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Construction Materials Outlook Released by FMI

by FMI on

An Analysis of the 2018 Construction Materials Market and M&A Expectations for 2019

FMI Capital Advisors, the leading investment banking services firm serving the construction materials sector, is pleased to announce the release of its latest research report, Understanding the Balance: An Analysis of the 2018 Construction Materials Market and M&A Expectations for 2019. In this article, George Reddin and Scott Duncan analyze the key economic factors that affected the 2018 construction materials market and discuss the future implications for 2019.

George Reddin, Managing Director of FMI’s Construction Materials group, states, “By understanding the major drivers of 2018, construction materials companies can gain a solid understanding of the current market and know what to look for in 2019. Many M&A investors will be targeting strategic, compelling bolt-ons in early 2019, while closely monitoring Q1 & Q2 earnings for signs of improving performance.”

Key findings include:

  • 2018 started off as a strong year for the construction materials (CM) sector, both for performance and M&A activity.
  • As the year progressed, CM companies encountered several headwinds resulting in a slowdown of M&A, including: cost increases (labor and materials), rising federal interest rates, new tariffs, weakening residential starts/construction, and inclement weather.
  • Despite these challenges, 2018 will still be remembered as a very good year for most CM producers, although performance was disappointing compared to original expectations.
  • Both public and private CM companies remain bullish on their business prospects for 2019, based on strong backlogs with high margins, incremental price improvements, weather normalization, and renewed interest in federal infrastructure funding.

To access FMI Capital Advisor’s construction materials article, please click here.

About FMI Capital Advisors

FMI Capital Advisors, a subsidiary of FMI Corporation, is one of the leading investment banking firms serving the Built environment, including the construction materials industry. With over 100 completed M&A transactions in construction materials space, our industry focus enables us to provide our clients with valuable insight and advice. Clients gain access to our unparalleled network of industry contacts and relationships, deep market knowledge and technical expertise, based on decades of experience.

For more information, please visit www.fminet.com. Follow FMI on Twitter and LinkedIn.