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TXI Reports Third Quarter Results

Certain statements contained in this quarterly report are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements may include the words "may," "will," "estimate," "intend," "continue," "believe," "expect," "plan," "anticipate," and other similar words. Such statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, the impact of competitive pressures and changing economic and financial conditions on our business, the cyclical and seasonal nature of our business, the level of construction activity in our markets, abnormal periods of inclement weather, unexpected periods of equipment downtime, unexpected operational difficulties, changes in the cost of raw materials, fuel and energy, changes in cost or availability of transportation, changes in interest rates, the timing and amount of federal, state and local funding for infrastructure, delays in announced capacity expansions, ongoing volatility and uncertainty in the capital or credit markets, the impact of environmental laws, regulations and claims, changes in governmental and public policy, and the risks and uncertainties described in our reports on Forms 10-K, 10-Q and 8-K. Forward-looking statements speak only as of the date hereof, and we assume no obligation to publicly update such statements.

TXI is the largest producer of cement in Texas and a major cement producer in California. TXI is also a major supplier of construction aggregate, ready-mix concrete and concrete products.

 (Unaudited)
CONSOLIDATED STATEMENTS OF OPERATIONS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
         
  Three months ended Nine months ended
In thousands except per share February 28, 2013 February 29, 2012 February 28, 2013 February 29, 2012
NET SALES  $ 141,359  $ 121,894  $ 483,575  $ 435,696
Cost of products sold 129,035 123,774 444,297 425,464
GROSS PROFIT 12,324 (1,880) 39,278 10,232
Selling, general and administrative 17,056 17,265 51,679 46,774
Restructuring charges 3,153
Interest 7,227 8,512 22,462 26,810
Other income (2,091) (1,332) (6,614) (8,725)
  22,192 24,445 67,527 68,012
LOSS BEFORE INCOME TAXES FROM CONTINUING OPERATIONS (9,868) (26,325) (28,249) (57,780)
Income taxes (benefit) (1,355) (1,148) (2,151) (2,601)
NET LOSS FROM CONTINUING OPERATIONS  $ (8,513)  $ (25,177)  $ (26,098)  $ (55,179)
NET INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX 2,699 897 6,504 2,442
NET LOSS  $ (5,814)  $ (24,280)  $ (19,594)  $ (52,737)
NET LOSS PER SHARE FROM CONTINUING OPERATIONS:        
Basic  $ (0.30)  $ (0.90)  $ (0.93)  $ (1.98)
Diluted  $ (0.30)  $ (0.90)  $ (0.93)  $ (1.98)
NET INCOME FROM DISCONTINUED OPERATIONS:        
Basic  $ 0.09  $ 0.03  $ 0.23  $ 0.09
Diluted  $ 0.09  $ 0.03  $ 0.23  $ 0.09
NET LOSS PER SHARE:        
Basic  $ (0.21)  $ (0.87)  $ (0.70)  $ (1.89)
Diluted  $ (0.21)  $ (0.87)  $ (0.70)  $ (1.89)
AVERAGE SHARES OUTSTANDING        
Basic 28,190 27,926 28,073 27,894
Diluted 28,190 27,926 28,073 27,894
CASH DIVIDENDS DECLARED PER SHARE $ — $ — $ —  $ 0.075
         
See notes to consolidated financial statements.        
 
(Unaudited)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
         
  Three months ended Nine months ended
In thousands February 28, 2013 February 29, 2012 February 28, 2013 February 29, 2012
Net loss  $ (5,814)  $ (24,280)  $ (19,594)  $ (52,737)
Other comprehensive income        
Net actuarial gains (losses) of defined postretirement benefit plans        
Reclassification of recognized transactions, net of taxes -- $126, $209, $736 and $627, respectively 219 363 784 1,088
Adjustment, net of tax (55)
Prior service cost of defined postretirement benefit plans        
Reclassification of recognized transactions, net of taxes - ($71), ($71), ($413) and ($213), respectively (123) (123) (168) (369)
Total other comprehensive income 96 240 561 719
Comprehensive loss  $ (5,718)  $ (24,040)  $ (19,033)  $ (52,018)
         
See notes to consolidated financial statements.        
 
