EAGLE MATERIALS INC

Previous wording

Our business is organized into two sectors: Heavy Materials, which includes the Cement and Concrete and Aggregates segments; and Light Materials, which includes the Gypsum Wallboard and Recycled Paperboard segments. Financial results and other information for the three and six months ended September 30, 2024 and 2023, are presented on a consolidated basis and by these business segments – Cement, Concrete and Aggregates, Gypsum Wallboard, and Recycled Paperboard.

Current wording

Our business is organized into two sectors: Heavy Materials, which includes the Cement and Concrete and Aggregates segments; and Light Materials, which includes the Gypsum Wallboard and Recycled Paperboard segments. Financial results and other information for the three and nine months ended December 31, 2024, and 2023, are presented on a consolidated basis and by these business segments – Cement, Concrete and Aggregates, Gypsum Wallboard, and Recycled Paperboard.

Previous wording

All our business activities are conducted in the United States. These activities include the mining of limestone for the manufacture, production, distribution, and sale of portland cement, including portland limestone cement (a basic construction material that is the essential binding ingredient in concrete); the grinding and sale of slag; the mining of gypsum for the manufacture and sale of gypsum wallboard; the manufacture and sale of recycled paperboard to the gypsum wallboard industry and other paperboard converters; the sale of readymix concrete; and the mining and sale of aggregates (crushed stone, sand, and gravel).

Current wording

All our business activities are conducted in the United States. These activities include the mining of limestone for the manufacture, production, distribution, and sale of portland cement, including portland limestone cement (portland cement and portland limestone cement are basic construction materials that are the essential binding ingredient in concrete); the grinding and sale of slag; the mining of gypsum for the manufacture and sale of gypsum wallboard; the manufacture and sale of recycled paperboard to the gypsum wallboard industry and other paperboard converters; the sale of readymix concrete; and the mining and sale of aggregates (crushed stone, sand, and gravel).

Previous wording

On August 9, 2024, we finalized the Acquisition of an aggregates operation in Battletown, Kentucky. The purchase price of the Acquisition was approximately $24.9 million. The Acquisition is included in our Heavy Materials sector, and its results of operations are reported in the Concrete and Aggregates business segment. See Footnote (B) in the Unaudited Consolidated Financial Statements for more information regarding the Acquisition.

Current wording

On August 9, 2024, we finalized the acquisition of an aggregates operation in Battletown, Kentucky. The purchase price of the Kentucky Acquisition was approximately $24.9 million. The Kentucky Acquisition is included in our Heavy Materials sector, and its results of operations are reported in the Concrete and Aggregates business segment. See Footnote (C) in the Unaudited Consolidated Financial Statements for more information regarding the Kentucky Acquisition.

Previous wording

We expect demand for cement to remain steady in the near term given growth in heavy industrial construction and the continued health of state and local budgets to support infrastructure projects. To date, only approximately 25% of federal funding from the trillion-dollar Infrastructure Investment and Jobs Act(IIJA) has been spent. We anticipate a pick-up in demand as the remaining approximately 75% of IIJA funds gets spent on public construction and repair projects.

Current wording

The macroeconomic environment continues to be constructive for our products. We expect demand for cement to remain steady in the near term given federal, state and local support for public infrastructure projects and continued spending on heavy manufacturing and private-nonresidential construction. To date, only approximately 25% of federal funding from the trillion-dollar Infrastructure Investment and Jobs Act(IIJA) has been spent. We anticipate a pick-up in demand as the remaining IIJA funds get spent on public construction and repair projects.

Previous wording

In residential construction, activity has remained steady. While the higher interest rate environment has been a headwind for housing demand and affordability, several factors, including the chronic housing shortage caused by more than a decade of underproduction and exacerbated by the "rate lock-in", has supported solid levels of housing construction activity. Moving forward, lower interest rates and continued healthy consumer balance sheets should support residential construction. We believe our geographic footprint across the U.S. heartland and fast-growing Sun Belt region positions us to capitalize on these favorable market dynamics.

