Titan America’s Earnings Call: Residential Recovery, Margin Expansion Drivers, and Pricing Delays Don’t Match

Date of Call: Mar 17, 2026

Financials Results

• Revenue: Q4: $406M, up 4% YOY. Full year: $1.66B, up 1.8% YOY.
• Operating Margin: Q4 adjusted EBITDA margin: 23.1%, up from 21.4% YOY. Full year adjusted EBITDA margin: 23.4%, up 75 bps YOY.

Guidance:

• Low single-digit % revenue growth for 2026 compared to 2025.
• Modest expansion in adjusted EBITDA margins for 2026.
• Residential recovery expected to remain soft, with inflection likely pushed to 2027.
• Infrastructure and private non-residential demand expected to remain strong.

Business Commentary:

Record Financial Performance in 2025:

• Titan America delivered record revenue of $1.66 billion for 2025, up 1.8% compared to $1.63 billion in 2024.
• The company achieved record adjusted EBITDA of $390 million, reflecting a 5% increase from $370 million in 2024.
• The growth was driven by product pricing improvements, increased aggregate sales volumes, strategic capacity investments, and effective cost management despite a challenging market environment.

Geographic Expansion and Strategic Acquisition:

• Titan America signed an agreement to acquire the Keystone Cement Company, expanding its geographic reach into Pennsylvania and Ohio.
• The acquisition adds approximately 990,000 short tons of clinker capacity and is expected to support more than 50 years of cement production.
• This strategic move enhances Titan America's vertically integrated footprint and positions it to capitalize on growth trends in the region.

Segment Performance and Market Dynamics:

• The Florida business segment achieved record adjusted EBITDA of $279 million, a 11.6% increase from $250 million in 2024, driven by strong infrastructure and private non-residential construction demand.
• The Mid-Atlantic segment faced headwinds from soft demand in Metro New York and New Jersey, adverse weather, and higher raw material costs, impacting its adjusted EBITDA by 10.6%.
• The performance highlights the mixed demand environment, with Florida benefiting from strong infrastructure projects while the Mid-Atlantic region faced challenges.

Capital Investments and Growth Strategy:

• Titan America's net capital expenditures for 2025 were $163 million, focusing on expanding domestic cement plant capacity, vertical integration through ready-mixed concrete and concrete block facilities, and dragline investments in Florida aggregates.
• The company remains focused on strategic growth opportunities, including the development of a precast lintel manufacturing facility and enhancements to its marine import terminals.
• These investments are aimed at supporting long-term growth and improving operational efficiencies across its business segments.

Sentiment Analysis:

Overall Tone: Positive

• Management stated '2025 was a record year' and described the year as 'historic transformative.' They noted 'strong financial performance' as a public company, 'record revenues and adjusted EBITDA,' and are 'excited about the strong growth opportunities ahead' including a strategic acquisition.

Q&A:

• Question from Asher Sonen (Citigroup): Could you walk through the puts and takes driving the 2026 guide? How do expectations for infrastructure/private non-res compare to three months ago? Can you break out the revenue guide between price and volume?
  Response: No major change in infrastructure/private non-res expectations; remains strong. Residential recovery pushed to 2027 due to high mortgage rates. Do not provide breakout between price and volume.

• Question from Asher Sonen (Citigroup): What makes the Keystone Cement markets (Ohio, Pennsylvania) attractive? Compare with existing markets.
  Response: Familiar territory via fly ash operations. Attractive for manufacturing reshoring. Plant serves Washington D.C. area and offers logistics synergies.

• Question from Jesse (Jefferies): What caused the sequential cement pricing decline? What is the 2026 pricing outlook and timing?
  Response: Decline attributed to mix pressures. Announced price increases for January: $12/ton for cement, $10/cubic yard for ready-mix, $3 for aggregates finished goods, but largely pushed to April due to market conditions.

• Question from Chad Dillard (Bernstein): What share of costs are fuel-related? How much of current oil price is embedded in guidance? How to think about EBITDA margin cadence in 2026 given seasonality?
  Response: Fuel/energy represents ~8% of COGS. Multiple levers to mitigate costs (alternative fuels, dual burner, fuel surcharges). Margin expansion expected via operational excellence, digital transformation, and cost initiatives, offsetting headwinds.

• Question from Brian Brophy (Stifel): What is driving the increase in domestic cement capacity? How much growth expected?
  Response: Capacity increase driven by investments in facilities (e.g., Pennsuco) and reliability factors. Further capacity growth expected in 2027.

Contradiction Point 1

Residential Construction Inflection Timing

Contradiction on when the residential construction market will recover.

Asher Sonen (Citigroup) - Asher Sonen (Citigroup)

2025Q4: For residential, the anticipated inflection point has likely been pushed into 2027 due to elevated mortgage rates...softness in single-family construction... - Bill Zarkalis(CFO)

Can you detail the factors driving the 2026 guidance, how expectations for infrastructure and private non-residential construction have changed compared to three months ago, and break out the 2026 revenue guidance between price and volume? - Sherif El-Sabbahy (Bank of America)

20251106-2025 Q3: Normalized margins are currently compressed due to soft residential markets. A substantial margin expansion is expected in the future, contingent on the residential sector rebounding... - Vassilios Zarkalis(CEO)

Contradiction Point 2

Margin Expansion Drivers and Timing

Contradiction on the primary driver for future margin expansion.

Chad Dillard (Bernstein) - Chad Dillard (Bernstein)

2025Q4: 2026 margin expansion...driven by...deep penetration in infrastructure and large-scale projects...Continued operational excellence initiatives...expected to drive margin expansion in 2026, similar to the improvement seen in 2025. - Bill Zarkalis(CFO)

How does seasonality impact the 2026 guidance for modest EBITDA margin expansion? - Sherif El-Sabbahy (Bank of America)

20251106-2025 Q3: Normalized margins are currently compressed due to soft residential markets. A substantial margin expansion is expected in the future, contingent on the residential sector rebounding... - Vassilios Zarkalis(CEO)

Contradiction Point 3

Residential Construction Outlook and Inflection Point

Contradiction on the timing of a potential recovery in residential construction.

What were the key factors driving the company's performance in the quarter? - Asher Sonen (Citigroup)

2025Q4: The anticipated inflection point has likely been pushed into 2027 due to elevated mortgage rates... and inflationary pressures... - Bill Zarkalis(CFO)

Could you walk through the key drivers of the 2026 guidance, including changes in expectations for infrastructure and private non-residential construction compared to three months ago, and break out the 2026 revenue guidance between price and volume? - Wesley Brooks (HSBC)

2025Q2: High interest rates are delaying recovery, but the long-term housing shortage creates potential demand. Recovery may be sector-specific (e.g., multifamily may grow while single-family softens). - Larry Wilt(COO) and Bill Zarkalis(CFO)

Contradiction Point 4

Pricing Increase Implementation Timeline

Contradiction on when announced price increases will be implemented.

Jesse (Jefferies) - Jesse (Jefferies)

2025Q4: The implementation of these increases was largely pushed to April 2026. - Bill Zarkalis(CFO) and Larry Wilt(COO)

Was the sequential decline in cement pricing due to mix pressures, and could you remind us of the 2026 price increases and the progress of those conversations? - Phil Ng (Jefferies)

2025Q2: Pricing momentum remains strong... Overall, pricing momentum remains strong, though mix shifts (e.g., from bulk to bagged cement) affect reported averages. - Larry Wilt(COO) and Bill Zarkalis(CFO)