Titan America Q2 Earnings Call Highlights

Titan America (NYSE:TTAM) reported second-quarter 2026 revenue growth and a modest increase in adjusted EBITDA, as strong Mid-Atlantic demand offset operational disruptions and softer residential construction conditions in Florida.

Revenue rose 9.6% year over year to $471 million, including a $20 million contribution from the recently acquired Keystone Cement Company. Adjusted EBITDA increased 1.3% to $101 million, although the adjusted EBITDA margin declined to 21.4% from 23.2% a year earlier. Net income fell to $43 million, or $0.23 per share, from $51 million, or $0.28 per share, in the prior-year period.

Chief Financial Officer Larry Wilt said approximately $0.03 of the $0.05 year-over-year decline in earnings per share was tied to Keystone-related transaction costs and a one-time tax charge related to the post-acquisition reorganization of Keystone entities.

Mid-Atlantic Growth Offsets Florida Pressures

The company’s Mid-Atlantic segment delivered external revenue of $214 million, up 27% from $168 million a year earlier, while adjusted EBITDA increased 30% to $53 million. The segment benefited from Keystone, strong legacy cement operations, and double-digit ready-mix concrete revenue growth.

Management cited demand from data centers, commercial construction, infrastructure and other private non-residential applications. Ready-mix concrete growth was supported by higher selling prices, project mix and new portable plant capacity, according to the company.

Titan America said it is participating in 77 of the 148 data centers under construction in Virginia during 2026. Chief Executive Officer Bill Zarkalis said Virginia represents a significant market for the company, with an estimated 30% share of the global hyperscale data center market. The company also noted that an additional 250 data centers are in the pre-construction phase in the state.

Florida external revenue declined 1.6% to $257 million, while segment adjusted EBITDA fell to $51 million from $62 million in the prior-year quarter. The Florida adjusted EBITDA margin fell to 19.7% from 23.8%.

The Florida business was affected by extended scheduled maintenance shutdowns at the Pennsuco cement and aggregates plant, delays in imported cement caused by Mediterranean port and shipping disruptions, and the cost of temporarily sourcing cement and aggregates from third parties. Wilt estimated that these short-term headwinds had an adverse direct impact of roughly $7 million in the quarter.

Zarkalis said Florida pricing was broadly stable, though the company had not been successful in raising prices in the region. He cited subdued residential demand, project delays and softer cement demand as key pressures. In contrast, he said pricing was more robust in the Mid-Atlantic, where commercial, infrastructure and data center activity has been stronger.

Volume, Pricing and Cash Flow

Cement volumes, including external sales and internal consumption, rose 10% year over year, reflecting Keystone’s initial contribution and demand in infrastructure and private non-residential construction. Excluding Keystone, cement volumes were roughly flat as import supply-chain disruptions limited performance.

• Total aggregate volumes declined 1.3% as higher external sales were offset by lower internal consumption in Florida.
• Fly ash volumes increased about 12% from a low prior-year base.
• Ready-mix concrete volumes rose 2.6%, led by Mid-Atlantic non-residential demand.
• Concrete block volumes increased 8.3%.

On pricing, cement prices declined 1.5% year over year, with Mid-Atlantic improvement offset by Florida softness. Ready-mix concrete pricing increased 4.4%, while fly ash pricing was flat. Aggregate pricing declined due to regional market dynamics and product mix in Florida, and concrete block pricing declined 2.6% because of channel and customer mix.

Operating cash flow for the first half of 2026 increased to $137 million from $108 million a year earlier, while free cash flow rose to $50 million from $26 million. Wilt attributed the improvement to working-capital discipline, lower tax payments and higher operating cash flow.

As of June 30, Titan America had $36 million in cash and cash equivalents and $574 million of total debt, resulting in net debt of $538 million. Its leverage ratio was 1.37 times trailing-12-month adjusted EBITDA, compared with 0.64 times at the beginning of the year, following the Keystone acquisition.

Keystone Integration and Fly Ash Investment

Titan America completed its acquisition of Keystone Cement during the second quarter, expanding its presence in Pennsylvania, Ohio, Delaware and Maryland. The company is targeting at least $30 million of annual run-rate synergies from the acquisition by 2029.

Zarkalis said the synergies are expected to build over three years rather than occur evenly, with the largest contribution anticipated in the third year. The company expects benefits from improved plant reliability and throughput, commercial and logistics opportunities, operational improvements, and increased aggregate sales. Management said some initiatives will require targeted capital investments, including investments that may be completed during planned plant shutdowns.

The company also announced plans for a fly ash recycling plant at the Brunner Island Steam Electric Station in Pennsylvania. Titan America expects to invest approximately $30 million in the facility, which is under construction and expected to become fully operational in the third quarter of 2027. The plant is expected to process 600,000 tons of landfill material annually and produce about 400,000 tons of concrete-grade fly ash per year.

Updated 2026 Outlook

Following the Keystone acquisition, Titan America updated its full-year outlook. The company now expects high-single-digit revenue growth in 2026 compared with 2025 and a modest decline in adjusted EBITDA margin.

During the question-and-answer session, Zarkalis said the expected full-year margin decline is estimated at roughly 25 to 50 basis points, reflecting Keystone’s lower initial margin contribution. Management said it expects no lingering effects from the extended Pennsuco shutdown, though a normal, shorter second-half maintenance outage remains scheduled. The company also said it does not currently expect further major disruptions from imported cement logistics, although some sea freight costs could be higher in the second half.

Titan America’s board approved a $0.04-per-share issue premium distribution, payable Oct. 9 to shareholders of record as of Oct. 1.

About Titan America (NYSE:TTAM)

Titan America is a leading vertically integrated, multi-regional manufacturer and supplier of heavy building materials and services operating primarily on the Eastern Seaboard of the United States (the “Eastern Seaboard”). We are a leading provider of materials that contribute to lower carbon emissions than traditional building materials and/or beneficial reuse of waste materials. We are a leading provider of heavy building materials in Florida, the New York and New Jersey Metropolitan area (“Metro New York”), Virginia, North Carolina and South Carolina (Virginia and the Carolinas, together with Metro New York and their adjacent areas, the “Mid-Atlantic”).

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