Current wording

In residential construction, activity has remained steady. While the higher interest rate environment has been a headwind for housing demand and affordability, several factors, including the chronic housing shortage caused by more than a decade of underproduction and exacerbated by the "rate lock-in", have supported housing construction activity. While the path ahead for US Federal Reserve monetary policy is less certain than a quarter ago, we believe that continued healthy consumer balance sheets should also support residential construction. We believe our geographic footprint across the U.S. heartland and fast-growing Sun Belt region positions us to capitalize on these market dynamics.

Previous wording

We believe we are well-positioned to manage our cost structure and meet our customers’ needs during the second half of this fiscal year. Our substantial raw material reserves for our Cement, Aggregates, and Gypsum Wallboard businesses, and their proximity to our respective manufacturing facilities, support our low-cost producer position across all our business segments.

Current wording

We believe we are well-positioned to manage our cost structure and meet our customers’ needs. Our substantial raw material reserves for our Cement, Aggregates, and Gypsum Wallboard businesses, and their proximity to our respective manufacturing facilities, support our low-cost producer position across all our business segments.

Previous wording

The primary raw material used to produce paperboard is OCC. Prices for OCC increased during the six months ended September 30, 2024 compared with fiscal 2024. Fiber prices are subject to change upon short notice due to several factors, including supply of OCC and demand for OCC from both domestic and international companies. Our current customer contracts for gypsum liner include price adjustments that partially compensate for changes in raw material fiber prices. However, because these price adjustments are not realized until future quarters, material costs in our Gypsum Wallboard segment are likely to fluctuate until the effects of these price adjustments are realized.

Current wording

The primary raw material used to produce paperboard is old corrugated cardboard (OCC). Recycled fiber prices are subject to change upon short notice due to several factors, including supply of OCC and demand for OCC from both domestic and international companies. Our current customer contracts for gypsum liner include price adjustments that partially compensate for changes in the cost of raw materials, such as recycled fiber, natural gas, and electricity. However, because these price adjustments are not realized until future quarters, material costs in our Gypsum Wallboard segment are likely to fluctuate until the effects of these price adjustments are realized.

Previous wording

Maintenance costs increased in fiscal 2024, and we expect continued inflation for maintenance in fiscal 2025 as equipment and contractor costs remain high.

Current wording

Maintenance costs increased during the first nine months of the fiscal year as equipment and contractor costs remain high, and we expect maintenance costs to remain elevated next fiscal year.

Previous wording

Revenue increased by $1.4 million to $623.6 million for the three months ended September 30, 2024. The Acquisition contributed $1.7 million of Revenue during the three months ended September 30, 2024. Excluding the Acquisition, Revenue decreased by $0.4 million. This decrease was due to lower Sales Volume, which adversely affected Revenue by approximately $17.0 million, and was partially offset by higher gross sales prices, which increased Revenue by $16.6 million.

Current wording

Revenue decreased by $0.8 million to $558.0 million for the three months ended December 31, 2024. The Kentucky Acquisition contributed $3.1 million of Revenue during the three months ended December 31, 2024. Excluding the Kentucky Acquisition, Revenue decreased by $3.9 million. This decrease was due to lower Sales Volume, which adversely affected Revenue by approximately $18.1 million, and was partially offset by higher gross sales prices, which increased Revenue by $14.2 million.

Previous wording

Cost of Goods Sold increased by $6.6 million, or 2%, to $419.8 million for the three months ended September 30, 2024. The Acquisition contributed $2.1 million of Cost of Goods Sold during the three months ended September 30, 2024. Excluding the Acquisition, Cost of Goods Sold increased by $4.5 million, or 1%. The increase was due to higher operating costs of $16.4 million, partially offset by lower Sales Volume of $11.9 million. Higher operating costs were primarily related to our Cement and Concrete and Aggregates businesses and are discussed further in the segment analysis.

Current wording

Cost of Goods Sold increased by $2.0 million, or 1%, to $380.2 million for the three months ended December 31, 2024. The Kentucky Acquisition contributed $3.4 million of Cost of Goods Sold during the three months ended December 31, 2024. Excluding the Kentucky Acquisition, Cost of Goods Sold decreased by $1.4 million. The decrease was due to lower Sales Volume of $12.0 million, partially offset by higher operating costs of $10.6 million. Higher operating costs were primarily related to our Cement and Concrete and Aggregates businesses and are discussed further in the segment analysis.

