Piper Jaffray Comments On Texas Industries Q2 Results

Texas Industries TXI Q2 EPS of a loss of $0.40 was better than both Jefferies' estimate of a loss of $0.66 and the Bloomberg consensus estimates of a loss of $0.55. This mainly reflected higher than expected volumes, which the company attributes to better weather. It remains cautious on the outlook. The Q2 pre-tax loss of $19.0m was $11.8m better than Jefferies estimate. Two items accounted for the majority of the difference. Operating profit was $8.8m ahead of Jefferies forecast, mainly due to better than expected volumes, but selling prices were also higher than forecasted in both cement and aggregates. TXI's Q2 interest charge was $3m less than forecasted, mainly due to the capitalizing of interest costs on the Hunter plant where construction work was resumed in the quarter. The company attributes the increase in its Q2 shipments mainly to weather, which was particularly poor a year ago whereas in Q2 of this year the weather was more normal. It still regards its markets as "Challenging". For the remaining two quarters it expects to capitalize $15m of interest costs, which Jefferies already has in its forecasts. TXI is trading higher at $44.41