Martin Marietta Materials has reported financial results for the fourth quarter and full year ended December 31, 2002, with comments on its composites business.
For the year ended December 31, 2002, net sales were $1.497 billion in 2002 compared with $1.506 billion in 2001. Earnings from operations were $174.7 million in 2002, compared with $197.2 million in 2001. Full year results for 2001 included $22.4 million of goodwill amortization expense. Other income and expenses, net, was $5.6 million of income more than the prior year, while interest expense decreased $2.8 million, or 6 percent.
Commenting on the results, Stephen P. Zelnak, Jr., Chairman and CEO of Martin Marietta Materials, stated, “”With respect to our new structural composites business, we recently announced the opening of a manufacturing facility for our composite products in Sparta, North Carolina. This 185,000-square-foot facility, which will be the hub of composite structures assembly and production, is a key growth initiative for this business.
“We expect to begin assembly of our Composittrailer specialty composite truck trailers at the Sparta location in late 2003. We also announced the recent installation of two additional composite bridge decks in Pennsylvania and Ohio. We now have 18 successful installations in the United States. In addition to the growing U.S. business, we expect to install composite decks in three European countries in 2003. During the quarter, we signed a licensing agreement related to a proprietary composite sandwich technology, which we expect will play an important role in our product line with respect to flat panel applications.
“We currently expect to ramp up business during 2003, with 2004 being the first full year of business. Our objective over the next five to seven years beginning in 2004 is to create a business with characteristics that include high organic growth rates, low capital intensity, noncyclicality based on diverse products and opportunities for substitution for existing structural materials. Although revenue has been insignificant to date and any start-up opportunity is subject to uncertainty and risks, given the size of the potential market and the diverse opportunities we are continuing to explore, our goal is to build a revenue base of $300 million to $500 million with 15 percent margins based on earnings before interest and taxes. “
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