Previous wording

Gross Profit decreased 2% to $203.8 million during the three months ended September 30, 2024. The decrease was primarily related to higher operating costs and lower Sales Volume, partially offset by higher gross sales prices. The gross margin declined to 33%, with higher operating costs being partially offset by a rise in gross sales prices.

Current wording

Gross Profit decreased 2% to $177.8 million during the three months ended December 31, 2024. The decrease was primarily related to higher operating costs and lower Sales Volume, partially offset by higher gross sales prices. The gross margin remained consistent at 32%, with higher operating costs being offset by a rise in gross sales prices.

Previous wording

Corporate General and Administrative expenses increased by approximately $1.3 million, or 8%, for the three months ended September 30, 2024. The increase was primarily due to $1.0 million of costs associated with business development and transaction due diligence.

Current wording

Corporate General and Administrative expenses increased by approximately $6.6 million, or 47%, for the three months ended December 31, 2024, primarily because of increases in information technology, compensation, and professional costs of $1.9 million, $1.7 million, and $1.3 million, respectively. The increase in professional costs includes costs associated with business development and transaction related activities.

Previous wording

Interest Expense, net increased by approximately $0.5 million, or 5%, during the three months ended September 30, 2024. This was primarily due to higher interest on our Revolving Credit Facility, which was mostly related to higher average balances outstanding during the period.

Current wording

Interest Expense, net decreased by approximately $1.0 million, or 11%, during the three months ended December 31, 2024. The decrease resulted from lower interest on our Revolving Credit Facility, which was due to both lower interest rates and lower average balances outstanding during the period.

Previous wording

Earnings Before Income Taxes decreased to $185.3 million during the three months ended September 30, 2024, primarily because of lower Gross Profit and Equity in Earnings of Unconsolidated Joint Venture and higher Corporate General and Administrative Expense and Interest Expense.

Current wording

Earnings Before Income Taxes decreased to $154.3 million during the three months ended December 31, 2024, primarily because of lower Gross Profit and Equity in Earnings of Unconsolidated Joint Venture and higher Corporate General and Administrative Expense.

Previous wording

Income Tax Expense was $41.7 million for the three months ended September 30, 2024, compared with $43.6 million for the three months ended September 30, 2023. The effective tax rate was consistent at 23%.

Current wording

Income Tax Expense was $34.7 million for the three months ended December 31, 2024, compared with $37.5 million for the three months ended December 31, 2023. The effective tax rate was consistent at 23%.

Previous wording

Net Earnings decreased 5% to $143.5 million for the three months ended September 30, 2024, as discussed above.

Current wording

Net Earnings decreased 7% to $119.6 million for the three months ended December 31, 2024, as discussed above.

Previous wording

Revenue increased by $8.5 million, or 1%, to $1,232.3 million for the six months ended September 30, 2024. The Acquisition contributed $1.7 million of Revenue during the six months ended September 30, 2024. Excluding the Acquisition, Revenue increased by $6.8 million, or 1%. The Revenue increase was due to higher gross sales prices, which positively affected Revenue by $43.5 million, partially offset by lower Sales Volume, which adversely affected Revenue by approximately $36.7 million.

Current wording

Revenue increased by $7.7 million to $1,790.3 million for the nine months ended December 31, 2024. The Kentucky Acquisition contributed $4.8 million of Revenue during the nine months ended December 31, 2024. Excluding the Kentucky Acquisition, Revenue increased by $2.9 million. The Revenue increase was due to higher gross sales prices, which positively affected Revenue by $54.0 million, partially offset by lower Sales Volume, which adversely affected Revenue by approximately $51.1 million.

Previous wording

Cost of Goods Sold increased by $2.9 million to $841.6 million for the six months ended September 30, 2024. The Acquisition contributed $2.1 million of Cost of Goods Sold during the six months ended September 30, 2024. Excluding the Acquisition, Cost of Goods Sold increased by $0.8 million. The increase was due to higher operating costs of $28.4 million, partially offset by lower Sales Volume of $27.6 million. Higher operating costs were primarily related to our Cement and Concrete and Aggregates businesses and are discussed further in the segment analysis.