CONSOLIDATED BALANCE SHEETS
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
     
  (Unaudited)  
In thousands February 28, 2013 May 31, 2012
ASSETS    
CURRENT ASSETS    
Cash and cash equivalents  $ 31,664  $ 88,027
Receivables – net 98,458 98,836
Inventories 100,282 99,441
Deferred income taxes and prepaid expenses 20,282 19,007
Discontinued operations held for sale 38,769 40,344
TOTAL CURRENT ASSETS 289,455 345,655
PROPERTY, PLANT AND EQUIPMENT    
Land and land improvements 170,078 168,173
Buildings 49,637 49,567
Machinery and equipment 1,156,061 1,142,439
Construction in progress 483,641 436,552
  1,859,417 1,796,731
Less depreciation and depletion 647,281 611,406
  1,212,136 1,185,325
OTHER ASSETS    
Goodwill 1,715 1,715
Real estate and investments 23,024 20,865
Deferred income taxes and other charges 22,141 23,368
  46,880 45,948
   $ 1,548,471  $ 1,576,928
LIABILITIES AND SHAREHOLDERS' EQUITY    
CURRENT LIABILITIES    
Accounts payable  $ 57,000  $ 64,825
Accrued interest, compensation and other 48,134 61,317
Current portion of long-term debt 1,816 1,214
TOTAL CURRENT LIABILITIES 106,950 127,356
LONG-TERM DEBT 658,392 656,949
OTHER CREDITS 88,088 96,352
SHAREHOLDERS' EQUITY    
Common stock, $1 par value; authorized 100,000 shares; issued and outstanding 28,324 and 27,996 shares, respectively 28,324 27,996
Additional paid-in capital 506,112 488,637
Retained earnings 184,542 204,136
Accumulated other comprehensive loss (23,937) (24,498)
  695,041 696,271
   $ 1,548,471  $ 1,576,928
     
See notes to consolidated financial statements.    
(Unaudited)
CONSOLIDATED STATEMENTS OF CASH FLOWS 
TEXAS INDUSTRIES, INC. AND SUBSIDIARIES
     
  Nine months ended
In thousands February 28, 2013 February 29, 2012
OPERATING ACTIVITIES    
Net loss  $ (19,594)  $ (52,737)
Adjustments to reconcile net loss to cash provided by operating activities    
Depreciation, depletion and amortization 42,968 46,495
(Gains)/Loss on asset disposals (4,822) (3,736)
Deferred income tax (benefit) expense 1,025 (1,653)
Stock-based compensation expense 7,015 1,710
Other – net (7,555) (4,424)
Changes in operating assets and liabilities    
Receivables – net 830 7,624
Inventories (710) 10,048
Prepaid expenses (2,158) 3,261
Accounts payable and accrued liabilities (7,228) (4,466)
Net cash provided by operating activities 9,771 2,122
INVESTING ACTIVITIES    
Capital expenditures – expansions (61,344) (64,901)
Capital expenditures – other (19,910) (31,394)
Proceeds from asset disposals 5,783 4,188
Investments in life insurance contracts 2,366 3,354
Other – net (67) (302)
Net cash used by investing activities (73,172) (89,055)
FINANCING ACTIVITIES    
Debt payments (78) (173)
Debt issuance costs (1,829)
Stock option exercises 7,116 1,749
Common dividends paid (2,091)
Net cash provided (used) by financing activities 7,038 (2,344)
Decrease in cash and cash equivalents (56,363) (89,277)
Cash and cash equivalents at beginning of period 88,027 116,432
Cash and cash equivalents at end of period  $ 31,664  $ 27,155
     
See notes to consolidated financial statements.    
CONTACT: T. Lesley Vines, Jr.
         Corporate Controller & Treasurer
         972.647.6700

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