP was up 20% in ready-mix. That helped a lot, but frankly, volume was up very modestly. And again, Texas is 80% of our volume in ready-mix. Now, alternatively, if you go to HMA, give you a sense of that's gonna be full year, probably about 9 million tons. So it's a fairly notable business. Now, practically speaking, it's in three places. It's in Minnesota, it's up and down the Rocky Mountains, and it's in California. And what we saw there was ASP was up 6.7% because liquid wasn't moving as much. But the fact was, Q3 was an all-time record of almost 3.9 million tons for us in asphalt. And keep in mind, asphalt is gonna be about 95% crushed stone. So from our perspective, that's a very attractive business, particularly in Minnesota, where, as you recall, Jerry, it's largely an FOB business, so it's truly a materials business for us there. Of that 9 million tons, Minnesota is gonna be a little bit over 3 million of it. So at least those are the, the quick puts and takes that we've got on that. Jim, anything you wanna add on that? Yeah, I mean, obviously, the bitumen pricing costs did help the asphalt paving business improve margins. It wasn't wholly due to that, of course, but on the ready-mix side, I would say it was very, very little added from the lower energy costs. So, hopefully, that answers the question, too, just rounding out what Ward had provided. It does. Thank you. Thank you, Jerry. Take care. Your next question comes from Anthony Pettinari with Citi. Please go ahead. Good morning. Hi, Anthony. Hey, Ward, you talked about some softness in aggs in the quarter in the Southwest and the Midwest, if I heard that right. I was just wondering if you could talk a little bit more about that. Was that, you know, weather-driven or maybe a specific end market? Just wondering if there's any carryover into 4Q or potential reads into 2024. Thanks for the question. You had a couple of things. One, in the Southwest, frankly, you had a lot of heat, and the heat slowed some things down, and you also had some timing relative to the large energy projects as well. So I see a lot of that being pushed off to the right. I mean, clearly, and it's not just a Southwest or Midwest issue. There's some degrees of softening relative to warehousing and data centers. I mean, that's not a surprise. We anticipated that. But what we are seeing is a nice renaissance relative to manufacturing, and then the timing of energy. Energy is coming. Energy is not one of those issues that we have any concerns about. It's just relative to pace. So I think more than anything, we had degrees of timing, and we had certain degrees of softness that, from my perspective, were broadly anticipated. And I think that's one of the reasons that when we were giving you our results at half year, part of what we indicated to you is we thought we would probably see a near-term nadir in volumes in the third quarter. So if we're looking at the way Q3 worked from our perspective, Anthony, honestly, no big surprises, including the way the pull-through came through and obviously some very attractive incrementals in the quarter. Okay, that's very helpful. I'll turn it over. Thank you. Your next question comes from Phil Ng with Jefferies. Please go ahead. Hey, guys. Congrats on a really strong quarter and obviously, your value over volume approach is showing in your results. But I'm just curious, how much line of sight do you have on your aggregates pricing in 2024? How are your competitors behaving in this environment? Is that value over volume approach potentially a risk to your volumes? The reason why I ask is because one of your bigger competitors calling for perhaps weaker volumes than your flattish outlook. So just wanna understand how the competitive landscape is behaving on pricing. Well, the thing that we stay focused on, Phil, is what can we control and how do we run our business, and we do that based on what our needs are. So we're very focused on Martin Marietta. We're focused on where our operations are. We're focused on what our inventories look like. We're focused on what our reserves look like in the ground, and we're focused on what we feel like the market can bear relative to these products. So from our perspective, those are really the unique drivers on that. As I indicated before, if you're looking at volumes for the quarter, were our volumes down a little bit more than others? Yeah, probably so. Are we okay with that? You bet. Do I feel like that's probably gonna find more degrees of equilibrium going forward? I think it probably will. At the same time, if I'm looking at the geographies in which we tend to be focused, let's face it, we're talking about Texas, that's gonna be awfully good. I mean, we're looking at a TxDOT budget for FY 2024 that exceeds $18.5 billion. I mean, that's just a massive budget. In Colorado, they recently passed a $5.3 billion ten-year infrastructure bill that's gonna be massive in that state. Here in North Carolina, and it was something that I'm proud to have been a part of, we structurally changed the way that we're paying for infrastructure here. Now we're using a degree of sales taxes, and in FY 2024, it's gonna ramp up to 4% here in North Carolina because North Carolina recognized they needed to increase their spending by over $7 billion over the next decade. But even separate and distinct from that, if we're looking to Florida right now, Florida is looking at a $17.2 billion budget for FY 2024. And that's an all-time record, and I feel like I've said for probably the last 6 or 7 years, that every year is an all-time record for transportation in Florida, largely because it has been. And in California, where we brought that new business, the Caltrans budget is $20.5 billion next year. Now, to give you a sense of it, that's a 5.5% or 5.6% year-over-year increase, with $12.1 billion designated for highway and bridge capital spending. So