Current wording

Cost of Goods Sold increased by $4.9 million to $1,221.8 million for the nine months ended December 31, 2024. The Kentucky Acquisition contributed $5.5 million of Cost of Goods Sold during the nine months ended December 31, 2024. Excluding the Kentucky Acquisition, Cost of Goods Sold decreased by $0.6 million. The decrease was due to lower Sales Volume of $37.4 million, partially offset by higher operating costs of $36.8 million. Higher operating costs were primarily related to our Cement and Concrete and Aggregates businesses and are discussed further in the segment analysis.

Previous wording

Gross Profit increased 1% to $390.7 million during the six months ended September 30, 2024. The increase was primarily related to higher gross sales prices, partially offset by lower Sales Volume and increased operating costs. The gross margin expanded to 32%, with higher gross sales prices being partially offset by a rise in operating costs.

Current wording

Gross Profit increased 1% to $568.5 million during the nine months ended December 31, 2024. The increase was primarily related to higher gross sales prices, partially offset by lower Sales Volume and increased operating costs. The gross margin remained consistent at 32%, with higher gross sales prices being offset by a rise in operating costs.

Previous wording

Equity in Earnings of our Unconsolidated Joint Venture decreased $1.0 million, or 10%, for the three months ended September 30, 2024. The decrease was primarily due to lower gross sales prices and higher operating costs, which reduced earnings by approximately $1.1 million and $0.3 million, respectively. This was partially offset by higher Sales Volume, which positively affected earnings by $0.4 million.

Current wording

Equity in Earnings of our Unconsolidated Joint Venture decreased $0.8 million, or 4%, for the nine months ended December 31, 2024. The decrease was primarily due to lower gross sales prices and Sales Volume, which negatively affected earnings by $1.5 million and $1.2 million, respectively. This was partially offset by lower operating costs, which positively affected earnings by approximately $1.9 million. The decrease in operating costs was primarily related to freight and distribution costs of approximately $2.1 million.

Previous wording

Corporate General and Administrative expenses increased by approximately $5.2 million, or 19%, for the six months ended September 30, 2024. The increase was primarily due to higher salaries, information technology upgrades, and costs associated with business development and transaction due diligence of $1.6 million, $1.2 million, and $1.5 million, respectively.

Current wording

Corporate General and Administrative expenses increased by approximately $11.8 million, or 28%, for the nine months ended December 31, 2024. The increase was primarily due to higher compensation of $2.6 million, information technology upgrades of $2.4 million, and legal costs, including those associated with business development and transaction related activities of $4.5 million.

Previous wording

Interest Expense, net decreased by approximately $1.0 million, or 5%, during the six months ended September 30, 2024. This decrease was primarily due to approximately $0.5 million of lower interest on our Revolving Credit Facility, which was related to lower average outstanding borrowings, as well as increased interest income of $0.5 million on cash deposits.

Current wording

Interest Expense, net decreased by approximately $2.1 million, or 6%, during the nine months ended December 31, 2024. This decrease was primarily due to approximately $1.6 million of lower interest on our Revolving Credit Facility, which was related to both lower interest rates and lower average outstanding borrowings, as well as increased interest income of $0.5 million on cash deposits.

Previous wording

Earnings Before Income Taxes increased to $356.2 million during the six months ended September 30, 2024, primarily because of higher Gross Profit and Equity in Earnings of Unconsolidated Joint Venture, which were partially offset by higher Corporate General and Administrative Expense.

Current wording

Earnings Before Income Taxes decreased to $510.5 million during the nine months ended December 31, 2024, primarily because of higher Corporate General and Administrative Expense and lower Equity in Earnings of Unconsolidated Joint Venture, partially offset by higher Gross Profit and lower Interest Expense, net.

Previous wording

Income Tax Expense was $78.8 million for the six months ended September 30, 2024, compared with $78.2 million for the six months ended September 30, 2023. The effective tax rate of 22% remained consistent with the prior-year period.

Current wording

Income Tax Expense was $113.6 million for the nine months ended December 31, 2024, compared with $115.7 million for the nine months ended December 31, 2023. The effective tax rate of 22% remained consistent with the prior-year period.

Previous wording

Net Earnings increased 2% to $277.4 million for the six months ended September 30, 2024, as discussed above.

Current wording

Net Earnings decreased 1% to $396.9 million for the nine months ended December 31, 2024, as discussed above.

