Business Context and Reporting Period
Company: United States Lime & Minerals, Inc. (USLM)
Filing Type: Form 10-Q (Unaudited)
Reporting Period: Quarter and six months ended June 30, 2026
Business Overview: Manufacturer of lime and limestone products supplying construction, industrial, environmental, metals, and agriculture sectors. Operations are conducted across multiple states including Texas, Arkansas, and Colorado. The company also holds non-operated working interests in natural gas wells.
Key Financial Metrics
| Metric | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 |
|---|---|---|---|---|
| Revenues | $99.1 million | $91.5 million | $187.0 million | $182.8 million |
| Gross Profit | $46.7 million (47.1%) | $41.9 million (45.8%) | $88.5 million (47.3%) | $88.0 million (48.2%) |
| Operating Profit | $40.7 million (41.0%) | $35.7 million (39.0%) | $76.4 million (40.9%) | $75.6 million (41.4%) |
| Net Income | $34.5 million | $30.8 million | $65.1 million | $64.9 million |
| Diluted EPS | $1.20 | $1.07 | $2.26 | $2.26 |
| Cash & Equivalents | $402.6 million (as of June 30, 2026) | |||
| Operating Cash Flow (YTD) | $71.1 million | $73.5 million (YTD 2025) | ||
| Capital Expenditures (YTD) | $36.2 million | $28.1 million (YTD 2025) | ||
| Debt Outstanding | $0 (excluding $4.6M letters of credit) |
Material Changes vs. Prior Period
- Revenue Growth: Q2 2026 revenue increased 8.3% year-over-year, driven by a 6.6% increase in sales volumes and a 1.7% increase in average selling prices. YTD revenue grew 2.3%.
- Profitability: Q2 Net Income rose 11.9% to $34.5 million. YTD Net Income remained relatively flat, increasing only 0.2% to $65.1 million.
- Cost Structure: Gross profit margins improved in Q2 (47.1% vs 45.8%) but declined slightly YTD (47.3% vs 48.2%) due to higher fuel and transportation costs offsetting revenue gains.
- Capital Deployment: Capital expenditures increased significantly to $36.2 million YTD 2026 from $28.1 million YTD 2025, primarily due to the $20.9 million spent on the new Texas kiln project.
- Liquidity: Cash and cash equivalents increased by $31.5 million during the first half of 2026, reaching $402.6 million.
Outlook, Commentary, and Risks
- Management Commentary: Increased demand from construction and steel customers drove volume growth, partially offset by decreased demand from roof shingle manufacturers. Management anticipates data center projects will continue to support strong construction demand.
- Capital Projects: The new vertical kiln at the Texas Lime Company plant is estimated to cost $65 million total. As of June 30, 2026, $57.7 million has been incurred. The kiln is expected to come online in the summer of 2026.
- Dividends: The company paid $0.06 per share in Q2 2026. A subsequent dividend of $0.06 per share was declared on July 29, 2026, payable in September 2026.
- Risks: Key risks include volatile fuel and transportation costs, supply chain disruptions, regulatory changes (environmental and safety), and macroeconomic factors affecting construction and industrial demand.
Investor Verification Checklist
- Texas Kiln Timeline: Verify the commissioning date of the new Texas kiln and the timing of depreciation commencement.
- Cost Pass-Through: Monitor the company's ability to pass through rising fuel and transportation costs to maintain gross margins.
- Customer Concentration: Assess the impact of decreased demand from the roof shingle sector versus growth in construction and steel.
- Capital Expenditure Run Rate: Confirm remaining capital requirements for the Texas kiln project and other maintenance capex.
- Debt Covenants: Review the Cash Flow Leverage Ratio to ensure continued compliance with the Wells Fargo credit facility, particularly regarding dividend and share repurchase restrictions.