as we're thinking about what that public funding looks like, and we're coming back and looking at what's happening industrially in places like Atlanta, what's going on in South Georgia. Literally, just yesterday, Toyota announced they're adding $8 billion to what is already a large battery plant that's underway in Randolph County, that's just outside of Greensboro. These are the types of things that we're seeing in our markets, both in public and heavy non-res, that gives us a lot of confidence around the way that we think volumes will work next year. And, the fact is, with the footprint that we have, I don't have any doubt that we're gonna get our fair share of that business. I just wanna make sure that we're doing it for what we feel like is fair value for that business. Super. And Ward, you mentioned maybe some of the weakness recently tied to some of these bigger projects, whether it's energy mega projects getting pushed out. Can you give us a little perspective, when you see that kinda ramping up? Is that early next year, middle parts of next year? And then on the public infrastructure side, you know, we could all appreciate there's a lot of money coming. How do you kinda see that ramping up and building into 2024? Yeah, Phil, those are great questions. I think the public infrastructure side, we're still where we were. We said we thought we would start to see that building in 4 and then build into 2024. When I say 4, I mean Q4 of this year. And that was part of what led us to the commentary around the fact that we thought we'd probably see this type of dip in Q3. So again, very anticipated. If we're looking, for example, at the large LNG projects, part of what we're seeing right now is several projects that are already underway. Golden Pass is underway. Chevron Phillips has a large facility in Orange, Texas, that's underway. Port Arthur LNG, at least portions of that are underway. Cheniere has a lot that's underway. But if we look going forward, I can think of at least four big jobs, and I think this gives you a sense from a timing perspective in Texas that we're watching. Cheniere has another one in Cameron Parish, Louisiana. We have Grand LNG in Brownsville and Freeport LNG in Texas. All are looking at, we believe, 2024 start dates. We're actually anticipating some acceptance of materials maybe as soon as this week on some of those projects, so it continues to be a live conversation. So if we think about it for the year, has timing been a little bit of a headwind on those? Yeah, it has. Do we think they're going away? Absolutely not. And part of what we're seeing, and frankly, in degrees, this is helpful, you've got degrees of material tightness in some of those markets, and that continues to underscore at least the notion of the overall economy in Texas today. So Phil, I hope that gives you a snapshot, at least on some of the heavy non-res pieces of it. Appreciate the great go on. You bet. Your next question comes from Timna Tanners with Wolfe Research. Please go ahead. Yeah. Hey, good morning, everyone. Hi, Temna. Okay, so just two things I wanted to follow up on. One was just appreciate the- Hey, Timna, I'm sorry to interrupt you. We're having a hard time hearing you. Can you lean in a little bit more, please? Yeah. Is that better? Yes, ma'am, it is. Thank you. Okay. Sorry about that. So we're—you know, appreciate the commentary on big projects, and the starting up in 2024. We have heard some delays and cost overruns. Are those not—you know, affecting your geographies perhaps as much, or are you budgeting for that as well? You know what? I, I don't think they're affecting, number one, our geographies that much, and, and two, to the extent that inflation or varying degrees of it continues to go through, you know, frankly, if, if we can keep up with that or stay ahead of it, Timna, it, it's actually been an ally to our business, not an enemy to our business. So I, I do think if, if we had a strikingly different geographic profile than we have, I would probably feel differently about it than I do. But if we go back to that conversation I was having just a little while ago, relative to our leading states and the degree of both public and private activity that we're seeing in Texas and Colorado and the Carolinas and Georgia and Florida, you know, those are very powerful, steady markets right now. And I'm even taken, too, by the continued resiliency in markets like Indiana and in Iowa as well. You know, Iowa is a state that has been very steady all the way through cycles for us, including probably the single most steady market in which we participated during the great financial crisis. So I just call that out because it's one of those states that doesn't come to mind immediately if you're in New York or Chicago or Dallas or Los Angeles, thinking about this industry. But it's been one that, for us, that's been actually quite important and very durable. Okay, helpful. And then just on the commentary on M&A. I know in the past, you would have hoped to have some done by the end of this year, now talking about next year. Is that just a timing issue? Is there anything that you can share there? It's more of a timing issue than anything else, Timna. Obviously, you know what the process looks like. You're gonna have dialogue with a potential company you want to acquire. You go through a valuation process, you might go through letters of intent, contracting, and then you also have regulatory processes that you have to go through. And, you know, none of that's easy, but our team is actually very good at it. But we're gonna be thoughtful as we do it. So it's not the fact that you haven't seen more done is not indicative of anything other than it's just an ordinary process. Now, part of what's been different, too, in fairness, we're typically not in the selling business, and we've been in the selling business for the last