Previous wording

Three AND SIX MONTHS ENDED September 30, 2024, COMPARED WITH three AND SIX MONTHS ENDED sEPTEMBER 30, 2023, BY SEGMENT

Current wording

Three AND nine MONTHS ENDED december 31, 2024, COMPARED WITH three AND nine MONTHS ENDED december 31, 2023, BY SEGMENT

Previous wording

The following presents results within our two business sectors for the three and six months ended September 30, 2024, and 2023. Revenue and operating results are organized by sector and discussed by individual business segments.

Current wording

The following presents results within our two business sectors for the three and nine months ended December 31, 2024, and 2023. Revenue and operating results are organized by sector and discussed by individual business segments.

Previous wording

Cement Revenue was $352.8 million, a 2% decrease, for the three months ended September 30, 2024. The decrease was primarily due to lower Sales Volume, which reduced Cement Revenue by approximately $16.2 million, partially offset by higher gross sales prices of $8.2 million.

Current wording

Cement Revenue for the three months ended December 31, 2024 was $295.4 million, a 4% decrease from the prior-year period. The decrease was primarily due to lower Sales Volume, which reduced Cement Revenue by approximately $18.8 million, partially offset by higher gross sales prices of $5.6 million.

Previous wording

Cement Operating Earnings decreased by $5.5 million to $115.9 million for the three months ended September 30, 2024. The decrease was due to lower Sales Volume and higher operating costs of $5.9 million and $7.8 million, respectively, partially offset by higher average sales prices of $8.2 million. Higher operating costs were primarily due to increased maintenance and litigation loss of approximately $6.9 million and $0.7 million, respectively. The Operating Margin decreased to 33% from 34%, as a result of higher operating costs, partially offset by the higher gross sales prices.

Current wording

Cement Operating Earnings decreased by $18.8 million to $86.8 million for the three months ended December 31, 2024. The decrease was due to lower Sales Volume and higher operating costs of $7.1 million and $17.3 million, respectively, partially offset by higher average sales prices of $5.6 million. Higher operating costs were primarily due to increased maintenance of $7.8 million, as well as $8.1 million related to increased fixed costs per unit, including labor, resulting from lower production during the quarter. The Operating Margin decreased to 33% from 39%, as a result of higher operating costs, partially offset by the higher gross sales prices.

Previous wording

Cement Operating Earnings increased by $9.6 million to $205.1 million for the six months ended September 30, 2024. The increase was due to higher gross sales prices of $28.4 million, which was partially offset by lower Sales Volume and higher operating costs of $8.3 million and $10.5 million, respectively. Higher operating costs consisted of $5.1 million of increased maintenance, $3.5 million of higher freight costs, $1.2 million increase in purchased raw materials, $2.1 million of higher labor costs, and a litigation loss of approximately $0.7 million. These higher costs were partially offset by the impact of recording in the prior year $2.8 million of acquired inventories at fair value. Cement Operating Margin increased to 30% from 28%, as a result of higher gross sales prices, partially offset by higher operating expenses.

Current wording

Cement Operating Earnings decreased by $9.3 million to $291.8 million for the nine months ended December 31, 2024. The decrease was due to lower Sales Volume and higher operating costs of $15.0 million and $28.2 million, respectively, which was partially offset by higher gross sales prices of $33.9 million. Higher operating costs consisted of $12.9 million of increased maintenance, $4.9 million of higher freight costs, $2.8 million increase in purchased raw materials, and $8.3 million related to increased fixed costs, including labor, resulting from lower production. These higher costs were partially offset by the impact of recording in the prior year $2.8 million of acquired inventories at fair value. Cement Operating Margin remained flat at 30%, as the higher operating costs were offset by higher gross sales prices.

Previous wording

Concrete and Aggregates Revenue remained relatively flat at $69.9 million for the three months ended September 30, 2024. Excluding the Acquisition, Revenue declined $1.6 million. The decline was due to lower Sales Volume, which reduced Revenue by $5.4 million, partially offset by higher gross sales prices of $3.8 million.

Current wording

Concrete and Aggregates Revenue declined 1% to $60.7 million for the three months ended December 31, 2024. Excluding the Kentucky Acquisition, Revenue declined $3.6 million. The decline was due to lower Sales Volume, which reduced Revenue by $4.6 million, partially offset by higher gross sales prices of $1.0 million.

Previous wording

Operating Loss was approximately $1.0 million, for the three months ended September 30, 2024. Excluding the Aggregates Acquisition, Operating Loss was $0.7 million. The Operating Loss was due to lower Sales Volume and higher operating costs of $1.5 million and $7.6 million, respectively, partially offset by higher gross selling prices of $3.8 million. The increase in operating costs was primarily due to higher cost of materials, maintenance, delivery, and energy costs of approximately $3.2 million, $2.7 million, $0.4 million, and $0.3 million, respectively.

Current wording

Operating Loss was approximately $1.4 million for the three months ended December 31, 2024. Excluding the Kentucky Acquisition, Operating Loss was $1.1 million. The decrease in Operating Earnings was due to lower Sales Volume and higher operating costs of $1.6 million and $2.3 million, respectively, partially offset by higher gross selling prices of $1.0 million. The increase in operating costs was primarily due to higher cost of materials, maintenance, and labor costs of approximately $0.2 million, $0.7 million, and $0.6 million, respectively.

Previous wording

Concrete and Aggregates Revenue was $134.8 million for the six months ended September 30, 2024. Excluding the Acquisition, Revenue declined $7.2 million. The decrease was due to lower Sales Volume, which reduced Revenue by $14.7 million. This was partially offset by higher gross sales prices of $7.5 million.

Current wording

Concrete and Aggregates Revenue declined 3% to $195.5 million for the nine months ended December 31, 2024. Excluding the Kentucky Acquisition, Revenue declined $10.8 million. The decrease was due to lower Sales Volume, which reduced Revenue by $19.5 million. This was partially offset by higher gross sales prices of $8.7 million.

Previous wording

Operating Earnings were approximately $2.0 million, an 83% decrease. Excluding the Aggregates Acquisition, Operating Earnings decreased to $2.3 million. The decline in Operating Earnings was due to lower Sales Volume and higher operating costs of $3.4 million and $13.5 million, respectively. This was partially offset by higher gross selling prices of $7.5 million. The increase in operating costs was primarily due to higher cost of materials, maintenance, energy, and delivery expenses of approximately $4.3 million, $5.6 million, $1.8 million, and $1.7 million, respectively.

Current wording

Operating Earnings were approximately $0.6 million for the nine months ended December 31, 2024. Excluding the Kentucky Acquisition, Operating Earnings decreased to $1.2 million. The decline in Operating Earnings was due to lower Sales Volume and higher operating costs of $4.9 million and $16.0 million, respectively. This was partially offset by higher gross selling prices of $8.7 million. The increase in operating costs was primarily due to higher cost of materials, maintenance, delivery, and labor expenses of approximately $4.5 million, $5.5 million, $1.8 million, and $1.7 million, respectively.

Previous wording

Gypsum Wallboard Revenue was $215.0 million, a 3% increase for the three months ended September 30, 2024. The increase was primarily due to higher gross sales prices and Sales Volume, which increased Revenue by $0.4 million and $5.4 million, respectively. Our market share remained relatively consistent during the three months ended September 30, 2024.

Current wording

Gypsum Wallboard Revenue for the three months ended December 31, 2024 was $209.5 million, a 4% increase from the prior-year period. The increase was primarily due to higher gross sales prices and Sales Volume, which increased Revenue by $4.3 million and $4.2 million, respectively. Our market share remained relatively consistent during the three months ended December 31, 2024.

Previous wording

Operating Earnings increased 5% to $90.1 million, due to $0.4 million of higher gross sales prices, a $2.2 million increase in Sales Volume, and a decrease of $1.9 million in operating costs. Lower operating costs were primarily related to freight and energy, which increased Operating Earnings by approximately $0.9 million and $1.4 million, respectively. Operating Margin increased to 42% for the three months ended September 30, 2024, primarily because of lower operating costs and higher gross sales prices. Fixed costs are not a significant portion of the overall cost of wallboard; therefore, changes in utilization have a relatively minor impact on our operating cost per unit.