year and a half, more than we ordinarily would be. You've seen what we've done relative to the Redding plant in Northern California, the Tehachapi plant in Southern California, and even relative to our ready-mix business in Colorado. I mean, if you think back to it, between Stockton, Redding, Tehachapi, and our Colorado business that we sold, that's over $1 billion worth of divestitures. That's not ordinary for us. But again, we talk about the fact that it's an aggregates-led business, and when we talk about cement, we talk about a strategic cement business. So, some years, most years, we're gonna be busier buying than selling. The last year and a half, we've actually had more on the sell side than on the buy side, for all the right reasons. Got it. Okay, thanks again. Thank you, Timna. Your next question comes from Tyler Brown with Raymond James. Please go ahead. Hey, good morning. Good morning, Tyler. Hey, Ward. I wanna come back to costs a little bit. So it feels like costs are, you know, they're obviously remaining fairly sticky here. You mentioned a little bit of easing. So just specifically, where are you seeing some of that moderation? Are you seeing it in labor, consumables? Is maintenance starting to roll? Just a little bit of color there would be helpful. Sure. I'll tell you what I'll do. I'll turn to Jim and ask him to come back and give you more granularity. If you think about overall costs, I mean, have we seen supplies go up mid-single digits? Yes. Have repairs gone up low double digits? Yes, and contract services as well. But Jim can give you a little bit more color on that. Yeah, it's largely the same story as before, which is a continuing slow moderation in cost inflation, still elevated versus historical levels, slowly coming back to normal from where it was out, very elevated, but it still remains elevated. I would say the most problematic areas are parts. Costs are still quite high. I don't see those coming down for a bit. But you know, labor is behaving more and more normal as we go on. But otherwise, I'd say high single digits is mid to high single digits is the right way to think about it for the rest of this year. Getting a little bit better, moderating next year. Again, I'm holding aside energy, which is, you know, very volatile and just holding that one aside, because we don't know where that ends up going. Does that answer your question? Yep. Nope, that, that's very helpful. I appreciate it. Sure. Thank you, Tyler. Your next question comes from David MacGregor with Longbow Research. Please go ahead. David, are you there? Hey, I'm here now. Sorry about that. I apologize. There we are. Congratulations on a great quarter. Thanks so much, David. Yeah, I just wanted to sort of revisit the slide in your deck on highway contract awards, up 18%, and get your thoughts in terms of, you know, what's changing in the lag from awards to stone demand and stone shipments. Yeah. No, I think it's been, Dave, from my perspective, a fairly predictable curve. And I think in large measure, because we went for such an extended period of time without more money coming from the federal government in a meaningful way on that. So if you think about what happened, we had a decade plus of continuing resolutions, then we had the FAST Act that didn't have more money, but it did have more time. And so now what's happened is you, you've had that very attractive double whammy of, hey, here comes more money, here comes more time. And you also had DOTs who had actually been building up their own budgets for about 15 years because they weren't getting more money and more time from the federal government. So I think what we're going to see, particularly in Martin Marietta states, is it's not so much driven by maintenance and repair. It's going to be more driven by bringing in new capacity, and that's important for a number of reasons. Number one, our states have had a lot of people move to them. So if we're simply looking at overall population trends, I mean, it's pretty eye-popping to think about the fact that Texas has led all the states in population gains over the past decade, adding 4 million people. If we're looking at Colorado, their population has grown 14.8% just since 2010. I mean, North Carolina has been one of the fastest growing states in the country. Georgia's gonna move up to number 8 in the country in population. So if you think about why these states need to add capacity, as opposed to maintenance and repair, that's a big reason. And if you're thinking about what happens from a lag perspective on, rather than putting new asphalt on top of old asphalt, but rather adding a new lane or building new roads, it frankly takes a little bit longer. Now, the punchline is, it ends up being considerably more aggregates intensive. So for us, it's like a big birthday. It's worth the wait sometimes. So, and we feel like good things are coming from this, but I think that's really driving that lag that we've seen. The dollars are there, and you can see where they are, you can see what the state DOT budgets are. But again, I think it's those states, those budgets, those population inflows-... that are driving a different nature of construction. What we'll see in Charlotte, what we'll see in Atlanta, what we'll see in Dallas, is going to be a very different story than what you'll see in New York or what you'll see in Chicago. Great. Thanks very much. Thank you, David. Your next question comes from Michael Dudas with Vertical Research. Please go ahead. Good morning, Jacklyn, Jim, Ward. Good morning, Michael. You've been terrific observations about the markets and some of the puts and takes heading into end of this year, 2024. Just wondering, it seems as you look at the residential side of the business in your important states, it seems if we're at a... Is that the flywheel that could impact positively expectations on volume, given it