Current wording

Operating Earnings increased 15% to $86.4 million, due to $4.3 million of higher gross sales prices, a $1.6 million increase in Sales Volume, and a $5.4 million decrease in operating costs. Lower operating costs were primarily related to freight, energy, and maintenance, which increased Operating Earnings by approximately $1.8 million, $1.4 million, and $1.2 million, respectively. Operating Margin increased to 41% for the three months ended December 31, 2024, primarily because of lower operating costs and higher gross sales prices. Fixed costs are not a significant portion of the overall cost of wallboard; therefore, changes in utilization have a relatively minor impact on our operating cost per unit.

Previous wording

Gypsum Wallboard Revenue was $432.8 million, a 1% increase for the six months ended September 30, 2024. The increase was primarily due to increased gross sales prices and Sales Volume, which positively affected Revenue by $0.7 million and $3.8 million, respectively. Our market share remained relatively consistent during the three months ended September 30, 2024.

Current wording

Gypsum Wallboard Revenue for the nine months ended December 31, 2024 was $642.3 million, a 2% increase from the prior-year period. The increase was primarily due to higher gross sales prices and Sales Volume, which positively affected Revenue by $5.1 million and $7.9 million, respectively. Our market share remained relatively consistent during the nine months ended December 31, 2024.

Previous wording

Operating Earnings increased 4% to $184.1 million, primarily because of $0.7 million higher gross sales prices, a $1.5 million increase in Sales Volume, and a $5.3 million decrease in operating costs. Lower operating costs were primarily related to freight and energy, which increased Operating Earnings by approximately $3.0 million and $2.5 million, respectively. Operating Margin increased to 43% for the six months ended September 30, 2024, primarily because of higher gross sales prices and lower operating expenses. Fixed costs are not a significant portion of the overall cost of wallboard; therefore, changes in utilization have a relatively minor impact on our operating cost per unit.

Current wording

Operating Earnings increased 8% to $270.5 million, primarily because of $5.1 million higher gross sales prices, a $3.2 million increase in Sales Volume, and a $10.7 million decrease in operating costs. Lower operating costs were primarily related to freight and energy, which increased Operating Earnings by approximately $5.6 million and $3.9 million, respectively. Operating Margin increased to 42% for the nine months ended December 31, 2024, primarily because of higher gross sales prices and lower operating expenses. Fixed costs are not a significant portion of the overall cost of wallboard; therefore, changes in utilization have a relatively minor impact on our operating cost per unit.

Previous wording

Recycled Paperboard Revenue increased 18% to $50.8 million during the three months ended September 30, 2024. The increase was due to higher gross sales prices and Sales Volume, which increased Revenue by $4.5 million and $3.3 million, respectively. Higher gross sales prices were related to the pricing provisions in our long-term sales agreements.

Current wording

Recycled Paperboard Revenue increased 19% to $56.2 million during the three months ended December 31, 2024. The increase was due to higher gross sales prices and Sales Volume, which increased Revenue by $6.1 million and $3.0 million, respectively. Higher gross sales prices were related to the pricing provisions in our long-term sales agreements.

Previous wording

Operating Earnings increased 6% to $8.0 million, primarily because of higher gross sales prices and Sales Volume, which increased Operating Earnings by $4.5 million and $0.6 million, respectively. This was partially offset by higher operating costs, which reduced Operating Earnings by approximately $4.6 million. The increase in operating costs was primarily related to higher input costs, namely fiber, which reduced Operating Earnings by approximately $5.7 million. This was partially offset by lower energy costs of $1.0 million. The Operating Margin decreased to 16% because of higher operating costs, partially offset by higher gross sales prices. Although the Company has certain pricing provisions in its long-term sales agreements, prices are adjusted only at certain times throughout the year, so price adjustments are not always reflected in the same period as the change in costs.

Current wording

Operating Earnings increased 47% to $11.0 million, primarily because of higher gross sales prices and Sales Volume, which increased Operating Earnings by $6.1 million and $0.5 million, respectively. This was partially offset by higher operating costs, which reduced Operating Earnings by approximately $3.1 million. The increase in operating costs was primarily related to higher input costs, namely recycled fiber, which reduced Operating Earnings by approximately $2.9 million. The Operating Margin increased to 20% because of higher gross selling prices, partially offset by higher operating costs. Although the Company has certain provisions in its long-term sales agreements related to adjustments for the cost of raw materials, namely recycled fiber, natural gas, and electricity, prices are adjusted only at certain times throughout the year, so price adjustments are not always reflected in the same period as the change in costs.