seems like we're at a bottom or in this kinda longer base bottom, given the affordability issues? Is that kind of where the, the, the help could come if, you know, volumes could get better? And is that a market that you'd be able to take advantage of, given your positioning and your, and your, certainly your backlog and your ability to serve? Yeah, look, I think the answer, Michael, is yes and yes to all of the above. It's interesting because you've got two issues relative to housing in the United States today. We've talked about one of them, and that is affordability, and clearly seeing mortgage rates move to 23-year highs drive some of that. The other issue that doesn't get the airtime that it probably should, but it does in our states, is availability. And that's a big issue today. And single-family housing in the U.S. is structurally underbuilt. I mean, as a practical matter, it ought to be trending comfortably over 1 million starts a year, at least as we drill it down to the markets in which most of our business is. Because, again, we're back to those population trends that I mentioned in the dialogue with Dave MacGregor just a few minutes ago. If you come to Raleigh, your biggest issue is can you find a house? Same issue in Charlotte, same issue in Atlanta. In varying degrees, the same issues in Dallas, Fort Worth, and in Colorado today. So to the extent that there could be some upside there, could it be single-family housing driven? I think so. And for example, several things are happening. Are home builders looking at having their own mortgage companies within home building companies? They are. Are they doing that because they wanna keep building? They do. Do they wanna keep building because they know the market is there? Absolutely. In some instances, are they building and basically building to rent, even in the near term, because they recognize that they can do that. So I think your, your point around a swing factor on housing is important, and I think it's relevant to say, keep in mind, single family housing is 2-3 times more aggregates intensive than is multifamily. So if you're watching housing, look, is it nice to see multifamily go? Yeah. Is it really nice to see single family go? The answer is yes. But I, I think what we've just described is, is worth watching and could be a build in 2024, and I hope that helps, Michael. It sure does. Excellent, Ward. Thank you. You bet. Ladies and gentlemen, as a reminder, should you have a question, please press star followed by the one. Your next question comes from Adam Thalhimer with Thomas Davis. Please—Thompson Davis. Please go ahead. Hey, good morning, guys. Great quarter. Adam, thanks. Two quick questions. It's getting late in the call. Two quick questions. One, where do you want us for Q4? 'Cause the, the range is pretty wide. I'm just curious if we wanted to bake in, you know, an early onset to winter, where would that put us? And then the second question is: do you ever see yourself recreating, what you've built in Texas and other geographies? Well, boy, that's two big questions for a guy late on the call today, Adam. A couple of things. I'll take the second part of that. I'll leave the first part to Jim. You know what? Texas is a tremendous market, and when we bought TXI and when we've done some of the moves that we've made in Texas since then, frankly, we thought it was gonna be that kind of a market. You know, that. But at the same time, we're in some other markets today that are enormously attractive. Do we think we can do some very great things in California? Yeah, I think we can. Can we continue to grow our business in places like Florida and still in Texas and in Tennessee and others? The short answer is yes. But one thing I think is so important for me to say, Adam, is you should expect us to continue to be an aggregates-led company. And I think that part of what is so evident in these numbers is again, how durable that is. Now, with respect to Q4, I'll pivot over to Jim, and he can talk to you a little bit more about how we see some puts and takes on that. But you know, frankly, a lot of it is gonna be driven by when does winter show up in different parts of our business? So, Jim? Yeah, so at Q4, I would say, look, generally speaking, look at the midpoint of whatever we put out, that's sort of the best way to think about it. What could push it to the bottom end? Ward mentioned, actually, bad weather, rainy weather in Texas, early winter in the north parts of our footprint. And then, of course, there's you know, costs, timing, some shifts. There's nothing fundamentally happening that's sort of troubling. But costs could shift from one quarter to the next, causing volatility. If those slipped into Q1, that would help Q4. If they don't, that would hurt Q4. So, I think I'd just stick with the midpoint for now, Adam, and go with that. Great. Thanks, guys. Thank you, Adam. There are no further questions at this time. Please proceed. Thank you again for joining today's earnings conference call. To conclude, our strong third quarter results underscore the resiliency and secular durability of our aggregates-led business model through various business cycles. Our focus remains on building the world's safest, most resilient, and best performing aggregates-led public company for the benefit of our shareholders, customers, employees, and other stakeholders. Thanks to the disciplined execution of SOAR and the fidelity of our teams to safety, commercial, and operational excellence, Martin Marietta is poised to continue delivering sustainable growth and superior shareholder value in 2024 and beyond. We look forward to sharing our fourth quarter and full year 2023 results with you in February. As always, we're available for any follow-up questions. Thank you for your time and continued support of Martin Marietta. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.